– Fed Cuts Again; Where Will Mortgage Rates Go?
– Mortgage Lenders Struggle to Keep Up With Demand
– Shiller on Coronavirus Effect
– Equity Up $489 Billion in Q4
– Steep Competition Expected This Spring
– Fannie Mae HPSI Dips Slightly in February
– December Delinquency Rate Drops
– Analyst: Housing Much Stronger Now Than in Last Recession
– YIMBY Act Passes House
– Wealthy Millennials Choosing Smaller Houses, Shorter Commutes
– Commuting Costs Time and Money
– Gen Xers Are Most Likely to Hear ‘No’ to Mortgage Application
– Square Footage Determinations Are Not Easy
Fed Cuts Again; Where Will Mortgage Rates Go?
The Federal Reserve has cut short-term interest rates again, this time to virtually zero, to neutralize the impact the coronavirus is having on the U.S. economy.
Fed chairman Jerome Powell spoke.
The Fed’s decision could, indirectly, push mortgage rates even lower than they are now, possibly to new record lows.
However, experts quoted by MarketWatch also say it is unrealistic to expect zero-percent mortgages.
Mortgage Lenders Struggle to Keep Up With Demand
The already record-low mortgage rates have encouraged many people to buy a home — but the refinance demand is going through the roof, and lenders are struggling to keep up with the demand.
Matt Weaver with Cross Country Mortgage in Florida spoke to CNBC.
The Mortgage Bankers Association is now projecting much higher demand this year than previously anticipated. MBA economist Joel Kan.
National Housing Conference CEO David Dworkin said on Fox Business that if you’ve refinanced fairly recently, you may want to consider moving to a 20-year or even a 15-year mortgage.
For the week ending March 6th, the MBA reported a 79% spike in refi applications.
Shiller on Coronavirus Effect
Coronavirus fears could help bring more people into the housing market.
So says Nobel-prize winning Yale economist Robert Shiller. He spoke to Bloomberg.
Meanwhile, Fannie Mae and Freddie Mac are reminding eligible homeowners that hardship forbearance is an option for those unable to make their monthly mortgage payments due to coronavirus.
Equity Up $489 Billion in Q4
From the fourth quarter of 2018 to the final quarter of 2019, America’s homeowners gained almost half a trillion dollars in home equity.
The latest numbers from CoreLogic indicate that the amount of equity in mortgaged properties reached a new high in the closing months of last year.
Steep Competition Expected This Spring
It’s shaping up to be a hotly-competitive housing market this spring.
According to REALTOR®.com fewer homes were on the market in February compared to a year ago, and as prices keep rising, more bidding wars are likely.
But REALTOR®.com Chief Economist Danielle Hale said on Yahoo Finance that falling mortgage rates could put you in a stronger position to compete.
The company says nationwide housing inventory fell 15-percent year over year in February.
Fannie Mae HPSI Dips Slightly in February
The share of Americans who think now is a good time to buy a home dipped slightly in February, but remains strong.
The latest Fannie Mae Home Purchase Sentiment Index was down half-a-point, to a reading of 92.5 last month. It is still, however, very close to the survey high of 93.8.
But Fannie Mae points out, its survey was completed before the market volatility associated with the coronavirus.
December Delinquency Rate Drops
The nation’s overall mortgage delinquency rate continues to drop.
According to the latest report from CoreLogic, in December only 3.7% of home mortgages were in some stage of delinquency. That’s down from 4.1% a year earlier.
And it’s the lowest for any December in more than 20 years.
Analyst: Housing Much Stronger Now Than in Last Recession
The recent stock market volatility, brought on by worldwide anxiety over the coronavirus, has sparked new fears of a recession. Even the President now concedes a recession is possible.
But one Wall Street analyst is NOT worried about how the housing market would fare.
Jack Micenko is a homebuilder analyst at Susquehanna Financial Group.
Micenko spoke on CNBC.
YIMBY Act Passes House
The House of Representatives has passed a bill that would incentivize local governments to allow more high-density residential zoning, which would mean more affordable housing.
It’s called the “Yes In My Backyard,” or YIMBY Act.
Washington Democrat Denny Heck is the bill’s co-sponsor.
The fate of the “YIMBY Act” is uncertain, as it heads to the Republican-controlled Senate.
Wealthy Millennials Choosing Smaller Houses, Shorter Commutes
Growing numbers of wealthy Millennial homebuyers are choosing homes that are smaller, but closer in, with shorter commutes.
And that’s altering some longtime assumptions about what luxury homebuyers want.
Agents quoted by the Wall Street Journal say these well-to-do Millennials are not impressed by large homes on big lots.
The Journal says shifting luxury preferences among those Millennial buyers will reshape some suburban markets, where homeowners have traditionally accepted longer commutes in exchange for more house and land.
Commuting Costs Time and Money
How much time do you waste, stuck in traffic, getting to and from work?
Last year, according to transportation analytics firm INRIX, Americans spent an average 99 hours sitting in rush hour traffic, at a cost of nearly 14-hundred dollars.
Boston workers spend the most time stuck in traffic — on average, 149 hours a year.
Gen Xers Are Most Likely to Hear ‘No’ to Mortgage Application
If you’re between the ages of 40 and 54, you are more likely than other age groups to be turned down for a mortgage, according to data collected by THE NATIONAL ASSOCIATION OF REALTORS®.
Lenders said ‘no’ to 7% of Generation X mortgage applicants, compared to 5-percent for all other age groups.
Lingering effects from the Great Recession may be Gen X’s downfall, the report suggests — factors like low credit scores and high debt-to-income ratios.
Square Footage Determinations Are Not Easy
How big is your house?
Simple question — complicated answer.
Does your finished basement count toward your home’s total square footage? How about your enclosed front porch or the guest room over the garage?
REALTOR® Magazine reports that some MLSs will report all finished and unfinished square footage of a house as one number, leaving it up to the buyer and their agent to figure out how it all breaks down.
And typically, the article says, no: finished basements don’t count. But your enclosed porch may.