Quick Contact

Your Name (required)

Your Phone (required)

Your Email (required)

Your Message


Type this number below.

NAR: Home Price Gains at a “Healthier” Pace

An asset bubble can burst, or it can develop a slow leak, and float more or less gradually back to normal levels. The National Association of Realtors'® (NAR's) quarterly report on existing homes and metro home sales seems to indicate that the housing market, where skyrocketing prices were a concern not that long ago, is following the latter pattern.  Not only are sales slowing, but inventories are growing, and appreciation appears to be gradually decelerating. The NAR said the median price of a single-family home sold in the fourth quarter of 2018 was $257,600, a 4.0 percent increase from the median of $247,800 a year earlier.  The year-over-year gain in the fourth quarter of 2017 was 5.3 percent.

 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Delinquencies and Foreclosures at 10-Year Lows

According to CoreLogic, loan performance continues to improve on a national basis, with delinquencies dropping more than 1 percentage point over the 12 months ended in November 2018.  Frank Nothaft, CoreLogic's Chief Economist, said the decline was driven by solid income growth, a record amount of home equity and an absence of high-risk loan products.  "This put the U.S. homeowner on solid ground. All of this has helped push delinquency and foreclosure rates to the lowest levels in almost two decades, and will provide a cushion if the housing market should turn down," he said.

 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Low Rates Unfazed by a Bit of Market Weakness

Mortgage rates held their ground fairly well today, despite the fact that underlying bond markets were weaker.  Bond market weakness is associated with higher interest rates, all other things being equal.  To understand this, consider that a bond is essentially a loan.  An investor who buys a bond is buying the right to collect interest payments on a loan.  That investor is effectively "the lender."  Ideally, those investors would compete with one another for the right to collect interest on loans.  If bonds are "weaker," it means those investors don't see as much value in buying those loans.  The price they pay to obtain the loan goes down (aka "weakness").  In turn, the loan's rate of return needs to be bumped up in order to attract investors.  And "bumping up the rate of return on a loan" is tantamount to "higher rates."

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Mortgage Rates End Week at Lows

Mortgage rates may not be quite as low as they were on January 31st, but they nonetheless managed to end at the lowest levels of this week.  Unlike January 31st, we can still say we're at the lowest levels in more than a year (yesterday was the first official day for that distinction).  

All of this is beside the point.  We're effectively as low as we've been in a long time.  The average lender is once again able to quote conventional 30yr fixed rates below 4.5% for the best-qualified borrowers.

Beyond that, there's at least an equal chance that rates could go lower in the short-to-medium term depending on economic data and the resolution (or lack thereof) of several lingering uncertainties.  

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

NAR’s Proposal to Restructure Fannie/Freddie

The second proposal for reform of the housing finance system in a week was just introduced by the National Association of Realtors® (NAR). Their "vision" for reform is centered on Fannie Mae and Freddie Mac (the GSEs). The future of the two companies, in federal conservatorship since 2008, barely got a mention in the outline for reform legislation released a few days ago by Mike Crapo (R-ID), chair of the Senate Bankin Committee. NAR unveiled its proposal, developed in collaboration with Susan Wachter, the Albert Sussman Professor of Real Estate and Professor of Finance at The Wharton School of the University of Pennsylvania, and Richard Cooperstein, head of Risk Management at Andrew Davidson and Company, Inc., before a sold-out forum audience of 400 on Thursday.

 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Big Day For Mortgage Rates

Thursday plays host to vastly more mortgage rate articles than any other day of the week.  This has to do with the regular weekly release of Freddie Mac's mortgage rate survey (which many news organizations use as source material for one article per week on the topic.  Freddie's data is great when it comes to tracking long term trends, but it doesn't account for day to day movements.  For example, today's Freddie survey suggests rates are lower this week, but if we look at this Thursday afternoon vs last, we're not quite back down to those levels for the average lender. The good news is that last Thursday's rates were the lowest in nearly a year. 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Housing Sentiment May Be Bouncing Back

Respondents to Fannie Mae's January National Housing Survey adopted a new outlook to go along with the new year, primarily in responses about their personal financial situation.  As a result, the Home Purchase Sentiment Index (HPSI) increased 1.2 point to 84.7, taking back some of the 2.3 points it shed in December.

The improvement was driven by an 8-point increase in the net share of respondents reporting higher income than 12 months earlier. At 27 percent, that net is 11 points higher than in January 2018.  This was partially offset by a 6-point decline in the net percentage of those who said they were not concerned about losing their job.  The net of 73 percent is unchanged from a year ago.

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Conventional Loan Access Rebounds After HARP-Related Losses

The Mortgage Bankers Association's (MBA's) Mortgage Credit Availability Index (MCAI), a measure of access to mortgage credit, partially rebounded from an unusually large downturn in December.  The Index rose 2.3 percent in January to 179.0. A lower MCAI indicates that lending standards are tightening while increases means credit is loosening.  The MCAI fell 7.3 percent the prior month, driven by a 14.5 percent decline in the Conventional MCAI. The Conventional MCAI increased 4.9 percent while the Government MCAI was unchanged. Of the component indices of the Conventional MCAI, the Conforming MCAI increased by 7.3 percent, and the Jumbo MCAI increased by 3.0 percent.  

 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Mortgage Rates Fall Back Toward Long-Term Lows

Mortgage rates moved lower for the second straight day after rising moderately on Friday and Monday.  This brings the average lender to the second lowest levels in almost exactly 1 year.  The only day with lower rates was January 31st, 2019 (last Thursday). 

Yesterday was important in the sense that it helped make a case for a short-term ceiling in rates.  All bets were off as to where we might see such a ceiling after a round of strong economic data on Friday (stronger data tends to push rates higher).  Today is just as important as it confirms the resilience wasn't a fluke.  Granted, things can change quickly when it comes to financial markets, but it's currently easiest to make a case for sideways momentum for the time being.

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Aging-in-Place Trend Contributing to Tight Inventories

In their December Insight report Freddie Mac's economists estimated the country will fall short of its housing needs this year by about 2.5 million units. Yet at the same time, fewer members of the Millennial generation are buying houses than young people did in earlier periods. This month the Insights report examines the intersection of these facts, asking who is living in those homes that young people were expected to buy, and how this relates to the shortfall. Freddie Mac' research finds that today's seniors (persons born after 1931) are staying in their homes longer, and aging in place. 

...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.