September 2024 – REI INK

HOME FLIPPING ACTIVITY DIPS SLIGHTLY WHILE PROFITS INCH UP IN Q2 2024

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Flipping Rate Follows Usual Springtime Downward Track While Profits Keep Moving Slowly Higher; Investment Returns Still Hovering Around Modest 30 Percent Level Nationwide; Typical Raw Flipping Profit Rises Close to $75,000 ATTOM, a leading curator of land, property data, and real estate analytics, released its second-quarter 2024 U.S. Home Flipping Report showing that 79,540 single-family homes and condominiums in the United States were flipped in the second quarter. Those transactions represented 7.5 percent, or one of every 13 home sales, nationwide during the months running from April through June of 2024. The latest portion of flipped properties was down from 8.7 percent of all sales in the U.S. during the first quarter of 2024 – a common pattern during the busy annual Springtime buying season each year when other types of home sales spike. The flipping rate also was down slightly from 7.9 percent a year earlier. While the rate declined, fortunes kept ticking upward for investors who buy, renovate and quickly resell homes. The latest data showed that investors typically earned a 30.4 percent profit nationwide before expenses on homes sold during the second quarter of this year, marking the fourth time in five quarters that margins increased following a six-year period of nearly continuous drop-offs. The typical profit margin on homes flipped during the second quarter of 2024 – based on the difference between the median purchase and median resale price for home flips – remained about 25 percentage points below peaks hit in 2016. It also stayed within a range that could easily be wiped out by carrying costs that include renovation expenses, mortgage payments and property taxes, revealing anew the struggles home flippers are having in turning healthy profits. But the return on investment was up slightly from both the first quarter of 2024 and from a low point over the past decade of about 25 percent in the first quarter of last year. Gross profits on typical flips around the country, meanwhile, increased to about $73,500. That remained down from a high of almost $81,000 reached in 2022, but up from $70,000 in the first quarter of 2024 and more than $12,000 above last year’s low point. “The Spring home-buying season of 2024 brought another sign of hope for home flippers that the rebound in fortunes that began for them last year was more than just a temporary thing,” said Rob Barber, CEO for ATTOM. “It’s not as if profits have shot through the roof and investors are riding a new wave of good times. Far from it, as they continue to struggle to benefit from the broader market boom. But the second-quarter numbers did show another step in the right direction.” He added that “with the market rising amid tight supplies of homes for sale around the country and falling interest rates, conditions appear ripe for more improvement over the rest of the year as long as prices don’t shoot up past what most buyers can afford.” The small changes in flipping activity and profit margins during the second quarter came during yet another period of mixed patterns for the home-flipping industry compared to the U.S. housing market. Overall, home prices rebounded strongly during the second quarter from a varied period of gains and losses during the prior 12-month period. Median prices for all single-family homes and condos nationwide rose 9 percent quarterly and 6 percent annually. But home-flipping resale prices rose far less, with the median inching up only 2 percent quarterly and annually to $315,000. Nevertheless, that was enough to boost flipping profit margins as investors benefitted, in small increments, from shifts in prices going in their favor between the time of purchase to resale. Those gaps led to the quarterly and yearly improvement in investment returns. The latest gains for home flippers extended their recovery from an unusual pattern of timing the housing market poorly, which resulted in their profits dropping from 2016 through 2022 while returns for other sellers soared. Home-flipping rates dip downward in most of U.S. Home flips as a portion of all home sales decreased from the first quarter of 2024 to the second quarter of 2024 in 159 of the 185 metropolitan statistical areas around the U.S. with enough data to analyze (85.9 percent). They went down annually in 115, or 62.2 percent, of those markets. Measured against the same peak buying period of 2023, most flipping rates declined less than one percentage point. (Metro areas were included if they had a population of 200,000 or more and at least 50 home flips in the second quarter of 2024). Among the metro areas analyzed, the largest flipping rates during the second quarter of 2024 were in Warner Robins, GA (flips comprised 20.7 percent of all home sales); Macon, GA (15.4 percent); Atlanta, GA (13.4 percent); Columbus, GA (13.2 percent) and Memphis, TN (12.8 percent). Q2 2024 U.S. Home Flipping Historical Trends Aside from Atlanta and Memphis, the highest second-quarter flipping rates among metro areas with a population of more than 1 million were in Birmingham, AL (11.7 percent); Cleveland, OH (11 percent) and Columbus, OH (10.7 percent). The smallest home-flipping rates were in Hilo, HI (3.3 percent); Honolulu, HI (3.5 percent); Seattle, WA (4 percent); San Jose, CA (4.1 percent) and Portland, OR (4.2 percent). Typical home-flipping returns up year over year in slightly more than half of U.S. The median $315,000 resale price of homes flipped nationwide in the second quarter of 2024 generated a gross profit of $73,492 above the median investor purchase price of $241,508. That resulted in a typical 30.4 percent gross profit margin before expenses in the second quarter of 2024, up about one point from 29.2 percent in the first quarter of 2024 and up from 27.8 percent in the second quarter of last year. But the latest nationwide figure still remained far beneath the 56.3 percent level in mid-2016 and from a more recent peak of 48.8 percent in 2020. . Profit margins increased from the first to the second

