Tag Archives: Freddie Mac

July 2017 Real Estate Market Report

Existing-Home Sales Slide 1.3 Percent in July

real estate market update for July 2017Listings in July typically went under contract in under 30 days for the fourth consecutive month because of high buyer demand, but existing-home sales ultimately pulled back as large declines in the Northeast and Midwest outweighed sales increases in the South and West, according to the National Association of Realtors®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, slipped 1.3 percent to a seasonally adjusted annual rate of 5.44 million in July from a downwardly revised 5.51 million in June. July’s sales pace is still 2.1 percent above a year ago, but is the lowest of 2017.

Lawrence Yun, NAR chief economist, says the second half of the year got off on a somewhat sour note as existing sales in July inched backward. “Buyer interest in most of the country has held up strongly this summer and homes are selling fast, but the negative effect of not enough inventory to choose from and its pressure on overall affordability put the brakes on what should’ve been a higher sales pace,” he said. “Contract activity has mostly trended downward since February and ultimately put a large dent on closings last month.”

“Home prices are still rising above incomes and way too fast in many markets,” said Yun. “Realtors® continue to say prospective buyers are frustrated by how quickly prices are rising for the minimal selection of homes that fit buyers’ budget and wish list.”

According to Freddie Mac, the average commitment rate (link is external) for a 30-year, conventional, fixed-rate mortgage rose to 3.97 percent in July from 3.90 percent in June. The average commitment rate for all of 2016 was 3.65 percent.

To read the rest of this article, visit here

Money Monday: Declining 30-year mortgage rates

Source: Associated Press

mortgage rates and property taxesLong-term U.S. mortgage rates edged lower this week. As rates remain at historically low levels, homeowners taking advantage of the chance to refinance their mortgages have pushed up refinancing activity.

Mortgage giant Freddie Mac said Thursday the average for the benchmark 30-year fixed-rate mortgage declined to 3.44 percent from 3.46 percent last week. The average rate is down from 3.90 percent a year ago, and is close to its all-time low of 3.31 percent in November 2012. The 15-year fixed mortgage rate eased to 2.76 percent from 2.77 percent.

Full story: finance.yahoo.com/news/us-average-30-mortgage-rate-144315073

Money Monday: Mortgages are still getting cheaper

Mortgage rates are dropping.

“In December, when the Federal Reserve raised rates for the first time in nearly a decade, many would-be homebuyers assumed it meant the beginning of the end for record-low mortgage rates.

mortgage rates and property taxes

“‘This is evidence that the Federal Reserve isn’t the sole determinant of U.S. mortgage rates,’ said Mark Hamrick, senior economic analyst at Bankrate.

“The 30-year mortgage rate fell to 3.79%, the fourth straight week of declines, according to Freddie Mac. A year ago, the rate averaged 3.66%.

“The rate on a 15-year fixed mortgage also dropped to 3.07%…

“…But tight inventory has helped push home prices higher, creating an affordability problem in many markets throughout the country.

“In response to the lower rates, mortgage applications ticked up 8.8% last week.”

Read the rest of CNN’s article here: money.cnn.com/2016/01/28/real_estate/mortgage-rates-fall

 

December’s real estate market conditions

December Existing-Home Sales Rise, 2013 Strongest in Seven Years

housing market trendExisting-home sales edged up in December, sales for all of 2013 were the highest since 2006, and median prices maintained strong growth, according to the National Association of Realtors®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased Continue reading

Freddie Mac economist makes ’13 housing predictions

Frank Nothaft, chief economist for mortgage giant Freddie Mac, is in San Diego this weekend for the American Economic Association annual meeting. He took some time Friday to talk to U-T San Diego about his national and regional predictions for housing in 2013. Here are some excerpts:

On housing activity: It began to turn around in 2012 and will continue to pick up in 2013. Housing starts nationwide were up 25 percent in 2012 from 2011. Home sales were up about 9 percent during that same time frame. Housing starts this year may rise an additional 20 percent to 25 percent and home sales may rise another 8 percent to 10 percent. Southern California also will see pickup in home prices and sales.

On mortgage rates: Mortgage rates are going to stay at a very low level, mainly due to the Federal Reserve’s decision to continue buying up large quantities of mortgage-backed securities. That pushes up the price of those securities, which reduces the yield and drives the very-low interest rates. The 30-year fixed conforming loan rate is expected to remain below 4 percent…

Read the rest of SignonSanDiego.com’s article here: “Freddie Mac economist makes ’13 housing predictions”.

New short-sale program offers relief for underwater homeowners

One of the federal government’s most-important financial relief efforts for underwater homeowners started operating Nov. 1.

