Feb 6, 2014 | Uncategorized
The Mortgage Bankers Association forecasts $1.2 trillion in mortgage originations during 2014, a 32 percent decline from 2013. Here’s a look at more key stats projected for 2014.
- Originations: Purchase originations are projected to increase to $723 billion in 2014, up from $661 billion in 2013. In contrast, refinances are expected to drop to $463 billion, which will result in total originations of around $1.2 billion. For 2015, MBA is forecasting purchase originations of $796 billion and refinance originations of $433 billion as total volume holds steady. The MBA expects a decline in the share of sales paid for with cash, and higher average LTVs on purchase mortgages, due to the rise in home prices.
- Mortgage Rates: The MBA estimates mortgage rates will increase above 5 percent in 2014 and then increase further to 5.5 percent by the end of 2015. As a result, mortgage refinancing will continue to drop, and borrowers seeking to tap the equity in their homes will be more likely to rely on home equity seconds rather than cash-out refinances. The market will potentially see a small increase in refinances toward the end of 2015 as the Home Affordable Refinance Program 2.0 expires.
- Existing Home Sales: Sales are forecasted to hold fairly even with 2013— which should finish around 5.13 million—at about 5.12 million in 2014. The average median existing-home price is projected to be about $209,000, up 6 percent from 2013 year-end estimates.
- New Home Sales: Likely to grow to 508,000 in 2014, housing starts are forecast to reach 1.13 million in 2014 compared to an estimated 917,000 in 2013.
- Real GDP: Growth will remain relatively weak through early 2014, at around 2 percent, due to a variety of uncertainties, particularly over U.S. spending and tax policies linked to the debt limit debate. The MBA expects the economy will grow somewhat faster in the second half of 2014 as some of these issues are resolved.
- 10-Year Treasury Rate: The 10-year Treasury rate is expected to stay below 3 percent into early 2014, but then increase more rapidly in the second half of 2014 as the Fed tapers its asset purchases and subsequently phases out the third round of quantitative easing (QE3). The MBA expects the Fed to begin tapering its asset purchases in early 2014, and ending QE3 in September 2014. The Fed funds rate will be kept near zero until mid 2015.
- Unemployment: The unemployment rate is expected to continue on a downward path due to falling labor force participation and job growth in the range of 150,000 to 170,000 jobs per month. The MBA expects the unemployment rate will decrease to 6.9 percent in 2014 and 6.5 in 2015.
Source: Mortgage Bankers Association, National Association of Realtors and American Land Title Association.
Jan 29, 2014 | Uncategorized
Earlier this month the Consumer Financial Protection Bureau updated the real estate settlement cost booklet “Shopping for yor home loan”. The booklet was which originally prepared by the U.S. Department of Housing and Urban Development (HUD).
According to the CFPB, certain changes were made to reflect new mortgage rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).
The booklet includes information about title services and title insurance. The it tells consumers that a lender’s policy only protects the lender’s interest. But it also informs consumers that “If you want to protect yourself from claims by others against your new home, you will also need an owner’s title insurance policy.” This is no change to the description of what HUD previously said in the booklet about owner’s title insurance.
The CFPB plans a larger update of the booklet, which will reflect the integrated mortgage disclosures under the Truth in Lending Act and the Real Estate Settlement Procedures Act and other changes under the Dodd-Frank Act. The changes are consistent with other CFPB resources and tools for consumers as part of the CFPB’s broader mission to educate consumers. View and download the booklet here.
Jan 11, 2013 | Uncategorized
The Mortgage Forgiveness Debt Relief Act of 2007 was created to protect homeowners who were foreclosing or short selling on principal residences and who had never refinanced by taking out a home equity line of credit. The Internal Revenue Service states that The Mortgage Debt Relief Act of 2007 allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.
