2024 – Page 19

Redfin Reports Buyers Are Coming Back: Mortgage Demand Shoots Up, Home Tours Hit Highest Level Since May

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Mortgage-rate locks rose 68% from a month earlier in the days after the Fed announced its interest-rate cut. Many house hunters had been waiting for the Fed’s cut before locking in a mortgage rate. Homebuyers locked in nearly 70% more mortgages than they did a month earlier on September 23, according to a new report from Redfin, the technology-powered real estate brokerage. The report analyzes mortgage rate-lock data from Optimal Blue. The surge in mortgage-rate locks comes five days after the Fed cut interest rates for the first time in four years. It’s worth noting that the surge in mortgage-rate locks may overstate the increase in mortgage demand, as it could be exacerbated by buyers who had already decided to purchase a home but were waiting to lock in a rate until after the Fed meeting. Still, there are other indicators that demand is improving. Mortgage-purchase applications are up more than 10% month over month. Additionally, Redfin’s Homebuyer Demand Index–a measure of tours and other buying services from Redfin agents–shot up to its highest level since May during the week ending September 22. It’s also notable that the Demand Index rose 1% annually, the first increase in nearly a year. Pending U.S. home sales fell 3.1% during the four weeks ending September 22, but that’s the smallest decline in five weeks, and the increases in mortgage-rate locks and mortgage applications will likely lead to an uptick in sales over the next few weeks. News of the Fed’s historic interest-rate cut is the main factor bringing home buyers off the sidelines. Mortgage rates and housing costs had been declining meaningfully for several weeks before the rate cut, but before this week it hadn’t led to an uptick in demand. Many house hunters had been waiting for the rate cut to actually happen to get serious about buying, and now they have, even though mortgage rates didn’t fall further after the rate cut than they had in the week leading up to it. Improving affordability is also, of course, a major factor bringing buyers back. The median monthly housing payment is down 4.4% year over year, the biggest decline in more than four years. It has dropped to its lowest level since January (with the exception of the prior 4-week period), thanks to mortgage rates dropping to their lowest level since February 2023 last week. (Home prices are still increasing nationwide, rising 3.9% year over year.) In some metro areas, such as San Jose, CA and Los Angeles, housing payments have fallen more significantly. “One new client decided to start their home search last Thursday because of the Fed’s rate cuts on Wednesday,” said Andrew Vallejo, a Redfin Premier agent in Austin, TX. “They immediately reached out to a real estate agent and they’re working with a lender. Rate cuts have sparked more showings; we’re seeing all of our listings in the area get more traffic. It’s a nice glimmer of hope after a slow year in Austin.” Declining mortgage rates and the Fed’s rate cut are also leading to fresh supply. New listings of homes for sale are up 7.6% year over year, the biggest increase since June, with sellers realizing it’s unlikely mortgage rates will drop back down to the 3% or 4% range anytime soon. It’s worth noting another reason for annual uptick in new listings is that they were quite low at this time last year. For Redfin economists’ takes on the housing market, please visit Redfin’s “From Our Economists” page. To view the full report, including charts, please visit:

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New platform exits beta, empowering mortgage professionals with a unified, AI-enhanced solution that optimizes processes, increases productivity and fosters seamless collaboration Simplist Technologies, the innovator behind the award-winning mortgage marketplace Simplist, is excited to announce the official launch of Sonar, the world’s first mortgage experience platform. This follows a successful beta phase with over 200 mortgage companies. Sonar seamlessly integrates loan origination system (LOS) and point-of-sale (POS) systems, providing mortgage professionals with a comprehensive, all-in-one solution to revolutionize the mortgage journey from start to finish. “With Sonar, we’ve combined the POS and LOS into a single, streamlined platform, enhancing the entire mortgage journey for mortgage originators and borrowers alike,” said Chris de la Motte, co-founder and co-CEO of Sonar. “By helping thousands of people secure mortgages through Simplist, we gained deep insights into the often disjointed and complex nature of mortgage systems. We experienced firsthand the frustrations of using a fragmented tech stack, and Sonar was built to solve these problems by creating a seamless, modern solution for the entire industry — including borrowers and mortgage professionals alike.” The mortgage industry has long grappled with outdated and disconnected systems, often requiring mortgage professionals to juggle multiple tools to manage a single loan. This disjointed process can result in high costs, inefficiencies and frustration for originators and consumers alike. Sonar addresses these challenges head-on by offering a unified platform that simplifies the origination process, enhances productivity and reduces costs. Key features include: Anthony Sherman, co-founder and co-CEO at Sonar, added: “With over 20 years of experience in the mortgage industry, I have never been as excited about a development as I am about AI. AI is set to revolutionize mortgage origination by automating the nuanced processes, reducing costs for originators, minimizing errors and ultimately providing a better experience for consumers. At Sonar, we are proud to be at the forefront of this transformation, streamlining workflows and relationships with AI-powered tools and bringing mortgage loan origination into the modern age.” Simplist Technologies’ deep understanding of the industry, honed through the success of its consumer mortgage platform Simplist — which has facilitated several billion dollars in originations and emerged as one of the fastest-growing mortgage companies in the United States — uniquely positions the company to address the complex challenges of mortgage origination. For more information, or to schedule a demo, please visit yoursonar.com.

