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Next-Gen Property Valuations

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PropStream Announces New AVM & AI Innovations PropStream, the leading real estate data provider, announced another enhancement in its lineup of updates powered by machine learning AI—AI Property Values and AVM (Automated Valuation Model). By upgrading the Estimated Value function (AVM) powered by machine learning, PropStream can provide the most up-to-date property values by pulling them from several data sources and updating them with its machine learning AI as soon as they’re available. “PropStream is committed to transforming how real estate data is collected and used with the integration of new predictive AI features,” said PropStream President Brian Tepfer. “Our first release is a new AVM powered by machine learning—giving our users an edge in their property research and comping to collect the most precise, diverse, and dynamic property valuations – empowering them to make educated decisions.” From adding the Demographics datasets to now incorporating a cutting-edge machine learning AVM, PropStream is leading the charge in optimizing real estate data for practical, modern use. PropStream has more exciting updates in the works, so stay tuned! Also, remember to activate your 7-day free PropStream trial to see the new AVM in action. To learn more about this update and how the AI model is used, check out this blog. About PropStream: PropStream, a Stewart Company, is the leader in multi-sourced data aggregation, allowing real estate professionals to get the most targeted leads. In business since 2006, PropStream has data for over 155 million properties nationwide. Upcoming enhancements utilize the power of Predictive Real Estate Data to pave the way for new features, proprietary AI predictive analytics, and hundreds of filtering combinations (including 20 Lead Lists). PropStream helps real estate professionals find the best off-market leads and market to them in the least amount of time. PropStream was acquired by Stewart Information Services Corporation (NYSE:STC) in November 2021 and has been named a HousingWire Tech 100 Honoree four years in a row since 2021. Contacts PropStream Marketing1-877-204-9040

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Nearly Half of Prospective Home Buyers Struggle with Basic Home Costs, Worry About Home Insurance Affordability Amidst Extreme Weather

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Two Bright Spots: Almost Two in Three Expect Mortgage Rates to Drop; More Than Four in Ten Say 5% Mortgage Rates Would Compel Them to Buy Nearly half of prospective home buyers are struggling to pay basic home costs and say home insurance affordability is a major factor in where they decide to move, according to the results of a survey of 1,818 US adults across the country released today. The survey was conducted by Mphasis Digital Risk, a leading provider of origination, diligence, quality control and artificial intelligence services for the mortgage, consumer lending and financial services industries.  Despite their concerns regarding insurance and costs associated with housing, Americans are more positive regarding the direction of interest rates, and what they call their “magic number” – representing the mortgage rate that would compel them to make a home purchase. More than four in ten (42%) cited a 5% rate as the “sweet spot”; more than one in four (27%) said 4%, and one in five (20%) said the magic number was 6%. In addition, Americans are generally optimistic about the general direction of the mortgage market. Almost two out of three people (64%) say they are either “very encouraged” (21%) or “somewhat encouraged” (43%) that mortgage rates will be dropping soon. However, a significant number of respondents, 40%, said they would put off buying a home until after November’s presidential election is settled. The largest share of respondents, 30%, blamed “inflation” as a driving factor of high mortgage rates; 23% blamed the current president, while 13% blamed the Federal Reserve. The surprisingly large number of people (48%) challenged by home-related expenses, including maintenance, utilities, taxes and fees, is underscored by 39% of those surveyed who said they have seen a “significant increase” in their monthly payments (which include taxes and insurance). In addition, more than one in four (27%) Americans, across all income groups including mass affluent and above, said they have been forced to arrange a payment plan or other arrangement to assist in making their monthly payments. Concerns about the fast-rising costs of home insurance, driven by increasingly common extreme weather events, is another major factor on the minds of would-be home buyers: A full 47% say home insurance costs will have “a lot” (18%) or “a good deal” (29%) of influence in where they decide to move. One-quarter (25%) said they are considering moving due to extreme weather in their area, and 26% said they knew of someone who was forced to move because of home insurance costs. “Many prospective buyers started questioning the American dream of home ownership as inflation brough mortgage rates to a cyclical peak of 8% in October 2023, but now rates are down more than 1.5% from this peak,” said Jeff Taylor, Co-Founder and Managing Director of Mphasis Digital Risk. “We’re now getting closer to homebuyers’ comfort zone of low-6%, high-5% rates, and September’s anticipated Fed cuts should help buyer sentiment. This is why industry estimates call for a robust 2025 with $2 trillion in expected mortgage originations.” Just under 30% of respondents are considering a home purchase in the second half of the year. But buyers are feeling the effects of a seller’s market as existing home supply drives prices upward, with more than 20% saying they’ve been searching for more than two years and finding it, “a bit depressing,” and 17% reporting that, “It’s often on my mind and makes me feel sad and angry.” About Mphasis Digital Risk, LLCMphasis Digital Risk, LLC is a leading end-to-end origination, risk, compliance, and technology services company that offers differentiated solutions to the mortgage, consumer lending, and other regulated industries. The individual talents of Digital Risk’s thousands of analysts are amplified by the company’s proprietary technology and advanced analytics performed using the Making Mortgages Safe™ solutions suite. Mphasis Digital Risk, LLC is a wholly owned subsidiary of Mphasis Ltd. To learn more, visit www.DigitalRisk.com. SOURCE Mphasis

