December Inventory At All-Time Low

Monthly home value appreciation accelerated for the first time since July as potential buyers continue to outnumber new listings, driving December inventory to an all-time low, according to Zillow’s latest market report. “Home shoppers picked the shelves clean this December, leaving fewer active listings than ever before in the U.S. housing market,” said Jeff Tucker, senior economist at Zillow.  “Enough determined buyers kept up their house hunt to reignite monthly price appreciation. Rising mortgage rates could be the next potential headwind, but demand has proven persistent; neither high prices nor slim inventories have deterred buyers so far.” The typical home value is now $320,662, 19.6% above that of December 2020 and a record high for Zillow’s data, which dates back…

Loan Applications Jump 2.3%

Mortgage loan application volume rose 2.3%% from last week, the Mortgage Bankers Association’s (MBA) weekly survey reported. The adjusted Market Composite Index, a measure of mortgage loan application volume, increased 2.3%. The adjusted purchase index rose 8%, while the unadjusted purchase index rose 14% and was 13% lower YOY. The refinance index fell 3% and was down 49% YOY. Refinances made up 60.3% of total applications. “Mortgage rates hit their highest levels since March 2020, leading to the slowest pace of refinance activity in over two years. The 30-year fixed rate reached 3.64% and has increased more than 30 basis points over the past two weeks. FHA and VA refinance declines drove most of the refinance slowdown,” said Joel Kan,…

Builder Confidence Dips As Costs Rise

Builder confidence dropped slightly in January, disrupting a four-month trend of rising builder sentiment despite high consumer demand, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Builder confidence in the markets for newly-built, single-family homes dropped one point to 83. Any number over 50 indicates that more builders view conditions as good than poor. Notably, the HMI has remained at 83 or 84 for the past three months, the same level as the spring of 2021. The drop was attributed to inflation concerns and ongoing supply chain disruptions. “Higher material costs and lack of availability are adding weeks to typical single-family construction times,” said NAHB Chairman Chuck Fowke, a custom home builder from Tampa,…

MBA: Pace Of Forbearance Exits Drops To Lowest Since June 2020

The total number of loans in forbearance fell from 1.67% of servicers’ portfolio volume to 1.41% in December 2021, according to the Mortgage Bankers Association’s (MBA) Loan Monitoring Survey. The pace of monthly forbearance exits is at its lowest point since MBA began tracking exits in June 2020. MBA estimates 705,000 homeowners are currently in forbearance plans. Independent mortgage banks saw a 0.28% decline from 1.94% to 1.66%, while depositories saw a 0.28% drop from 1.52% to 1.24%. The share of forborne Fannie and Freddie loans fell to 0.68%, down by 8 basis points, while Ginnie Mae loans fell from 2.10% to 1.63%, down 47 basis points. PLS and portfolio loans in forbearance dropped by 51 basis points to 3.43%.…

December Home Sales Saw Largest Drop Since May 2020

December was a hot month for homebuyers, but supply couldn’t keep up with demand. Monthly home sales saw their largest decline since the beginning of the pandemic, according to Redfin. Month-over-month sales fell 3.6%, the largest drop since May 2020, and were down 11% year-over-year (YOY), the largest annual decline since June 2020.  The drop was the result of continuing stock shortages. Active listings declined 19% YOY, reaching a record low. New listings dropped 13%, down annually in 82 of the 88 metro areas Redfin tracks. In addition, home prices were up 15% YOY, marking the 17th straight month of double-digit price increases. “Home sales are slumping, but not for lack of demand,” said Redfin Chief Economist Daryl Fairweather. “There…

Commercial And Multifamily Delinquencies Fell In Q4 2021

Delinquencies on commercial and multifamily mortgages fell in Q4 2021, according to the Mortgage Bankers Association’s (MBA) Commercial/Multifamily Delinquency Report. Outstanding loan balances that were current on their payments rose from 96.7% to 97%, with only 1.9% 90 or more days delinquent or in REO, down from 2.2%. Loans 60-90 and 30-60 days delinquent saw no change, at 0.2% and 0.3% respectively. Loans that were less than 30 days delinquent fell 0.1% to 0.7%. Lodging and retail properties continued to be the most delinquent but saw improvement in Q4. For lodging loans, delinquencies fell 3.5% to 10.5%, while delinquent retail loans fell from 8.2% to 7.6%. CMBS loans also saw improvement, with 5.7% of balances non-current, down from 7.2% in…

Forbearance Exits Remain High

Of single-family homeowners who entered Covid-19 related forbearance, 89% have now exited their plans. Active forbearance plans dropped by 43,000 (-8%) in the first week of January, according to Black Knight’s blog, Vision. The number of loans in forbearance fell across all categories, led by a 22,000 (-8%) drop in forborne loans held by portfolios and PSLs. Forbearances on FHA/VA loans fell by 17,000 (-16%) and GSE loans fell by 4,000 (-1.6%). The number of active plans is down 100,000 (-12%) from last month. An additional 155,000 plans are up for extension or removal in January. However, less than a third are expected to expire, meaning exit volumes will lessen moving forward. New plan starts rose again, reaching their highest…

Interest Rates Jump to 3.45%

Mortgage rates jumped significantly this week, up to an average of 3.45% from 3.22%, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 3.45%. A year ago at this time, the 30-year FRM averaged 2.79%. “Mortgage rates rose across all mortgage loan types, with the 30-year, fixed-rate mortgage increasing by almost a quarter of a percent from last week,” said Sam Khater, Freddie Mac’s Chief Economist. “This was driven by the prospect of a faster than expected tightening of monetary policy in response to continued inflation exacerbated by uncertainty in labor and supply chains. The rise in mortgage rates so far this year has not yet affected purchase demand, but given…

Foreclosures Activity Hits Record Low

ATTOM Data Solution’s Year-End 2021 U.S. Foreclosure Market Report found foreclosure filings dropped 29% from 2020 and were down 95% from a peak of nearly 2.9 million in 2010. It is the lowest level since ATTOM began tracking filings in 2005. Properties with foreclosure filings–default notices, scheduled auctions, and bank repossessions– made up 0.11% of all U.S. housing units, down from 0.16% in 2020. “The COVID-19 foreclosure tsunami that some people had anticipated is clearly not happening,” said Rick Sharga, executive vice president at RealtyTrac, an ATTOM company.  The report is heartening from a broad view of foreclosure filings in the US. However, it found that filings increased as protections expired, pushing rates closer to pre-pandemic levels. A total of…

Loan Applications Up, Though Refis Continue Trending Down

Mortgage loan application volume rose 1.4% from last week, though refinances once again fell, the Mortgage Bankers Association’s (MBA) weekly survey reported. The Market Composite Index, a measure of mortgage loan application volume, increased 1.4%. The seasonally adjusted purchase index rose 2%, while the unadjusted purchase index rose 51% and was 17% lower YOY. The refinance index fell 0,1% and was down 50% YOY. Refinances made up 64.1% of total applications, their lowest level in more than a month. Conventional refi applications are at their lowest level since January 2020. The survey attributed the drop in refinances to increasing interest rates. The 30-year fixed rate reached 3.52%, its highest level since March 2020, and the Fed signaled this week that…