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For-sale listings on Zillow will now feature detailed climate risk information for five key categories — flood, wildfire, wind, heat and air quality — along with insurance recommendations Zillow® is introducing climate risk data, provided by First Street, the standard for climate risk financial modeling, on for-sale property listings across the U.S. Home shoppers will gain insights into five key risks—flood, wildfire, wind, heat and air quality—directly from listing pages, complete with risk scores, interactive maps and insurance requirements. With more than 80% of buyers now considering climate risks when purchasing a home, this feature provides a clearer understanding of potential hazards, helping buyers to better assess long-term affordability and plan for the future. In assisting buyers to navigate the growing risk of climate change, Zillow is the only platform to feature tailored insurance recommendations alongside detailed historical insights, showing if or when a property has experienced past climate events, such as flooding or wildfires. “Climate risks are now a critical factor in home-buying decisions,” said Skylar Olsen, chief economist at Zillow. “Healthy markets are ones where buyers and sellers have access to all relevant data for their decisions. As concerns about flooding, extreme temperatures and wildfires grow — and what that might mean for future insurance costs — this tool also helps agents inform their clients in discussing climate risk, insurance and long-term affordability.” Climate risk information will be available on the Zillow app for iOS® and on the Zillow website by the end of the year, with Android™ availability expected early next year. Navigating climate risk scores on ZillowWhen using Zillow’s search map view, home shoppers can explore climate risk data through an interactive map highlighting five key risk categories: flood, wildfire, wind, heat and air quality. Each risk is color-coded and has its own color scale, helping consumers intuitively navigate their search. Informative labels give more context to climate data and link to First Street’s property-specific climate risk reports for full insights. When viewing a for-sale property on Zillow, home shoppers will see a new climate risk section. This section includes a separate module for each risk category—flood, wildfire, wind, heat and air quality—giving detailed, property-specific data from First Street. This section not only shows how these risks might affect the home now and in the future, but also provides crucial information on wind, fire and flood insurance requirements. Nationwide, more new listings came with major climate risk, compared to homes listed for sale five years ago, according to a Zillow analysis conducted in August. That trend holds true for all five of the climate risk categories Zillow analyzed. Across all new listings in August, 16.7% were at major risk of wildfire, while 12.8% came with a major risk of flooding. Zillow partnership with First StreetZillow has partnered with First Street, a trusted leader in climate risk modeling, to deliver accurate, reliable data to home shoppers. First Street’s models, developed by leading scientists and vetted through a peer-review process, are used across multiple industries, including real estate, banking, government and insurance, ensuring that the climate insights given on Zillow are both credible and actionable. First Street’s analysis of the impact of Hurricane Debby found 78% of properties flooded by that hurricane were outside FEMA flood zones, and consequently located where flood insurance isn’t mandatory. It’s important to note that 85% of these properties would have received an insurance recommendation on Zillow, highlighting how climate risk data can guide users in assessing insurance needs and making informed decisions about their future homes. “At First Street we are on a mission to connect climate change to financial risk,” said Matthew Eby, founder and CEO of First Street. “Partnering with Zillow helps us achieve that mission by providing the millions of everyday users on the Zillow platforms with the same property-specific climate risk data that is used by top banks, agencies and investors.” SOURCE Zillow

