sales

Apache is functioning normally

Apache is functioning normally

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Available inventory of homes for sale is on the rise in late September, which is very unusual for this time of year. In fact, inventory is growing faster than this time a year ago.

This is a demand-driven slowdown, because new listings supply is still running 9% to 10% fewer homes for sale each week than this time last year. We’re seeing fewer new sellers each week, but inventory is building as homebuyers wait to see if mortgage rates will come down to make purchases more affordable. 

What’s happening with inventory?

Fewer new sellers also means that inventory can’t grow too much; the real trouble develops when demand drops and supply surges. There’s no supply surge, but there is a notable demand drop. Consumers are very sensitive to changes in mortgage rates, and rates are still rising. 

We can see these slowing changes build up each week. It’s a pretty sharp change from what was a surprisingly strong first half of the year. There are now 528,000 single-family homes on the market. That’s an increase of 1.8% from last week. 

Normally by this point in September, available inventory is declining slightly each week. It’s late in the summer, so normally new listing volume drops as the last few sales of the peak summer months are concluding.

The fact that inventory grew by nearly 2% this week and last week is telling of how homebuyers are reacting to the highest mortgage rates in over two decades. 

In this chart of each year’s inventory curves, you can see that the number of homes on the market is climbing faster now than this time last year. This year is the dark red curve, and last year the light red. Mortgage rates continue to climb, so there is no immediate relief for homebuyers on the horizon either.

At this point, it looks like we may see inventory grow to the end of October like we did last year. Look at the divergence in the curves from this year and the tan line from two years ago when we were still in the middle of the pandemic housing boom and record-low mortgage rates.

Pending-home sales continue to lag

New pending sales each week continue to run 10% to 15% below last year’s pace. If you follow the National Association of Realtors when they publish their existing-home sales report each month, you know that the latest report for August showed a sales pace of only 4 million seasonally adjusted annual home sales.

We can already see in the NAR data that there are no signs of improvement for the sales count through September and October. The home sales that are in contract now will close mostly in October. It’s not hard to imagine that next month’s seasonally adjusted home sales data from NAR will come in under 4 million. 

In this chart, each bar is the total number of home sales pending on any given week. The shorter the bar, the fewer sales that are in progress. The light portion of the bar is the count of new pendings each week.

There are now 344,000 single-family homes in contract to close in the next couple months. That’s 14% fewer than last year and almost 30% fewer than in September of 2021.

Home sales are limited by the decreased demand, of course, and they’re also limited by the very low supply of new listings. You can’t buy what’s not for sale.

We’ve been talking all year about the market being supply constrained. Right now, sales are limited by declining demand from still-climbing mortgage rates.

Price reductions climb again

We can see the impact of weaker demand starting to creep into the pricing indicators. In the chart below, we look at the leading indicator of this trend: price reductions. This is the percent of homes on the market that have taken a price cut from their original list price. 

For a while earlier this year, demand was exceeding supply in residential real estate, and you could measure that demand with the price-reductions curve improving each week. As mortgage rates lurched over 7% to their new highs, suddenly there are fewer offers.

And home-price reductions are climbing again, with 37% of the market taking a price cut. That’s more than any recent year except last year at this time. Price reductions are accelerating now, which bodes negatively for future sales prices.

A normal, balanced market will have 30% to 35% of the homes for sale that have reduced their asking price in recent months. As this dark red line approaches 40%, that’s a clear indicator that buyers are making fewer offers. Remember, the slope of this line captures how many properties are taking new price cuts each week. And this slope is increasing now.

These are transactions that will happen in the future, so it implies sales price weakness in the fourth quarter, which you’ll hear about in the headlines after the new year. But you can see it in the data now.

The median sales price of single-family homes in the U.S. right now is $440,000. That’s down 1% from last week and it’s just a tiny fraction higher than this time last year.

We can see the pressure on home prices in recent weeks. Home prices step downward in September for the seasonal change every year, and you can detect strength or weakness relative to changes in other years.

What we see now is that year-over-year price gains are just barely positive. And the comparison is getting weaker, not stronger, as our current mortgage markets deteriorate. There are fewer offers, and those that do happen are doing so at slight discounts each week. 

Last year at this time, there were big price discounts being applied. So, our October comparisons may get slightly easier, but I sure haven’t seen any signals of price strength now.

Looking ahead to the end of 2023

So the question is will Q4 this year be a little better than Q4 2022? The median price of the new listings is fractionally higher than last year at $398,500. It will be fascinating to watch the light colored line here over the next couple weeks.

The new listings are where you see price weakness first. And last year, they were already headed lower.

The price of the new contracts this week came in at $370,000. These are the pending-home sales that went into contract in the last week. Prices of the homes going into contract are lower than last year by a fraction.

