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- The Inaugural Edition
The Inaugural Edition
Kelly Guest
July 08, 2024
July 8, 2024
The holiday week brought a new jobs report and the MBA notes it “doesn’t tell the whole story.” Meanwhile, National Mortgage News’ Kyle Campbell writes about how the way shelter costs are tracked is keeping inflation up, prolonging the wait for Fed rate cuts. For those curious about what consumers of different generations want in the lending and real estate processes for communication, technology and the latest trends, ServiceLink's 2024 State of Homebuying Report is an interesting read.
CHATTER
DID SCOTUS DECLAW THE CFPB? “Chevron Deference” Decision Could Impact Industry Watchdog
The U.S. Supreme Court cut back sharply on the power of federal agencies to interpret the laws they administer and ruled that courts should rely on their own interpretion of ambiguous laws. The decision will likely have far-reaching effects across the country, from environmental regulation to healthcare costs.
POOR POLL NUMBERS: T3 Sixty Finds Majority of RE Agents Unhappy with NAR
T3 Sixty released its mid-year flash poll and reports that 63% of real estate agents disapprove of The National Association of Realtors®' handling of the compensation lawsuits. And, 62% disapprove of NAR overall.
EX-EXCHANGE: NYSE announced that the warrants of Finance of America, traded under the ticker symbol “FOA.WS,” will be delisted from the exchange.
DOT-COM DISPUTES: Move Sues CoStar Group Alleging Theft of Trade Secrets
Move Inc. (parent company of Realtor.com) is suing CoStar Group (parent of Homes.com), alleging theft of portal data and inside info.
LUXURY JUST GOT RICHER: Douglas Elliman Gets $50M Growth Investment
Kennedy Lewis Investment Mgmt is pouring funds into the brokerage which operates in NY, FL, CA, CT, CO, MA, TX, DC, NV, NJ, BAHAMAS/INT’L. HW reports that “The first board appointment as part of this investment is David Chene, who is the co-founder and co-managing partner of Kennedy Lewis. The firm also announced that Patrick Bartels Jr., an independent director from Redan Advisors LLC, will join the board.”
INTROS & INNOVATIONS
SPRECHEN SIE MORTGAGE? HUD Translates 19 Loan Docs in 5 Languages
The translated docs are available in Chinese, Korean, Spanish, Tagalog and Vietnamese and will be available for FHA loans.
ROBOT ROCKET BOOSTER? Rocket Partners with AI Company Instabase
Rocket Mortgage is utilizing the Instabase platform to help automate data extraction to expedite the lending process. The release claims this helps facilitate loan closings 2.5 times faster than the industry average.
MOVING & SHAKING
ROCKET NAMES Heather Lovier COO: Lovier switched seats in the C-Suite from Chief Client Experience Officer and replaces Bill Emerson who will stay on as President.
ORIGINAL CFPB CAST MEMBER DEPARTS FOR GSE: Patrice Ficklin led the Consumer Financial Protection Bureau's fair lending office since its inception in 2011, returns to Fannie Mae as new Fair Lending Officer.
MARKET/INDUSTRY
JOBS JUMBLE: June Jobs Report Shows Employment up by 206K Jobs, Unemployment at 4.1%
MBA's Fratantoni says “the headline gain in nonfarm payroll employment data in June does not tell the entire story. [ ] Inflation data showing more reductions for the next couple of months will be the most important evidence that the Federal Reserve needs to cut rates in September. The current job market data points in that direction once you read below the headline.”
SLOWER GAINS: CoreLogic's May HPI Showed Slower Y-O-Y Home Price Nationwide
Prices rose 1.2% between April and May, 5.3% from May 2023 to May 2024. The forecast is +.08% from May to June 2024 and +3.7% from May 2024 to May 2025.
Source: CoreLogic
…BUT AFFORDABILITY STILL SUCKS: First Am Financial Adjusts Forecast
Apart from the fall of 2023, affordability in May reached its lowest level in over three decades. On a year-over-year basis, affordability declined by nearly 9 percent. Two factors drove the sharp annualized drop in affordability – a 5.9 percent annual increase in nominal house prices, according to our First American Data & Analytics House Price Index(opens in a new tab/window), and a 0.6 percentage point increase in the 30-year, fixed mortgage rate compared with one year ago.
ATTOM DATA PARROTS AFFORDABILITY ISSUES: Q224 US Home Affordability Report
Median-priced single-family homes and condos remained less affordable in Q224 compared to historical averages in 99% of counties around the nation with enough data to analyze.
The latest trend continued a pattern dating back to early 2022.
The report also shows that major expenses on median-priced homes consumed 35.1 percent of the average national wage in the second quarter – marking the high point since 2007 and standing well above the common 28 percent lending guideline.
INVENTORY, DOM UP – LIST TO SALE RATIO DOWN: House Canary’s June Market Pulse
There’s been an increase of 0.7% in net new listings and the number of properties that went under contract decreased 5.3%.
For the month of June 2024, 304,906 net new listings were placed on the market, and 302,003 properties went under contract. This represents an increase of 2.6% and 4.7%, respectively, versus June 2023.
Median days on market stands at 37. This is up 4.7% from where it was one year prior at 35 days on market.
The median price of all single-family listings in the US was $460,214 and the median closed price was $443,632.
On a year-over-year basis, the median price of all single-family listings is up 3.0% and the median price of closed listings is up 6.5%.
Month-over-month, the median price of single-family listings is down 0.2% and the median price of closed listings is up 2.4%.
Source: Freddie Mac
MORTGAGE RATES INCREASE:Freddie 7-3-24
Mortgage rates increased this week, coming in just under seven percent. Both new home and pending home sales are down, causing active listings to rise. We are still expecting rates to moderately decrease in the second half of the year and given additional inventory, price growth should temper, boding well for interested homebuyers.
Mortgage applications decreased 2.6 percent from one week earlier: MBA'S Weekly Survey for the week ending 6-28-24.
The Market Composite Index decreased 2.6% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 8% compared with the previous week.
The Refinance Index decreased 2% from the previous week and was 29% higher than the same week one year ago.
The seasonally adjusted Purchase Index decreased 3% from one week earlier. The unadjusted Purchase Index increased 7% compared with the previous week and was 12% lower than the same week one year ago.
The refinance share of mortgage activity increased to 35.7% of total applications from 35.1% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6% of total applications.
“Mortgage rates moved higher last week, crossing the 7 percent mark, even as the latest inflation data has kept market expectations alive for a rate cut from the Fed later this year. Purchase applications decreased the final full week of June, even as both new and existing inventories have increased over the past few months. Refinance activity also remains subdued – although there was a slight increase in applications for conventional refinance loans.” - Mike Fratantoni, MBA’s SVP and Chief Economist
HOMEBUYER AFFORDABILITY IMPROVED IN MAY: MBA's PAPI The national median payment applied for by purchase applicants decreasing to $2,219 from $2,256 in April according MBA’s Purchase Applications Payment Index (PAPI), which measures how new monthly mortgage payments vary across time – relative to income.
RENT CONTROL NO ES BUENO: Housing Solutions Coalition (in response to President Biden’s mention of capping rents during the Presidential debate)
“Decades of academic research from across the United States and around the world clearly show that rent caps – more commonly known as rent control – reduce the supply of available housing and fail to target those renters who need help the most while simultaneously harming other residents and the communities they reside in. Despite President Biden’s mention of rent caps during the debate, he and his policy experts know that the real reason so many Americans struggle with housing costs is because we need to build more housing. There is no debate. Rent caps hurt renters and communities.”