  •  Traditionally short sales, where the lender agrees to accept less than the full amount owed and the house is sold to a new purchaser at a discounted price, are associated with extended periods of delinquency by the original owner. The new Fannie-Freddie program breaks with tradition by allowing short sales for owners who are current on their payments but are encountering a hardship that could force them into default.
  • Eligible hardships under the new program run the gamut: Job loss or reduction in income; divorce or separation; death of a borrower or another wage earner who helps pay the mortgage; serious illness or disability; employment transfer of 50 miles or greater; natural or man-made disaster; a sudden increase in housing expenses beyond the borrower’s control; a business failure; and “other,” meaning a serious financial issue that isn’t one of the above.
  • Homeowners who participate in this new program should be aware that although officials at the Federal Housing Finance Agency – the agency that oversees the program – are working on possible solutions with the credit industry at the moment, it appears that borrowers who use the new program may be hit with significant penalties on their FICO credit scores – 150 points or more.
  • Other factors to consider are promissory notes and other “contributions.” In the majority of states where lenders can pursue deficiencies, Fannie and Freddie expect borrowers who have assets to either make upfront cash contributions covering some of the loan balance owed or sign a promissory note. This would be in exchange for an official waiver of the debt for credit reporting purposes, potentially producing a more favorable credit score for the sellers.
  • Finally, participants should be aware of second-lien hurdles. The program sets a $6,000 limit on what second lien holders – banks that have extended equity lines of credit or second mortgages on underwater properties – can collect out of the new short sales. Some banks, however, don’t consider this a sufficient amount and may threaten to thwart sales if they cannot somehow extract more.

Read the full story
http://www.latimes.com/business/realestate/la-fi-harney-20121111,0,6735335.story

Why the big banks are doing more short sales

Why the big banks are doing more short sales

“San Diego County’s level of housing distress took a pivotal turn this year. Short sales, once rare deals in the real estate world, now make up a bigger share of the residential market compared to foreclosed homes that have been resold.

Short sales allow homeowners who can’t afford their mortgages to sell their homes for less than what they still owe, as long as the lender says OK. One in five homes resold in the county were short sales, based on August numbers from local real estate tracker DataQuick. Compare that to single-digit percentages seen while the housing bubble began to percolate in 2007.

Short SaleShort sales are expected to become even more common and easier to close as Freddie Mac, which owns or guarantees a sizable chunk of mortgages in California, will make it easier for borrowers to complete them starting next month. Borrowers will see that the process is considerably shorter and that it will leave less of a financial black mark on their credit histories.

Already boosting the number of short sales is a $25 billion mortgage deal between the nation’s biggest banks and 49 states that settled foreclosure abuse allegations and was signed earlier this year. The agreement essentially forces banks to do more short sales and provide relief to borrowers on expedited terms. Some banks are even offering cash as incentives to get more people to short sell.

“Banks are really motivated to do short sales,” said Matt Battiata, who owns Del Mar-based Battiata Real Estate. “…Banks have decided and learned over the last several years that short sales are a much better way to mitigate loss.”

The end result appears to be good for the housing market.

The increase in short sales means a more dynamic real estate market, fewer losses for banks and increased chances that short sellers could buy homes again after a shorter hiatus…”

Read the rest of this article by SignonSanDiego.com here: “Why the big banks are doing more short sales”.

Do you need help in selling your home as a short sale? Give me a call–I have experience in closing over 150 short sales in San Diego county.  – John A. Silva (619) 890-3648 | www.JohnASilva.com

NEW Government Ruling Devastating

Fannie, Freddie: the two government entities leader or housing regulator Edward DeMarco said this last Tuesday there will be no benefit to principle reductions of troubled borrowers who are upside down and has ordered all firms or institutions to not allow any help that is provided in the guidelines of the HAMP (Home Affordable Modification Program) and HARP (Home Affordable Refinance Program). He stated: “we concluded that the potential benefit was too small and uncertain, relative to the known and unknown costs and risks”. THIS IS DEVASTATING!!!

Treasury Secretary, Timothy Geithner noted that in the agency’s own analysis, that Fannie  and Freddie could save $3.7 billion by participating in the administration’s housing programs (HAMP & HARP), the taxpayers would save $1 billion. My commentary is that the institutions once again are controlling this country and not the government. The Obama administration, lawmakers on Capitol Hill, and housing advocates argue that principle reduction is an essential tool to help the 5 year crisis that is still going strong due to millions or about a quarter of the nation’s homeowners are under water, representing excessive mortgage debt of about $700billion!! This decision could burst the bubble that was going down in size due to the workout programs in place that have temporarily bandaged the real estate market, but now with no real help in the near future, the average homeowner who is on the fence will bail or walk away from their home. Coupled with the fact that many state laws have provisions protecting homeowners through the end of this year, I expect an onslaught of upside down homeowners to short sale their homes to take advantage of salvaging incentives currently being offered by most banks.

DeMarco, in his statement noted that only a small percentage of homeowners would strategically default on their mortgage, while most advocates would encourage it, so the savings would literally disappear for the agencies and the taxpayer. I say this is Chicken Little-type thinking and he is playing this game to not allow further losses to the institutions, who I believe are running the show!! Further, he also stated that the institutions investors would be spooked over this reduction program causing an increase in mortgage costs in the future. Another statement that shows the banks rule!!

In conclusion, the gains that have been made in the current real estate market are clearly at risk now, and will no doubt cause an increase of activity in sales and foreclosures in the near future, resulting in values stagnating, to possible reductions more likely. You can view more on this recent development here: http://www.fhfa.gov/webfiles/24113/pfstatement73112.pdf

Your comments are appreciated. What are your thoughts on this recent real estate news?