The next few weeks will be interesting to track this stat, too. Last year in mid-September is when mortgage rates jumped from 6% to 6.5% to 7.5%. By early October, any offers that were made for purchases came in at notably lower price points.

By September 2022, new pending-home sales prices fell by 3% per week. Will that happen again? Mortgage rates are even higher now than they were last year.

In this chart, you’ll notice the light-colored line started a big decline during this week in 2022. That’s when buyers reacted to newly increased mortgage rates. So, we’re watching to see where the new contracts come in over the next few weeks.

The macro trends impacting mortgage interest rates and the Fed have not given us any reprieve yet. The signals are that mortgage rates are still headed higher.

Consumer expectations for future mortgage rates have moved higher, too, so potential homebuyers are less optimistic than they were at the start of the year. And that’s what we’re seeing in the data each week now.

However, it’s important to point out that while buyer demand has backed off this fall, there is still no sign of any surge in new supply coming to the market. It can be very easy to focus on the negative momentum.

People on the fence should also know that while their competition is lessening, there’s no sign of an inventory flood. That may be an important factor in their home-buying decisions.

Mike Simonsen is president and founder of Altos Research.

Source: housingwire.com

Apache is functioning normally

Apache is functioning normally

The Federal Reserve ended its long streak of interest rate hikes last week, but the pause may offer little reprieve to Americans squeezed by higher borrowing costs.

The decision left interest rates unchanged at a range of 5% to 5.25%, the highest level since 2001. However, policymakers also opened the door to additional rate increases this year, meaning there could be more pain for would-be homebuyers in the form of steeper mortgage rates.

“Higher rates are a positive for savers, but it also means mortgage rates may not fall all the way back to where they were in 2020 and 2021,” said Sonu Varghese, global macro strategist at Carson Group.

Mortgage rates spiked over the past year as the Fed waged an aggressive campaign to crush high inflation. In the span of just 16 months, the central bank approved 11 rate increases – the fastest pace of tightening since the 1980s.

A pedestrian passes the Federal Reserve building in Washington, D.C., on June 3, 2023.

MORTGAGE CALCULATOR: SEE HOW MUCH HIGHER RATES COULD COST YOU

While the federal funds rate is not what consumers pay directly, it affects borrowing costs for home equity lines of credit, auto loans and credit cards.

READ ON THE FOX BUSINESS APP

Rates on the popular 30-year fixed mortgage are currently hovering around 7.19%, according to Freddie Mac, well above the 6.29% rate recorded one year ago and the pre-pandemic average of 3.9%. It is near the highest level in two decades.

MORTGAGE DEMAND DROPS AGAIN AS INTEREST RATES EASE SLIGHTLY

Below, you can calculate how volatile increases and decreases in rates could affect the typical cost of a monthly mortgage.

Even just a minor change in rates can affect how much would-be homebuyers pay each month.

A recent study from LendingTree compared the average monthly payments on 30-year fixed-rate mortgages in April 2022 – when the rate hovered around 3.79% – and one year later, when rates jumped to 5.25%.

It found that higher rates cost borrowers hundreds more each month and potentially add as much as $75,000 over the lifetime of the 30-year loan.

The monthly mortgage payment for a median-priced home, calculated using the current 30-year mortgage rates and a 6% down payment, is about $2,590. That is dramatically higher than just three years ago, when that same mortgage payment would cost about $1,779.

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The spike in mortgage rates comes as the Federal Reserve wages an aggressive campaign to crush high inflation, raising interest rates at the fastest pace in decades in a bid to cool the economy and tame runaway prices.

While the federal funds rate is not what consumers pay directly, it affects borrowing costs, including everything such as home equity lines of credit, auto loans and credit cards.

Even just a minor change in mortgage rates can affect how much potential homebuyers pay each month.

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“Higher mortgage rates have radically altered homebuyer purchasing power and have been a key factor in existing home sales dropping from a more than 6.5 million unit pace in early 2022 to the roughly 4 million unit pace in recent months,” said Danielle Hale, chief economist at Realtor.com. “Perhaps more importantly, higher mortgage rates continue to keep existing homeowners sidelined because they don’t want to borrow at today’s much higher rates.”

Original article source: See how much higher mortgage rates are actually costing you

Source: finance.yahoo.com

Apache is functioning normally

Apache is functioning normally

Mortgage Machine Services, a digital origination technology provider, has appointed Dan McGrew as director of sales. In this role, McGrew will shoulder the responsibility of marketing the company’s digital products, including the flagship loan origination system (LOS) Mortgage Machine.

