Demand for rental housing is on the rise,

Demand for rental housing is on the rise,

Government Support Needed to Sustain Affordable Housing: Demand for rental housing is on the rise, but the federal government is reducing its role in the sector, according to a report from Harvard University’s Joint Center for Housing Studies (JCHS). As such, the Center expressed concern for the future availability of affordable housing.

“As policymakers take steps to reduce the role of the GSEs and FHA in multifamily lending, it is important to bear in mind the key role these institutions play in the affordable segment of the market, as well as in underserved and weaker markets where capital outside of government channels is scarce,” stated the JCHS report.
More than 1.1 million rental households took shape from 2011 to 2012, accounting for all net household growth over the year.
Rental households now make up 35 percent of all households in the United States, according to JCHS. Read more ...

Skyrocketing Fixed Mortgage Rates

Skyrocketing Fixed Mortgage Rates

In Response to Fed Remarks: Mortgage rates shot up in the last week following remarks from the Federal Reserve that it may be tapering its bond purchases later this year.

According to Freddie Mac’s Primary Mortgage Market Survey, the average 30-year fixed-rate mortgage (FRM) rose to 4.46 percent (0.8 point) for the week ending June 27, an increase from only 3.93 percent last week and the highest figure since the week of July 28, 2011. The weekly increase is the largest since April 1987.

“Mortgage rates posted the biggest one week increase since the 2008 failure of Lehman Brothers that pushed the global financial system to the brink. This week, the catalyst was something far more benign,” Bankrate said, referring to Bernanke’s announcement. Good News for High-End Home Buyers?

High LTVs and Their Impact on Prices

High LTVs and Their Impact on Prices

Report: Mortgages with higher loan-to-value (LTV) ratios are not only riskier in terms of the likelihood to default, but they can also impact markets by triggering greater losses in home values, according to the most recent Home Value Forecast report from Pro Teck Valuation Services and Collateral Analytics.

“During the housing bubble (2004-2006), it has been well documented that higher loan-to-value (LTV) ratios led to riskier mortgages, but there has been much less research showing the correlation between high LTVs leading to greater price declines,” 

“We have found that as home prices decline, homeowners with high LTVs are much less inclined to stay in their homes since they have little or no equity to protect. This leads to more price declines, which has a cascading effect on other high LTV owners and a further depreciation in home values,” the authors explained. New-Home Orders Soar 27%  Inventories also rose in May, reaching a 4.1-month supply at the current sales pace.

CFPB Proposes Revisions to Mortgage Rules

CFPB Proposes Revisions to Mortgage Rules

he Consumer Financial Protection Bureau (CFPB) announced Monday proposed revisions to its ability-to-repay rule, mortgage servicing rules, and rules regarding consumer protections.

“Today’s proposal revises and clarifies certain aspects of our rules to ease implementation and to pave the way for more effective consumer protections in the marketplace,” said Richard Cordray, director of the CFPB.

One of the clarifications specified in Monday’s announcement is the definition of a loan originator. CFPBrules detail qualifications and compensation guidelines for loan originators, and industry participants have expressed a need to ensure tellers and administrative staff are not considered loan originators for the purposes of these new guidelines. Delinquency, Foreclosure Rates Decrease

Are Appraisals Finally Playing Catch-Up?

Are Appraisals Finally Playing Catch-Up?

Many real estate professionals have been blaming low appraisals for derailing transactions over the last few years. But now home prices are heating up across the country. Are appraisals still coming in lower than the agreed-upon sales price? 

Even with prices rising and the number of foreclosures falling, some appraisers say assigning a value to a property isn’t getting any easier. One of the big reasons, they say, is because of low inventories in many markets. “An undersupply of available homes has prompted bidding wars above list price, a price that isn’t necessarily justified by an appraisal,” The Chicago Tribune reports.  Bizarre Mortgage Requests Delay Borrowers

Short and Long Term Outlook for Lenders

Short and Long Term Outlook for Lenders

Deloitte Analyzes: Though rising mortgage rates and the current supply and demand situation present short-term difficulties for originators, researchers at Deloitte say the long-term picture is rosier.

