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Home Price

Apache is functioning normally

June 7, 2023 by Brett Tams

According to realtor.com, the March 2023 median listing home price in Lexington, KY was $339.9K. This shows an upward trend of 7.9% year-over-year, which is good news for homeowners concerned with the economic situation in the US. Redfin points out that the market there is still highly competitive, with the average home receiving at least 6 offers, and the average sale coming within 22 days. Judging from the list of agents we went through to select the four below, the region has above average professionals handling the deals as well. Here’s four of Lexington’s best.

allnutt 2

Sandy Allnutt, of The Agency, has one of the nicest Facebook page’s we’ve seen in some time. A perfect mix of info/relevance and personality, this social channel should be a template for how agents operate their pages. Allnutt’s 319 perfect reviews on Zillow, and 120 stellar ones on Google cement her place in our list as one of the region’s top professionals. Throw in an effective Instagram channel, a useful (if mediocre looking) website, and you’ll quickly put Allnutt in the same category as the best agents in America. 

The well traveled agent has operated out of Lexington since 1989, and seems to have turned over every marketing rock for her firm’s clients. The group has a useful but sparse YouTube channel, and some media mentions locally. Where Allnutt really shines in on LinkedIn, where she’s networking with over 1,300 business professionals. One of these days we should quiz agents to see how many leads/sales come from LI. 

Website, Facebook, Contact # 1-859-699-4663

Kymberly Clem – McCreary is the “mover” in this list of top agents. With her small team, she’s managed almost 80 sales in the past year. That may not sound like a lot, but for a professional woman who’s only been in real estate for just over 3 years, it’s an accomplishment. The former Lockheed Martin exec, has also put together a fairly impressive digital marketing scheme. 

Looking at her linktr.ee breakdown, I see she’s covered every base to let potential clients connect with all her profiles, bios, and listings. Facebook to LinkedIn, she’s engaged remarkably well during such a short span of time. One thing I find particularly telling is the fact this professional is already making use of TikTok. She’s got over 500 followers there already. The YouTube channel needs a lot more content and followers, but what she’s posted so far is very nice. 

A last note, Kymberly also opted to be a Premier Zillow Agent, and I would not be surprised to see Google Ads for he agency either. If this U.S. Army veteran’s efforts have one negative point, it’s that the website could use some more SEO attention (60% score) and aesthetics. Other than this, and more local media notice, she’s on track to be the leading agent in this part of Kentucky. 

Website, Facebook, Contact # 1-859-248-1142

kim
nick

Nick Ratliff sold 102 homes in the past 12 months. On Zillow, he has over 200 perfect reviews. Even more impressively, he has received 273 perfect Google reviews. The former Better Homes & Gardens agent also has the best website in this group, SEO-wise at least, with a score of 70%. Functionally, his site is top notch too. 1,600 followers on Facebook, a useful YouTube channel, 1,100 followers on LinkedIn, etc. etc. etc.

Ratliff is doing all the right things, albeit maybe not as diligently/powerfully as he should. The agent seems to have devoted a lot of time and effort on Twitter, which would be better used on Facebook or doing media outreach to get mentions of his company. Twitter is a horrible conversion network, and will remain so unless Elon Musk gets creative. 

Website, Facebook, Contact # 1-859-554-2075

Deborah Back’s team, The Brokerage, is one of Kentucky’s most successful real estate groups. The team has almost 280 perfect Zillow reviews, and ticks all the boxes in social media marketing. One thing that differentiates this broker from many others, is the fact her team has gotten the website/web billboard right. Their website is very nice aesthetically, even though it only scores 59% for SEO. 

Another plus in Back’s favor is the team’s effective Instagram channel, which could be a bit more creative. Also, The Brokerage business page on LinkedIn shows that the team is growing at a decent clip of almost 10% per year, with agents of 3.5 years tenure. This is a good sign of a healthy real estate entity. If Deborah and the team could rejuvenate her YouTube channel with some helpful videos, and work on SEO and boosting social a bit, the company would surely prosper even more.  

A last note on Back, it’s indicative of her role that there is not a single photograph of her alone anywhere on the web that we are allowed to use (copyright). So, I took this one on the right from her Twitter account. The caption reads “Rise and Shine.”

Website, Facebook, Contact # 1-859-983-2717 

Bach 2

Special update: We were informed by a reader that the original photo of Nick Ratliff was incorrect. We have replaced it with a version from the agent’s website.

Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.

Latest posts by Phil Butler (see all)

Source: realtybiznews.com

Posted in: Paying Off Debts Tagged: 2023, agent, agent profiles, agents, Agents/Brokers, All, average, best, Blogging, Broker, brokerage, brokers, business, company, Deals, Deborah Back, Digital, digital marketing, estate, facebook, Featured News, Financial Wize, FinancialWize, good, Google, Google reviews, healthy, helpful, home, Home Price, homeowners, homes, in, Instagram, Kentucky home sales, kentucky real estate, ky, Kymberly Clem - McCreary, lexington, list, Listings, Local, making, market, Marketing, Media, More, needs, networking, News, nick, Nick Ratliff, offers, or, Original, Other, personality, place, points, price, Professionals, Real Estate, Real Estate Agents, Real Estate Marketing, realtor, Realtor.com, Redfin, Reviews, right, rise, sale, sales, Sandy Allnutt, SEO, short, single, social, Social Media, social media marketing, Tech, TikTok, time, top agents, trend, Twitter, update, will, woman, work, youtube, Zillow

Apache is functioning normally

June 7, 2023 by Brett Tams

All 12 Federal Reserve districts have seen issues with a lack of housing inventory, which is largely due to existing homeowners holding back on listing their homes after previously locking in low mortgage rates. 

Demand from the buyer side has remained steady or increased, however, and new home builders have responded to inventory shortages by increasing speculative inventory production, according to the Federal Reserve Beige Book, released Wednesday. 

The Beige Book is a compilation of data and interviews with bank and branch directors, community organizations and economists from on or before May 22.

“Residential real estate activity picked up in most Districts despite continued low inventories of homes for sale,” the report states. 