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ServiceLink, the nation’s premier provider of tech-enabled services for all phases of the mortgage lifecycle, is pleased to announce the promotion of Antonio Little to vice president, national sales manager in the origination division, where he will oversee account executives across the country. Known for his warm personality and ability to gain trust, Little is a sought-after leader with 24 years of industry experience, eight of which he’s spent at ServiceLink. He has been a part of the Fidelity National Financial family of companies for nearly 10 years. Little is a customer-centric visionary, with a background in operations, training, business development and management across nearly all channels of the mortgageservices industry. He spent the bulk of his career in management, focusing on strategy and implementation of new processes, with a stint as chief revenue officer at an IT consulting firm. Over the course of his career, Little has helped companies expand their operations throughout the United States and into both Canada and Australia. He has an expansive knowledge of the industry and has spent most of his career working with top-tier clients, always striving to marry ServiceLink’s rich skillset and expertise with the needs of industry clients. ServiceLink also is excited to welcome two national sales executives to its default and origination divisions. They will each be responsible for driving client growth and new business development in their respective divisions. Raquel Pasala brings more than 15 years’ experience in the mortgage servicing and financing space to ServiceLink’s default division, where she will serve as vice president, national sales executive. She is known for her meticulous attention to detail, adaptability, dedication and a comprehensive understanding of financial processes. Pasala also has extensive experience in real estate, law, origination, insurance and client relations, along with a deep knowledge of property preservation and the single-family rental market. Pasala comes to ServiceLink after a stint at First Allegiance, where she served as senior vice president in strategy and business relations. Kevin Ziolkowski, who joins ServiceLink’s origination division as a national sales executive, brings decades of industry experience, with a background in sales, operations, insurance, account management and technology. Ziolkowski has a proven track record of success in developing and implementing complex initiatives to drive improved customer satisfaction and growth. He comes to ServiceLink from Magellan Solutions USA, where he was director of business development. Previously, Ziolkowski spent nearly a decade as vice president of sales at Black Knight, where he focused on data and analytics partnerships nationwide. He also helped create a startup and tech-forward organization by leading sales at Mortgage Harmony, now Finofr. He has extensive experience in the mortgage insurance sector, where he created and grew strategic partnerships and has received multiple top sales performer awards throughout his mortgage career.

How Smart Home Tech is Revolutionizing Real Estate

Danny Linenger is the Director of US Operations at Swidget, a company that provides cutting edge smart home technology. He has over 21 years of experience in building products and over 10 years in the single-family rental space, and he is with us today to talk about his journey and what brought him the success he has today. Listen now to learn more about Danny’s journey, Swidget’s approach to smart home technology, and how technology is impacting the real estate world today! Quotables “The biggest thing I’ve learned in this industry is really not to burn bridges. It’s a really small but connected network.” “If you’ve built relationships with other folks, they’re happy to make those introductions to the right people.” “Coming from a big company to a smaller company, just the ability to actually listen to a customer, understand the problem, develop the solution, build a solution, and implement a solution all within a matter of weeks or months – I still can’t get over that.” Links LinkedIn: Danny Linenger Website: RCN Capital https://www.rcncapital.com/podcast Website: REI INK https://rei-ink.com/ Email: RCN Capital info@rcncapital.com

