By TYRONE TOWNSEND As the spring selling season continues, those in the industry are noticing that the housing market in parts of the country is beginning to cool after a wild ride during the pandemic. Bidding wars and all-cash bids were prevalent due to rising housing prices and low availability. As more investors invaded the market, millions of average Americans were left on the sidelines, unable to compete. The housing market is already beginning to cool but despite this fact, respite for homeowners – particularly first-time purchasers – is unlikely as the Federal Reserve continues to boost interest rates to battle inflation, driving up mortgage rates. According to Realtor.com’s Monthly Home Trends Report, housing inventory in the United States was…
Existing-home sales fell 2.4% to a seasonally adjusted annual rate of 5.61 million in April, the third consecutive month of decline, according to the National Association of Realtors (NAR). Sales were down 2.4% from March and 5.9% YOY. All of the four major regions saw declines in YOY sales, though two posted month-over-month gains. Unsold home inventory rose to 1.03 million at month’s end, or 2.2 months of supply at the current sales pace. Total inventory rose 10.8% from March but is still down 10.4% from the same time last year. “Higher home prices and sharply higher mortgage rates have reduced buyer activity,” said NAR Chief Economist Lawrence Yun. “It looks like more declines are imminent in the upcoming months,…
Mortgage rates dropped slightly to an average of 5.25% last week, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 5.25%. A year ago at this time, the 30-year FRM averaged 3%. “Economic uncertainty is causing mortgage rate volatility,” said Sam Khater, Freddie Mac’s Chief Economist. “As a result, purchase demand is waning, and homebuilder sentiment has dropped to the lowest level in nearly two years. Builders are also dealing with rising costs, meaning this posture is likely to continue.” The latest National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index found that only 56.9% of new and existing homes sold between the beginning of January and the end of March were…
Fannie Mae’s Economic and Strategic Research (ESR) Group has downwardly revised its full-year 2022 real GDP expectations, along with anticipated home sales and mortgage originations, according to the group’s latest forecast. They now expect full-year real GDP to grow at a reduced rate of 1.3%, a 0.8% decrease from their previous prediction, citing inflation, rising interest rates, and “a slowdown of global economic growth.” The forecast also predicts that Q2 2022 will see growth rebound to 1.6%, a reaction to Q1’s economic contraction of 1.4%. “Financial conditions have tightened significantly, and the economy is slowing faster than previously expected as markets adjust to the Federal Reserve’s tightening guidance,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. Mortgage…
Builder confidence fell eight points in May, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The HMI registered a reading of 69 in May, a significant drop from April. This is the fifth consecutive month of decline and the lowest reading since June 2020. The low reading suggests that the housing market is slowing thanks to affordability challenges. “The housing market is facing growing challenges. Building material costs are up 19% from a year ago, in less than three months mortgage rates have surged to a 12-year high and, based on current affordability conditions, less than 50% of new and existing home sales are affordable for a typical family,” said NAHB Chief Economist Robert…
After ticking up 2% last week, mortgage loan application volume tanked by 11% last week, the Mortgage Bankers Association’s (MBA) weekly survey shows. The adjusted Market Composite Index, a measure of mortgage loan application volume, fell by 11%. The adjusted purchase index fell by 12%, while the unadjusted purchase index fell by 12% as well and was 15% lower YOY. The refinance index fell 10% and was down 76% YOY. Refinances made up 33% of total applications, up from 32.4%. “Mortgage applications decreased for the first time in three weeks, as mortgage rates – despite declining last week – remained over two percentage points higher than a year ago and close to the highest levels since 2009. For borrowers looking…
The number of loans in forbearance fell 11% in April from 1.05% of servicers’ portfolio volume to 0.94%, according to the Mortgage Bankers Association’s (MBA) Loan Monitoring Survey. MBA now estimates that 470,000 homeowners remain in forbearance plans. Of Fannie and Freddie loans, the number in forbearance dropped 6 basis points to 0.43%. Ginnie Mae loans saw an 11 basis point drop to 1.49%, while PLS and portfolio loans saw a 29 point decline to 2.15%. “With the number of borrowers in forbearance decreasing to less than half a million, the pace of monthly forbearance exits reached its lowest level since MBA started tracking exits in June 2020,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “Servicers are…
Ten of the 15 metros with the highest fraud risk saw an increase in risk compared to last quarter, CoreLogic reported in its Quarterly Mortgage Fraud Brief. The report analyzes the metros with the highest mortgage fraud risk in order to get a clear picture of trends found in residential mortgage loan applications processed by LoanSafe Fraud Manager. CoreLogic’s National Mortgage Application Fraud Risk Index was flat in Q1 2022, falling slightly from 138 in Q4 2021 to 137 this quarter. Year-over-year, the trend is up 15% at 119. The Poughkeepsie metro area topped the list for highest fraud risk, with risk up 16% quarter-over-quarter. It’s followed by the Miami, San Jose, Las Vegas, New York, Los Angeles, San Francisco, Stockton,…
By CHUCK GREEN While climbing interest rates are throwing a monkey wrench in the U.S. economy, commercial real estate – at least in the short term – seems to be looking up. In a recent address to the 2022 REALTORS Legislative Meetings’ Commercial Economic Issues and Trends Forum, NAR Chief Economist Lawrence Yun said regardless of burgeoning rates, the commercial real estate market is expected to prosper. “Outside of the office sector, which is lagging behind as employers allow increased remote work flexibility to keep and attract talent, commercial real estate continues to strengthen,” Yun said. Apparently shucking aside setbacks in light of the 2020 and 2021 pandemic, heading into this year conditions were looking up for the commercial real…
By KIMBERLEY HAAS Guild Mortgage has partnered with The Home Depot to help buyers save on utility costs and manage multiple payments by bundling the cost of new energy-efficient appliances into their home loan. The GreenSmart Advantage program offers options to finance energy or water-efficient improvements up to 5% of a home’s appraised value by consolidating the costs into a mortgage. Refrigerators, dishwashers, smart thermostats, washing machines, and dryers are examples of what can be included. Primary FHA purchase transactions are eligible. A 3.5% down payment and a credit score above 580 are required to qualify. Mary Ann McGarry is CEO of Guild Mortgage, which is headquartered in San Diego. She said in a statement that the company is always…