“As Mortgage Machine Services continues to pioneer technology for the mortgage industry, we knew we needed a seasoned and innovative thinker like Dan to help us deliver these innovations to the masses,” Mortgage Machine Services President and CEO Jeff Bode said in a prepared statement. “The recent launch of our namesake LOS is only the beginning, and we look forward to Dan’s assistance in helping lenders harness the power of our current and future digital lending technology releases.”

Prior to this role, McGrew was the chief operating officer and senior vice president of sales at Pavaso, a full-service eClosing platform. He also spent six years as the president of IT Services, a U.S.-based boutique SAP consulting firm.

In 2019, McGrew founded Elite Digital Advisors, a consulting firm which helps lenders move from a paper based closing process to electronic. He still serves as its president and CEO.

McGrew has a deep knowledge of LOS, document generation, eVault and eClosing platforms. 

Mortgage Machine Services’s LOS product utilizes intelligent automation, configurable business workflows and a cloud-based infrastructure to optimize the entire loan lifecycle. 

Source: housingwire.com

Apache is functioning normally

Apache is functioning normally

Data Mining, Digital Lending, Real Estate Database, Servicing Products; Conventional Conforming Program Shifts

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Data Mining, Digital Lending, Real Estate Database, Servicing Products; Conventional Conforming Program Shifts

By:
Rob Chrisman

49 Min, 7 Secs ago

As if lenders and vendors don’t have enough other stuff to worry about, the budgetary standoff in the U.S. doesn’t look like it will abate soon, raising the likelihood of the first government shutdown since 2019. Current funding for federal operations will end on October 1 unless a deal is reached or the proverbial can kicked down the road. Thousands of federal workers might be furloughed without pay. Sure it will be temporary, and its wider impact will likely be limited, but still even talking about it is lousy. According to Morgan Stanley, the last 20 government shutdowns that occurred since 1976 “appear to have had limited impact on the economy.” As for bond prices, a shutdown may cause some “temporary instability”, but this is not a given. There is talk of a short-term Continuing Resolution (CR) providing funding until later this year, but federal agencies, including HUD and Treasury, will cease to function normally. The National Flood Insurance Program (NFIP) authorities also expire on October 1st. The Mortgage Bankers Association created a guide outlining how HUD (including FHA and Ginnie Mae), VA, and USDA would be directly affected by the furlough of government employees and the curtailment of agency operations. (Today’s podcast can be found here and this week’s is sponsored by Built. Built is powering smarter and faster money movement for the entire construction and real estate ecosystem, all while reducing risk. Hear an interview with Servbank’s Bryan Crofford on how companies can best invest in employees, promoting longevity and success.)

Lender and Broker Software, Programs, and Services

Life can change on a dime, and sometimes even the most prepared borrowers end up facing financial hardships they never would have imagined. Forward-thinking credit unions are preparing today, so they can be there for their members when they need help the most. It’s why Mission Federal Credit Union implemented the MSP® loan servicing system, to not only improve their own efficiencies, but better serve their members who are facing financial difficulty. Are you ready to join Mission Federal Credit Union by enhancing your technology to be there for homeowners in life’s most challenging moments? Learn more about MSP today.

One thing that you can always count on in the mortgage space, is that regulatory requirements are always changing. This is why it’s critical for Banks or Mortgage Servicers to stay vigilant with comprehensive Compliance Testing and Monitoring to mitigate exposure and minimize risk. At the MBA Annual in Philadelphia, PA, Servbank’s Shayna Arrington will be helping us all do exactly that. Watch her moderate the panel, “Today’s Top Regulatory Issues” on Tuesday, October 17 at 1:30 PM, on 200 Level, Exhibit Hall E. Want to dive deeper into how Servbank can partner with you? Servbank will have a meeting space at the W Philadelphia on 10/16 and 10/17. Schedule some time to meet with them here: [email protected] or learn more at www.servbank.com.

One-Time Close (OTC) Volume Soars to record highs at AFR Wholesale® (AFR)! While housing inventory is still at an all-time low, OTC loans have witnessed an unprecedented surge in volume! In August, AFR closed more One-Time Close loans in one month than at any other time in their long history of offering the product. Homebuyers are increasingly drawn to the convenience and cost-saving benefits of OTC loans, as they streamline the construction process, reduce paperwork, and offer more favorable terms. This surge in OTC loans at AFR is not just a testament to its effectiveness but also an indicator of the outstanding clients and partners of AFR. Breaking news: As a thank you to their clients, AFR has also brought back FHA OTC on site-built homes!! This long-awaited product is back for partners of AFR to utilize now. Partner Today or contact AFR, email or call 1-800-375-6071.

