Wells Fargo Shrinking Lending Business, Plans To Focus On Existing And Underserved Borrowers

Wells Fargo is reducing its home lending footprint, a move that experts say will have major ramifications in the mortgage industry. Formerly the nation’s largest mortgage lender, the bank announced Tuesday that it is exiting the correspondent lending channel and shrinking its mortgage servicing portfolio. “We are making the decision to continue to reduce risk in the mortgage business by reducing its size and narrowing its focus,” Kleber Santos, CEO of Consumer Lending, said in a statement. The company’s correspondent arm accounted for 42% of its loan originations in Q3 2022. Demand is down across the country due to affordability issues and high mortgage rates. Lenders are seeing originations shrink, resulting in closures and layoffs. Wells Fargo has suffered the…

Inventory Sees Record Uptick As Homes Linger On Market

Inventory saw a record uptick in the four weeks ending December 4th as buyer demand dwindled and homes lingered on the market, according to new data from Redfin. The total number of homes for sale rose 15% YOY in that period, the largest increase recorded in Redfin’s Homebuyer Demand Index. New listings fell by 20%, however, suggesting the stock shortage will be ongoing. Demand has dwindled as many homebuyers were priced out of the market by sky-high prices and rates. Buyers who could afford a home when interest rates were at historical lows found that in 2022, they couldn’t afford anything. But homebuyer demand did rebound from an all-time low, up 5% from a week prior as rates continue to…

Price Appreciation Slows To Half Of April Peak

Home price appreciation is now half of what it was in April, its lowest recorded point since early 2021, according to new data from CoreLogic. October’s CoreLogic Home Price Index recorded a 10.1% increase YOY. Though still elevated, it continues to decrease from record highs earlier this year. The coming months are expected to push growth back into single digits. Month-over-month, prices were down 0.1% from September. Low inventory, waning buyer purchase power, and economic uncertainty are at the heart of the issue, CoreLogic leaders say. Price growth is expected to cool through next spring when the housing market may go negative before slowly rebounding in the latter half of 2023. CoreLogic predicts appreciation will be 4.1% next October. “Following…

Ivy Zelman: Housing Demand “Grossly Exaggerated”

The hot housing market has been attributed to historically low-interest rates, Millennials reaching homebuying age, and a desire for spacious living created by the pandemic. Across the industry, experts agree that all of this has been exacerbated by a shortage of houses that started with underbuilding in the aftermath of the 2008 financial crisis. Everyone except Ivy Zelman, the housing analyst who foresaw the financial crisis in 2005. In a report, her firm, Zelman and Associates, claims that housing demand is overblown and that the country is already on a path to building too many houses. “The perception that housing is drastically undersupplied and that a strong demographic picture lies ahead is creating a false sense of security,’’ the report…