Homebuilding plummeted in July as both homebuyers and sellers continue to lose confidence in the market. Housing starts fell by a shocking 9.6% to a seasonally adjusted annual rate of 1.446 million units last month, according to new data released by the Commerce Department. This is their lowest rate since February 2021 and significantly below market expectations of 1.53 million. Last month’s revised data put starts at a rate of 1.599 million units. A drop this big suggests the housing market still has room to contract in the third quarter of this year. Ian Shepherdson of Pantheon Macroeconomics called the data “terrible” in a tweet Tuesday. Single-family starts fell 10.1%, their lowest in two years, while starts for units in…
New listings fell 12% during the four-week period ending August 7, the largest YOY decline since June 2020, according to recent Redfin data. Higher mortgage rates are keeping some Americans in their homes longer than they normally would be. Some homeowners are experiencing what Redfin calls “rate lock-in,” a fear of putting their home up for sale due to a low rate they nabbed during the pandemic. Others are realizing they won’t get an offer over listing price on-demand like they could last year. “Buyers are backing off due to rising housing costs and sellers are holding back because they realize they won’t get the bidding war they would have gotten six months ago,” said Redfin Deputy Chief Economist Taylor…
By ISAIAS PACHECO The Mortgage Bankers Association weekly mortgage application survey has recorded an increase of 0.2% for the week of August 5. On an unadjusted basis, the index decreased 0.3% compared with the previous week. Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting said mortgage rates remained volatile last week – after drops in the previous two weeks. Kan said mortgage rates ended up rising four basis points and mortgage applications were relatively flat, with a decline in purchase activity offset by an increase in refinance applications. “The purchase market continues to experience a slowdown, despite the strong job market. Activity has now fallen in five of the last six weeks, as buyers remain on the…
By ISAIAS PACHECO Information about the AEI Housing Market Indicator for the month of July was recapped during a recent meeting. Leaders at the organization went over their new Month-over-Month constant quality home price appreciation graphic, which shows that many of the largest Metros, especially western Metros, have begun experiencing negative M-O-M HPA. The overall goal is to monitor market stability through accurate real-time tracking to help avoid destructive housing booms and busts, they say. Key takeaways from the briefing on August 2: Purchase rate lock volume and home price appreciation both continue to decelerate and confirm a strong trend reversal.April 2022 volume was down 13% from the same month in 2021 but up 8% from 2020.Based on Optimal Blue…
By SCOTT KIMBLER Potential buyers are starting to wonder if moving out of urban areas continues to remain a good idea. In 2020, as housing costs were already skyrocketing, the Covid-19 pandemic hit. The combination of the two made migrating further out of large cities appealing to a lot of people, especially young people who were looking to buy a home and start a family. Fast forward to now and many of those factors have changed. As a result, some popular hotspots are starting to see a decline in frenzied buyers putting in multiple bids. Roy Black, an Economics Professor at Emory University’s Goizueta Business School, says although some areas are seeing a shift people will always be attracted to…
By ISAIAS PACHECO The home purchase settlement index decreased by two points in July, according to Fannie Mae. This is the lowest level since 2011, and the HSPI has been declining steadily which is making consumers concerned. They are not buying or selling, experts say. Doug Duncan, Senior Vice President and Chief Economist, said in a statement that unfavorable rates have been increasingly cited by consumers as the top reason behind the growing perception that it is a bad time to buy and sell. It is expected that the market will cool and there will be moderate home sales over the coming year. Thousands of people in the industry may be let go as a result. Email story ideas to…
By TYRONE TOWNSEND In the upcoming months, mortgage lenders, refinancing businesses, and real estate agencies may fire thousands of people as the housing market cools. Many millennials had started looking for new houses because of low-interest rates, stimulus payments, and the ability to work from home during the coronavirus epidemic, which fueled a booming U.S. housing market. But now the pandemic is no longer driving workers out of metro markets. Peak prices hit in June and potential buyers are pulling out of the market. According to experts, mortgage origination is expected to fall 35 to 50 percent this year. The drop in refinancing is also playing a key role in changes to the mortgage industry. The Mortgage Bankers Association attributes…
Active listings posted a record-high growth rate in July, an indication that balance is returning to the housing market, Realtor.com reported. July’s Monthly Housing Trends Report found that the national inventory of active listings rose by 30.7% YOY, while the total inventory of unsold homes, including pending listings, increased for the first time since September 2019. This means there were 176,000 more homes actively for sale on a typical day in July than at the same time last year. However, the bump in total unsold inventory amounted to only a modest 3.5% due to a dip in pending inventory. And listings are still far behind their pre-pandemic and even early pandemic levels. Active listings were 15.7% below 2020 and 45.4%…
Home price appreciation is leveling out on a national level, but zooming in on price points and regions reveals a more complex picture, according to new data from the AEI Housing Center. The center looked at how home price appreciation is changing, first by price tier and then by specific metros and geography. While June home price appreciation dropped to nearly zero month-over-month nationally, the story is completely different when analyzing these two metrics. In the first, the Center divided home sales into four price tiers based on their access to leverage. Doing so revealed that appreciation is slowing across all tiers, especially when it comes to the highest level. High-price tier homes were the first to show a negative…
Mortgage rates nosedived by 31 basis points last week, dropping below 5% for the first time since April, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 4.99%. Last week it averaged 5.30%, and a year ago at this time, the 30-year FRM averaged 2.77%. “Mortgage rates remained volatile due to the tug of war between inflationary pressures and a clear slowdown in economic growth,” said Sam Khater, Freddie Mac’s Chief Economist. “The high uncertainty surrounding inflation and other factors will likely cause rates to remain variable, especially as the Federal Reserve attempts to navigate the current economic environment.” Recession fears are adding to a dip in homebuyer demand spurned on…
