Home prices in August surged 7.7 percent, the largest year-over-year price gain since May 2015. The national median sale price was $293,000, flat from July. None of the metro areas Redfin tracks saw prices decline in August. The median value of off-market homes in August was $251,000, as measured by the Redfin Estimate, up 0.7 percent from July. Sales in August fell 5.5 percent compared to last year, the largest decline posted since July 2016. This follows the 5 percent decline posted in July by the Redfin Housing Demand Index. The number of homes for sale plunged 12.4 percent, the largest year-over-year decline in a 23-month streak of declining inventory. The number of new listings in August was down 1 percent from a year ago, leaving just 2.8 months of supply. Less than six months of supply signals the real estate market is tilted in favor of home sellers. In the San Jose, Calif. metro area, inventory plummeted 50 percent in August compared to a year ago, leaving less than a one-month supply, the lowest of all markets Redfin tracks. Nearly a quarter (24.9%) of homes sold above their list price. The average sale-to-list ratio was 98.5 percent. The typical […]
The CFPB today issued policy guidance on the loan-level Home Mortgage Disclosure Act data it will make available to the public under the revised HMDA data collection rules, which take effect in 2018. Noting concerns over consumer identity protection—which ABA raised several times to the bureau in previous comments—the CFPB is proposing to not publicly disclose a number of data points, including the universal loan identifier, the application date, the date of action taken by the bank on a covered loan or application, the address of the property securing the loan and the credit score or scores relied on in making the credit decision. The bureau also proposed changes that would reduce the precision of values reported for several data fields, such as the amount of the covered loan applied for, the age of an applicant or borrower, or a borrower’s debt-to-income ratio.
The Internet has changed the way the real estate market and real estate marketing operate. The traditional mainstays and methods of advertising and promotions no longer function as effectively. Who has a phonebook? How are you going to cold call an e-retailer? You can buy an ad in the newspaper, but the only customers it will attract are the kind of customers who still have a newspaper subscription. Our Internet habits are also leading to the fragmentation of the digital universe, where no two people are seeing the same combination of information sources. The world is also more media savvy than ever. This means advertising simply does not work as well as it used to. People are less likely to see your ad, no matter where you put it, and are inclined to view it with suspicion when they do. People are intolerant of solicitation in general. Most people won’t open up for a door-to-door salesperson, viewing them as an anachronism at best and a nuisance at worst. Cold calls are practically useless, especially now that so many people have cell phones and unlisted numbers. Most cities do not even print home phonebooks anymore, and the commercial phonebooks are usually […]
Buy a house without your spouse: sensible or sleazy? Can you (or should you) buy a house without your spouse? Yes; you can take title in many ways, and one of those ways is “a married man / woman as his / her sole and separate property.” But what does that mean? And just because you can, does it mean you should? Why would you buy a house on your own? There a several reasons you might want to purchase a house in your name only: to protect your interests, to plan your estate, to save money, or to qualify for a mortgage. To get a mortgage Many mortgage programs have minimum FICO scores that would get a couple declined if one spouse’s score is too low. Whether it’s bad credit or just a too-short credit history, if the result is a FICO under 620, you’ll be disqualified under many mortgage programs. So it would make sense to put the mortgage in your own name if you can qualify without your significant other’s income. To save money A few years ago, the Federal Reserve studied mortgage costs and found something startling. Of over 600,000 loans studied, ten percent could have […]
Fed’s George pushes for more rate hikes despite low inflation · Kansas City Fed President Esther George tells CNBC that inflation running below 2 percent shouldn’t prevent more interest rate hikes. · George made the remarks from the annual Fed conference in Jackson Hole, Wyoming. · While Fed officials have indicated a desire to hike interest rates once more this year, traders in the funds market are expressing doubt. Low inflation shouldn’t stop the Federal Reserve from continuing to hike interest rates, Kansas City Fed President Esther George said Thursday. Inflation has been running persistently below the 2 percent target the central bank likes to see as indicative of healthy economic growth. Some officials have expressed caution about the Fed’s collective desire to keep raising rates in that climate. However, George said she feels confident enough in where things stand to keep advocating for tighter policy. “I think we should continue with the gradual rate path,” she told CNBC in a live interview from the annual symposium in Jackson Hole, Wyoming, that the Kansas City Fed hosts. “While we haven’t hit 2 percent, I’m reminded that 2 percent is a target over the long term, and in the context of […]