Mastering Negotiation Skills & Creative Finance Opportunities

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Matt Reilly is a seasoned expert in real estate finance with years of experience as a certified real estate appraiser and managing billions of dollars worth of non-performing loans and REOs. Today, Matt continues to specialize in bridge loans and private lending at Stonecrest Financial and he is with us to give us a little more insight on the financial side of real estate investing. Listen now to learn more about evaluating properties for investments, the different financing options you have as an investor, and more! Quotables “I think in order to negotiate well, you have to be a good listener so you always want to hear what the other side is saying and formulate your opinion.” “There are no shortcuts. Due diligence is key to most deals – you want to know as much as you can about any property or deal.” “If a deal lingers on too long, it always seems to collapse so I think when you’re getting into a deal, you always want to set realistic expectations and then you want to stick to the timeline.” Links Website: Stonecrest Financial https://stonecrestfinancial.net/ 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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Major Home-Ownership Expenses Consume 34 Percent of National Average Wage; Portion Ticks Downward as Home-Price Spike Eases and Mortgage Rates Drop; Historical Affordability Also Inches Up While Remaining Weak ATTOM, a leading curator of land, property data, and real estate analytics, released its third-quarter 2024 U.S. Home Affordability Report showing that median-priced single-family homes and condos remain less affordable in the third quarter of 2024 compared to historical averages in 99 percent of counties around the nation with sufficient data to analyze. The latest trend continues a pattern, dating back to early 2022, of home ownership requiring historically large portions of wages as U.S. home prices keep reaching new highs. The report also shows that major expenses on median-priced homes currently consume 33.5 percent of the average national wage. That level marks a slight improvement over the second quarter of this year but remains virtually unchanged from a year ago – and still above the common 28 percent lending guideline. Despite small gains in both the historic and current affordability measures, the third-quarter figures represent ongoing markers of how home ownership remains a financial stretch for average workers around the nation. They come as the national median home price has spiked to $365,000 this quarter and mortgage rates, while declining, remain above 6 percent, helping to keep ownership expenses above what lenders prefer when issuing mortgages. The portion of average wages nationwide required for typical mortgage payments, property taxes and insurance still sits 12 points above a low point reached early in 2021, right before home-mortgage shot up from the lowest levels in decades. “Home affordability continues to show signs of easing, which lightens the pressure on house hunters struggling to find a place that fits their budget,” said Rob Barber, CEO for ATTOM. “The cost of owning a home across much of the nation remains a tough go for average workers, exceeding levels preferred by banks and other lenders. But it is at least tracking in the right direction. That’s mainly because of declining interest rates.” Barber added that last week’s half-point cut in the benchmark interest rate by the Federal Reserve “should brighten the prospects for buyers, as long as it doesn’t spike demand too much and lead to even higher prices amid the ongoing tight supply of homes for sale around the U.S.” The small shift toward better affordability this quarter comes amid a mix of forces generally, but not completely, working in favor of home buyers. On the downside for house hunters are home prices and property taxes that continue to rise across the country in 2024, helping to keep affordability at historical lows. At the same time, though, a steady decline in home-mortgage rates in 2024, from more than 7 percent down to close to 6 percent, is acting as a counterweight. In addition, the national median home has increased at a slower pace this quarter versus the prior three-months. The result over the Summer months has been a 3 percent decrease in the typical cost of major home-ownership expenses at a time when average wages have grown. That combination is pushing affordability back in a better direction for house hunters. While major expenses as a portion of wages is unchanged annually, it has declined for the second straight quarter. The report determined affordability for average wage earners by calculating the amount of income needed to meet major monthly home ownership expenses — including mortgage payments, property taxes and insurance — on a median-priced single-family home and condo, assuming a 20 percent down payment and a 28 percent maximum “front-end” debt-to-income ratio. That required income was then compared to annualized average weekly wage data from the U.S. Bureau of Labor Statistics. Compared to historical levels, median home ownership costs in 575 of the 578 counties analyzed in the third quarter of 2024 are less affordable than in the past. That is mostly unchanged from both the second quarter of 2024 and the third quarter of 2023, when 574 of the same counties were historically unaffordable. Historic measures remain negative as the portion of average local wages consumed by major home-ownership expenses on typical homes are considered unaffordable during the third quarter of 2024 in about 80 percent of the 578 counties in the report, based on the 28 percent guideline. Counties with the largest populations that are unaffordable in the third quarter are Los Angeles County, CA; Cook County (Chicago), IL; Maricopa County (Phoenix), AZ; San Diego County, CA, and Orange County, CA (outside Los Angeles). The most populous of the counties with affordable levels of major expenses on median-priced homes during the third quarter of 2024 are Harris County (Houston), TX; Wayne County (Detroit), MI; Philadelphia County, PA; Cuyahoga County (Cleveland), OH, and Allegheny County (Pittsburgh), PA. View Q3 2024 U.S. Home Affordability Heat Map National median home price up quarterly and annually in majority of markets The national median price for single-family homes and condos has risen to $365,000 in the third quarter of 2024. The latest figure represents a 1.4 percent increase over the second quarter of this year and is 6.6 percent above the typical price in the third quarter of 2023, although the pace of increase has slowed compared. (Typical values shot up 7 percent from the first to the second quarter of this year). At the county level, median home prices have climbed from the second quarter to the third quarter of this year in 363, or 62.8 percent, of the 578 counties included in the report. Annually, they are up in 492, or 85.1 percent of those markets. Data was analyzed for counties with a population of at least 100,000 with sufficient data and at least 50 single-family home and condo sales in the third quarter of 2024. Among the 46 counties in the report with a population of at least 1 million, the biggest year-over-year increases in median prices during the third quarter of 2024 are in Wayne County (Detroit), MI (up 12.3 percent annually); Suffolk County (Long

