Guardian Residential Lending Industry News, June 11-18, 2020

Guardian Residential Lending Industry News, June 4-11, 2020
June 11, 2020
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In the Know: A Roundup of This Week’s Local and National Real Estate Stories

Mortgage Rates Tumble to Another All-Time Low (HW, June 18)

Mortgage rates in the U.S. tumbled to another all-time low this week as bond investors reacted to reports showing the economy is struggling amid the COVID-19 pandemic.

The average rate for a 30-year fixed mortgage was 3.13%, down from 3.21% last week, Freddie Mac said in a statement Thursday. It was the second time in two weeks the rate set a new low in a data series that goes back to 1971. The average 15-year rate fell to 2.58%, the lowest in seven years, according to the mortgage financier.

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Homebuyer mortgage demand spikes to 11-year high, as rates hit another record low (CNBC, June 17)

Buyers are rushing back into the housing market, enticed by record low mortgage rates and a pandemic-induced need to nest like never before.

Mortgage applications to purchase a home rose 4% last week from the previous week and were a remarkable 21% higher than one year ago, according to the Mortgage Bankers Association’s seasonally adjusted index. That was the ninth consecutive week of gains and the highest volume in more than 11 years.

“The housing market continues to experience the release of unrealized pent-up demand from earlier this spring, as well as a gradual improvement in consumer confidence,” said MBA economist Joel Kan.

Buyers were also fueled by a new record low mortgage rate.

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Homebuilder sentiment posts biggest monthly surge ever, a sign housing is rebounding from coronavirus (CNBC, June 16)

A faster-than-expected turnaround in homebuyer demand, following a sharp drop-off at the start of the coronavirus pandemic, has the nation’s homebuilders bullish on their business again.

Builder sentiment jumped a striking 21 points in June to 58, the largest monthly increase ever in the National Association of Home Builders/Wells Fargo Housing Market Index. Any reading above 50 indicates a positive market. In April, it plunged a record 42 points to 30.

“As the nation reopens, housing is well-positioned to lead the economy forward,” said NAHB Chairman Dean Mon, a homebuilder and developer from Shrewsbury, New Jersey. “Inventory is tight, mortgage applications are increasing, interest rates are low and confidence is rising.”

Meanwhile, mortgage applications to purchase a newly built home jumped 10.9% annually in May, according to the Mortgage Bankers Association.

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Homeownership Among Single Women Rising (The M Report, June 17)

In a blog post by First American, Deputy Chief Economist Odeta Kushi said that single women are playing a large role in the rising homeownership levels since 2016.

The homeownership rate for single women (including widowed, separated, or divorced) was 2.2% higher than single men, according to new data. Also, a 2018 report by Bank of American found that single women prioritize owning a home more than single males (73% vs. 65%).

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Google will make it impossible for lenders and Realtors to target consumers based on ZIP code, demographics (HW, June 12)

Goal is to prevent housing discrimination

Google announced it is tightening its policies, prohibiting employment, housing and credit advertisers from targeting or excluding ads based on certain demographics and ZIP codes.

The company explained that it has long prohibited advertisers from targeting users based on “sensitive categories” related to their identity, beliefs, sexuality or personal hardships. This means the company doesn’t allow targeting based on categories like race, religion, ethnicity, sexual orientation, national origin or disability.

But now, Google is adding several new categories to that list to improve access to housing, employment and credit opportunities.

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42% of people who bought homes during the pandemic engaged in a bidding war (HW, June 17)

The COVID-19 pandemic upended just about everything this year, and that includes much of the home-buying process. A new study from Clever revealed that homebuyers who bought between January and May this year are twice as likely to have anxiety and stress than those who bought in the last five years.

The study also showed that 42% of homeowners who made a purchase during the January to May time period ended up in a bidding war, demonstrating the strong demand for homes amid low inventory.

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Online listing views show renewed interest in migration to suburbs (HW, June 17)

Homeowners interest in outlying areas seeing increase from last year

In new data released by realtor.com on Wednesday, listing views in suburban ZIP codes grew 13% in May, nearly doubling the pace of growth in urban areas.

Suburban listing views in May 2020 surpassed listing views from May 2019, realtor.com said, as well as the start of the year. Of the nation’s 100 largest metros, 54% are seeing more interest in the suburbs.

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Fannie Mae sees record-low mortgage rates through 2021 (HW, June 15)

The 2020 and 2021 annual averages will be lowest on record, according to the forecast

The cheapest mortgage rates on record are heading lower, Fannie Mae said in a forecast on Monday.

According to Fannie Mae, the annual average rate for 2020 will be 3.2%, down from 2019’s 3.9%. This would beat the record of 3.65% set in 2016, according to Freddie Mac data. Fannie Mae expects rates to drop to 2.9% in 2021.

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Brown allows Multnomah County to enter phase 1, requires face masks indoors in public (PBJ, June 17)

Oregon’s largest county is finally getting a green light to begin reopening. Multnomah County can enter the first phase of easing Covid restrictions Friday, joining the rest of the state, Gov. Kate Brown announced Wednesday. It will remain in phase 1 for 21 days, along with Clackamas and Washington counties.

Brown also announced that face masks will be required in grocery stores and other indoor public places in the three Portland area counties as well as in Hood River, Polk, Marion and Lincoln counties starting June 24.

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Thanks for reading, and be well.