One of the biggest questions for LOs in a down market is “How do I find more agent partners?” The answer is MMI. To find the right agent partners, you need the right data. MMI has assembled the industry’s most comprehensive real estate and mortgage transaction database which is leveraged by thousands of mortgage professionals daily. Using MMI’s database, LOs can easily search & filter, find an agent and at the click of a button, push the info to a CRM like Bonzo. Sign up for a demo today to see why a majority of the top 25 lenders rely on MMI.

Free eBook: Market-Proof: How to Build a Flexible Lending Business Resilient in Upcycles & Downturns. The exaggerated upcycles and downturns of the past few years underscore just how crucial it is for lenders to build resilience and flexibility into their businesses. To overcome today’s challenges, lenders need to hone their lending process at each step. In this new eBook, Maxwell provides 12 tips from industry veterans to help you optimize your mortgage process from loan application to the secondary market. You’ll get insight from exclusive interviews with industry veterans on how to increase efficiency, access economic scale, and become resilient to market volatility like never before. Click here to download Maxwell’s new eBook “Market-Proof: How to Build a Flexible Lending Business Resilient in Upcycles & Downturns.”

The transformation from paper to digital processes offers substantial benefits, including cost reduction and improved borrower experiences. Most lenders are in a hybrid phase, blending paper and digital processes. To navigate this ongoing change and ongoing innovations in the digital lending space, lenders should consider embracing five best practices: create a successful strategy, prioritize borrower experience, ensure compliance, harness technology, and stay adaptable in the evolving digital landscape. Tackle the future of lending by staying informed and proactive. For deeper insights into this digital lending revolution and actionable steps, read the full article.

“Heading to Vegas? The Total Expert team is in full force at the Digital Mortgage conference in Las Vegas! There are three ways to interact with us. The first is to stop by booth #501 to get your Customer Intelligence ROI report and learn how you could increase funded loan volume by 20 percent. You can watch a LIVE demo of Total Expert on Tuesday 9/26. Lastly, catch our Founder & CEO Joe Welu for a panel discussion: The Customer Data Goldmine Goes Way Beyond Credit Triggers on Wednesday 9/27.Schedule time to meet with the Total Expert team in Vegas.”

Freddie Mac, Fannie Mae, Conventional Conforming News

The Federal Housing Finance Agency (FHFA) released its second quarter 2023 Foreclosure Prevention and Refinance Report. The report shows that Fannie Mae and Freddie Mac (the Enterprises) completed 47,370 foreclosure prevention actions during the quarter, raising the total number of homeowners who have been helped to 6,818,471 since the start of conservatorships in September 2008. View the News Release

FHFA-OIG released two reports: Within the Federal Housing Finance Agency (FHFA), the Division of Federal Home Loan Bank Regulation (DBR) is responsible for supervising the Federal Home Loan Bank (FHLBank) System to ensure the safe and sound operation of the FHLBanks. In response to market disruptions, DBR adapted the scope of its Federal Home Loan Bank Supervisory Activities in 2023.

Regulated entities have not been immune to the trends affecting the labor market over the past few years. Some of the regulated entities experienced higher attrition in 2021 and 2022, consistent with trends in the broader labor market, but one Enterprise reported that its turnover rate started declining in 2022. Read the full report, People Risk at FHFA’s Regulated Entities.

Freddie Mac will update Loan Product Advisor® (LPASM) in October to support multiple recent Single-Family Seller/Servicer Guide announcements, plus more enhancements, described in Freddie Mac October LPA Releases.

Freddie Mac Loan Selling Advisor September Updates includes the following information: Uniform Loan Delivery Dataset (ULDD) Phase 4a Updates and Phase 5 Specification, Auto Evaluate on Import Loan, New Loan Delivery Rules Supporting the Duty to Serve Credit Fee Cap, Initial Principal and Interest Payment Amount Conditionality update, Auto Re-evaluate: Improvements to Modify and Evaluate, and Enhancements to Mandatory Cash Contracting.

Leverage Fannie Mae’s new edition of Beyond the Guide to help your organization build a best-in-class quality control (QC) program. Specific examples and scenarios provided can help teams understand and apply Selling Guide concepts in a way that is most impactful to their organization. A robust QC program helps strengthen loan quality ensuring a safe, sound, and resilient mortgage industry.

Fannie Mae Appraiser Update September 2023 edition focuses on dual themes of delivering high quality appraisals and understanding recent policy changes. Topics include updates to the Appraiser Independence Requirements (AIR), new options for 1004D completion, our stance on 3D printed homes, and more.

Fannie Mae posted the September Appraiser Quality Monitoring (AQM) list. Read the AQM FAQs.