The Beige Book also notes that “home prices and rents rose slightly on balance in most Districts, after little growth in the prior period.”

In return, the lack of inventory of homes for sale pushed demand for rental properties in some areas — including New York, Chicago, St. Louis, Kansas City Federal Reserve districts.

Following are excerpts of statements on housing conditions from each of the 12 Federal Reserve districts. 

***

Boston – Contacts around the District attribute the still-low sales numbers to low inventories more than to weak demand, as slightly lower mortgage rates have helped bring more buyers to the market.

House price appreciation has slowed on average but remains slightly positive, with the exception that home prices in Massachusetts (not including Boston) have experienced modest declines from a year earlier. The modest price growth in the Boston area marks a trend reversal from the preceding few months. 

Contacts anticipate that, despite healthy buyer demand, home sales are likely to experience only a modest seasonal increase moving forward, owing to extremely low inventory levels.

New York – The residential sales market has been strong across the District. A New York City-area contact reports that the sales market in and around New York City has picked up strongly in recent weeks after a brief pause in early April, which was due to uncertainty in the banking sector.

After a slow start to the year, housing markets in upstate New York have also started to pick up, with bidding wars and multiple offers becoming more common. Inventory remains exceptionally low and is restraining sales activity in much of the District. A key factor suppressing new listings is the prevalence of homeowners with historically low interest rates on their existing mortgages, reducing the incentive to sell and move.

A strong economy and relatively high mortgage rates have pushed some movers to the rental market, boosting demand.

Philadelphia –  High interest rates have continued to dissuade existing homeowners from listing their house and losing their low interest rate. Existing home sales have fallen moderately in this district, and prices have continued to rise as the market heats up again. New home builders have benefited from the unseasonably modest sales of existing homes as the resale market has slowed. 

Cleveland – Demand for residential construction and real estate has stabilized in this District, and contacts attribute this stabilization to the arrival of spring and flattening interest rates.

Homebuilders have reported an increase in speculative construction projects in this District, as many buyers want to purchase and move into homes immediately, in part to avoid further rises in interest rates.

Richmond – Residential real estate respondents indicate in the report that the spring market is off to a good start, with sales prices continuing to appreciate, but not at the same pace as last year. For-sale inventory remains constrained due to fewer people putting their homes on the market, but buyer traffic has been steady while the days on market has increased slightly in the last month. 

However, fluctuations in mortgage rates have caused buyers to pull back, with pending sales and closed sales both down in this District. Builders have been offering strong incentives to close deals. 

Atlanta – Housing demand throughout the District has remained strong despite interest rate and home price volatility. Though home sales are down compared to a year ago, sales in many markets in this District have increased on a monthly basis, as buyer sentiment has modestly improved. 

The supply of existing homes for sale has remained low as homeowners have showed increased hesitancy to list homes for sale, especially if they financed at a low interest rate. Home prices remain down from peak levels but have recently shown month-to-month improvement.

New home builders have responded to inventory shortages by increasing speculative inventory production, and some have begun to reduce buyer incentives.

Chicago – Residential construction activity has been down modestly in this District. Contacts report that high-interest rates have led some projects to be postponed or canceled and that while construction costs had fallen, the decline isn’t enough to offset higher financing costs. 

Residential real estate activity has decreased modestly as well. Prices and rents have declined, and the low inventory of homes for sale has helped to prevent larger declines.

However, there have been reports of rising retail rents in some areas because of a lack of high-quality new construction.

St. Louis – Rental rates for residential real estate have increased slightly in this District. The number of new listings in residential real estate have dropped sharply in Louisville since our previous report, while new listings in the Memphis and Little Rock regions have remained unchanged. Seasonally adjusted home sales have remained unchanged since the previous report. 

Minneapolis – Residential construction has remained subdued. Single-family permitting in April was more than 40 percent lower year over year in the Minneapolis-St. Paul region; most other large markets in the District saw even bigger declines. Discounts have started to appear for some speculative developments.

Closed (residential real estate) sales in April fell notably year over year across the District, with many larger markets seeing declines of 30 to 50 percent. Median sale prices have declined in western and central Montana and have been flat in several other markets. 

Kansas City – Housing rental rate growth has remained elevated in several western District states, but the pace of increases has declined broadly and swiftly from the growth rate experienced during the past year. 

Dallas – Housing demand broadly has held up in the Dallas District, though sales have continued to be weaker than a year ago. Contacts have noted a decent spring selling season, with prices largely stable, and builders have been able to raise prices slightly in selected areas.

Outlooks have been cautious, however, with some voicing concern about whether demand would hold up beyond the spring selling season.

San Francisco – Activity in residential real estate has slowed further in this District. Contacts across the District have reported stable demand for single-family homes, although high mortgage rates have restrained prices. Existing single-family inventory has been low, and owners appeared hesitant to forego their existing low-rate mortgages by listing their homes.

Despite reported improvement in the availability and cost of materials, construction of new homes has been flat-to-down as developers responded to higher financing costs.

Source: housingwire.com

Posted in: Paying Off Debts, Real Estate Tagged: About, All, Appreciate, appreciation, atlanta, average, balance, Bank, Banking, before, Beige Book, bidding, bidding wars, book, boston, builders, buyer, buyers, chicago, city, construction, contacts, cost, dallas, data, days on market, Deals, Discounts, Economy, estate, existing, Existing home sales, experience, Family, Federal Reserve, Financial Wize, FinancialWize, financing, good, growth, healthy, hold, home, home builders, Home Price, home prices, Home Sales, Homebuilders, homeowners, homes, homes for sale, house, Housing, housing demand, Housing inventory, Housing market, Housing markets, improvement, in, interest, interest rate, interest rates, Interviews, inventories, inventory, inventory levels, Kansas City, list, Listings, Little Rock, louisville, low, Low inventory, low mortgage rates, LOWER, market, markets, Massachusetts, memphis, minneapolis, montana, More, Mortgage, Mortgage Rates, Mortgages, Move, Movers, Moving, multiple offers, new, new construction, new home, new listings, new york, new york city, offers, or, Other, percent, price, Prices, PRIOR, projects, Purchase, quality, Raise, rate, Rates, Real Estate, Real Estate Listings, rental, rental market, rental properties, resale, Residential, residential real estate, return, rise, rose, sale, sales, san francisco, seasonal, sector, Sell, selling, shortages, Side, single, single-family, single-family homes, Spring, St. Louis, stable, states, trend, Upstate New York, volatility

Apache is functioning normally

June 7, 2023 by Brett Tams

Let’s talk mortgage basics: “What is the loan-to-value ratio?”

