Real Estate Brotha

05/24/2022

Signs are piling up that the housing market is cooling down

🔵Last month, 61% of home offers faced a bidding war — when an agent reported at least one competing bid — down from 63% in March and 67% a year ago on an adjusted basis

🔵In April, 76% of Americans in Fannie Mae’s Home Purchase Sentiment Index® (HPSI) said it’s a bad time to purchase a house, up from 73% in March.

🔵The volume of mortgage applications to purchase a home dropped 12% the week ending May 13 — the latest data available from the Mortgage Bankers Association (MBA)

🔵Nationally, the share of homes that were marked down in April increased 1.3 percentage points to 6.9% year over year.

🔵the rate on the 30-year fixed mortgage — the most common home purchase loan — inched down to 5.25% last week from 5.3% the prior one, per Freddie Mac

🔵Rising prices are also seeping into the home-building process, with building material costs up 19% from a year ago, according to Robert Dietz, chief economist at NAHB.

🔵Fannie Mae’s Duncan expects the slowdown to mean home sales this year will shrink 10% to 11% from 2021.

https://money.yahoo.com/housing-market-cooling-off-173703861.html

05/14/2022

Commercial and Multifamily Lending Surged in Q1

🔷The volume of commercial and multifamily mortgage loan originations jumped 72 percent in the first quarter of 2022 compared to a year earlier.

🔷lending with hotel properties leading the way at 359 percent. While multifamily lending was in fifth place, it still grew 57 percent, behind industrial properties at 145 percent, retail and health care properties (88 and 81 percent, respectively.) Office properties lending increased 30 percent.

🔷The largest quarter-over-quarter decline in originations was in the office category, down 48 percent. Multifamily lending fell 41 percent, hotels 38 percent, retail 32 percent, and industrial 29 percent.

https://www.mortgagenewsdaily.com/news/05122022-commercial-multifamily-lending

05/11/2022

Adjustable-rate mortgage demand surges to 14-year high, as homebuyers try to afford this pricey spring market

🟦Mortgage applications to purchase a home rose 5% last week compared with the previous week.

🟦The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.53% from 5.36%. The rate on a 5-year ARM was 4.47%.

🟦The share of ARMs increased to 11% of overall loans and to 19% by dollar volume.

🟦There is simply a very small pool of borrowers left who can benefit from a refinance at the current interest rates.

https://www.cnbc.com/2022/05/11/adjustable-rate-mortgage-demand-surges-to-14-year-high-as-homebuyers-try-to-afford-this-pricey-spring-market.html

05/07/2022

05/07/2022

‘The pandemic boom in home sales is over’: Mortgage rates soar to highest level since 2009 as the Fed pressures the housing market

🔷The 30-year fixed-rate mortgage averaged 5.27% for the week ending May 5

🔷The average rate on the 15-year fixed-rate mortgage rose 12 basis points over the past week to 4.52%

🔷Since the end of the Great Recession, the spread between the two has averaged 1.7 percentage points, but currently it hovers above 2%

🔷the Federal Reserve will continue to raise rates throughout this year into their view on the mortgage market

🔷the Fed will be shrinking its balance sheet of mortgage-backed securities which will impact on liquidity in the mortgage market and lenders would need to make up the difference by raising rates.

🔷rising rates and higher prices has cooled demand among home buyers and home listings remain few and far between

🔷Most economists anticipate that the housing market is balancing out, meaning that bidding wars and contingencies could soon become a thing of the past

https://www.marketwatch.com/story/the-pandemic-boom-in-home-sales-is-over-mortgage-rates-soar-to-highest-level-since-2009-as-the-fed-pressures-the-housing-market-11651760108

05/04/2022

We’re in a historically overvalued housing market, and these cities could see home prices drop 10%, Moody’s says

🟦over the past two months, the average 30-year fixed mortgage rate has spiked from 3.11% to 5.1%.