Chris Whalen writes, “Our short take on the future of the GSEs (Government Sponsored Enterprises) looks a lot like the character played by Bruce Willis in the 1995 Terry Gilliam film, ‘Twelve Monkeys.’ Imagine if the GSEs were released from conservatorship, but then were immediately designated as a ‘systemically important financial institution’ (SIFI) by the FSOC. How do you think that would work for private investors? What would happen to the guarantee fees?”

Pennymac Conventional LLPAs updates effective for Best Efforts Commitments: Pennymac Announcement 23-58 replacement of ‘Purchase Special’ LLPA Grid with new ‘Area Median Income Adjustments’ LLPA Grid. Pennymac Announcement 23-59 introduces new ‘Investment Property’ LLPA to the ‘LLPAs by Product Feature for All Eligible Loans’ LLPA Grid. Pennymac Announcement 23-60 updates values for the ‘2nd Home Additional’ LLPA on the ‘LLPAs by Product Feature for All Eligible Loans’ LLPA Grid.

Pennymac is aligning with the FHFA based updated project review and eligibility requirements announced in Fannie Mae SEL 2023-06 and Freddie Mac Bulletin 2023-15, with the exception of any reference to co-op projects. View Announcement 23-61: GSE Updated Condo Project Review Requirements

Citizens Correspondent National Bulletin 2023-16 provides updates on the following topics: Conventional Conforming Products, Review requirements for condominium eligibility – DU and LPA, Gifts and Gifts of Equity – DU, 3D printed homes, Trust Income – DU, USDA-RD Product, Fiscal Year 2024 Conditional Commitment Notice, All Products, Disaster Tax Filing Relief.

PHH Mortgage Corporation updated Conforming Product listings for both Delegated and Non-Delegated loans.

Pennymac announcement 23-62: Fannie Mae SEL 2023-06 Condo Project Manager Updates

Citi Correspondent Lending Bulletin 2023-08 provides Credit policy updates regarding Non-Agency Depreciating Markets list updated, Condo & Co-Op Critical Repairs, Shared Equity and Shared Appreciation, LPA Asset, and Income Modeler (AIM), Continuity of Obligation: Limited Cash-Out, Hazard Insurance Update: Effective Date, and Taxpayer First Act.

On September 6, 2023, Fannie Mae and Freddie Mac announced Selling Guide policy changes addressing multiple topics in Fannie Mae SEL-2023-08 and Freddie Mac Bulletin 2023-18.

AmeriHome Mortgage accepts all revisions, view Product Announcement 20230910-CL for details.

Capital Markets

Ahead of today’s $48 billion 2-year Treasury auction, headlines to open the week revolved around increases in oil prices that’s evidence of inflation’s stickiness, Chinese developer Evergrande calling off talks with creditors as it appears headed for bankruptcy, and reaction to hawkish Fed remarks which is forcing yet another reprice from markets. There is growing sentiment that central banks across the globe aren’t done hiking rates, and Treasury yields trended higher to open the week as a result. With the calendar turning to fall, the economy is facing a few headwinds such as the run up in oil prices, student loan payment resumption, an expanding auto workers strike, and a partial shutdown of the U.S. government.

Every lender knows that mortgage rates remain above 7 percent, and housing data released over the last week highlighted another decline in builder sentiment. Housing starts fell 11.3 percent to a 1.25-million-unit pace in August. Existing home sales were down 0.7 percent in August as low inventory, high prices, and high mortgage rates continue to weigh on sales. Hoping for lower interest rates? A recession would likely mean lower interest rates, but workers with stable jobs (most individuals) would want to take advantage of low interest rates, causing home prices to rise faster. Initial jobless claims fell to 201k for the week ending September 16, which was the lowest weekly reading since January. The JOLTS report indicated that the demand for new workers is moderating somewhat however, significant layoffs are not on the horizon.

Today’s calendar includes the Philadelphia Fed non-manufacturing surveys for September, Redbook same store sales, July house price indexes from S&P Case-Shiller and FHFA, September consumer confidence, August new home sales, Richmond Fed manufacturing for September, Dallas Fed Texas services for September, the aforementioned Treasury auction of $48 billion 2-year notes, and remarks from Fed Governor Bowman. We begin Tuesday with Agency MBS prices a few ticks (32nds) better and the 10-year yielding 4.50 after closing yesterday at 4.54 percent. The 2-year is up at 5.12.

Employment

“At Fairway Independent Mortgage Corporation, customer service is a way of life. #FairwayNation mortgage loan officers are dedicated to finding great rates and loan options for our customers while offering some of the fastest turn times in the industry. Our goal is to act as a trusted mortgage advisor, providing highly personalized service and helping you through every step of the loan process, from application to closing and beyond.”

Logan Finance Corporation, a national Non-QM mortgage lender, is excited to welcome Aaron Samples to Logan’s Executive Leadership Team as Chief Revenue Officer. To learn more about why Aaron joined one of the fastest Non-QM lenders in the nation, contact Randy Viars.