If you’re currently shopping for a home or already going through the mortgage loan process, chances are you’ve heard the phrase loan-to-value ratio get thrown around on more than one occasion.

You may have also encountered the acronym “LTV” while perusing mortgage advertisements or playing around on mortgage rate comparison websites.

Regardless of what’s going on in the housing market, you should know all about this very important term when applying for a home loan.

Why? Because it can greatly affect mortgage rate pricing, refinance options, and overall loan eligibility.

How to Calculate the Loan-to-Value Ratio (LTV)

loan to value ratio

  • It’s actually one of the easiest calculations you can make
  • Simply divide the loan amount by the appraised value or purchase price
  • And you’ll wind up with a percentage known as your LTV
  • The tricky part might be agreeing on a sales price and getting the home to appraise at value

Simply put, the loan-to-value ratio, or “LTV ratio” as it’s more commonly known in the industry, is the mortgage loan amount divided by the lower of the purchase price or appraised value of the property.

If we’re talking existing mortgages (in the case of refinance loans), it’s the outstanding loan balance divided by the appraised value.

When calculating it, you will wind up with a percentage. That number is your LTV. And the lower the better here folks!

It’s actually very easy to calculate (no algebra required) and takes just one step. You don’t even need a mortgage calculator. In fact, you might be able to run the numbers in your head. Honest!

Let’s calculate a typical LTV ratio:

Property value: $500,000
Loan amount: $350,000
Loan-to-value ratio (LTV): 70%

In the above example, we would divide $350,000 by $500,000 to come up with a loan-to-value ratio of 70%.

Using a basic household calculator, not a so-called “LTV calculator,” simply enter in 350,000, then hit the divide symbol, then enter 500,000. You should see “0.7,” which translates to 70% LTV. That’s it, all done!

This means our hypothetical borrower has a loan for 70 percent of the purchase price or appraised value, with the remaining 30 percent the home equity portion, or actual ownership in the property.

LTV ratios are extremely important when it comes to mortgage rate pricing because they represent how much skin you have in the game, which is a key risk factor used by lenders.

A Lower LTV Ratio Means More Ownership, Better Mortgage Rate

low LTV low rate

  • The lower your loan-to-value ratio the more home equity or down payment you have
  • Which is another way of saying ownership or skin in the game
  • A low LTV equates to a lower mortgage rate because you’re viewed as less risky
  • It means the bank is risking less since you are more invested in the underlying property

Essentially, the lower the loan-to-value ratio, the better, as it means you have more ownership (home equity) in the property.

Someone with more ownership is less likely to fall behind on payments or foreclose, seeing that they have a greater equity stake, aka financial interest to keep paying the mortgage each month.

They’ve also got more options if they do struggle with payments, as they could just sell the property without taking a loss (or the bank losing money).

Not only that, but banks and mortgage lenders also set up pricing adjustment tiers based solely on the LTV ratio.

Those with lower LTV ratios will enjoy the lowest interest rates available, while those with high LTVs will be subject to higher mortgage rates and/or closing costs.

For example, if you’re being “hit” by the lender for having a less-than-stellar credit score, that adjustment will grow larger as the loan-to-value ratio increases (higher LTV ratio = greater risk).

So if your mortgage rate is bumped a quarter percent higher for a loan-to-value ratio of 80%, that same pricing hit may be increased to a half percentage point if the LTV ratio is a higher 90%.

This can certainly raise your interest rate in a hurry, so you’ll want to look at all possible scenarios with regard to down payment and loan amount to keep your LTV ratio as low as possible.

More importantly, just maintain an excellent credit score and you’ll have plenty of loan options, regardless of your chosen down payment or available home equity.

80% LTV Is a Very Important Threshold!

80% LTV

  • Keep your mortgage at/below 80% LTV if you want to save money
  • You won’t have to pay private mortgage insurance (PMI)
  • And it should result in a lower mortgage interest rate with fewer pricing adjustments
  • You’ll also enjoy greater lender choice as most banks will lend up to 80% LTV

Most borrowers (who have the means) elect to put 20% down when buying a home, as it allows them to avoid mortgage insurance and the much higher pricing adjustments often associated with LTVs above 80%.

Fewer adjustments mean you can secure a lower interest rate on your mortgage. And if you can avoid PMI at the same time, it’s a win-win for your monthly housing payment!

You may also find it easier to get approved, as virtually all banks and mortgage lenders will accept LTVs of 80% or less.

But you don’t necessarily need to put 20% down to enjoy the benefits of a low-LTV mortgage.

Also Get to Know the Combined Loan-to-Value Ratio (CLTV)

Looking at the above example again, if you were to raise the first mortgage amount to $400,000 and add a second mortgage of $50,000, the combined loan-to-value ratio, or CLTV as its known, would be 90%.

Banks and mortgage lenders have both LTV and CLTV limits, meaning they won’t allow homeowners to borrow more than say 80, 90, or 100 percent of the property value.

These limits came down after the Great Recession but are creeping back up again…

Let’s do the math here; again, no mortgage calculator required!

Simple math: $400,000 + $50,000 = $450,000 / $500,000 = 90% CLTV

You would have a first mortgage at 80% LTV, and a second mortgage for an additional 10% LTV, making the CLTV 90%. Simply add up both numbers.

Sometimes borrowers elect to break up home loans into a first and second mortgage, known as combo mortgages.

This keeps the loan-to-value ratio below key levels, thereby reducing the interest rate and/or helping the homeowner avoid private mortgage insurance.

Tip: The undrawn portion of a home equity line of credit (HELOC) typically isn’t included in the CLTV calculation.

