Great news about decreasing foreclosures, slowing rent growth, tight inventory in our area and household formations…
From Black Knight:
- Total U.S. loan delinquency rate (30 or more days past due, but not in foreclosure): 4.42%
- Total U.S. loan delinquency rate (30 or more days past due, but not in foreclosure): Down 0.91% MoM
- Total U.S. loan delinquency rate (30 or more days past due, but not in foreclosure): Down 7.49% YoY
- Total U.S. foreclosure pre-sale inventory rate: 0.95%
- Total U.S. foreclosure pre-sale inventory rate: Down 3.29% MoM
- Total U.S. foreclosure pre-sale inventory rate: Down 30.53% YoY
- Total U.S. foreclosure starts: 59,700
- Total U.S. foreclosure starts: Down 1.16% MoM
- Total U.S. foreclosure starts: Down 23.56% YoY
While this is talking about foreclosure numbers for the entire U.S. it is still awesome!
Has the long-anticipated boom in multifamily housing construction finally ignited a capacity glut that will lower rents and reduce pressure on renters to buy?
Rental growth has fallen to the lowest level in six years and rents in top luxury markets have declined over the past four months in the wake of rising capacity. New apartment inventory levels grow by 50 percent in 2016 compared to 2015 (320,000 vs. 200,000 new units), according to rental listing service RENTCafé. Construction peaked in 2015 Multifamily construction appears to have peaked in 2015, according to Dodge Data & Analytics.
IF there is a capacity glut that causes rent growth to slow, I would see this as a good thing. Many renters can not afford to save to buy a home due to high rent. This means that slower rent growth could help this situation.
Good article in the Independent Mail about the tight inventory in our area with several quotes from yours truly. I urge everyone to be confident and realize that what was normal the last time they bought/sold is no longer the case.
Economists are hinging a lot of their forecasts for the US economy on how many election promises President Donald Trump keeps. Millennial household formation is one such trend, according to Matthew Pointon, a property economist at Capital Economics.
“With wage growth finally set to accelerate, thanks to the fiscal stimulus, we think a larger number of youngsters will have the resources to move out of the parental home this year,” Pointon said. The fiscal stimulus involves cutting taxes and increasing infrastructure spending to create domestic demand and, potentially, economic growth.
Since young people can move out while still single, the decision to stay home goes back to economics: whether they can save enough to afford a down payment to buy, or are earning enough to afford renting on their own. And an improvement in their situation depends on how much American workers benefit if companies enjoy a windfall from the pro-business stimulus Trump has proposed.
Interesting. No one knows for sure what the future holds…
But if we do start to see more household formation, it could be great. On the other hand, with inventory still tight, this might cause the supply of homes for sale to get even tighter.
Apartment markets continued to retreat in the January National Multifamily Housing Council (NMHC) Quarterly Survey of Apartment Market Conditions. All four indexes of Market Tightness, Sales Volume, Equity Financing and Debt Financing remained below the breakeven level of 50 for the second quarter in a row.
Remain calm because they also said that demand remains strong.
CFPB Orders Citi Subsidiaries to Pay $28.8M for Giving the Runaround to Borrowers Trying to Save Their Homes
The Consumer Financial Protection Bureau (CFPB) today took separate actions against CitiFinancial Servicing and CitiMortgage, Inc. for giving the runaround to struggling homeowners seeking options to save their homes. The mortgage servicers kept borrowers in the dark about options to avoid foreclosure or burdened them with excessive paperwork demands in applying for foreclosure relief. The CFPB is requiring CitiMortgage to pay an estimated $17 million to compensate wronged consumers, and pay a civil penalty of $3 million; and requiring CitiFinancial Services to refund approximately $4.4 million to consumers, and pay a civil penalty of $4.4 million.
“Citi’s subsidiaries gave the runaround to borrowers who were already struggling with their mortgage payments and trying to save their homes,” said CFPB Director Richard Cordray. “Consumers were kept in the dark about their options or burdened with excessive paperwork. This action will put money back in consumers’ pockets and make sure borrowers can get help they need.”
Yet another fine or settlement…
The count of unfilled jobs in the overall construction sector remained elevated in November, as residential construction employment continues to grow. The open position rate (job openings as a percent of total employment) for November was 2.7%. On a smoothed twelve-month moving average basis, the open position rate for the construction sector increased to 2.8%, setting a cycle high and exceeding the peak twelve-month moving average rate established prior to the recession.
If Trump keeps his promises, we could see more positive reports about construction employment.
The market potential for existing-home sales fell 3.1 percent between November and December due to the post-election rate increase, offsetting increased demand caused by the strength of the broader economy, particularly wage growth and improving access to credit. However, the market continues to underperform its potential due to the highly limited inventory. While low inventories are still responsible for higher prices, I expect the impact of the increasing mortgage rates will cause a modest cooling in house price growth in 2017.
Please understand that when they said a cooling in house price growth, that does NOT mean that home prices will stop increasing. Only that the rate that home prices are increasing will slow down slightly.
A $90 billion wave of maturing commercial mortgages, leftover debt from the 2007 lending boom, is laying bare the weak links in the U.S. real estate market.
The delinquency rate for commercial mortgages that have been packaged into bonds is forecast to climb by as much as 2.4 percentage points to 5.75 percent in 2017, reversing several years of declines, as property owners struggle with maturing loans, according to Fitch Ratings. That sets the stage for bondholder losses.
You have to wonder if the problems that some retailers are experiencing will add to this situation. Closed stores mean no rent for the property owner and could lead to even more problems.
Wells Fargo says it’s found evidence that whistleblowers faced retaliation for trying to stop illegal sales tactics within the company. Wells Fargo has been at the center of controversy since last fall, when it was revealed that bank employees opened 2 million fake accounts in order to meet sales goals. At the time, several former employees came forward to say they were retaliated against for trying to bring the issue to light.
Not surprising behavior from a big bank. Something to consider when selecting a bank to do business with…
Four former employees say that Wells Fargo made clients in its Los Angeles region pay for missing deadlines to lock in interest rates on loans, even though the delays were the bank’s fault.
Wow, yet another negative story about Wells Fargo.
The mortgage industry has gone through some changes in the last three months. If you’re looking to finance a home in 2017, it’s important that you know what the opportunities are and how to capitalize on them. Over the next 12 months, here are some things to keep in mind as you consider your financing.
A must read for anyone buying home in 2017.
Americans’ confidence in the U.S. economy reached new heights last week. Americans have viewed the economy more positively since President Donald Trump’s election in November than they did in the nine years prior — largely attributable to improved confidence among Republicans.
I wonder why the increase in Republican sentiment isn’t offset by a decrease in Democrat sentiment? As for an independent like me, I prefer to wait and see what actually happens. That being said, I am more confident in the economy and housing market than I have been since the market crashed many years ago!