The FHA has a job opening for a Senior Underwriter: Job Announcement Number 23-HUD-2915-P. Job duties include assisting the Branch Chief in monitoring the status of goal accomplishment. Advise the Chief of potential problems in attainment of goals and objectives. Research required underwriting procedures and techniques. Serve as an expert-level resource within his/her Office on matters relating to Underwriting and other Direct Endorsement issues.

Don’t forget that private mortgage insurance companies are hiring: MGIC, National MI, Arch MI, Radian, Essent, and Enact (in no particular order). And while’s we’re at it, Fannie Mae and Freddie Mac. And my cat Myrtle’s friend the CFPB.

Dovenmuehle Mortgage, Inc. announced that Robert Howerton has joined the organization as Chief Information Officer where he will be maintaining and expanding Dovenmuehle’s current information technology (IT) infrastructure.

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

Apache is functioning normally

After a boost in July, the sales pace of new homes slowed in August, according to data published on Wednesday by the U.S. Census Bureau and the Department of Housing and Urban Development (HUD). 

In August, the sales pace of new homes fell 8.7% compared to July, reaching a seasonally adjusted annual rate of 675,000. On a year-over-year basis, new home sales were up 5.8%.

However, mortgage applications for new home purchases increased 4% between July and August, the strongest pace of sales in three months.

“Homebuilders are still benefiting from very low inventory of existing homes for sale, which has driven more buyers to consider new construction,” Bright MLS Chief Economist Lisa Sturtevant said. “But with mortgage rates elevated and home prices high, affordability is a growing concern for home buyers.”

​​The median sales price of a new house sold in August 2023 was $430,300, while the average sales price was $514,000. The seasonally‐adjusted estimate of new houses for sale at the end of August was 436,000.  At the current sales rate, this represents a supply of 7.8 months.

The inventory of unsold new homes is at its highest since December, Holden Lewis, home expert at NerdWallet said, and builders will be motivated to offer incentives to get them sold.

“Look for a resurgence of mortgage-rate buydowns, in which the sellers give buyers a break on the monthly payments for the first one to three years,” he added. 

Source: housingwire.com

Apache is functioning normally

Apache is functioning normally

Summer has officially ended, and with it comes some of the best end-of-season sales on home decor. If you want to cozy up your space for the fall season, it’s a great time to shop for rugs. 

That”s because right now you can find washable rugs for less. The the Boutique Rugs End of Summer Sale and get an additional 20% off at checkout with promo code SUMMER20.  

best rugs in different patterns, sizes, and shapes, so you can easily find the best option for your space.

The Best Washable Rugs on Sale at Boutique Rugs

Bozkurt Distressed Washable Rug

Was $189-$729, now $87-$339 at Boutique Rugs
If you have a bohemian or cottagecore style space, this gorgeous Bozkurt Distressed Washable Rug is a must. It’s low pile, machine washable, and comes in several sizes in both a rectangle area rug and a runner style, too. I love that it adds a subtle pop of color to the home while still feeling neutral enough to go with everything.

Cream Holi-2301 Washable Area Rug

Was $123-$968, now $69-$439 at Boutique Rugs
This Cream Holi-2301 Washable Area Rug boasts a nice, neutral pattern in a beautiful distressed finish. It comes in a rectangle shape in five different sizes as well as a runner style in four sizes, is no pile, and is – of course – machine washable. Since the rug is no pile and so neutral, it would be a great top piece for a layered rug look.

Judy Solid White Washable Rug

Was $85-$631, now $39-$298 at Boutique Rugs
As far as cleanup is concerned, all-white rugs are a tad terrifying. However, with a washable rug, you don’t have to worry about mess as much. This Judy Solid White Washable Rug features a high pile texture, a non slip backing, and is machine washable. Plus, it comes in several sizes in both rectangle and runner shapes. And, if white isn’t for you, the rug is also available in four additional colors, including brown, pink, dark gray, and light gray.

Moora Washable Area Rug

Was $89-$596, now $43-$329 at Boutique Rugs
If you love the look of a traditional rug but want something a little easier to care for, consider this washable option from Boutique Rugs. Moora Washable Area Rug is pet-friendly, machine-washable, and comes in both a rectangle and runner style in several sizes. I love that it has a subtle mix of colors that allow you to pull in accent pieces to tie everything together.

Askeaton Washable Area Rug

Was $157-$657, now $73-$299 at Boutique Rugs
The Askeaton Washable Area Rug is another top pick for the best washable rugs on sale as it features a chic pattern that adds some nice texture to a space and comes in rectangle, round, and runner shapes, giving you lots of variety. The machine washable rug also boasts a low pile texture and ships within 24 hours so it’s a great option if you need something fast.

