Surging home prices have made mortgage payments more unaffordable than any time since 2008. The median American household would need to spend 32.1% of its income on mortgage payments on a median-priced home today, according to the Federal Reserve Bank of Atlanta. In November 2008, that number was 34.2%. The Atlanta Fed estimated the amount a household would need to spend on mortgage payments rose 3.1% in the first six months of this year alone. Though low interest rates and slightly higher incomes improve affordability, the price of homes has negated any positive buying power they normally would have generated. Prices continue to climb despite some speculation that the market may soon cool. Years of underbuilding have resulted in a…
Good Morning! Today is Friday, October 1. Lawmakers avoided a partial shutdown last night by signing a bill to fund the government. House Democrats delayed a vote on the $1 trillion infrastructure bill. Supreme Court Justice Brett Kavanaugh tested positive for COVID-19. U.S. jobless claims remained near pandemic lows during September. And in mortgage and housing news… Teachers, Nurses Struggle With Housing: The lack of affordable housing is forcing in-person workers like teachers and nurses into smaller, older homes, according to a Zillow report. Forbearances Fall: Forbearances are down 11% month-over-month, the fastest rate of decline since July, Black Knight reported. Seniors At Home: An AAG survey found that over 80% of seniors do not want to sell their homes.…
Most American seniors do not intend to sell their homes and have no plans to move, a survey by the American Advisors Group (AAG) found. It’s disturbing news for a housing market already struggling with a supply shortage. AAG, a reverse mortgage company, conducted a survey of 1,500 seniors on their plans for their homes. Eighty-two percent of seniors said they would live in their homes for the rest of their lives if they could. “Our studies have shown that seniors in this country have a strong attachment to their home, and the pandemic only strengthened that bond,” said AAG Chief Marketing Officer Martin Lenoir. “It’s no secret that many seniors have built substantial equity in their homes after years…
The number of plans in active forbearance fell by 11,000 this week, according to Black Knight’s blog, Vision. That leaves 1.58 million homeowners in forbearances due to Covid-19. The total number of mortgages in forbearances is now down 192,000 month-over-month, an 11% difference. This is the fastest rate of decline reported by Black Knight since July. As early forbearance entrants reach their final expirations, even larger exit rates are expected. The blog notes that “the largest declines in forbearance volumes typically come during the first week of the month, as plans which expired in the prior month are deactivated in servicing systems of records.” Forbearance exits are being closely watched by industry analysts as expiration dates for forbearance plans loom.…
Lack of affordable housing is forcing in-person workers like teachers and nurses into smaller, older homes, according to a Zillow report. While remote work has allowed some people to buy upscale homes in more affordable markets, workers in occupations that require in-person work are left to deal with rising rent and home prices. Those left behind are often forced to live with roommates or in a less desirable home. “Many renters have been able to keep costs low even as prices have grown over the past several years, but merely affording rent does not mean they are thriving,” said Zillow economic data analyst Nicole Bachaud. “A deeper look shows a big slice of the market is out of reach for…
Good Morning! Today is Thursday, September 30. The House plans to vote today on a $1 trillion infrastructure plan. A new AP poll finds President Biden’s vaccine mandate splits Americans down party lines. The NCAA will allow women’s basketball to use the phrase “March Madness,” which used to be restricted to the men’s tournament. And in mortgage and housing news… Freddie Mac: Interest rates rose to 3.01% this week, Freddie Mac’s PMMS reported. Investor Confidence Falls: Nearly half of real-estate investors believe the investment market is worse than a year ago, and 36% expect it to stay bad over the next six months. AIME Conference: 3,000 mortgage professionals attended AIME’s 4th Annual Fuse conference. Pending Home Sales Rebound: Pending home…
Mortgage rates rose to 3.01% over the past week, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) reports the 30-year fixed-rate mortgage (FRM) averaged 2.88 percent. A year ago at this time, the 30-year FRM averaged 2.90 percent. “Mortgage rates rose across all loan types this week as the 10-year U.S. Treasury yield reached its highest point since June,” said Sam Khater, Freddie Mac’s Chief Economist. “Many factors led to this increase, including the Federal Reserve communicating that it will taper its support of the capital markets, the broadening of inflation and emerging energy supply shortages which compound other labor and materials shortages.” On Tuesday, both Fed Chairman Jerome Powell and Treasury Secretary Janet Yellen testified before Congress…
RealtyTrac’s Investor Sentiment Survey found 48% of real-estate investors believed the investment market is worse or much worse than a year ago, and 36% anticipate it will stay bad over the next six months. RealtyTrac, an ATTOM company that covers foreclosure and other real-estate data, surveyed more than 300 individual real-estate investors around the country. Almost 63% of respondents listed the rising cost of homes as a major challenge for investing, overtaking the former number one challenge, inventory, which came in at 57%. But when asked how they think the situation will look in six months, inventory again comes out on top, suggesting investors see home costs as a temporary hindrance. Competition from other buyers dropped out of the top…
Outstanding commercial and multifamily mortgage debt rose 1.5% in Q2 2021, an additional $60.7 billion, according to the Mortgage Bankers Association’s (MBA) latest Commercial/Multifamily Mortgage Debt Outstanding quarterly report. Multifamily mortgage debt specifically increased $23.8 billion, or 1.4%, to $1.7 trillion from Q1. Total commercial and multifamily debt rose to $3.98 trillion. “Strong demand from all of the major capital sources led to another increase in the amount of commercial and multifamily mortgage debt outstanding,” said Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research. “In line with the strength of apartment fundamentals and values, there was a solid increase in the amount of multifamily mortgage debt outstanding. Additionally, the increase in mortgage debt on other, non-multifamily commercial properties…
Mortgage loan application volume fell 1.1% last week, the Mortgage Bankers Association’s (MBA) weekly survey reports. Interest rate spikes stopped the upward momentum of applications seen in last week’s survey. The Market Composite Index, which measures application volume, fell 1.1% on an adjusted basis. On the same basis, they fell 1% from the week before, which is 13% lower year over year. The share of refinancing applications fell 1% and was 0.4% higher compared to a year ago. The seasonally adjusted Purchase Index fell 1%, while the unadjusted Purchase Index fell 2% compared to the week before, down 12% from the previous year. “Increased optimism about the strength of the economy pushed Treasury yields higher following last week’s FOMC meeting.…