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Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data, reports the following “first look” at August 2024 month-end mortgage performance statistics derived from its loan-level database representing the majority of the national mortgage market. Data as of Aug. 31, 2024 Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 3.34% Month-over-month change: -0.88% Year-over-year change: 5.11% Total U.S. foreclosure pre-sale inventory rate: 0.35% Month-over-month change: -0.85% Year-over-year change: -14.57% Total U.S. foreclosure starts: 27,000 Month-over-month change -8.61% Year-over-year change: -14.20% Monthly prepayment rate (SMM): 0.62% Month-over-month change: 4,67% Year-over-year change: 18.00% Foreclosure sales: 5,700 Month-over-month change: 2.58% Year-over-year change: – 18.09% Number of properties that are 30 or more days past due, but not in foreclosure: 1,801,000 Month-over-month change: -11,000 Year-over-year change: 117,000 Number of properties that are 90 or more days past due, but not in foreclosure: 450,000 Month-over-month change: 14,000 Year-over-year change: 2,000 Number of properties in foreclosure pre-sale inventory: 187,000 Month-over-month change: -1,000 Year-over-year change: -28,000 Number of properties that are 30 or more days past due or in foreclosure: 1,988,000 Month-over-month change: -12,000 Year-over-year change: 89,000 Top 5 States by Non-Current* Percentage Mississippi: 7.93% Louisiana: 7.87% Alabama: 5.61% Indiana: 5.30% West Virginia: 5.14% Bottom 5 States by Non-Current* Percentage California: 2.10% Montana: 2.04% Washington: 1.98% Idaho: 1.98% Colorado: 1.94% Top 5 States by 90+ Days Delinquent Percentage Mississippi: 2.10% Louisiana: 1.92% Alabama: 1.49% Arkansas: 1.30% Indiana: 1.18% Top 5 States by 12-Month Change in Non-Current* Percentage New York: -6.92% Hawaii: -6.04% Vermont: -5.10% Massachusetts: -4.39% Alaska: -3.30% Bottom 5 States by 12-Month Change in Non-Current* Percentage Arizona: 12.75% Nebraska: 12.12% Louisiana: 11.52% Tennessee: 10.22% South Dakota: 9.13% The company will provide a more in-depth review of this data in its monthly Mortgage Monitor report, which includes an analysis of data supplemented by detailed charts and graphs that reflect trend and point-in-time observations. The Mortgage Monitor report will be available online at https://www.icemortgagetechnology.com/resources/data-reports by Oct. 7, 2024. For more information about gaining access to ICE’s loan-level database, please send an email to Mortgage.Monitor@bkfs.com. Source: Intercontinental Exchange