The housing market will be besieged by the twin forces of shrinking supply and shrinking demand during the coronavirus pandemic, causing an uneven recovery over the next 12 months, according to a forecast released Wednesday by real estate investor Haus. In an analysis by Haus’ chief economist, the organization expects a recovery that looks like a “flying W” – an initial sharp drop this spring, followed by a rebound in the summer, another downturn in the fall and finally a solid road to recovery by next spring. The analysis predicts that single-family home sales and purchase mortgage originations will see the most impact. “There is likely to be both a reduction in demand and supply,” Haus chief economist Ralph McLaughlin…
By Jim Perskie Existing home sales fell in March amid the coronavirus outbreak, though overall sales were up slightly from a year ago, the National Association of Realtors announced Tuesday. “Unfortunately, we knew home sales would wane in March due to the coronavirus outbreak,” NAR chief economist Lawrence Yun said. “More temporary interruptions to home sales should be expected in the next couple of months, though home prices will still likely rise.” Total existing home sales dropped 8.5 percent from February, while climbing 0.8 percent from March 2019. Each of the four regions of the country suffered a decrease in sales from a month earlier, the report found. Northeast: Existing-home sales in the Northeast fell 7.1 percent for the month and…
By Jim Perskie The number of loans in forbearance continues to rise, with nearly 6 percent of all mortgages in pause as borrowers cope with economic hardship caused by the coronavirus pandemic. The share of loans in forbearance climbed from 3.74 percent to 5.95 percent as of April 12, according to the Mortgage Bankers Association’s Forbearance and Call Volume survey released Monday. That amounts to roughly 3 million mortgages. Before the pandemic took hold of the economy, about 0.25 percent of mortgages were in forbearance. “With over 22 million Americans filing for unemployment over the past month, homeowners are contacting their mortgage servicers seeking relief, leading to a sharp increase in the share of loans in forbearance across all loan…
The number of new houses going on the market is plummeting as the coronavirus pandemic wears on, according to an analysis released Monday by Redfin. The analysis found that there were fewer homes for sale in March than at any time since January 2012, when Redfin started tracking the data. New listings in March dropped 10.8 percent compared to March 2019. “Real estate activities nearly ground to a halt in some parts of the country by the end of March, disrupted by shelter in place laws,” Redfin lead economist Taylor Marr said. “Right now, sellers need to decide if they’ll list their home for sale among all the economic uncertainty.” Redfin also found: By the last week of March, new…
Mark Calabria appears to have misjudged the burden the coronavirus pandemic is going to have on the mortgage industry. Calabria, the director of the Federal Housing Finance Agency, told HousingWire earlier this month that he expected about 1 million mortgages backed by Freddie Mac and Fannie Mae to go into forbearance. Financial technology firm Black Knight found that there were nearly 1.4 million Fannie and Freddie loans in forbearance as of Friday, April 19 – representing 4.9 percent of their mortgages. “In these times, it is essential to both our industry and for the benefit of the entire U.S. economy to have a clear understanding of the magnitude of the mortgage forbearance situation,” Black Knight CEO Anthony Jabbour said. Calabria has been…
By Jim Perskie The lending business was significantly more profitable for independent mortgage banks (IMBs) in 2019. IMBs and mortgage subsidiaries of chartered banks made an average profit of $1,470 on each loan they originated last year – up from $367 in 2018, according to a report released Friday by Mortgage Bankers Association. The report also found: Average production volume was $2.7 billion (10,411 loans) per company in 2019, up from $2 billion (8,171 loans) per company in 2018.On a repeater company basis, average production volume was $2.94 billion (11,227 loans) in 2019, up from $2.14 billion (8,805 loans) in 2018. For the mortgage industry as whole, MBA estimates production volume at $2.17 trillion in 2019, up from $1.68 trillion in 2018.The…
Mortgage rates dipped slightly this week and are once again approaching historic lows, Freddie Mac announced Thursday. The 30-year fixed-rate mortgage averaged 3.31 percent. That’s down from 3.33 percent the last two weeks, according to Freddie Mac’s Primary Mortgage Market Survey. Rates reached 3.29 percent the week of March 9. “Mortgage rates continue to hover near all-time lows for the third straight week. As a result, refinance activity remains high, but home purchase demand is weak due to economic tightening,” Freddie Mac’s Chief Economist Sam Khater said. The survey also found: 15-year fixed-rate mortgage averaged 2.80 percent with an average 0.7 point, up from last week when it averaged 2.77 percent. A year ago at this time, the 15-year fixed-rate mortgage…
Another day, another clear sign that the housing market is taking a beating. Single‐family housing starts in March were at a rate of 856,000 – 17.5 percent below the revised February figure of 1,037,000, according to a monthly report released Thursday the U.S. Census Bureau and Department of Housing and Urban Development. “Housing has been deemed an essential business in most of the nation, and in the few states where the governors have not acted, we urge them to deem construction as essential,” said Dean Mon, chairman of the National Association of Home Builders (NAHB). “Housing can help lead an eventual rebound, as it has done in previous recessions.” The report also found: Total housing starts decreased 22.3 percent in…
Homebuilders aren’t feeling great about things. The National Association of Home Builders and Wells Fargo Housing Market Index released Wednesday showed a 42-point drop in April, the largest single monthly change in the history of the index. The index sits at 30, the lowest point since June 2012 and the first time it has been in negative territory (below 50) since June 2014. “This unprecedented drop in builder confidence is due exclusively to the coronavirus outbreak across the nation, as unemployment has skyrocketed and gaps in the supply chain have hampered construction activities,” NAHB Chairman Dean Mon said. The HMI index gauging current sales conditions dropped 43 points to 36, the component measuring sales expectations in the next six months…
Mortgage applications in coronavirus hotspots appear to have bottomed out in the midst of the pandemic. After weeks of double-digit decreases, mortgage applications in New York climbed 0.8 percent last week, according to the Mortgage Bankers Association. In Washington state, applications were up 16.4 percent. California saw a 1.8 percent increase. All three states, however, experienced year-over-year decreases of about 50 percent. Across the country, mortgage applications increased 7.3 percent from a week earlier. “The purchase market is still expected to rebound, as long as the public health measures to reduce the pandemic’s spread are successful and result in a broader recovery,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. In an interview with CNBC, Quicken Loans…
