Guardian Residential Lending Industry News, December 5-12, 2019

Guardian Residential Lending Industry News, December 5, 2019
December 5, 2019
Guardian Residential Lending Industry News, December 12-19, 2019
December 19, 2019
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In the Know: A Roundup of This Week’s Local and National Real Estate Stories 

The first 3D-printed neighborhood; First-time homebuyer news and more…

Fed keeps interest rates unchanged, expects no moves in 2020 (Bankrate, Dec. 11)

The Fed closed out its last meeting of the year by voting to leave its benchmark interest rate alone. The move was widely expected, after policymakers signaled that they were comfortable with where borrowing costs were after three cuts this year.

But even though the Fed didn’t take action today, your wallet is still going to feel it. In total this year, the federal funds rate has been lowered 75 basis points (or 0.75 percentage points). That means the Fed has unwound the majority of the rate hikes it voted for in 2018.

Credit card and auto loan rates, as well as variable-rate home equity loans and home equity lines of credit (HELOCs) , are already lower from where they were a year ago. Meanwhile, the no-move decision suggests that yields on savings account or CDs likely won’t fall much further.

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VA loans are becoming more popular, driving an increase in Ginnie Mae’s support of housing market (HW, Dec. 10)

VA loans are now more than 40% of Ginnie Mae’s portfolio.

But the increase in VA loans and the increase in overall portfolio size haven’t been without issues.

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First-Time Homebuyer Market Rebounds in Q3 (The M Report, Dec. 10)

First-time buyers purchased 591,000 homes in Q3 2019, which is a year-over-year increase of 1%. 

First-time buyers represented 39% of all buyers in the single-family market and 55% of purchase mortgages. Since 1994, first-time buyers represent an average of 35% of all buyers and 46% of new purchase borrowers.

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Jobs growth soars in November as payrolls surge by 266,000 (CNBC, Dec. 6)

The jobs market turned in a stellar performance in November, with nonfarm payrolls surging by 266,000 and the unemployment rate falling to 3.5%, according to Labor Department numbers released Friday.

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The median age of homebuyers is now 47. How did that happen? (HW, Dec. 6)

According to Realtor.com, the median age has increased by eight years since the financial crisis. But the trend goes back further than that.

A new report from Deutsche Bank Research shows that the median age of homebuyers in 1981 was 31. Since then, it’s gone up 16 years and now sits at 47.

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U.S. unemployment rate falls to 50-year low (HW, Dec. 6)

Economy adds 266,000 jobs in November

“Today’s numbers point to a more competitive housing market next year,” Kushi said. “Job growth is steady, the unemployment rate fell to 3.5%, a 50-year low, and wages are rising modestly, which bolsters Americans’ spending power.”  That translates into more demand for homes, Kishi said.

“Housing is the most durable consumer good we’ll ever buy,” he said, “and surging house-buying power fuels greater potential demand in a supply-constrained market. There’s no evidence that these dynamics will change in 2020.”

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The 2010s changed how you shop for homes. Will the 2020s change the way you buy them? (Curbed, Dec. 9)

Real estate portals like Zillow and Redfin transformed the role of the realtor

In short, the realtor’s role in the 2010s changed from gatekeeper of the experience to trusted adviser who can guide buyers through the glut of information that’s now moved online.

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The Biggest Changes Coming in 2020 Real Estate—and What Buyers and Sellers Need to Do (Realtor.com, Dec. 4)

“In 2020, there will be opportunity for buyers, but in many ways the challenges they’ve faced for years are going to persist—challenges like difficulty finding the home that’s right for them, and competing with other buyers, especially in affordable price points,” says Danielle Hale, chief economist at realtor.com, whose team pulled together a forecast of housing trends for 2020.

There is a bright side, though: Mortgage rates are expected to remain reasonable, at an average 3.85%.

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Just for Fun

The world’s first 3D-printed neighborhood now has its first houses (Fast Company, Dec. 11)

A giant 3D printer is currently squeezing out new homes in rural Mexico. Each one takes 24 hours and lets local families upgrade from a shack to a two-bedroom house. Could this be part of the global housing solution?

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Thanks for reading!