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Expert Panel Predicts Home Price Growth Will Decelerate in 2024 and 2025

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Panel Also Shares Thoughts on Most Impactful Potential Policy Reforms to Boost Housing Supply Following home price growth of 6.0% in 2023, a panel of housing experts forecasts annual national home price growth of 4.7% in 2024 and 3.1% in 2025, according to the Q3 2024 Fannie Mae (OTCQB: FNMA) Home Price Expectations Survey (HPES), produced in partnership with Pulsenomics, LLC. The HPES polls over 100 experts across the housing and mortgage industry and academia for forecasts of national home price percentage changes in each of the coming five calendar years, as measured by the Fannie Mae Home Price Index (FNM-HPI). The panel’s latest estimates of national home price growth are higher than last quarter’s expectations of 4.3% for 2024 but lower than the previous quarter’s expectations of 3.2% for 2025. This quarter, the ESR Group also surveyed panelists on the impact of potential zoning and permitting reforms at state and local levels to increase construction of new homes and, thereby, the supply of homes available to buyers and renters. While most panelists believe that reforms implemented to date are likely to have a positive effect on new construction within the next five years, they were generally split on whether that effect would be “moderate” or “insignificant.” A plurality of panelists suggested that hastening the construction permitting process would have the greatest positive impact on housing supply if broadly enacted, following by expanding zoning for multifamily housing developments and enabling more “missing middle” or “light touch density” housing construction. However, 63% of panelists are “not confident at all” that the initiatives they think would be most effective will be enacted widely within the next five years. Complete results of the Q3 2024 HPES can be found here. “Recent measures of home price growth, including our own, have continued to come in stronger than previously expected, as reflected by the 100-plus HPES panelists who, on average, once again modestly upgraded their home price outlook for 2024,” said Mark Palim, Fannie Mae Vice President and Deputy Chief Economist. “Strong home price appreciation has persisted despite purchase affordability remaining stretched for the vast majority of consumers, a dynamic that is still primarily a function of inadequate supply. Our panelists overwhelmingly agreed that there is a fundamental lack of housing in the United States relative to underlying demographic factors – and, on average, believe the nation to be short approximately 2.8 million homes. We’ve previously estimated the shortfall to be more than 4 million. The panelists also shared that they think speeding up construction permitting processes, increasing density around transit corridors, and allowing more ‘missing middle’-type housing are the local and state policy reforms likeliest to increase housing production. However, most remain apprehensive about the near-term prospects of these sorts of reforms being enacted broadly enough to have a meaningful effect on supply and housing affordability.” Terry Loebs, founder of Pulsenomics, added: “Despite robust home value growth in the first half of 2024, our panelists anticipate a slowdown in price appreciation for the remainder of the year and beyond. While lower interest rates could incentivize some homeowners to sell, the deep-rooted housing supply and affordability crises will likely persist, even with a more accommodative monetary policy.” To receive e-mail updates regarding future HPES updates and other economic and housing market research from Fannie Mae’s Economic & Strategic Research Group, please click here. SOURCE Fannie Mae

