Annual price increases in September were quite literally off the charts. Both the S&P CoreLogic Case-Shiller National Index and the Housing Market Index from the Federal Housing Finance Agency (FHFA) recorded annual appreciation of at least 7 percent. The Case-Shiller National Index, which covers all nine U.S. census divisions, reported a 7.0 percent annual gain in September, up from the August increase of 5.8 percent. The National Index posted 1.2 percent month-over-month growth before seasonal adjustment and 1.4 percent afterward. As has been the case since the beginning of the pandemic, housing data from Wayne County, Michigan where Detroit is located has been insufficient to include the city in the indices. The 10-City Composite annual increase came in at 6.2 percent and the 20 City at 6.6 percent. The two composites had appreciated in August by 4.9 percent and 5.3 percent, respectively. On a monthly basis the 10-City increased 1.3 percent before adjustment and 1.2 percent afterward, while the 20 City's gains were the reverse, rising 1.2 percent before adjustment and 1.3 percent afterward. In September, all 19 cities (excluding Detroit) reported increases before and after seasonal adjustment. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
A recent survey by Lending Tree found that nearly half of Americans are thinking about moving in the not-to-distant future and it appears that the COVID-19 pandemic may be at least part of their motivation. Crissinda Ponder writes that the health crisis has affected nearly every aspect of daily life, and with 11 million Americans unemployed, residents make an exodus from major cities, a desire for more living space. There is no reason to think that housing choices would be any less affected. The Lending Tree survey covered 2,000 consumers and 46 percent said they were thinking about relocating within the next year. Twenty-seven percent are considering a new home in their current area, with a primary motivation of reducing their living expenses. Another 12 percent would consider a nearby city, while 8 percent would like to move to a new state. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Black Knight, in its "first look" at the month's loan data, says that mortgage delinquencies improved for the fifth consecutive month in October. The national delinquency rate fell another 3.3 percent from September to 6.44 percent, the lowest rate since last March. There were 3.437 million mortgages nationwide that were 30 or more days past due but not in foreclosure in October, down 105,000 loans in a month. Despite the five months of improvement, however, the national delinquency rate is 90 percent higher than in October 2019, and the number of loans in the 30-day delinquency bucket is 1.651 million larger year-over-year. Black Knight's delinquent loan totals include those in active forbearance plans. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The forbearance plan rolls expanded slightly over the past week, reversing two weeks of falling numbers. Black Knight said the total of loans in approved plans, which had declined by 273,000 over the previous two weeks, rose by 30,000. This brings the number of forborne loans to 2.77 million or 5.2 percent of the country's 53 million active mortgages. Even with this uptick, the situation is much improved from the peak of 4.76 million loans in late May of this year and the number is down by 212,000 or 7 percent just from the same time in October. The greatest increase over the week was in loans serviced for FHA and the VA, up by 15,000 loans. Loans serviced for portfolio lenders or private label securities (PLS) were close behind with an increase of 14,000 plans while the GSEs Fannie Mae and Freddie Mac added 1,000 forborne loans to their totals. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Ellie Mae said the interest rate across all closed loans dropped below 3 percent for the first time in the nine years the company has been tracking the data. Ellie Mae is now a part of ICE Mortgage Technology, a division of Intercontinental Exchange, Inc., a NYSE listed firm. The company's Origination Insight Report shows that the 30-year note rate for VA loans was 2.75 percent, 3 basis points lower than in September, while the Conventional rate dipped from 3.02 percent to 3.01 percent and FHA loans held steady at 3.01 percent. The rate across all loans was 2.99 percent. With rates so low, refinances continued to dominate originations, reaching 60 percent of total closed loans in the month, up from 58 percent in September. This bested the 2019 high, which also was in October, by 9 percentage points but is well below the peak 2020 share of 65 percent in both April and May....(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The Federal Housing Finance Agency (FHFA) has reached another milestone as it tries to resolve the 12-year conservatorship of the GSEs. On Wednesday it released a new regulatory capital framework for Fannie Mae and Freddie Mac. The final rule, a revision of a proposal made in 2018, reflects the 128 comments made on the 2018 proposal and well as other outreach to stakeholders. FHFA says the final rule fulfills Congress's mandate in Housing and Economic Recovery Act of 2008 that FHFA establish risk-based capital requirements for the GSEs. It is intended to ensure their safety and soundness by increasing the quantity and quality of their regulatory capital and reducing the pro-cyclicality of the aggregate capital requirements....(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The hot home sales market continued unabated in October. The National Association of Realtors® (NAR) reports that existing home sales grew for the fifth consecutive month and 72 percent of homes that sold were on the market for less than a month. Single-family houses, townhouses, condos, and cooperative apartments sold in October at a seasonally adjusted annual rate of 6.85 million units. This was an increase of 4.3 percent from the September pace and 26.6 percent above the rate of 5.41 million sales in October 2019. Single-family home sales rose 4.1 percent to a seasonally adjusted annual rate of 6.12 million, up from 5.88 million in September. This was 26.7 percent above the pace a year earlier. The annual sales rate for existing condominium and co-ops was up 5.8 percent and 25.9 percent from the two earlier periods to 730,000 units. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Freddie Mac has published research examining the characteristics of borrowers who took advantage of the availability of forbearance plans in the early part of the COVID-19 pandemic. Mortgage forbearance temporarily removes the obligation for borrowers to make their monthly mortgage payment. Forbearance plans are typically used by borrowers who experienced a sudden loss of employment, a reduction in income or damage from a natural disaster. Freddie Mac looked at internal loan-level servicing information on forbearance of its mortgages during three different periods, comparing COVID forbearance rates from March to June 2020 against a baseline period running from January 2019 to February 2020 and the 2017 storms and recovery from August to December 2017. For that later period only loans eligible for disaster related forbearance programs were included. The analysis is restricted to 30-year fixed-rate mortgages, which were current and not in forbearance the month prior to the start of the observation period....(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Residential construction data for October was mixed. The U.S. Census Bureau and Department of Housing and Urban Development reported that the rate of permitting flattened and completions declined. Housing starts, usually considered the key number, continued to climb. Permits for residential construction were issued at a seasonally adjusted annual rate of 1,545,000 units, virtually identical to the September pace after its revision down from 1,553,000. Permits have grown by 2.8 percent year-over-year. The September rate had been higher than anticipated, so builders may now be working off a backlog. Still, October's permits were only slightly less than forecast. Analysts polled by Econoday had looked for a range of 1,520,000 to 1,600,000 with a consensus of 1,560,000....(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The Mortgage Bankers Association's (MBA's) November 2020 economic forecast ups the ante from its rosy October version. Its revisions are due to the strong pace of home sales and low interest rates which continue to fuel a refinancing boom. MBA has increased its prediction for total mortgage originations from the $3.175 trillion estimate in October to $3.39 trillion. This would be a 50 percent increase from the $2.25 trillion in total originations in 2019, and the highest total since 2003. Refinancing, of course, is the driver behind these numbers. By the end of the year MBA expects those originations to have increased by 91.5 percent year-over-year to $1.97 trillion, potentially the highest total since 2003. Purchasing volume has not been shoddy either. That total is expected to be the highest since 2005 at $1.42 trillion, representing annual growth of 16 percent. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Despite a healthy upward bump in purchase applications, overall mortgage volume declined last week. The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of application volume, dipped 0.3 percent on a seasonally adjusted basis during the week ended November 13, and was down 2 percent unadjusted. The week's results were not adjusted to account for the Veterans' Day holiday that occurred midweek. The Refinance Index was down 2 percent from the previous week but was 98 percent higher than the same week one year ago. The refinance share of mortgage activity decreased to 69.8 percent of total applications from 70.0 percent the previous week. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
For the third straight month the level of builder confidence in the new home market set a record high. The National Association of Home Builders (NAHB) said the Housing Market Index (HMI) it co-sponsors with Wells Fargo soared 5 points in November to 90. This is the highest level in the 35-year history of the HMI which set records of 83 in September and 85 in October. These are the only times in its history that the Index surpassed the 80-point level and is triple its level in April when the pandemic caused it to plunge. NAHB cautioned, however, that 69 percent of the survey responses were received before the results of the presidential election were called on Nov. 7. The election results and their future impacts on housing market conditions, will be more fully reflected in December's HMI report. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The National Association of Realtors® (NAR) said on Thursday that home prices have continued to grow in each of the 181 areas it tracks for its quarterly metro home price report. Both record-low mortgage rates and depleted inventories of existing homes for sale contributed to the annual growth. "Favorable mortgage rates will continue to bring fresh buyers to the market," said Lawrence Yun, NAR chief economist. "However, the affordability situation will not improve even with low interest rates because housing prices are increasing much too fast." Percentage price gains reached into the double digits in 65 percent or 117 of the areas. In comparison, only 15 metro areas recorded double-digit increases in 2020's second quarter. The biggest gainers in the third quarter were Bridgeport, Connecticut, (27.3 percent); Crestview, Florida. (27.1 percent); Pittsfield, Mass. (26.9 percent); Kingston, New York. (21.5 percent); Atlantic City, New Jersey (21.5 percent). ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The number of COVID-19 related forbearances plans headed downhill at an increasing pace over the last few week although there is no guarantee the improvement will continue. Black Knight says there was another 4 percent decline, representing 121,000 loans, over the past week. This brings the improvement in the number of plans since just the first of November to 416,000 loans or 9 percent. As of November 10, there were 2.735 million loans remaining in plans. This represents 5.2 percent of the 53 million active mortgage loans in servicer portfolios and an aggregate unpaid principal balance of $559 billion. Of the loans still in active forbearance, 81 percent have had their terms extended at some point since March. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Mortgage applications, especially for home purchases, pulled back from the previous week's level. The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of application volume, decreased 0.5 percent on a seasonally adjusted basis during the week ended November 6. On an unadjusted basis, the Index decreased 1 percent compared with the previous week. Refinancing remained the strength of the Composite Index and that component gained 1 percent week-over-week and was 67 percent higher than the same week one year ago. The refinance share of mortgage activity increased to 70.0 percent of total applications from 68.7 percent the previous week. ...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.