The Mortgage Forgiveness Debt Relief Act of 2007 was originally set to expire in December 2009. However, the Act was extended in October 2009 only three months before the act was scheduled to expire. Over the past few months the expiration date of December 31, 2012 has been a looming deadline for strategically defaulting homeowners. Much to the housing industry’s relief an extension of this Act was granted during congressional fiscal cliff negotiations providing tax relief until December 31, 2013.
Aug 18, 2011 | Uncategorized
There are around 1.6 million homes in the U.S. in foreclosure or close to foreclosure, and the inventory of bank owned homes continues to grow. Market economists fear that a steady stream of home sales from banks may depress prices for years to come.
However, there is a chance that many of these bank owned homes may never hit the market. Banks are increasingly turning to demolition teams instead of real estate agents to dispose of many of the nearly worthless properties. Bank of America recently announced plans to demolish over 90 foreclosed homes in the Cleveland area. They will then donate the land to the local government authorities. Bank of America says that their donations in Cleveland are part of a larger plan to dispose of un saleable properties. According to a company spokesperson, these homes are worth less than $10,000. Bank of America has already donated homes in Detroit and in Chicago, and plans to do the same in other cities by the end of the year.
Many other banks are also increasing their efforts to dispose of their unwanted homes. Fannie Mae has a program to sell houses to local municipalities for around a few hundred dollars. Wells Fargo has donated 800 homes to be demolished since 2009. JPMorgan Chase is one of the first banks to begin donating houses it couldn’t sell, or identified as un repairable. Since 2008, the JPMorgan has donated or sold at a discount 1,900 houses to cities and county authorities. (more…)
Jun 30, 2011 | Uncategorized
Home Prices Down 7.4 Percent
Home prices in the U.S. increased by 0.8 percent in May 2011 compared to April 2011, the second consecutive month-over-month increase. On a year-over-year basis, home prices declined by 7.4 percent in May 2011 compared to May 2010 after declining by 6.7 percent* in April 2011 compared to April 2010. Excluding distressed sales, year-over-year prices declined by 0.4 percent in May 2011 compared to May 2010 and by 0.8* percent in April 2011 compared to April 2010. Distressed sales include short sales and real estate owned (REO) transactions.
Highlights as of May 2011
- Including distressed sales, the five states with the highest appreciation were: New York (+4.4 percent), Vermont (+3.9 percent), North Dakota (+3.8 percent), Hawaii (+2.5 percent) and the District of Columbia (+0.5 percent).
- Including distressed sales, the five states with the greatest depreciation were: Idaho (-16.4 percent), Michigan (-12.9 percent), Arizona (-12.1 percent), Illinois (-11.8 percent) and Nevada (-11.6 percent).
- Excluding distressed sales, the five states with the highest appreciation were: West Virginia (+10.1 percent), Hawaii (+9.0 percent), North Dakota (+8.6 percent), Vermont (+6.3 percent) and New York (+6.1 percent).
- Excluding distressed sales, the five states with the greatest depreciation were: Nevada (-9.8 percent), Idaho (-7.9 percent), Arizona (-7.0 percent), South Dakota (-6.1 percent) and Minnesota (-5.0 percent).
- Including distressed transactions, the peak-to-current change in the national HPI (from April 2006 to May 2011) was -32.7 percent. Excluding distressed transactions, the peak-to-current change in the HPI for the same period was -21.2 percent.
- Of the top 100 Core Based Statistical Areas (CBSAs) measured by population, 91* are showing year-over-year declines in May, unchanged from April.
“Two consecutive months of month-over-month growth and continued relative strength in the non-distressed market segment are positive seasonal signs in the housing market. Slowly declining shadow inventory and stabilized negative equity levels are also positive signs.” said Mark Fleming, chief economist with CoreLogic. “Nonetheless, the fragile economic recovery is still critical to the long-term recovery in the housing market.” © 2011 CoreLogic. All rights reserved. http://www.corelogic.com/
Jun 29, 2011 | Uncategorized
The average price of a single-family home rose for the first time in eight months in April and is now back at levels last seen in the summer of 2003, according to the Standard & Poor’s/Case-Shiller index.