🟦In terms of house prices, I expect it [growth] to go flat…there will be markets where we will see a price decline of around 5% to 10%

🟦Higher prices and mortgage rates erode buyer affordability and should dampen demand in coming months, leading to the moderation in price growth in our forecast

https://fortune.com/2022/05/02/home-prices-in-these-housing-markets-could-fall-moodys-says/

05/01/2022

Foreclosure filings are up 132% from a year prior. Here’s what that means for the housing market (and it’s not what you might think)

⚫️That the number of active foreclosures edged up by more than 7,000 in March — the first year-over-year increase in almost 10 years

⚫️more than 78,000 U.S. properties had a foreclosure filing during the first quarter of 2022, which is up 39% from the previous quarter and up 132% from a year ago

⚫️serious mortgage delinquencies — those 90 or more days past due — are 70% higher than they were pre-pandemic

⚫️Even with the dramatic increase in Q1 foreclosure activity, we’re still running at about 50% of the normal level.

⚫️Foreclosures are at a very low level and the legal process can take months, so I don’t expect any real fallout from the foreclosure uptick

https://www.marketwatch.com/story/foreclosure-filings-are-up-132-from-a-year-prior-heres-what-that-means-for-the-housing-market-and-its-not-what-you-might-think-11651351836

05/01/2022

Closing on this property took almost 2 months… the reason tenant not paying rent. The solution… cash for keys. The listing agent worked diligently to get the tenants another place to live. It took so long that I need to extend my rate lock since the rates have gone up 1% since I got it under contract. To avoid paying extra dates to extend rate even further the tenant moved into Airbnb. The left a lot to clean up. Looking so much better. Few cosmetic changes and I’m ready to rent this duplex out.

05/01/2022

Locked up off market property with SMS texting campaign. It’s a 3/1 in St. Louis, MO. Great cashflow in class C neighborhood.

04/27/2022

FAU Economist: Leasing Property is Hedge Against Buying at Top of Market 

🔳Despite rapidly rising rents, prospective buyers in many U.S. markets could build long-term wealth as fast or faster by renting a similar single-family property and investing the money that otherwise would have been spent on owning. 

🔳The only six metro areas where buying and building equity beats renting are: Boston, Chicago, Cleveland, New York, San Francisco and Honolulu, Hawaii. 

🔳Even though rents are high right now and rising, renting becomes a hedge against locking in a home price that is too far above a market’s long-term pricing trend.

🔳The 17 markets where renting is better than buying are Atlanta, Cincinnati, Dallas, Denver, Detroit, Houston, Kansas City, Los Angeles, Miami, Milwaukee, Minneapolis, Philadelphia, Pittsburgh, San Diego, Seattle, St. Louis and Portland, Oregon.

🔳Of those, Dallas, Denver, Houston, Kansas City and Seattle strongly favor renting because home prices in those metros are quickly skyrocketing, putting recent buyers in danger of serious price declines once those markets level off

🔳Renting typically costs less per month than owning, after factoring in home maintenance costs, homeowner association dues and other fees

https://business.fau.edu/newsroom/press-releases/2022/more-consumers-should-rent-rather-than-own.php

04/26/2022

Another housing bubble? ‘We’re skating close to one,’ says Realtor.com economist

🔷Over the past 12 months, U.S. home prices are up a staggering 19.2%.

🔷The housing inventory on Zillow is down 52% from pre-pandemic levels.

🔷Black Knight’s mortgage-payment-to-income ratio was now up to 31%—the highest reading since September 2007.

🔷The swift move up in mortgage rates over the past few months has dramatically increased mortgage payments for new borrowers.

https://fortune.com/2022/04/24/the-housing-market-might-be-headed-for-another-housing-bubble-says-real-estate-economist/

04/24/2022

The top 20 U.S. cities renters flocked to in 2021 — 4 are in Texas

🟦The average rent in the U.S. for a one-bedroom apartment has increased more than 17% from its pre-pandemic level in February 2020

🟦Rental applications appear to be up 10% from 2020 to 2021,

🟦the analysts calculated the ratio of people moving into a city for every person that was leaving

🟦three are in the greater Dallas metropolitan area

🟦The majority of the renters moving to both Irving and Lewisville moved from Dallas proper

🟦Why Texas? Lots of jobs, low cost of living, and cheap property. Headquarters in Dallas American Airlines, AT&T, and Southwest Airlines. Austin manufacturing Tesla and Samsung. Census numbers back that up: Texas' population increased nearly 16% to more than 29 million

https://grow.acorns.com/amp/us-cities-renters-moved-to-most-in-2021/