With demand, prices, and credit conditions all on a path to recovery, Deloitte Banking & Securities research leader Val Srinivas examined the problems still facing originators and how they must adapt to overcome.
The biggest challenge to the housing market in general right now is low supply. According to data collected from the Census Bureau and the National Association of Realtors, supply of new and existing single-family homes has nearly halved in both categories since 2011. Watch our video ...

Home Prices Rising at ‘Unsustainable’ Rate

Home Prices Rising at ‘Unsustainable’ Rate

Home prices have been soaring by double digits compared to last year’s numbers and the National Association of REALTORS® are calling the rises “unsustainable.” 

The price for existing home sales surged 15.4 percent higher in May compared to last year. 

'Some of the increases can be explained by the fact that it is recovering from an over-corrected situation,' says Lawrence Yun, NAR chief economist. 'But with people's income rising at only 1 or 2 percent and prices rising in double digits, it cannot continue.” 
1 in 5 Foreclosures Vacated by Owner

First-Time Home Buying Still at Low Levels

First-Time Home Buying Still at Low Levels
First-time home buyers make up about 29 percent of the housing market, which is “weaker than the historic norm” of 40 percent, according to Walt Molony, spokesman for the National Association of REALTORS®. 

As the housing market’s recovery strengthens, why are the numbers of first-time home buyers numbers still so low? The leading culprits have been identified as tight credit conditions, limited housing inventories, and steep competition from investors for the same properties.

10 percent down payment may be back and 

Mortgage Rates Pull Back: . 

CoreLogic Dismisses Bubble Fears

CoreLogic Dismisses Bubble Fears
Double-digit price increases in some markets hard-hit by the housing crisis prompt the question, are we experiencing another housing bubble? While several factors are combining to push prices up right now,CoreLogic analysts say we are not headed into anther bubble.

“While our recent projected CoreLgic HPI indicates continued home price gains, bolstered by still-tight supply and strong demand, we expect recent double-digit gains to moderate as markets normalize,”  Builders Ramp Up Production Meet Increasing Demand

Homebuilder Confidence

Homebuilder Confidence
Big Milestone: Homebuilder confidence is at its highest level in seven years, reaching a big milestone in June, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). 
The index, which measures homebuilder sentiment over the new-home market, rose eight points in June to 52 — any reading above 50 indicates that more builders view sales conditions as good rather than poor. 
Provo Utah 2nd Turnaround Housing Markets 

10 Fastest-Growing Economies by State

10 Fastest-Growing Economies by State
Some of the states seeing the biggest increases are expanding due to booming energy industries, such as in Texas and North Dakota. Population growth is also fueling some economies. The top five states for GDP growth were also among the five largest for population growth last year. 

“You’r going to find border states with heavy immigrant presence generating faster population growth,” says Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities.

The following are the states with the fastest growing economies, based on GDP growth. 

7. Utah

> GDP growth: 3.4%
> Real 2012 GDP: $111.8 billion (18th smallest)
> 1-yr. population change: 1.45% (4th highest)
> 1-yr. employment growth: 1.76% (11th highest)

Sales Spike in 19 Major Metros in May

Foreclosure Sales in West Down in May

Foreclosure Sales in West Down in May

Likely to Increase in June: Foreclosure sales decreased in all five Western states tracked by PropertyRadar —Arizona, California, Nevada, Oregon, and Washington—over the month of May.

The greatest decline took place in Oregon, where foreclosure sales fell 47.8 percent over the month. Nevada followed with a 38.7 percent decline, and then Arizona, California, and Washington fell in line with declines of 24.5 percent, 23.1 percent, and 14 percent, respectively. Are Mortgage Rates Too Low To Threaten the Recovery?