Max LTV by Home Loan Type

max LTV

  • FHA loans go as high as 96.5% LTV (3.5% down payment)
  • Conforming loans (Fannie/Freddie) go as high as 97% LTV (3% down)
  • USDA and VA loans go to a full 100% LTV (zero down)
  • Jumbos, cash-out refis, and investment properties are much more restrictive
  • And there is no maximum LTV in many cases for streamline refinances

There are certain LTV limits based on home loan type, with conventional loans (non-government) typically being more restrictive than government loans.

And mortgage refinance programs often less accommodating than home purchase loans.

At the moment, you can get an FHA loan as high as 96.5% LTV, which is just 3.5% down payment.

You can get a conventional loan as high as 97% LTV, which at just 3% down is higher than it used to be.

In recent history, the maximum was 95% LTV, but now Fannie Mae and Freddie Mac are competing directly with the FHA.

[See FHA vs. conventional for more on that.]

You can get either a VA loan or USDA loan at 100% LTV (which represents no money down).

These are the most flexible loan programs LTV-wise, but they are also only available to veterans or those living in rural areas, respectively. So not everyone will qualify for these types of mortgage loans.

There are also proprietary home buying programs from various private mortgage lenders that allow for 100% LTV financing if you take the time to shop around.

If it’s a jumbo home loan, a cash-out refinance, or an investment property, the loan-to-value will be a lot more limited, potentially capped at just 70-80% LTV, depending on all the attributes.

And finally, those underwater or upside down borrowers you hear about; they owe more on their mortgage than the property is currently worth.

This can happen due to negative amortization and/or home price depreciation.

A quick underwater loan-to-value ratio example:

Property value: $400,000
Loan amount: $500,000
Loan-to-value ratio (LTV): 125%

As you can see, the underwater borrower has a LTV ratio greater than 100% (this equates to negative equity), which is a major issue from a risk standpoint.

For the record, you get 1.25 by dividing 500 by 400.

The problem with homeowners in these situations is that they have little incentive to stick around, even with a modified mortgage payment, as they’re so far in the red that there’s little hope of recouping home value losses.

However, the popular Home Affordable Refinance Program (HARP) allowed millions of underwater homeowners to refinance to lower rates with no LTV limit. And many of these folks are probably now back in the black.

Today, this type of program still exists, but is a permanent option known as a high-LTV refinance, or HIRO for short.

So there are options to refinance and get a lower interest rate, as long as your loan is owned by Fannie Mae or Freddie Mac, no matter the mortgage balance relative to the property value.

Same goes for FHA loans and VA mortgages thanks to the FHA streamline refinance and the VA IRRRL option.

Despite being far behind new homeowners entering the market in terms of building home equity, many of these formerly-underwater borrowers now have lots of equity thanks to rising home prices and several years of paying down their mortgages.

That’s why you have to consider the long-game in real estate and never give up, even when times get tough. This also illustrates why home buying shouldn’t be a quick or hasty decision.

A Lower Loan-to-Value Can Save You Money!

  • A lower LTV generally results in a better interest rate
  • Which means cheaper monthly mortgage payments
  • It puts more of your hard-earned dollars toward the principal balance each month
  • Potentially saving you thousands of dollars over the life of the loan!

As noted, a lower LTV will likely result in big savings thanks to a lower interest rate.

Additionally, you may be able to avoid costly private mortgage insurance, enjoy expanded loan program eligibility, and have an easier time getting approved for a mortgage.

If your LTV is higher than you’d like it to be, there are some creative options to lower it.

Borrowers Can Reduce Their LTV in a Variety of Ways

  • Come in with a larger down payment if it’s a home purchase loan
  • Ask for gift funds to increase your down payment
  • Or break your mortgage up into two separate loans (combo loan)
  • Make extra payments or a lump sum payment for a refinance to get the LTV down before you apply
  • Or simply wait for natural amortization and home price appreciation to lower your LTV over time

If we’re talking about a home purchase, simply bring in more down payment money and the LTV will be lower. Easier said than done, sure, but possible for some.

Perhaps someone will gift you the money or act as a co-borrower?

Alternatively, you can look into breaking up your financing into two loans, with both a first and second mortgage.

If it’s a mortgage refinance, simply pay down the mortgage balance a bit more before you apply, whether on schedule or by making extra mortgage payments.

This can be especially helpful if you’re super close to a certain LTV threshold, or just above the conforming loan limit.

Speaking of, pay close attention to your LTV – if it’s just above 80% or some other meaningful tier, think about adjusting your loan amount down (your loan officer should advise you here!).

Lastly, there’s another way existing homeowners can get their LTV down and it requires no effort whatsoever.

You don’t have to do anything except sit back and watch your property value increase over time, thereby lowering your LTV in the process. Of course, the opposite can happen too if home values drop!

But as noted, real estate should be treated with a long time horizon, so be sure you have the ability to ride the ups and downs and make moves when it’s most favorable to you.

Read more: 10 ways to build home equity.

Source: thetruthaboutmortgage.com

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Apache is functioning normally

June 7, 2023 by Brett Tams

While it’s hard to compare the current possible housing crisis to the very real one experienced about a decade ago, there are fears of negative market impact due to COVID-19.

We’ve already seen listing prices fall, along with a big jump in delistings, where home sellers pull their properties off the market.

And home purchase mortgage applications continue to plummet, especially in large metros like LA, NY, and Seattle, per the MBA.

purchase apps

Meanwhile, real estate brokerage Redfin revealed via an SEC filing that it was laying off 7% of its workforce, which could result in roughly 236 job losses.

Then we have Wells Fargo curtailing its mortgage menu, and ARMs pricing higher than fixed-rate mortgages.

The number of mortgages in forbearance has also surged 1000%, and is likely to get a lot worse the longer this goes on.

The real estate and mortgage industry certainly isn’t operating as usual, and it’s even reminiscent of times back in the early 2000s.

Temporary Inability to Pay the Mortgage?

