Americans who bought a home this year are facing rising underwater risk as home prices cool. Black Knight’s October Mortgage Monitor found that 8% of homes bought in 2022 are now at least marginally underwater, while almost 40% have less than a 10% equity stake in their homes. “Make no mistake: negative equity rates continue to run far below historical averages, but a clear bifurcation of risk has emerged between mortgaged homes purchased relatively recently versus those bought early in or before the pandemic,” said Black Knight President Ben Graboske. “Risk among earlier purchases is essentially nonexistent given the large equity cushions these mortgage holders are sitting on. More recent homebuyers don’t fare as well.” This is a particular issue…
Rent prices are easing in most American cities thanks to a boost in available units. Sixty-eight of the country’s largest metros saw month-over-month rent declines in October, according to researchers at Florida Atlantic University and two other schools. The average rental rate was $2,040, down 0.9% from September. Springfield, MA, Austin, TX, Seattle, and New York were among the cities where rents posted declines. “It seems that an increase in supply helped relieve the pricing pressure on rental units around the country – and that’s exactly what had to happen,” said Ken H. Johnson, Ph.D., an economist in FAU’s College of Business. He noted that delivery of units under construction, as well as increasing unit density and conversions of short-term…
Mortgage interest rates fell again last week to 6.49%, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.49%, down from 6.58% the week prior. Weeks of decline have made some analysts optimistic that rates have peaked. “We probably have seen peak mortgage rates unless there is some other major shock to the economy,” Cris deRitis, deputy chief economist at Moody’s Analytics, told NextAdvisor. The 15-year fixed-rate mortgage also fell from 5.90% to 5.76%. A year ago, it averaged 2.39%. “Mortgage rates continued to drop this week as optimism grows around the prospect that the Federal Reserve will slow its pace of rate hikes,” said Sam Khater, Freddie Mac’s Chief Economist. “Even as…
Just days ago, Inlanta Mortgage seemed poised to go under due to declining homebuyer demand. The Wisconsin-based company operates in 27 states. Leaders there announced plans to close next year, starting the winding down process immediately. The company cited “the dramatic and unanticipated drop in mortgage product demand” for its demise. In a letter to Wisconsin’s Department of Workforce Development, it said 62 employees would be let go. Some of those employees may now be saved from termination by Guild Mortgage, which announced it is acquiring Inlanta. Terms of the acquisition were not disclosed. In a press release, Guild CEO Mary Ann McGarry said the decision aligns with Guild’s expansion mindset. “Inlanta is a natural fit because of its almost…
By KIMBERLEY HAAS Leaders at Big Purple Dot and CoreLogic have come together to launch a platform that provides detailed production data on loan officers and a service to help lending companies in their recruiting efforts. Roxana Davidoff, Founder and CEO of Big Purple Dot in Irvine, California, recently sat down with The Mortgage Note to explain why this data is needed by lenders as the housing market cools following a whirlwind pandemic-driven surge. “We understand where we are headed in this environment, where before people were hired just to fund a loan. Business was so hot people were funding loans every single day. Now the music has slowed down and people need to take a look now, and they…
Despite the slew of closings and layoffs, some mortgage lenders continue to expand as the market cools. Planet Home Lending announced it is opening a new branch office in Lehigh Valley, PA. It will be led by Retail Branch Managers Christopher Lewis and Nick DeJesus, and Sales Manager Andrew Keller. The group is known for providing a customer-focused, high-touch experience. Planet Home offers down payment and closing cost assistance, as well as rate buydowns. Planet Home continues to expand nationwide after its Q3 earnings report showed a 14.1% boost in loan volume despite market difficulties. “Planet’s efficiencies allow us to deliver what first-time homebuyers expect in the Lehigh Valley market,” DeJesus said. “We were drawn to Planet by the company’s great rates,…
Pending home sales fell for the fifth consecutive month in October, with three of the four regions seeing month-over-month declines, according to the National Association of Realtors. The Pending Home Sales Index dropped by 4.6% between September and October. Year-over-year it tanked by 37%. All four regions saw pending sales drop year-over-year. The Midwest, however, experienced a small uptick month-over-month, up by 3.3%. The Northeast PHSI fell by 4.3% from September, while the South fell 6.4% and the West saw a major decline of 11.3%. “October was a difficult month for home buyers as they faced 20-year-high mortgage rates. The West region, in particular, suffered from the combination of high interest rates and expensive home prices. Only the Midwest squeaked out…
By CHUCK GREEN According to experts, not only is the housing market expected to continue cooling this year, the forecast remains chilly entering 2023. Real house prices jumped 10.5% in September and logged a 60.6% YOY increase, according to First American’s Real House Price Index. But prices fell in 15 out of the top 50 markets they analyze. Mortgage originations saw their largest annual decline in 21 years this fall, further evidence that the housing boom is coming to an end. Originations fell 47% YOY in Q3, according to ATTOM Data’s Q3 2022 U.S. Residential Property Mortgage Origination Report. Quarter-over-quarter they were down 19%, the sixth consecutive drop. So, what in the name of the cranky barometer’s up? For one thing, surprise, surprise,…
Mortgage loan application volume dipped last week despite rates slipping, affected by the holiday and the weakening economy, according to the Mortgage Bankers Association’s weekly survey. The adjusted Market Composite Index, a measure of mortgage loan application volume, decreased by 0.8%. The adjusted purchase index rose 4%, while the unadjusted purchase index decreased by 31% and was 41% lower YOY. The 30-year fixed rate dropped to 6.49%, having now fallen 57 bps in just four weeks. Rates declined for all other loan types, as well. “The economy here and abroad is weakening, which should lead to slower inflation and allow the Fed to slow the pace of rate hikes,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Purchase…
Home price appreciation continued to cool in September though growth remained elevated from a year earlier, according to new data. The S&P CoreLogic Case-Shiller National Home Price NSA Index saw home prices decelerate, posting a 10.6% annual gain in August, down from 12.9% in the previous month. Craig J. Lazzara, Managing Director at S&P DJI, said all three composites are above their historical medians but peaked about six months ago. “As has been the case for the past several months, our September 2022 report reflects short-term declines and medium-term deceleration in housing prices across the U.S.,” he said. “As the Federal Reserve continues to move interest rates higher, mortgage financing continues to be more expensive and housing becomes less affordable. Given the…