Kuval Checkered Brown Rug

Was $85-$1,065, now $39-$489 at Boutique Rugs
For an outdoor washable rug option, consider the Kuval Checkered Brown Rug. This indoor/outdoor rug is made from a polypropylene material and, while it’s not machine washable, it’s easy to hose down and keep clean when dust, dirt, and food spills come into play. The rug is available in rectangle and round shapes in several sizes and features a trendy checkered pattern that adds some nice print without feeling too busy, too. 

Rugs are un utterly underrated part of your interior decor. A rug can make or break a space, either adding a little texture and interest and elevating a room or completely derailing a color scheme and mood. They can be a comfortable, soft base for a coffee table or a scratchy scrap of fabric detracting from the rest of your style. That’s why we put so much effort into covering the best rugs for every space. We’ve also covered the best outdoor rugs, because these have very different materials and needs than indoor rugs. If none of our choices work for you, we’ve also covered all of the best places to buy rugs so that you can shop around for yourself. 

Source: homesandgardens.com

Apache is functioning normally

Apache is functioning normally

Just weeks after New York-based digital lender Better Home & Finance Holding went public, Better issued pink slips to employees in early September in a new round of layoffs, Insider reported.

Better laid off about a quarter of its U.S. mortgage sales and origination team, according to the news outlet, citing two former employees who were affected by the latest downsizing.

The layoff news comes on the heels of Better going public via special purpose acquisition company (SPAC) Aurora Acquisition Corp. in August.

About 75 employees are left on the mortgage origination team in the U.S. as well as some employees in India, according to Insider. 

While Better didn’t respond to HousingWire‘s inquiry about the number of affected employees, spokeswoman Jessica Schaefer told Insider the firm has more than 100 people left on the team. 

Better plans to fill some vacant positions from the layoffs.

“As a publicly listed company, we’re focused on making prudent and disciplined decisions that account for market dynamics so that we can continue to serve both customers and shareholders for the long-term,” Better’s spokesperson said in an e-mailed statement to HousingWire.

“We are hiring more seasoned professionals who can sell in this tough mortgage environment and then making them 10X more productive through our continued investment [in] technologies such as Tinman and One Day Mortgage, which have created efficiencies that streamline and automate nearly every major function of homeownership,” the spokesperson said. 

As of June, Better had 950 team members, a 91% decrease over an 18-month period from 10,400 in Q4 2021, according to its previous filing with the Securities and Exchange Commission (SEC). 

While Better was an efficient refi shop during the pandemic years when rates hit record lows, the lender and other independent mortgage banks (IMBs) were hit hard by the Federal Reserve‘s monetary policy.

The digital lender reported a net loss of $45.5 million in Q2, an improvement from a net loss of $89.9 million the previous quarter.

In Q2, Better’s origination volume was $900 million across 2,421 loans, compared to production of $800 million across 2,347 loans funded in Q1.

When Better debuted on Nasdaq in late August, the SPAC deal unlocked $565 million of fresh capital for the unprofitable company.

The digital lender has pivoted its strategy from being a one-stop-shop to becoming a “mortgage-as-a-service” company or a white-label provider of mortgage tech.

“For things like homeowner’s insurance, title insurance, and Realtors, we’ve now just become a marketplace. We match the consumer with a partner capable of delivering the best product to them. So, we ended Better Real Estate for the sake of efficiency and savings for the consumer. We partner with best-in-class agents, insurance companies and title companies,” Better CEO Vishal Garg said in an interview with HousingWire in August.

Better will invest in tech-driven products like One Day Mortgage, a program that will allow customers to apply for a mortgage, get preapproved, lock their rate and receive a mortgage commitment letter within 24 hours.

“We are committed to further developing this technology during an interest rate environment where customers need it the most,” Better’s spokesperson noted.

Better was ranked as the 59th largest lender in Q1 2023, plummeting from the 19th in 2021, according to Inside Mortgage Finance.

Source: housingwire.com

Apache is functioning normally

Apache is functioning normally

If you think home prices are too expensive, you wouldn’t be the only one.

A new analysis from First American revealed that housing affordability is the lowest it has been in more than three decades.

In other words, it hasn’t been this expensive to purchase a home since the 20th century.

The title and settlement company’s Real House Price Index (RHPI) determines house-buying power using median household income, mortgage rates, and home prices.

And they found that real house prices, adjusted for these factors, were up nearly 17 percent year-over-year in July.

Blame Higher Mortgage Rates and Home Prices for a Lack of Affordability

As for why housing affordability continues to erode, it’s a combination of factors.