  • The housing crisis a decade ago was driven by shoddy financing
  • Such as stated income, option ARMs, interest-only loans, and so on
  • This potential crisis is being driven mostly just by loss of income due to COVID-19
  • As long as it’s temporary it shouldn’t create too many problems for the housing market

This time around, the number one issue is inability to make mortgage payments due to loss of income or unemployment as a result of coronavirus.

Either companies have laid off staff due to a loss of business, or small business owners have taken a hit because they’ve had to close up shop.

Others might just be experiencing a temporary loss of income or a pay cut while companies navigate the uncertain waters ahead.

Whatever the situation, the problem seems to center around capacity to pay, as opposed to being overleveraged, or holding a home loan with some creative financing terms like interest only or an exploding ARM.

Homeowners could mostly afford their monthly mortgage payments before this unforeseen event took place, unlike the crisis that took place in the early 2000s.

Back then, borrowers took out mortgages they couldn’t afford, and serially refinanced them as their inflated home values grew.

Today, many homeowners have a sizable equity cushion, partially because cash out refinance volume has been very low, and also because home prices have risen a ton over the past decade.

This puts them in a much better position than those homeowners from 2006 who purchased a property with zero down financing and stated their income on the application.

That’s the good news. The bad news is many housing markets were already vulnerable before COVID-19 hit, and thus could see some an uptick in foreclosures if this plays out for a long period of time.

Almost Half of the 50 Most Vulnerable Counties Are in Florida and New Jersey

  • 14 of the highest risk counties can be found in New Jersey
  • Several are also located in the NYC suburban area
  • Another 10 are in Florida, mostly in the central and north part of the state
  • Others are scattered along the Mideast coast

So where are the potential foreclosure hotspots, once any coronavirus-related moratoria disappear?

Well, a new “Special Coronavirus Market Impact Report” released by ATTOM Data Solutions found that half of the most vulnerable counties reside in Florida and New Jersey.

They rank market risk by looking at three main factors:

– Percentage of housing units receiving a foreclosure notice in Q4 2019
– Percentage of homes underwater (LTV 100 or greater) in Q4 2019
– Percentage of local wages required to pay for major homeownership expenses

As we know from the prior mortgage crisis, payment default was driven by homeowner equity to some degree, with underwater borrowers often throwing in the towel because they had nothing to lose.

This was further exacerbated if they didn’t have the money to make mortgage payments, or if they were simply overextended.

Finally, if a foreclosure notice was already received before the coronavirus pandemic took place, it’s clearly a bad sign for a situation that likely just got worse.

As for which counties are on alert, there are 14 in New Jersey, such as Camden and Ocean, along with five in the New York City suburban area: Bergen, Essex, Passaic, Middlesex, and Union counties.

And there are 10 counties in Florida, mostly in the northern and central portions of the state, including Clay, Flagler, Hernando, Lake, and Osceola counties.

Additional New York counties include Orange, Rensselaer, Rockland, and Ulster.

There are also a handful of counties in the top 50 in Delaware, Louisiana, Maryland, North Carolina, South Carolina, and Virginia.

Only Seven Risky Housing Markets in the Midwest and West

  • The housing markets in the Midwest and West appear to be stronger overall
  • The only high-risk markets are in Illinois, mostly the Chicago metro
  • Along with Shasta County, CA, which is just south of Oregon
  • And Navajo County, AZ, in the northeast part of the state

Things appear to be a lot better in the Midwest and West, with just seven counties total landing in the top-50 most vulnerable list.

Every single Midwestern county can be found in Illinois, including Kane, Lake, McHenry, Tazewell, and Will.

Most are in the Chicago metropolitan area, a region that has never really seen massive amounts of home price appreciation since the crisis.

In terms of the West, only two counties made the top-50, including Shasta County, CA and Navajo County, AZ. Both aren’t major metros.

The report also revealed that counties where median home prices range from $160,000 to $300,000 account for 36 of the most vulnerable counties.

Meanwhile, counties with median home prices below $160,000 or above $300,000 made up just 14.

This is because those with median prices below $160,000 are among the most affordable, while those priced above $300,000 have some of the highest home equity amounts, and thus the lowest foreclosure rates.

The takeaway here is that most of the country looks pretty good overall with regard to housing market risk.

That could change depending on how long things play out, but there are plenty of mortgage relief programs available, including a 6-12 month forbearance via the CARES Act.

As long as this is somewhat temporary, and most homeowners get back to work, it should be a momentary blip.

Read more: How does mortgage forbearance work?

Source: thetruthaboutmortgage.com

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Apache is functioning normally

June 7, 2023 by Brett Tams

The town of Newton, Massachusetts is working to comply with a new state law that requires the construction of new multifamily housing units in areas served by public transit, according to reporting from the Boston Globe.

The law, which went into effect in early February, requires 177 communities served by the Massachusetts Bay Transportation Authority (MBTA) to eliminate barriers that could restrict the zoning and construction of multifamily housing units.

As of February, just seven of the 175 initial communities that were required to submit preliminary compliance plans had failed to do so by the initial deadline.

“This new law requires that an MBTA community shall have at least one zoning district of reasonable size in which multi-family housing is permitted as of right and meets other criteria set forth in the statute,” according to information posted by the state government.

Other criteria include a minimum density of at least 15 units per acre; that a development be located no more than one-half mile from a transportation hub (such as a commuter rail station, ferry terminal, subway station or ferry terminal); and that the units have no age restrictions and are suitable for families with children.

However, the debate in Newton could be more contentious than in other parts of the state, according to the Globe.

“Newton, one of the region’s wealthiest enclaves, has to zone for more new units under the state rezoning law, MBTA Communities, than almost any other community,” the article states. “Should the rezoning overcome fledgling resident opposition and pass by the end-of-year deadline, it could serve as a model for other communities and represent a major turning point in the city’s attitude toward multifamily housing.”

The median home price for a single-family home in the area is $1.6 million, according to data from Warren Group.

The debate is due in large part to the way Newton is currently zoned, which is primarily for single-family homes. Some apartments have been constructed in recent years, but the construction level has been low.