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Guidewire announced the availability of critical data and maps detailing hurricane risk at the national, state, and local levels in the United States. This service leverages HazardHub’s more than 1,000 data points and risk scores for climate risks and extreme weather events. Top States for Hurricane Risk The top ten states for hurricane risk, based on the percentage of properties rated as “D” (high) or “F” (very high) risk for hurricane damage in the Guidewire HazardHub Hurricane Risk Model, are: 1. Florida2. Louisiana3. South Carolina4. Texas5. Mississippi6. North Carolina7. Delaware8. Georgia9. Alabama10. Virginia These states face the highest hurricane risk, factoring in the likelihood of Category 1 or greater hurricanes, proximity to the coast, and the frequency of tropical and subtropical events, among other factors. States at Risk of Storm Surge The percentage of housing units at risk of storm surge flooding in high-risk states for hurricanes, as indicated by an “F” rating in the HazardHub SurgeMax Storm Surge Flooding Model, are: The HazardHub SurgeMax Score is a metric developed by HazardHub to measure the risk of storm surge flooding for any given location. The score is designed to help insurers, underwriters, and others assess and manage the risk associated with storm surge events, which can be a significant threat in coastal areas, particularly during severe hurricanes. The SurgeMax Score takes into account various factors, including historical NOAA storm surge data, topography, distance from the coast, and other relevant geographical and environmental data to estimate the potential severity of storm surge impacts. In Florida, the state at most significant risk for hurricane events, nearly 1 out of 3 homes, or 3 million homes, are susceptible to storm surge flooding from hurricanes, making it one of the most vulnerable states to flooding from hurricanes. In Louisiana, the state with the second greatest hurricane risk, approximately 52% of homes, or 910,000 homes, are susceptible to hurricane storm surge flooding. Louisiana is highly prone to hurricanes and storm surge flooding due to its location along the warm waters of the Gulf of Mexico, its low elevation and flat terrain, and the ongoing loss of protective wetlands and barrier islands. The Mississippi River Delta’s subsidence further exacerbates the state’s vulnerability, making it one of the most at-risk areas for flooding during hurricanes. “Understanding hurricane risk is vital for insurers and property owners alike, as it informs their coverage options, emergency plans, and mitigation strategies,” said Christina Hupy, Vice President, HazardHub at Guidewire. “HazardHub helps insurers better understand a property’s climate and hurricane risks at the individual address level, enabling more accurate underwriting of that risk. With this technology, property owners, meanwhile, are also better informed to be able to mitigate their risks and prepare for these events.” The HazardHub Hurricane Risk Scores and other detailed data and risk scores are accessible to insurers through Guidewire apps, including PolicyCenter and InsuranceNow, and via the HazardHub API. Consumers interested in learning about their home’s risks can visit freehomerisk.com. About Guidewire Guidewire is the platform P&C insurers trust to engage, innovate, and grow efficiently. More than 570 insurers in 42 countries, from new ventures to the largest and most complex in the world, rely on Guidewire products. With core systems leveraging data and analytics, digital, and artificial intelligence, Guidewire defines cloud platform excellence for P&C insurers. We are proud of our unparalleled implementation record, with 1,700+ successful projects supported by the industry’s largest R&D team and SI partner ecosystem. Our marketplace represents the largest solution partner community in P&C, where customers can access hundreds of applications to accelerate integration, localization, and innovation. For more information, please visit www.guidewire.com

