Redfin Furloughs Agents, Cuts Salaries

Redfin announced that 41 percent of its agents are leaving the company, with some leaving the company for good and most furloughed through the summer. The company also it is cancelling bonuses and temporarily cutting headquarter salary by 10 to 15 percent. “We decided on this large-scale furlough because fewer people are buying and selling homes, but another factor was the federal government’s $600 weekly contribution to each person’s unemployment insurance,” CEO Glenn Kelman said. “Of the field folks leaving, we estimate about 75 percent live in states that will allow them to earn more from unemployment insurance than from Redfin.” Kelman said employees who build the technology and programs behind the brokerage are staying on, with “a small number…

Purchase Applications Down 33% From Last Year

Another day, another rough report for the housing market, as lower interest rates were not enough to overcome the headwinds of the coronavirus pandemic last week. The Mortgage Bankers Association’s weekly survey released Wednesday showed that mortgage applications dropped 17.9 percent from a week earlier. The weekly purchase index dropped 12 percent from a week earlier and was 33 percent lower than a year ago. “Mortgage applications fell last week, as economic weakness and the surge in unemployment continues to weigh heavily on the housing market. Purchase activity declined again, with the index dropping to its lowest level since 2015 and now down 33 percent compared to a year ago,” said Joel Kan, MBA’s Associate Vice President of Economic and…

Report: Home Prices Expected To Lag This Year

Home prices are expected to increase an average of just 1.9 percent across the United States through the first quarter of 2021 due to massive unemployment and other economic impacts associated with the coronavirus pandemic. Five cities in Illinois – led by Chicago – are expected to be among the bottom top performing markets, according to the projections released by Veros Real Estate Solutions. “Home price trends and forecasts certainly take a backseat to more pressing health and safety issues during this unprecedented tragedy. While we expect a softening of house prices in the near-term, we anticipate a rebound when the COVID-19 pandemic subsides,” said Darius Bozorgi, CEO of Veros Real Estate Solutions. “The fundamental economic principles under which housing…

Mortgage Forbearance Requests Skyrocket In March

Mortgage forbearance requests skyrocketed in early days after the passage of the CARES Act as homeowners seek financial relief in the face of the coronavirus pandemic. Forbearance requests grew by 1,270 percent between the week of March 2 and the week of March 16, and another 1,896 percent between the week of March 16 and the week of March 30, the Mortgage Bankers Association announced Tuesday. The share of loans in forbearance grew from 0.25 percent to 2.66 percent between March 2 and April 1, according to MBA’s forbearance and call volume survey. “MBA’s survey highlights the immediate relief consumers are seeking as they navigate the economic hardships brought forth by the mitigation efforts to stop the spread of COVID-19.…

Free Press Silent About UWM Leadership Coach’s Past

The Detroit Free Press wrote a glowing article last week about United Wholesale Mortgage CEO Mat Ishbia and his hiring of former Michigan State basketball teammates: Twenty years ago, Ishbia was a walk-on third-string point guard for the Spartans, the human victory cigar on a team that won the 2000 NCAA tournament. Now, he’s the CEO and president of United Shore, a company that has grown from 12 employees to 5,800 in just 17 years. Ishbia has hired five former MSU teammates to work with him, in part because they are his friends — he gets them in the door; it’s up to them to do something with it. But also because they speak the same language and share the same experiences. Those teammates are Adam…

Troubled WVa Bank First To Fail In Coronavirus Era

The Federal Deposit Insurance Corporation announced the first failure of a bank during the coronavirus pandemic, though the bank was struggling before economic challenges began. The West Virginia Division of Financial Institutions closed The First State Bank in Barboursville, West Virginia on Friday. MVB Bank of Fairmount acquired all of the bank’s deposit accounts. FDIC said The First State Bank had approximately $152.4 million in total assets and $139.5 million in total deposits as of Dec. 31. In addition to assuming all of the deposits, MVB Bank agreed to purchase approximately $147.2 million of The First State Bank’s assets. The FDIC will retain the remaining assets for now. Earlier this year, DepositAccounts.com had given the bank an “F” for its financial…

Report Shows Housing Market Softens

Industry trend reports are starting to show the effects of the coronavirus pandemic on the U.S. housing market. Realtor.com’s march Housing Trends Report for March shows that inventory softened, the number of newly listed properties declined, and prices did not increase as fast in the second half of the month – though there was a strong start to the month. That strong start meant the total number of homes for sale declined 15.7 percent from March 2019. The numbers declined to 15.2 percent for the weeks ending March 21 and March 28. In the weeks ending March 21 and March 28, the volume of newly listed properties decreased by 13.1 percent and 34 percent from last year. During the last two weeks of March,…

After Pandemic, Will People Flee Cities?

Real estate brokerage firm Redfin reported this week that people are increasingly searching for homes in rural areas and small towns on its website amid the coronavirus pandemic. For the week ending March 23, page views on Redfin were up 115 percent in rural areas and 88 percent in small towns, compared to a year ago. Meanwhile, page views for metro areas of 1 million people or more dropped by 10 percent from a year ago. “America’s urban cities have boomed over the last few decades for their density of amenities, entertainment, innovation, and jobs,” Redfin lead economist Taylor Marr said. “But this pandemic has forced us to close down those benefits and has shined a bright light on one of the historic…

UWM Customers Struggle With Relief; Company Adds 2nd Income Verification

United Wholesale Mortgage announced that it is conducting a second verification of income and employment step late in the loan process in the face of rising unemployment amid the coronavirus pandemic. At the same time, existing customers are getting increasingly frustrated with the company and vocal on social media with the company’s lack of responsiveness as they seek to adjust their mortgages during economic hardship. “With everything going on right now, it’s just really imperative that we’re verifying that income and employment have not changed the day we’re sending them the money,” said Eric Mojica, UWM’s vice president of sales. Mojica said UWM does two verification of employment checks now, one earlier in the process and one just before closing to…

Rates Drop, Will More Mortgage Applications Follow?

Mortgage rates dropped for the second week in a row – and almost reached the nearly historic lows from before the coronavirus fully hit the United States. The 30-year fixed-rate mortgage averaged 3.33 percent in Freddie Mac’s Primary Mortgage Market Survey released Thursday. “Mortgage rates have drifted down for two weeks in a row and that drop reflects improvements in market liquidity and sentiment,” Freddie Mac Chief Economist Sam Khater said. “While the market has stabilized relative to prior weeks, homebuyer demand has declined in response to current economic conditions. The good news is that the pending economic stimulus is on the way and will provide support for both consumers and businesses.” Mortgage rates hit a low of 3.29 percent…