The first and most obvious issue is markedly higher mortgage rates, with the 30-year fixed mortgage now priced above 7%, assuming discount points aren’t paid.

Per Freddie Mac, rates on this most-popular loan program are up about 1% from year-ago levels. First American pegs the annual change at a higher 1.4 percentage point increase.

And if we zoom out a bit more, this key interest rate was in the 3% range to start out 2022.

So interest rates alone have wreaked havoc on housing affordability and home buying power.

Just consider a loan amount of $400,000 at a 3% rate versus 7% rate. We’re talking about a monthly principal and interest payment of $1,686 vs. $2,661.

That’s nearly $1,000 based on the interest rate increase alone. Then you have to factor in higher property taxes, higher insurance premiums, and so on thanks to a higher purchase price.

Yes, despite higher interest rates, nominal home prices have also risen year-over-year.

While people logically think there’s an inverse relationship with home prices and mortgage rates, this isn’t always true.

Per First American, nominal home prices (not adjusted for inflation) were also up 4% year-over-year.

This means a prospective home buyer faces both a higher purchase price and a significantly higher mortgage rate.

And though household income increased 3.7% since July 2022, it wasn’t enough to offset the higher costs associated with the jump in rates and rising nominal home prices.

Real Home Prices Are Now Above the 2006 Peak

If you recall the year 2006, you might remember that home prices peaked and then began to fall.

Back then, unsustainable home price gains were fueled by exotic financing.

Many home loans were underwritten via stated income or no documentation at all, while the products offered may have been option ARMs and other adjustable-rate mortgages.

Additionally, the typical down payment was at or close to zero, while the loan-to-value (LTV) ratio was often 100% when it involved a mortgage refinance.

In other words, home prices were too high, borrowers had little to no skin in the game, and many weren’t even qualified to be homeowners.

Without the widespread use of loose underwriting, home prices would not have been able to continue rising as high as they did.

As we know, the housing bubble burst set off the Great Recession, leading to double-digit home declines and scores of short sales and foreclosures.

Today, unadjusted home prices are 53.7% above those during the peak in 2006, while real prices are 0.7% higher than that housing boom peak.

While this might be reason to worry, consider the new mortgage rules that were born out of that crisis.

The Ability-to-Repay/Qualified Mortgage Rule (ATR/QM Rule) essentially outlawed much of what I just mentioned.

Borrowers today must be fully qualified when taking out a mortgage, and the vast majority are going with a 30-year fixed-rate mortgage.

Gone are the days of stated income underwriting and negative amortization. That makes the current situation more of an affordability crisis than a housing bubble.

It is driven more by a lack of supply than it is loose financing, with not enough inventory to meet demand.

Housing Is Overvalued Nationally, But Some Markets Remain Affordable

As noted, the July 2023 Real House Price Index (RHPI) increased about 17% from a year ago.

This meant the median sale price was roughly $345,000, while the median house-buying power was just $337,000.

Since house-buying power is below the median price, it means housing is overvalued. In an ideal world, it should be at or below the median.

However, that applies to the national median price of real estate. Only 24 of the 50 top markets tracked by First American are overvalued by this measure.

Granted, it has worsened over time, as only 15 markets were considered overvalued last July.

At the moment, San Jose, California is the most overvalued metro, with the median sale price nearly $1,440,000 and consumer house-buying power just $700,000.

San Francisco and Los Angeles were also quite overvalued by this measure, though to a lesser degree.

Meanwhile, some undervalued markets still exist, if you can believe it. The metros of Detroit, Philadelphia, and Cleveland are undervalued by roughly $126,000.

How Do We Fix the Unaffordable Housing Market?

We know home prices are out of reach for many, but how do we fix it? Well, the Real House Price Index (RHPI) takes into account home prices, mortgage rates, and incomes.

So if you want housing to be more affordable, you need relief via those three elements.

This means either mortgage rates need to fall, home prices have to come down, or incomes must increase.

Or you get some combination of the three, such as a 1% drop in mortgage rates and a pullback in prices, which boosts affordability.

The problem at the moment is mortgage rates might be higher for longer, and home prices are pretty sticky due to a major lack of inventory (why are there no homes for sale?).

Incomes also don’t look to be increasing by a material amount, making it difficult for prospective buyers to get in the door.

One exception is new home sales, which have relied heavily on temporary and permanent mortgage rate buydowns to tackle the financing piece.

But there are only so many new homes for sale, and such sales only typically account for 10% of the overall market.

This explains the current housing market dynamic. Ultimately, there aren’t many existing homes on the market, not a ton of demand, and not a lot of sales.

And until something changes, this will likely be the status quo.

Read more: Why are home prices so high right now?

Source: thetruthaboutmortgage.com