Between 2010 and 2020, roughly 1,100 new housing units were added in Newton, accounting for just over 3% of the area’s total housing stock. This has led Newton to have some of the highest housing prices in the state.

In addition to the price concerns, most multifamily construction has been concentrated in commercial areas in recent years.

The current proposal would add an estimated 10,000 new units, depending on parking requirements, which is well above the 8,330 units mandated by the new law. The new unit construction would also impact only 3% of Newton’s land and is not expected to impact existing single-family neighborhoods.

This is the latest step being taken at the state level to temper the housing supply shortages occurring nationwide. In New York, Gov. Kathy Hochul is pushing the state’s government to override local zoning laws and mandate more housing construction in the state’s suburban counties.

In Washington state, Gov. Jay Inslee recently signed a series of bills designed to spur more affordable housing construction, including through the elimination of single-family zoning. Similar measures have been introduced in states like Florida and Minnesota, but have ultimately been reversed.

Source: housingwire.com

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Apache is functioning normally

June 6, 2023 by Brett Tams

According to Realtor.com, the median listing home price in Tempe, Arizona, in April of this year was $500K in April, a figure down by -2.9% year-over-year. The latest reports also show that the average listing sells within 31 days, which is up from this Summer’s figures in the 20-day range. The region’s tech boom in 2022 made prices and sales shoot through the roof, but the economic slump has hit this town like most others in the U.S. The downturn is all the more reason to get the best of the best for buying or selling. With this in mind, here’s a list of some of the top real estate professionals in the area.

agent

George Laughton has an outstanding sales and review record on Zillow. Two thousand seven hundred seven clients gave the Tempe/Phoenix agent’s team 5-star reviews on the platform, and Laughton made 1194 sales in the past year. His “My Home Group” team also has excellent reviews and individually exceptional profiles, each to his or her’s efforts. 

The team’s website leaves much to be desired where SEO and aesthetics go. A score of 50/100 for an agency of this caliber is shocking. Likewise, Facebook is a bit of a surprise. Even though Laughton has over 3.8k followers, the team has not posted anything in over a month. 

At LinkedIn, we see the focus of Laughton’s leads effort digitally. His 3k plus network, his membership in the LI Social Media Management Group I belong to, his posts, and his endorsements tell the tale. Then there are the team’s YouTube efforts, including a top-rated (by me) channel, ads, and broadcasts on other real estate channels. Unfortunately, Laughton’s YouTube effort has dropped off in the past few years. However, his media outreach and Zillow Premier Agent efforts seem to be ramping up. Zillow recently included Laughton as an expert in a recent press release. Good work, George. This is how agents should get it done. 

Website, Facebook, Contact # 1-623-266-3806

Right behind Laughton, Shawn Rogers and his West USA Realty have garnered over 1,000 five-star reviews from Zillow users. The group only has 92 sales in the past 12 months, however. Nevertheless, where Facebook is concerned, Rogers eclipses the competition with over 12k followers and timely, interesting postings nicely conveying the brand. 

Like Laughton, Rogers also has an impressive LinkedIn effort with over 2k followers and meaningful, contextual postings regularly. The West USA Realty boss also has a stunning YouTube channel with 1.25k subscribers. This is a massive number for a real estate agent, maybe the highest we’ve seen (I will have to check). Rogers is on gaining media mentions like his competitor above, as well. The only surprising thing about his super-professional effort is that his website has the worst SEO score we’ve ever mentioned. 13% out of 100% is horrific. And the site is pretty nice too. 

Rogers

Website, Facebook, Contact # 1-480-313-7031

Katie 2

Keller Williams Realty’s Katie Baccus has 1.7k Facebook followers, a great company and personal (private) Instagram effort, and the best website of all those in this group aesthetically and by search engine optimization (78/100 from Neil Patel). Baccus has almost 200 perfect Zillow reviews and sold nearly 60 properties in the past 12 months. Her team is in the top 1% of agencies in Arizona, according to their website. Baccus Group also gets its share of local media mentions. 

Baccus’ YouTube channel only has 80-something subscribers so far, but what’s presented is helpful and very professional. This channel should be pushed more because Baccus is superb on camera and offers like a top TV hostess. In addition, her company’s Instagram feed has some of the best real estate related videos we’ve seen. 

The blog on the website has not been updated in some years, but since the site gets so little traffic, this is a minor thing. Too bad some effort is not being made to make the domain a valuable part of the marketing funnel. Baccus also has an excellent Twitter feed, but it’s been abandoned for some time. Her LinkedIn effort could also drive more leads, but it’s in placeholder mode for now. This agency could beat the competition with more commitment to digital marketing reach. 

Website, Facebook, Contact # 1-480-206-4336

Terri Witte, the team lead of The Jason Witte Team at eXp Realty, does not tick all the boxes for real estate digital marketing. However, she and her team have five-star reviews on Zillow and elsewhere, 1.6k Facebook fans, and a nice engagement by Jason Witte on LinkedIn. In addition, the team is also featured frequently in local and regional media. 

The team’s website has a 20/100 on-page SEO score. This is a shame because it’s one of the better-looking and functioning sites in the group. Plus, no social buttons are always negative. She made this list because of 88 sales in the past year. Jason Witte’s team could rise a lot in sales. 

witte 2

Website, Facebook, Contact # 1-480-286-1884  

Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.

Latest posts by Phil Butler (see all)

Source: realtybiznews.com

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Apache is functioning normally

June 6, 2023 by Brett Tams

Home price growth slowed in May, showing signs of a cooling housing market. But housing is the least affordable it has been since the mid-1980s as mortgage rates rise and home values soar, driven by low housing inventory, a new Black Knight report suggests.

The annual home price growth index, measured by Black Knight, grew 19.3% in May from a revised 20.4% in April marking the largest single-month deceleration since 2006. Prices, however, are still up 1.5% month over month, which is nearly twice the historical average for May, according to Black Knight’s monthly mortgage monitor report.

“While any talk of home values and 2006 might set off alarm bells for some, the truth is that price gains would need to see deceleration at this rate for more than 12 months just to get us back to a ‘normal’ 3-5% annual growth rate,” said Ben Graboske, data and analytics president at Black Knight. “That said, the pace of deceleration could very well increase in the coming months, as we’ve already begun to see in select markets such as Austin, Boise and Phoenix.”

