What Slowdown? Homebuyer Demand Hits Three Year Peak

Home prices have fallen a bit in recent weeks thanks to increasing inventory and buyer sticker shock, but expectations of a cooling market may be premature. A new report from Redfin found that early homebuyer demand reached its highest point in at least three years during the four-week period ending September 19. The report showed other housing market measures slowing at a normal rate for the end of summer. Pending sales fell 12% from their 2021 peak, and the number of homes selling above their list price fell. Time on market rose to 20 days. Asking prices also rose 2.4%. While that’s typical for September, the number itself is not: the median asking price rose 11% year-over-year to $359,724, an…

Average Homeowner Up $51k Since Q2 2020 As Home Values Soar

Homeowner equity grew $2.9 trillion since Q2 2020, up 29.3%, CoreLogic’s Homeowner Equity Report found. That shakes out to $51,500 in gains for the average borrower. Homeowners with mortgages make up roughly 63% of all residential properties in the U.S. Fifty-nine percent of borrowers reported they felt highly confident in their ability to make their mortgage payments in the coming year.  This is great news for underwater borrowers. The number of homes in negative equity has fallen 30% since Q2 2020. In Q2 2021 alone, the number of underwater homes fell 12% to 1.2 million homes, 2.3% of all mortgaged properties. The national aggregate value of negative equity dropped from $273.2 billion to $268 billion, a year-over-year decrease of about…

Freddie Mac: ‘Little Change’ in Rates

Mortgage rates remained essentially unchanged over the past week, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) reports the 30-year fixed-rate mortgage (FRM) averaged 2.88 percent. A year ago at this time, the 30-year FRM averaged 2.90 percent. “The slowdown in economic growth around the world has caused a flight to the quality of the U.S. financial markets,” said Sam Khater, Freddie Mac’s Chief Economist. “This has led to a rise in foreign investor purchases of U.S. Treasuries, causing mortgage rates to remain in place, despite the increasing dispersion of inflation across different consumer goods and services.” Khater continued, “On the housing front, homebuyers continue to snap up available inventory, which has improved modestly, and home price growth…

Analysts See Stable Housing Market Ahead

More than 100 economists and real estate experts who participated in Zillow’s Q3 Home Price Expectations Survey say they expect the housing market to remain relatively stable in the coming months. Their predictions are based on the premise that many homeowners have put off listing their homes for fear of having to then buy or rent while prices are high. Improvements in buying conditions may be modest, but the market is cooling, which should put potential sellers at ease. The survey is sponsored by Zillow and conducted quarterly by Pulsenomics. “Across the U.S., home value appreciation rates and annual rent price increases are at historically high levels, and home price expectations are now the highest we’ve recorded in the 12-year…

MBA: Mortgage Applications Up

Mortgage loan application volume rose 4.9% last week, the Mortgage Bankers Association’s (MBA) weekly survey reports. Unadjusted, the purchase index increased 16% over last week. Mortgage application volume fell by 1.9%, with purchase applications rising 2%. On an unadjusted basis, purchase applications increased 12% over the week before, 13% lower than the year before. The share of refinance applications rose 7% and was 5% lower year-over-year. The numbers are in line with an upward trend that began last week when loan applications bounced back from a low point. “There was a resurgence in mortgage applications the week after Labor Day, with activity overall at its highest level in over a month, and purchase applications jumping to a high last seen…

Renters Now Outnumber Homeowners In Big City Suburbs

Renters now outnumber homeowners in previously owner-dominated suburbs, and more communities are set to flip soon, according to a report from RentCafe. Over the past ten years, 103 suburbs have flipped their majorities from homeowners to renters. Many of the communities are in suburbs around Miami, Washington, D.C., and Los Angeles. Suburbs in the U.S.’s 50 largest metros gained 4.7 million people in that time, of which 79% are renters.  About 21 million people rent suburban homes in those metros, 3.7 million more than in 2010. The number of renters grew 22% between 2010 and 2019, while the number of suburban homeowners grew by only 3%. Fifty-five percent of renters are under 45 years old with median household earnings around…

Northeast Housing Starts Hit Biggest Monthly Gain Since 1959

A new report from the U.S. Census Bureau and the Department of Housing and Urban Development showed August housing starts up 3.9% from July and 17.4% year-over-year, despite labor and supply shortages.  Homebuilders started 1.615 million homes in August. Nationally, 1.727 million building permits were pulled, 6% higher than July and higher than the expected 1.6 million. The number of homes finished in August was 1.33 million, down 4.5% from July but up 9.4% from the same time last year. Multi-family starts drove the gains completely, with single-family starts falling 2.8%. Multi-unit starts are up to 52.7% year-over-year, while single-family starts have only risen 5.2%. Permits for single-family units are also down 0.1% while multi-family permits increased 44.3%. Starts fell…

MBA: August New Home Purchases Up From July, Down From Year Ago

August new home purchase applications fell 17% year-over-year, according to the Mortgage Bankers Association’s Builder Application Survey. However, applications were up 9% compared to July. The report shows new home sales rose 12% in August, the fastest pace of sales since January. MBA estimated that new single-family home sales made up 874,000 units with seasonal adjustments. Unadjusted, MBA estimated there were 71,000 new home sales, up 10.9% from July. “Mortgage applications to purchase new homes were down in August compared to 2020’s late-summer surge, but both mortgage applications and MBA’s estimate of new home sales jumped last month compared to July,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.  “While the new home construction market is…

MBA: Forbearances Fall To 3%

Forbearances fell again this week, continuing to trend down as relief plans expire, according to the Mortgage Bankers Association’s (MBA) latest survey. Forbearances made up 3.00% of servicers’ portfolio volume, down from 3.08%. That puts the estimated number of homeowners in forbearance plans at around 1.5 million. That’s a significant change from last year. In May 2020, the use of the forbearance provision peaked at about 3.4 million mortgages, representing about 7% of all single-family housing loans. For Fannie Mae and Freddie Mac loans, the August 2021 number was down five basis points to 1.47%. Ginnie Mae loans held at 3.39%. Portfolio loans and private-label securities shares fell 32 basis points, from 7.27% to 6.95%. Independent mortgage bank servicers saw…

Home Builders More Confident Despite Continued Supply, Labor Shortages

Despite continuing supply chain issues and labor shortages, builder confidence rose in September thanks to falling lumber prices and high demand, the National Association of Home Builders (NAHB)/ Wells Fargo Housing Market Index (HMI) reported. Builder sentiment in the market for newly-built single-family homes increased to 76, one point higher than last month. The data broke a three-month streak of downward expectations. “Builder sentiment has been gradually cooling since the HMI hit an all-time high reading of 90 last November,” said NAHB Chairman Chuck Fowke. Fowke builds custom homes in Tampa, Fla.  “The September data show stability as some building material cost challenges ease, particularly for softwood lumber. However, delivery times remain extended and the chronic construction labor shortage is…