The Federal Housing Finance Agency today extended the Home Affordable Refinance Program through Dec. 31, 2018. The program was scheduled to phase out in September upon the launch of Fannie Mae and Freddie Mac’s new streamlined refinance program for borrowers with high loan-to-value ratios. However, the agency today announced that the new high loan-to-value refi program would only be available for borrowers who originate their loans on or after Oct. 1, 2017; as a result, FHFA determined that HARP remained necessary to serve eligible existing borrowers. More than 143,000 homeowners may still be able to benefit from HARP, the agency added. Since its inception in 2009, more than 3.47 million refinances have been done through HARP. The eligibility date for the new high loan-to-value refi program was necessary to support the GSEs’ credit risk transfer programs, which since March have seen $54.2 billion worth of risk transferred. Fannie and Freddie will modify future credit risk transfers to accommodate the new streamlined refi program. Meanwhile, FHFA today announced that nearly 357,000 refinances of Fannie or Freddie loans were completed in the second quarter, with 9,700 of them coming through HARP. HARP refinances dropped by one third since the prior quarter. Fourteen […]
FDIC-insured banks and savings institutions earned $48.3 billion in the second quarter, up 10.7 percent from the industry’s earnings a year before, the FDIC said today. The rise in net earnings was largely driven by a 9.1 percent increase in net interest income as the Federal Reserve continues the process of normalizing interest rates, the agency said. Return on assets, a benchmark for industry performance, hit 1.14 percent — a level not seen since 2007. “America’s banks continue to finance the businesses that drive growth and create jobs,” said ABA Chief Economist James Chessen. “Small business lending was particularly strong in the second quarter, showing confidence by entrepreneurs that our eight-year expansion will continue well into 2018.” With interest rates slowly rising, net interest margin improved to 3.22 percent, up from 3.08 percent the year before and the highest level since 2013. Higher net interest margins were reported at larger institutions, which have a greater share of assets that reprice or mature in the short term. Noninterest income was 1 percent higher compared to the same point in 2016. Total loans and leases increased by 1.7 percent, or $161.2 billion, during the second quarter. While loan growth remains strong — […]
Inflation is falling “well short” of target so the Federal Reserve should be cautious about raising interest rates until it is confident of a rebound, an influential Fed policymaker said on Tuesday in making the dovish case ahead of a key policy meeting. In a speech highlighting months of weak data that has pushed core U.S. inflation down to 1.4 percent, Fed Governor Lael Brainard said the central bank should go so far as to make clear it is comfortable pushing prices modestly above a 2-percent target. Brainard, a permanent voting member on the Fed’s monetary policy committee who has in the past convinced colleagues to delay tightening, noted that the U.S. economy is on a “solid footing” and benefiting from two years of an “extremely welcome” rebound in global peers. Yet she seized on the fact that core U.S. price readings have sagged for five straight years. “We should be cautious about tightening policy further until we are confident inflation is on track to achieve our target,” Brainard lends in a speech at the Economic Club of New York. “There is a high premium on guiding inflation back up to target so as to retain space to buffer adverse […]
Fannie Mae recently raised the cap on its maximum debt-to-income (DTI) ratio to 50 percent. Will it help? NAR Research queried lenders about this change in the Survey of Mortgage Originators for the 2nd quarter of 2017. Mortgage lenders were optimistic about the change, but some will maintain overlays to mitigate potential risks. In July, Fannie Mae began buying and insuring loans with DTIs up to 50 percent. This change was an increase from the DTI cap of 45 percent maintained by Fannie Mae in recent years. Some analysts pointed to this change as a potential expansion of the credit box which would result in more home sales in the face of rising home prices and student debt. Others have panned it as simply taking mortgage loans from the Federal Housing Administration (FHA) or other channels. 57.1 percent of lenders in the survey indicated that the change would result in a modest increase in total originations as more borrowers take advantage of the change. Only 21.4 percent felt that this market segment was already served by the FHA, while 7.1 percent felt that the risk was too great to originate. When asked whether they or the investor/aggregator with whom they […]
Total nonfarm payroll employment rose by 156,000 in August, a decrease from July’s downwardly revised figure of 189,000, according to the Bureau of Labor Statistics. The national unemployment rate ticked up to 4.4%, staying within a 10 basis point range in the last five months. Private service-providing industries added a net 95,000 jobs, led by gains in professional and business services, which added 40,000 jobs during the month, and by the health care and social assistance sector, which added 17,000. Goods-producing employment rose by 70,000 jobs during the month, as gains in durable goods manufacturing and construction led by both adding 28,000 jobs in August. The civilian labor force participation rate was 62.9%, the same as in July. Workers unemployed for less than 14 weeks increased by 87,000, while the number of long-term unemployed, those jobless for 27 weeks or more, was essentially unchanged and accounted for 24.7% of the unemployed. The number of discouraged workers was 448,000, a 128,000 decrease from a year earlier. Average hourly earnings increased by 3 cents to $26.39, after a 9-cent increase in July. Over the past year, average hourly earnings have risen by 65 cents, or 2.5%.