FHFA: Home Prices Rose 1.7% in May, Up 18% Year-to-Year

The Fair Housing Finance Agency House Price Index (FHFA HPI®) rose 1.7 percent in May, sending the annual price increase to 18 percent. The previously reported 1.8 percent price change for April 2021 was unrevised. “House prices continued their record-setting growth into May,” said Dr. Lynn Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “This trend will likely continue around the country as busy summer homebuying months maintain the pressure being felt in already tight housing markets.” The increase in home prices was not evenly distributed across the country. Among the nine census divisions, the Pacific enjoyed the highest monthly price spike (2.4 percent), while prices rose least in the Middle Atlantic division (1 percent). The 12-month…

Mortgage Payments Associated With ‘Worse Health Outcomes’ in Early Pandemic

Having to make mortgage and rent payments was linked to lower health outcomes in the early stages of the pandemic, according to new research out of the University of Michigan. The study found that “during the early months of the COVID-19 pandemic, having to make rent or mortgage payments was significantly associated with health and mental distress,” the university said in a press release. The researchers found that “compared to those without mortgage debt, homeowners with mortgage debt and renters reported worse self-rated health and higher levels of mental distress” in the earliest months of the SARS-Cov-2 crisis in the U.S. “We know housing is a social determinant of health,” said lead study researcher Roshanak Mehdipanah. “We need to invest…

Mortgage Forbearances Decline Again, Though Downward Rate Slows

The share of U.S. mortgages in forbearance declined over the past week, signaling an ongoing steady improvement in those numbers, although the rate of decline slowed slightly over earlier weeks. The number of mortgages in forbearance declined “by 2 basis points from 3.50% of servicers’ portfolio volume in the prior week to 3.48% as of July 18,” the Mortgage Bankers Association said in a Monday press release. “As is typical for mid-month reporting, forbearance exits slowed, and there was a slight increase in new requests,” MBA Senior Vice President and Chief Economist Mike Fratantoni said in the release. “The net result was a small drop in the share of loans in forbearance – the 21st consecutive week of declines.” The…

The White-Hot Housing Market is Causing Some Buyers to Stop Looking

The still-searing housing market has reached such dizzying heights in some regions that many homebuyers are giving up searching altogether, at least until prices come down. Many would-be buyers “are calling off their search, for reasons that range from an inability to compete financially, to an unwillingness to waive contingencies like an inspection, to a belief the market will cool in time,” the New York Times reports. Prospective buyers have been resorting to drastic measures like waiving inspections and paying full closing fees in efforts to get a leg up and out-compete other buyers. But in some markets the competition is nearly stratospheric: Buyers in Utah, for instance, recently put an offer for a hour $60,000 over asking price with…

Are Zero-Down Mortgages in Canada a Sign of Potential Disaster?

A large number of low-to-nothing-down-payment mortgages in Canada have experts worried that the country could be on track to a U.S. subprime mortgage-style fallout in the near future. A growing number of buyers are reportedly “opting for loans that either allow them to borrow the money for their down payment or that provide cash back after the closing,” Bloomberg News reports. “Massive loans” are “being taken out by borrowers with relatively low incomes,” the news service reports, with mortgages with a “high loan-to-income ratio” making up around 17% of loans this year, more than double the rate two years ago. One Canadian investment banker, meanwhile, claims that “the number of her clients who call for advice on how to help…

Buyers Show Renewed Interest in Condos After ‘Pandemic-Fueled Slump’

Homebuyers are seeking out more condos after a long period of disinterest exacerbated by the COVID-19 pandemic. The “pandemic-fueled slump” in condo interest appears to be coming to an end with “renewed homebuyer competition,” Redfin reports, with an increasing number of condos selling for more than their listed price. Condos have sold below asking price for years, Redfin’s data show, but a relatively steady upward trend since around 2012 dropped in 2019 and appears to have been kept depressed over the past year and a half, coinciding with the SARS-Cov-2 crisis. June was only the second time condos have sold above asking price since at least 2012, the brokerage company said; May was the first.…

Home Sales Up 1.4 percent in June, Inventory Increases

Sales of existing homes increased marginally last month, according to the National Association of Realtors, with housing stock also edging upwards. Existing home sales “rose 1.4% on a seasonally adjusted annual rate from May to June, with no region showing a sales decline,” the NAR said on Thursday. Unsold homes throughout the country “increased 3.3% to 1.25 million from May to June ,” the organization added, which it said was “equivalent to 2.6 months of the monthly sales pace.” The median existing home sales price rose nearly 25 percent year-over-year, the NAR noted, which it said was “the second highest level recorded since January 1999.”…

Freddie Mac Weekly Average Mortgage Rates Continue Downward Trend

Weekly average mortgage rates tracked by the Federal Home Loan Mortgage Corporation (Freddie Mac) are continuing to trend downward according to the corporation’s weekly report released on Thursday. Thirty-year fixed average rates trended from 2.88 percent to 2.78 percent week-over-week, a continuance of a steady downward trend that began roughly a month ago on June 24. Fifteen-year rates also declined from 2.22 percent to 2.12 percent over the same time period. Only 5/1 ARMs increased, by just 0.02 percent. “Concerns about the Delta variant, and the overall trajectory of the pandemic, are undoubtedly affecting economic growth,” Freddie Mac said in the update. “While the economy continues to mend, Treasury yields have decreased, and mortgage rates have followed suit.” “Unfortunately, many…

As the Pandemic Recedes, Is Buyer’s Remorse on the Rise?

Is the U.S. facing an impending wave of “homebuyer’s remorse?” While the Delta variant is increasing the number of cases, COVID-19 vaccines and more effective treatments have kept hospitalizations and deaths far lower than in the pandemic’s early days. As a result, even if cases spike in the fall, the economy will likely continue to grow. The result will be a relatively normal American economy — and thousands of homeowners left with the consequences of hasty home-buying decisions made amid a lockdown. Last year, as the virus began to sweep the globe and many nations went under hardcore lockdowns, many residents of big cities began scrambling to find property outside of the now-restricted confines of city centers. There were widespread…

Market Slowdown? Mortgage Applications, Credit Availability, Building Permits All Down

The housing market continues to show at least short-term signs of cooling off as several key indicators of market activity are all down in recent weeks. Mortgage applications were down both week-over-week, month-over-month and year-over-year, according to industry reports on Wednesday. Meanwhile, though housing construction exceeded expectations last month, the number of construction permits for housing was down more than five percent. Mortgage credit availability, meanwhile, fell to a six-month low last month as lenders tightened standards amid the ongoing post-COVID economic recovery. On the flip slide, earlier this week it was reported that mortgage forbearance rates are declining, indicating that those who have already taken out mortgages are having an easier time paying for them.…