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Foreclosure Starts Decrease 5.1 Percent from Last Month; Completed Foreclosures Decrease 12 Percent from Last Month ATTOM, a leading curator of land, property, and real estate data and analytics, released its August 2024 U.S. Foreclosure Market Report, which shows there were a total of 30,227 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions — down 5.3 percent from a month ago and down 11 percent from a year ago. “Foreclosure activity has remained relatively steady in recent months, with both foreclosure starts and completed foreclosures declining in August,” said Rob Barber, CEO at ATTOM. “While overall activity is significantly lower than the peaks seen during the 2008 financial crisis, when filings exceeded 300,000 per month, the current economic environment, coupled with rising interest rates and affordability challenges, suggests a continued focus on potential housing market instability.” Nevada, Florida, and Illinois post highest foreclosure ratesNationwide, one in every 4,662 housing units had a foreclosure filing in August 2024. States with the highest foreclosure rates were Nevada (one in every 2,473 housing units with a foreclosure filing); Florida (one in every 2,605 housing units); Illinois (one in every 2,837 housing units); South Carolina (one in every 2,877 housing units); and New Jersey (one in every 3,227 housing units). Among the 224 metropolitan statistical areas with a population of at least 200,000, those with the highest foreclosure rates in August 2024 were Lakeland, FL (one in every 1,245 housing units with a foreclosure filing); Chico, CA (one in every 1,526 housing units); Columbia, SC (one in every 1,796 housing units); Bakersfield, CA (one in every 1,972 housing units); and Las Vegas, NV (one in every 2,016 housing units). Other than Las Vegas, those metropolitan areas with a population greater than 1 million with the worst foreclosure rates in August 2024 were: Riverside, CA (one in every 2,423 housing units); Miami, FL (one in every 2,429 housing units); Chicago, IL (one in every 2,450 housing units); and Orlando, FL (one in every 2,595 housing units). Greatest numbers of foreclosure starts in Florida, California, and TexasLenders started the foreclosure process on 20,747 U.S. properties in August 2024, down 5.1 percent from last month and down 9.4 percent from a year ago. States that had the greatest number of foreclosure starts in August 2024 included: Florida (2,668 foreclosure starts); California (2,443 foreclosure starts); Texas (1,857 foreclosure starts); New York (1,328 foreclosure starts); and Illinois (1,208 foreclosure starts). Those major metropolitan areas with a population greater than 1 million that had the greatest number of foreclosure starts in August 2024 included: New York, NY (1,332 foreclosure starts); Chicago, IL (1,069 foreclosure starts); Miami, FL (743 foreclosure starts); Los Angeles, CA (675 foreclosure starts); and Houston, TX (507 foreclosure starts). Foreclosure completion numbers decrease from last month and last yearLenders repossessed 2,889 U.S. properties through completed foreclosures (REOs) in August 2024, down 12.0 percent from last month and down 13.9 percent from a year ago. States that had the greatest number of REOs in August 2024, included: Pennsylvania (266 REOs); California (229 REOs); Illinois (224 REOs); Michigan (206 REOs); and Florida (202 REOs). Those major metropolitan statistical areas (MSAs) with a population greater than 1 million that saw the greatest number of REOs in August 2024 included: Chicago, IL (154 REOs); Detroit, MI (114 REOs); New York, NY (112 REOs); Pittsburgh, PA (100 REOs); and Baltimore, MD (56 REOs). Media Contact:Megan Huntmegan.hunt@attomdata.com SOURCE ATTOM

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Competition among buyers is likely to extend into the fall thanks to improved affordability Lower mortgage rates and rising inventory are giving home buyers a window of opportunity at an unusual time of year, according to the latest market report from Zillow®. Affordability has improved substantially for home buyers, and competition among them could extend into the fall instead of fading away as is typical at this time of year. “Late summer may be an opportunity for buyers who have been waiting in the wings for a monthly mortgage payment they can qualify for,” said Skylar Olsen, Zillow chief economist. “Buyers have more options to choose from for two reasons. For one, it’s easier to qualify for more of the homes on the market now that mortgage rates are a bit lower. Beyond that, more inventory is becoming available — enough to improve buyer negotiating power. Attractive properties in hot markets are still selling quickly, but some metros — or neighborhoods within them — have flipped further in favor of buyers.” Mortgage rate declines have made buying a home roughly affordable again at the national level (meaning monthly payments generally take less than one-third of median household income), assuming a buyer puts 20% down and before taxes and insurance are accounted for. Nationwide, the monthly payment on a typical home purchase has fallen by more than $100 since a peak in May. That drop is more than $300 a month in the ultraexpensive San Francisco metro area. Beyond lower costs, a number of metrics are moving in buyers’ favor. The Zillow market heat index shifted from being in favor of sellers into neutral territory in July. For the past two years, sellers held their edge nationally until October. Homes are taking longer to sell than in recent history, but shorter than in pre-pandemic times. Homes that sold in August took 20 days to go pending, two more than in July, but about six days faster than at this time of year before the pandemic. And while inventory growth has slowed, nearly 1.18 million homes are on the market, more than any month since September 2020. Lower rates could stall or slow a normal autumn cooldown, because right now buyers are more likely to be motivated by lower rates than sellers are. Some signals are already pointing to an altered trajectory in the housing market. The share of listings on Zillow with a price cut ticked down from July to August, reversing an upward trend of rising every month since March. Just under 26% of homes on the market had a price cut in August. That’s relatively high for this time of year, but not a record, as seen in recent months. Opportunities for buyers Opportunities for sellers SOURCE Zillow