30-Year Mortgage Rates Climb Near 4% Range

30-Year Mortgage Rates Climb Near 4% Range

Are 4 percent mortgage rates the new norm?

For the sixth consecutive week, mortgage rates inched higher, continuing to climb from all-time lows, Freddie Mac reports in its weekly mortgage market survey. The 30-year fixed-rate mortgage—the most popular among home buyers—has now climbed a half percentage point since last month. 

A strengthening economy and positive employment report this month prompted fixed-rate mortgages to climb higher this week, says Frank Nothaft, Freddie Mac’s chief economist. 

850K Borrowers Rise Out of Negative Equity in Q1, 'The negative equity burden continues to recede across the country thanks largely to rising home prices,'

Monthly Increase in REOs

Monthly Increase in REOs

Drives Up Foreclosure Activity in May: After posting a 75-month low in April, foreclosure filings increased 2 percent in May, according to RealtyTrac. The rise was primarily driven by an 11 percent increase in REOs over the month.

However, REOs demonstrated a 29 percent decline year-over-year in May, while foreclosure filings fell 28 percent over the same time period.
“Foreclosure activity continued to bounce back in some markets where it may have appeared the foreclosure problem had been knocked out by an aggressive combination of foreclosure prevention efforts over the past two years,” 
Inventory Situation Improves in June Compared to Start of 2013:

You Should Own, Not Rent

You Should Own, Not Rent

Why it's true: A recent study by mortgage giant Fannie Mae showed that 90 percent of renters aspire to be home owners one day, and the top reason behind that desire is for the sense of gaining greater control over their living arrangements. 

The survey revealed the following top reasons why renters want to own: Long-Lost Equity More Home Owners Regain:

Inventory on the Rise as Sellers Gain Confidence

Inventory on the Rise as Sellers Gain Confidence

Forty percent of Americans say now is a good time to sell a home -- up from 30 percent last month and 16 percent just one year ago, according to a new survey by Fannie Mae. Rising home prices are helping to boost sellers’ confidence. 

'Sentiment toward selling a home appears to be catching up with the strengthening housing market,' says Doug Duncan, chief economist at Fannie Mae. “This jump may foreshadow a gradual return to more normal levels of housing supply from their lows of recent months. In turn, increased housing supply could serve to temper increasing consumer home price expectations.”

Builders Don't Fear Housing Bubble

Why more Sellers Could Test Favorable Market!

Why more Sellers Could Test Favorable Market!

Inventories of for-sale homes are increasing as more owners see rising home prices and faster sales as a reason to try to sell now, according to industry reports.

In April, the number of listings was higher than the level of homes that were under contract in that month, according to a study by the real estate brokerage ZipRealty, which measured listings in 24 major metro markets.

“It’s less of an indication of buyer momentum flagging and more of seller momentum picking up, finally,” says Lanny Baker, the company’s chief executive.

The reports find that homes are selling faster—on average, within 32 days of being listed. In April 2012, that average stood at 48 days for homes to sell. Read what Refin says....

Americans regain the household wealth

Americans regain the household wealth

Household Wealth Tops Pre-Recession Levels: A robust stock market and stronger housing indicators are helping more Americans regain the household wealth that they lost during the Great Recession.

Federal Reserve reports that the net worth of American households is now higher than before the recession that occurred about five and a half years ago, without adjusting for inflation. Household net worth climbed 4.5 percent in the first quarter of 2013, reaching $70.3 trillion, compared to $68.1 trillion in 2007.  
See  How Home Buyers are Faring?

America has a proud heritage of diversity

America has a proud heritage of diversity

America's Largest Ethnic Groups Say Home: When it comes to homeownership, the three largest ethnic groups in the nation share similar visions and attitudes, according to a survey from Better Homes and Gardens Real Estate.