The strongest deceleration was in Austin, Texas where home price growth rate dropped 12.2 percentage points followed by Boise, Idaho (-12.1 percentage points) and Spokane, Washington (-7.1 percentage points), all of which saw significant home price growth in recent years, according to Black Knight.

While 97 of the nation’s 100 largest markets saw home price growth slowing, affordability is at its worst point since the mid-1980s, when sharp hikes by the Federal Reserve led to double-digit mortgage rates, which often resulted in greater than 50% payment-to-income ratio.

Back then, affordability pressures were almost entirely rate-driven and incomes largely kept up with home price growth, the report said. Today’s falling affordability is due to rising rates and soaring home values largely driven by low inventory levels.

The average home price is now more than six times the median household income. As of mid-June, it takes about 36% of the median household income to make the mortgage payment on average-priced home purchase, which is well above the 34% post-1980s peak in July 2006. That payment is higher than $2,100 for the first time on record, up nearly $750 so far this year and almost double the $1,089 required at the beginning of the pandemic.

However, the largest jump in housing inventory in the past five years also was in May, as pending listings began to normalize and existing listings sat longer on the market. Despite more than 107,000 homes listed for sale in May, inventory remains at a 60% deficit. That equates to about 770,000 fewer properties on the market than there would typically be at this time of the year, according to Black Knight.

“All major markets are still facing inventory deficits, but some have seen their shortages shrink much faster than others,” Graboske said.

Among them are some of the hottest housing markets, including San Francisco and San Jose, California, and Seattle, Graboske added. “Unsurprisingly, these are also among the markets seeing the strongest levels of cooling so far this year, with annual home price growth rates in each down more than three percentage points in recent months.”

Regarding mortgage rates, rising 30-year rates have now “all but eliminated traditional rate-term refinance incentives in the market,” Black Knight’s report said.

In an 18-month span from late 2020 to the present, the market saw the population of high-quality refi candidates soar to an all-time high, near 20 million, and plunge to the lowest level since the beginning of the century.

In early 2022, some 11 million refinance candidates remained but that population fell by 95% year to date with less than 500,000 remaining as of June. According to Black Knight, most of the remaining candidates held their mortgages since 2003 or prior, suggesting a reluctance to either refinance or restart a 30-year commitment.

Rate/term locks are down 90% from the same time last year and accounted for less than 5% of rate locks on the Optimal Blue platform in May. Cash-out locks were down 42% year over year and data through mid-June suggests they’re now down even more, to 50% from the same time last year.

Source: housingwire.com

Posted in: Mortgage, Mortgage Rates, Real Estate Tagged: 2, 2022, 30-year, About, affordability, affordable, affordable housing, All, Austin, average, ben, black, Black Knight, blue, boise, california, cooling, data, Digit, double, existing, Federal Reserve, Financial Wize, FinancialWize, growth, historical, home, Home Price, home price growth, home purchase, Home Values, homes, household, household income, Housing, Housing inventory, Housing market, Housing markets, idaho, in, Income, index, inventory, inventory levels, jump, Listings, locks, low, Low inventory, Make, market, markets, median household income, More, Mortgage, Mortgage Monitor Report, mortgage payment, Mortgage Rates, Mortgages, new, Optimal Blue, or, pandemic, Phoenix, points, Politics & Money, present, president, price, Prices, PRIOR, Purchase, quality, rate, Rates, Real Estate, Refinance, rise, sale, san francisco, San Jose, seattle, shortages, single, soaring, texas, time, traditional, washington

Apache is functioning normally

June 5, 2023 by Brett Tams

Demand for mortgages declined for the second consecutive week, led by a dip in purchase mortgage applications — despite rates on a downward trend.

The market composite index, a measure of mortgage loan application volume, decreased 1.7% for the week ending July 8, according to the Mortgage Bankers Association (MBA). The refinance index rose 2% from a week earlier and the purchase index dropped 4%.

“Purchase applications for both conventional and government loans continue to be weaker due to the combination of much higher mortgage rates and the worsening economic outlook,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting.

Freddie Mac PMMS showed purchase mortgage rates dropped 40 basis points to 5.3% last week. Rates during the previous two weeks dropped by half a percent but were still well above the 30-year purchase rate of 2.9% from the same period in 2021. 

The trade group estimates the average contract 30-year fixed-rate mortgage for conforming loans ($647,200 or less) remained at 5.74%, unchanged from the previous week. Jumbo mortgage loans (greater than $647,200) dipped to 5.25% from 5.28%. 

After reaching a record average purchase loan size of $460,000 in March 2022, the figure declined to $415,000 last week led by the potential moderation of home price growth and weaker purchase activity at the upper end of the market, Kan added. 


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The refi share of total applications rose to 30.8% last week, largely due to an uptick in conventional and Federal Housing Administration (FHA) refinances. The overall refi index remained 5% below the average level reported in June, according to the MBA.

“With the 30-year fixed rate 265 basis points higher than a year ago, refinance applications are expected to remain depressed,” said Kan. 

In a separate projection made by the MBA in June, of the $2.4 trillion origination volume forecast for 2022, about $730 billion is expected to come from refis. About $2.3 trillion, more than 40% of the $4 trillion origination volume, came from refis in 2021. 

The FHA share of total applications decreased to 11.7% from the previous week’s 12%. The United States Department of Agriculture (USDA) share also declined to 0.5% from the week prior’s 0.6%. The Veterans Affairs (VA) share of total applications slightly rose to 11.2% from 11.1%.

The share of adjustable-rate mortgages (ARM) applications also rose, accounting for 9.6%. According to the MBA, the average interest rate for a 5/1 ARM increased to 4.71% from 4.62% a week prior. 

The survey, conducted weekly since 1990, covers 75% of all U.S. retail residential mortgage applications.

