Home price growth cooled to the single digits for the first time in a year as both buyers and sellers continued to pull back from the market. The typical home cost $400,000, an annual increase of 8.4%, according to Realtor.com’s Monthly Housing Trends Report. While price appreciation remains elevated, it’s far lower now than its peak of 18% YOY earlier this year. The number of homes for sale was up 74.6% YOY, with 49 of the 50 largest metros seeing their inventory increase. That metric remained 38% lower than the December 2017-2019 average, however. Newly listed homes and pending listings both declined YOY. Home sellers who are locked into low interest rates are hesitant to take on a more expensive…
By KIMBERLEY HAAS The 26-year-old CEO of Alpha Capital Funds has plans to buy multi-family properties throughout the state of Connecticut with the goal of acquiring 500 units by the end of 2023. Tyler Smith, who says he was always hustling, started his career investing in real estate when he was still a student at Quinnipiac University in New Haven. “I was putting myself through school,” Smith said during a recent interview with The Mortgage Note. “I came across real estate.” Smith said he was 20 years old when he closed his first deal. Over time, his original company, Quick Cash for CT Houses, grew. “Once I started doing a lot more deals I scaled the company up. We were…
Mortgage loan application volume rose in the first week of 2023, boosted by a flurry of refinancing, according to the Mortgage Bankers Association’s weekly survey. The adjusted Market Composite Index, a measure of mortgage loan application volume, increased by 1.2%. Refinances saw the most improvement, up 5% from the week prior, as homeowners took advantage of the market’s reaction to indicators of a slowing economy. Data released last week showed the U.S. economy created fewer jobs in December, and hourly wages grew at the slowest annual pace in 16 months. Wage growth has fallen by a full percentage point since Q2 2022. As a result, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell from…
Rate lock volumes took a beating in December as buyers and sellers remained on the sidelines. Black Knight’s December Originations Monitor Report found that typical seasonal patterns, together with continuing inflationary pressures and elevated rates, resulted in record lows for locks of all kinds. “Using Black Knight’s McDash mortgage performance data to provide comparative history, December saw the fewest purchase locks in a single month since early 2014, and the fewest overall rate locks on record dating back to January 2000 when Black Knight began reporting origination metrics,” said Kevin McMahon, president of Optimal Blue, a division of Black Knight. Rate lock dollar volumes fell by 19.4% in December, their lowest level in the five years Optimal Blue has tracked…
Multifamily saw a stunning reversal in the fourth quarter of 2022 as apartment supply finally surpassed demand, creating a “swift and unprecedented” downturn. A new report from Apartments.com found that multifamily fundamentals declined in Q4, driven largely by limited absorption and supply/demand imbalances. “We ended the year with absorption barely remaining positive and vacancy rates trending upwards. As 2022 progressed, economic uncertainty suppressed household formations which limited multifamily demand,” said Jay Lybik, National Director of Multifamily Analytics at CoStar Group, which owns Apartments.com. “With 2023’s national forecast predicting the highest new supply totals since the 1980s, expect vacancy to rise above 7% and rent growth to push much lower.” More than 95,000 new units were delivered last quarter but many…
Homebuyers are feeling slightly more optimistic about the market as mortgage rates ease. Fannie Mae’s Home Purchase Sentiment Index (HPSI) rose 3.7 points in December. Three of its six components improved from the month prior as more consumers said they expect rates and home prices to drop. After weeks of declines, rates inched up in the first week of 2023 but remain well below 7%. Economists at Freddie Mac expect them to fall further as inflationary pressures ease. But home purchase sentiment remains near its all-time low, set in October, and is down 13.2 points YOY. Only 21% of respondents believe it’s a good time to buy a home. And the possibility of additional rate hikes from the Federal Reserve…
As the average 30-year fixed-rate mortgage rate rose to 6.48% from 6.42% in the last week of 2022, mortgage applications sunk to a 25-year low, according to officials at Freddie Mac. “Mortgage application activity sunk to a quarter-century low this week as high mortgage rates continue to weaken the housing market,” said Sam Khater, Freddie Mac’s Chief Economist. “While mortgage market activity has significantly shrunk over the last year, inflationary pressures are easing and should lead to lower mortgage rates in 2023.” Khater continued, “Homebuyers are waiting for rates to decrease more significantly, and when they do, a strong job market and a large demographic tailwind of Millennial renters will provide support to the purchase market. Moreover, if rates continue…
New York-based real estate brokerage Compass Inc. announced a third round of layoffs Thursday as part of its ongoing cost-cutting strategy in the face of a housing slowdown. Compass CEO Robert Reffkin has made major investments in technology as part of its business strategy in the competitive residential brokerage industry. According to reports, the cuts will leave the tech side of the company largely untouched. The layoffs, which began last June, are part of what Reffkin has said will be a $320 million cost-cutting plan. Compass is a major player in some large urban markets like New York and Los Angeles, with more than $250 billion in sales in 2021, according to RealTrends. However, over the past six weeks, the…
Home sales plummeted by 35% in November but there are early signs that demand may be picking up. Redfin’s latest data found that home sales dropped 35.1% YOY in November on a seasonally-adjusted basis. High buying costs kept both buyers and sellers on the sidelines. “Rates have declined significantly over the past six weeks, which is helpful for potential homebuyers, but new data indicates homeowners are hesitant to list their homes,” Sam Khater, Freddie Mac’s Chief Economist, noted. “Many of those homeowners are carefully weighing their options as more than two-thirds of current homeowners have a fixed mortgage rate of below four percent.” Sellers have hesitated to put their homes on the market, knowing they’ll have to buy a new…
The 30-year fixed rate dipped again last week, though the 15-year inched up, breaking a downward streak, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.27%, down from 6.31% the week prior. A year ago at this time, the 30-year FRM averaged 3.05 percent. The 15-year fixed-rate mortgage rose from 5.54% to 5.69%. A year ago, it averaged 2.30%. Most Americans opt for a 30-year FRM. In 2018, lenders wrote 22 times more 30-year notes than 15-year notes, according to a NerdWallet analysis. Last week’s rate increase will likely affect only a small portion of potential buyers who make enough money to afford larger monthly payments. “Heading into the holidays, mortgage rates…