The survey included three groups—Caucasians, African-Americans, and Hispanics—with 400 respondents represented for each group.
Most individuals from all three groups view homeownership as a lifelong goal and consider it to be the greatest indicator of status. For 78 percent of African Americans and Hispanics, homeownership was viewed as the greatest indicator of status, while 65 percent of Caucasians shared this view. Read more ...

'Buyer's Market' Still Years Away

'Buyer's Market' Still Years Away

It may be two to three more years before prospective home buyers get a break from escalating property prices and tight supply, according to experts speaking at a National Association of Real Estate Editors conference Wednesday. 

That is the time frame for institutional speculators, who currently are dominating the market, to pull out of their investments and still make a profit, explained Bill Rayburn of the mortgage technology firm FNC.  The market also will need to see the return of individual home buyers in order to normalize, he said, which will be propelled by employment gains. 

Higher Home Prices Cool Buying Frenzy: The recent rise in home prices has more investors concerned.

New Effort to Streamline Short Sale Process

New Effort to Streamline Short Sale Process Fannie Mae Announces: In an effort to speed up the short sale process, Fannie Mae is increasing early communication with real estate agents by asking listing agents to register accepted short sale offers with the GSE.

By registering offers, Fannie Mae says there will be greater transparency in the process and it will also allow the GSEto be more proactive when working with servicers to complete short sales.
“Fannie Mae recognizes the very important role real estate professionals play in the short sale process and we want to work closely with them to get short sales done,” said Jay Ryan, VP for real estate sales, Fannie Mae. Through Fannie Mae’s site Homepathforshortsales.com, agents can register their short sale offers. Learn more ....

Home prices climbed higher for the 14th straight

Home prices climbed higher for the 14th straight

Home Prices Post 12.1% Annual Gain in April, “Increasing demand for new and existing homes, coupled with low inventory, has created a virtuous cycle for price gains, most clearly seen in the Western states with year-over-year gains of 20 percent or more,”

When including distressed sales, prices were up 12.1 percent in April compared to a year ago CoreLogic reported the increase in April marks the biggest annual gain since February 2006. From March to April, home prices ticked up by 3.2 percent.  Read more ....

Shadow Inventory Looms Large for GSEs, HUD

Shadow Inventory Looms Large for GSEs, HUD
According to the report, the shadow inventory is more than seven times the inventory of REOs that Fannie Mae, Freddie Mac, and HUD currently own. 

Shadow inventory held by the GSEs and HUD “vastly” outnumbers REO properties the groups maintain, according to a joint report from the Office of Inspector General for the Federal Housing Finance Agency and HUD. The report further warned HUD and the GSEs must pay close attention to shadow inventory, which threatens to increase their supply of REOs. For the report, shadow inventory was defined as properties 90-days or more past due but not yet in foreclosure. Read more ...

Shrinking Bottom Line

Shrinking Bottom Line

Lost in the kerfluffle over the unexpected downward revision of first quarter GDP growth—2.4 percent annualized compared with the originally reported 2.5 percent—was the companion release of first quarter corporate profits, a disappointing drop from the fourth quarter.

 Recent data shows home prices rising at the fastest pace since the housing bubble burst. At the national level, though, the relatively rapid increase in prices doesn’t automatically suggest a new “bubble” since prices (adjusted for inflation) are down from their peak. 

Many low- and moderate-income people saw their dreams destroyed when the last bubble collapsed. It would be too cruel to see the same mistake repeated just a few years later. Read more..

Millennials Say

Millennials Say They Don't Want a Home Like Their Parents': 
The millennial generation is showing differing housing tastes than their parents’ generation. For example, millennials say they prefer smaller, functional homes than sprawling 'McMansions,' and they’re not interested in “cookie cutter” homes that look like everything else on the block. Instead, this generation of do-it-yourselfers wants to put their individual stamp on their home and make sure it reflects them and their tech-driven lifestyle. Millennials are the next big demographic of home buyers emerging in real estate. Read more ...