By CHUCK GREEN
Back in 2008, Fannie Mae and Freddie Mac were in trouble. In fact, without government intervention, they faced imminent collapse, and on Sept. 6 of that year, both were placed in conservatorship by the director of the Federal Housing Finance Agency.
With those conservatorships hitting their 15th anniversary, William Emmons, an adjunct lecturer at Washington University in St. Louis, said the takeover was historically significant because they were the first large-scale government interventions in what came to be known as the Global Financial Crisis.
“In other words, their collapse was a bellwether of things to come. Lehman Brothers failed one week later, which triggered the chain reaction of collapsing banks, AIG, and market confidence,” Emmons told The…
By SCOTT KIMBLER
As officials work to address racial bias in home valuations, leaders at a public policy think tank in Washington, DC, are saying recent recommendations made by a federal task force miss the mark.
The Interagency Task Force on Property Appraisal and Valuation Equity, or PAVE for short, was created in June of 2021 to tackle the problem of racial and ethnic bias in home valuations. Comprised of 13 federal agencies and offices, it is co-led by officials at the U.S. Department of Housing and Urban Development and the White House Domestic Policy Council.
In March of 2022, the PAVE Action Plan was released, and this past June the Biden-Harris administration announced a set of actions to deliver…
By KIMBERLEY HAAS
Addressing affordability issues by allowing for creative living solutions may be the key to getting more Millennials into homeownership.
According to the 2023 Home Buyers and Sellers Generational Trends Report published by the National Association of Realtors, the share of Millennial buyers has declined. Millennials between 24 and 42 years old made up 28% of all buyers surveyed.
The share of Millennial buyers dropped because Baby Boomers between 58 and 76 years old were on the move in the last half of 2021 and the first half of 2022. They made up 39% of buyers and were the largest share of homebuyers, taking the top spot from Millennials, who had held the position for eight years.
Overall,…
By KIMBERLEY HAAS
Federal housing officials have pledged to support people affected by the wildfires on the Hawaiian island of Maui as the state’s governor warns developers to stay away.
Officials from Ginnie Mae, the Federal Housing Administration, the Federal Housing Finance Agency, the United States Department of Agriculture, and the United States Department of Veterans Affairs issued a joint statement on Friday saying they are “committed to providing homeowners flexibilities and assistance so they feel the security of knowing they will have the option to return and rebuild when it is safe to do so.”
FHA-approved lenders doing business in Maui are encouraged to familiarize loan officers and operational teams with FHA’s 203(h) Disaster Mortgage, which provides up to…
Freedom Mortgage has been sanctioned by the Consumer Financial Protection Bureau for providing illegal incentives to real estate brokers and agents for mortgage loan referrals.
The CFPB says Freedom offered agents and brokers perks for past and future loan referrals, a violation of the Real Estate Settlement Procedures Act.
In at least forty cases, Freedom paid for marketing services that were never performed by the brokerages, which the CFPB says amounts to paying for referrals. RESPA particularly addresses illegal marketing service agreements, and the CFPB released detailed guidelines on their use in 2020.
Agents who worked with Freedom were also incentivized through paid subscription services offering important industry data, but they typically had to agree to be paired with a…
Low-income redevelopment zones continue to benefit from home price appreciation around the country, and some are faring better than their neighbors.
ATTOM’s Q2 2023 review of low-income Opportunity Zones targeted by Congress for economic redevelopment found that 61% of the 3,909 data zones saw price increases. In half of those, prices were up 5% or more.
Opportunity zones exist in and around low-income neighborhoods where the federal government offers tax breaks to advance economic development. Overall, these areas follow home price trends in other parts of the country.
Values declined in the last half of 2022 before recovering in 2023, a pattern that has impacted most U.S. neighborhoods. But prices in many zones rose faster than the nationwide trend both…
By CHUCK GREEN
Mortgage rates are hovering around 7% as the summer winds down and with potential homebuyers facing high monthly payments for the few properties for sale, people are wondering when the Federal Reserve will loosen its grip on monetary policy so the housing market can free up again.
Last month, Chairman Jerome Powell announced the key interest rate would be lifted to 5.25% to 5.5% — the upper figure representing a level not seen since 2001, according to the Associated Press. Powell said that they don’t expect to reach their goal of 2% inflation until 2025, and they do not intend to cut rates until next year.
“The Fed’s rate hikes attempt to combat inflation, increasing mortgage interest…
By DESMOND LACHMAN
There is good news and bad news for the U.S. housing market. The good news is that by this time next year, mortgage rates will be substantially lower than they are today. The bad news is that by this time next year, the U.S. is more than likely to be in a meaningful economic recession.
The main reason for believing that next year we will have both lower interest rates and a recession is that the Fed is currently engaged in monetary policy overkill and that monetary policy operates with long and variable lags. Those lags are thought to be between 12 and 18 months. That means the economy, which is already showing clear signs of slowing,…
By KIMBERLEY HAAS
Officials at the Federal Housing Finance Agency say racial and ethnic valuation gaps in home appraisals are being reduced in a majority of states.
According to a blog published Tuesday, “Although an appraisal valuation gap continues to exist between white and minority population tracts, data indicate a reduced gap following actions by stakeholders and federal, state, and local agencies, including the release of the PAVE Action Plan.”
The federal Interagency Task Force on Property Appraisal and Valuation Equity was created in June of 2021 to tackle the problem of racial and ethnic bias in home valuations. It is comprised of 13 federal agencies and offices and is co-led by officials at the U.S. Department of Housing and…
By KIMBERLEY HAAS
Fannie Mae and Freddie Mac were affected this week after Fitch Ratings downgraded the country’s credit rating.
On Tuesday, leaders at Fitch issued a press release saying they had downgraded the United States of America’s Long-Term Foreign-Currency Issuer Default Rating from AAA to AA+.
Fitch is one of three nationally recognized statistical ratings organizations. The other two are Moody’s Investors Service and S&P Global Ratings.
Expected fiscal deterioration over the next three years, a high and growing general government debt burden, and the erosion of governance were cited as reasons for the downgrade.
“The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management. In addition, the government lacks a medium-term fiscal framework, unlike…