Source: housingwire.com

Posted in: Mortgage, Mortgage Rates, Real Estate Tagged: 2, 2021, 2022, 30-year, 30-year fixed rate, About, Administration, All, Applications, ARM, average, Digital, digital marketing, Fed Policy, FHA, Financial Wize, FinancialWize, fixed, fixed rate, Forecast, forecasting, Freddie Mac, Freddie Mac PMMS, government, growth, home, Home Price, home price growth, Housing, How To, in, index, industry, interest, interest rate, Joel Kan, Jumbo mortgage, lenders, loan, Loans, Make, market, Marketing, MBA, measure, moderation, More, Mortgage, mortgage applications, Mortgage Bankers Association, mortgage loan, mortgage loans, mortgage professionals, Mortgage Rates, Mortgages, or, Origination, percent, PMMS, points, Politics & Money, president, price, PRIOR, Professionals, Purchase, purchase applications, Purchase mortgage applications, rate, Rates, Real Estate, Refi index, Refinance, refinance applications, Residential, rose, second, states, survey, Technology, time, trend, united, united states, USDA, VA, veterans, veterans affairs, volume, white

Apache is functioning normally

June 5, 2023 by Brett Tams

Purchase mortgage rates this week continued their recent downward trend, dropping 40 basis points to 5.30%, according to the latest Freddie Mac PMMS Index.

A year ago at this time, 30-year fixed rate purchase rates were at 2.90%. The PMMS, a government-sponsored enterprise index, accounts solely for purchase mortgages reported by lenders during the past three days.

“Over the last two weeks, the 30-year fixed-rate mortgage dropped by half a percent, as concerns about a potential recession continue to rise,” Sam Khater, chief economist at Freddie Mac, said in a statement.

Another index showed the 30-year conforming rates also declined from last week.

Black Knight’s Optimal Blue OBMMI pricing engine, which includes some refinancing data — but excludes cash-out refis to avoid skewing averages – measured the 30-year conforming rate at 5.68% Wednesday, down from last week’s 5.89%. Meanwhile, the 30-year fixed-rate jumbo was at 5.10% Wednesday, down from 5.42% from the previous week.

Mortgage rates tend to move in concert with the 10-year U.S. Treasury yield, which fell to 2.93% Wednesday, down from 3.10% a week before. The federal funds rate doesn’t directly dictate mortgage rates, but it does steer market activity to create higher rates and reduce demand.


How lenders can navigate a shifting market with non-QM loan options

In an effort to counter margin compression and satisfy a new generation of homebuyers, lenders are looking to offer loan options that better fit the average borrower. HousingWire recently spoke with John Keratsis, President and CEO of Deephaven Mortgage, about the potential benefits of non-QM lending in today’s tight housing market.  

Presented by: Deephaven 

Following the Federal Reserve’s interest rate hike of 75 basis points on June 15, mortgage rates climbed for two weeks, but started to decline last week, as expected by mortgage industry economists.

Mike Fratantoni, Mortgage Bankers Association’s (MBA) chief economist and senior vice president of research and industry technology, told HousingWire that after the Fed’s meeting in June and the removal of some of the market’s uncertainty over the path of rising rates, that rates would settle back to something closer to 5.5%. ​

Despite the decline in rates, borrowers’ demand for mortgage loans fell this week – mortgage application volume declined 5.4%, according to the MBA. Refi apps decreased 7.7% from the previous week and purchase application were down 4.3% from a week earlier.

Khater said that while the drop in rates provides “minor relief to buyers, the housing market will continue to normalize if home price growth materially slows due to the combination of low housing affordability and an expected economic slowdown.”

According to Freddie Mac, the 15-year fixed-rate purchase mortgage averaged 4.45% with an average of 0.8 point, down from last week’s 4.83%. The 15-year fixed-rate mortgage averaged 2.20% a year ago. 

The 5-year ARM averaged 4.19% this week, down from 4.50% the previous week. The product averaged 2.52% a year ago. 

Source: housingwire.com

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Apache is functioning normally

June 5, 2023 by Brett Tams

The affordability challenges homebuyers are facing are becoming more deeply entrenched, according to Black Knight‘s most recent monthly mortgage monitor report.

“In a sense, the gridlocked housing market has been feeding on itself,” Andy Walden, VP of enterprise research strategy at Black Knight, said. 

Tightening credit availability, elevated rates, inventory shortages and strengthening home prices are adding to affordability challenges, the report notes. In turn, the 100 largest U.S. markets are now less affordable than the long-term average. 

It now takes 34.2% of the median household income to make principal and interest (P&I) payments on the median-priced home purchased with 20% down and a 30-year fixed-rate mortgage.

One key contributor to the affordability challenges is dwindling inventory nationwide. Since the start of 2023, inventory has deteriorated in 95% of major markets, the report notes.

And, as rates have climbed, purchase activity has fallen, declining to a 34% deficit after pulling within 15% of pre-pandemic levels on mortgage rate dips earlier this year. Mortgage rates averaged 6.79% as of June 1, according to Freddie Mac, up 22 basis points from 6.57% the week prior. 

In addition, Optimal Blue rate lock data shows that average credit scores and down payments are on the rise, signaling a tightening credit atmosphere. This is compounding the challenges for potential home buyers and the origination market alike, Walden said. 

According to the report, purchase credit scores in April were the highest on record, dating back to 2000, when Black Knight first started tracking the metric.

And, the 0.46% seasonally adjusted rise in home prices in April was near the 30-year average of 0.48% for the month, which would reflect a 5.5% annualized growth rate if price gains continued at this pace, according to the report.

“While elevated interest rates continue to weigh on both affordability and demand, they’re simultaneously constricting supply as well as would-be sellers who locked in ultra-low rates early in the pandemic continue to sit on the sidelines. The combination of lower supply and demand in April led to both slowing sales and firming prices,” Walden said. 

Price strengthening nationwide this spring has erased more than 60% of the declines seen late last year, the report notes, and at the current rate of growth, it would fully erase those corrections by mid-2023.

At its current trajectory, the annual home price growth rate would fall only modestly below 0% for a very short time before pulling back above water by late second quarter and early third quarter of 2023, according to Black Knight.

Source: housingwire.com

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