Guardian Residential Lending Industry News, February 14-21, 2019

Guardian Residential Lending Industry News, February 7-14, 2019
February 14, 2019
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February 28, 2019
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In the Know: A Roundup of This Week’s Local and National Real Estate Stories 

Home equity levels, interest rates, a market swing and more…

Good news, homebuyers, there are more homes for sale (Housing Wire, Feb. 20)

In January, inventory increases at the fastest rate in nearly four years. READ MORE

The rate of homes hitting the housing market is now at a 10-year high (HW, Feb. 19)

RE/MAX real estate agents say they now have more homes for sale than at any point in the last 10 years, according to the latest housing report. Some takeaways from the report:

  • Fifty-nine days on market was a record low for January sold listings.
  • The median sales price of $234,000 was a report record for January.
  • January’s 3.9-month supply is higher than last year’s 3.4-month supply.
  • 9 of the 54 metro areas surveyed reported a supply at or over six months, typically indicating a buyer’s market.


Portland home prices dip for first time in seven years (KGW, Feb 19)

Portland and the entire West Coast has been hot property for years. But the housing market has cooled down.

For the first time in seven years Portland home prices have gone down, according to new numbers from Regional Multiple Listing Service. They’re barely 1 percent cheaper though, so if you’re a buyer, don’t get too excited.

Portland and the entire West Coast has been hot property for years. But the housing market has cooled down. The median home price in the metro area is now $384,000. If you thought the crazy buying frenzy around 2015 was expensive, prices are 42 percent higher now.

Salaries are up 22% from then.  READ MORE

MarketWatch: 3 reasons why the housing market is showing signs of stress (HW, Feb. 14)

The economy is relatively healthy, yet the housing market is showing signs of stress for three reasons:

  1. Student debt
    Millennials comprise the largest customer base for mortgages, but many of them are saddled by student debt. A survey by the National Association of Realtorsrevealed that 46% of Millennials say they have a student loan balance of $25,000, and 49% said this was preventing them from obtaining a mortgage loan.

“When someone has too much student debt, they don’t have the cash to make a down payment on a mortgage, nor may they have the appetite to go further into debt,” Das stated. “That the largest group of home buyers is in this tenuous situation creates a significant drag on the mortgage market.”

  1. Lack of inventory 
    The country is suffering from a housing shortage – averaging a shortfallof 370,000 unit – and that is driving home prices way up. And, an increase in home prices is turning potential buyers off.

“Moreover, because of the surge in prices, home purchase sentiment has fallen. There has been a 12% decrease in Fannie Mae’s sentiment index, meaning that homebuyers aren’t as keen on purchasing a home,” Das wrote.

  1. Interest rate uncertainty 
    The Fed recently announced that it would hold offon raising rates for now, taking a patience stance instead. But for years Americans enjoyed low interest rates, and recent hikes have made financing more expensive – a tough nut to swallow.

“Now financing has become more expensive, and homebuyers are highly attuned to the increase in their payment amounts,” Das wrote.


Fed’s Bullard: Rate hikes, balance sheet reduction ‘coming to an end’ (CNBC, Feb. 21)

  • Louis Fed President James Bullard tells CNBC he thinks interest rate hikes and the reduction of bond holdings is near an end.
  • The central bank official says he expects a timetable to be finalized in “the next couple of months.”
  • Interest rates now are “a little too high,” he adds.


Here’s why the housing market should expect a cash-out refi boom (HW, Feb. 20)

Home equity levels are climbing while mortgage interest rates are falling, and this has some experts predicting an inevitable boom in cash-out refinances.

A recent report from Capital Economics said the number of cash-outs will rise over the next couple of years to a 10-year high.  READ MORE


Experts: Home equity is key to solving the country’s looming retirement crisis (HW, Feb. 18)

As Baby Boomers continue to retire en masse without sufficient savings to support their later years, it’s become glaringly apparent that the country is on the brink of a retirement crisis.

Pensions have dwindled, Social Security is insufficient, health care costs are rising and people are living longer than ever before, carrying little resources with them into retirement.

But many older Americans do have one major source of wealth at their disposal: their house. And for some, utilizing their home equity could be the answer to their late-in-life money problems.

That’s why some experts are insisting that reverse mortgages – which allow older homeowners to access their home equity and remain in their homes – are an important public policy that must be preserved for future generations.

Alicia Munnell, director of the Center for Retirement Research at Boston College, said tapping home equity is essential to solving the country’s retirement crisis.


HomeStreet Bank moves to sell off almost entire mortgage business (HW, Feb. 15)

HomeStreet announced Friday that it is planning to sell off its entire retail mortgage operation, which includes 72 home loan centers in five states, as well as nearly all the mortgage servicing rights associated with loans originated in those retail outlets.  READ MORE


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