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HOUSING MARKETS IN CALIFORNIA, NEW JERSEY AND ILLINOIS STILL HAVE ELEVATED RISK OF DOWNTURNS IN SECOND QUARTER OF 2024

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New York City and Chicago Areas Remain Vulnerable to Housing Issues Despite Strong Overall Markets; South Region Faces Less Exposure While West Has More ATTOM, a leading curator of land, property, and real estate data, released a Special Housing Risk Report spotlighting county-level housing markets around the United States that are more or less vulnerable to declines, based on home affordability, underwater mortgages and other measures in the second quarter of 2024. The report shows that California, New Jersey and Illinois once again had the highest concentrations of the most-at-risk markets in the country, with some of the biggest clusters in the New York City and Chicago areas, as well as inland California. Less-vulnerable markets remained spread mainly throughout the South, along with parts of the Midwest. The second-quarter patterns – derived from gaps in home affordability, underwater mortgages, foreclosures and unemployment – revealed that nearly half of the counties around the U.S. considered most exposed to potential drop-offs were in California, New Jersey and Illinois. As with earlier periods over the past few years, those concentrations dominated the list of areas more at risk of downturns. County-level housing markets on that list included seven in around New York City, five in the Chicago metro area and 12 in areas of California mostly away from the Pacific coast. The rest were scattered largely around the South as well as other parts of the Midwest and Northeast. At the other end of the risk spectrum, close to half the markets considered least likely to decline fell in Virginia, Wisconsin and Tennessee. They included four in the Washington, DC, area and three each in the Richmond, VA, and Nashville, TN, metro areas. “The housing market boom continues to gain momentum, thanks to another Springtime boost. However, some markets show signs of potential instability, which suggests a mixed level of risk, particularly in certain regions that repeatedly show signs of concern,” said Rob Barber, CEO of ATTOM. “While these observations don’t indicate immediate red flags or warning signs of an impending downturn, they do highlight areas of relative risk. With the housing market still facing challenges, it’s crucial to closely monitor regions where key indicators suggest a higher likelihood of issues.” Counties were considered more or less at risk based on the percentage of homes facing possible foreclosure, the portion with mortgage balances that exceeded estimated property values, the percentage of average local wages required to pay for major home ownership expenses on median-priced single-family homes and local unemployment rates. The conclusions were drawn from an analysis of the most recent home affordability, equity and foreclosure reports prepared by ATTOM. Unemployment rates came from federal government data. Rankings were based on a combination of those four categories in 589 counties around the United States with sufficient data to analyze in the second quarter of 2024. Counties were ranked in each category, from lowest to highest, with the overall conclusion based on a combination of the four ranks. Significant gaps in risk continued in different parts of the U.S. during the second quarter of 2024 as key housing market metrics have gotten either better or worse this year. Those measures included home prices, equity and affordability. Vulnerable housing markets still clustered around Chicago, New York City and inland California The metropolitan areas around New York, NY, and Chicago, IL, as well as broad stretches of California, had 24 of the 51 U.S. counties considered most vulnerable in the second quarter of 2024 to housing market troubles. The counties were among 589 around the nation with enough data to analyze. (The report includes 51 counties at either end of the risk spectrum, instead of the usual 50 that have been included in prior reports, because of ties in rankings.) The most at-risk counties included three in New York City (Kings County, which covers Brooklyn, Richmond County, which covers Staten Island, and Bronx County) and four in the New York City suburbs (Essex, Passaic, Sussex and Union counties, all in New Jersey). It also included Cook, Kendall, McHenry and Will counties in Illinois and Lake County in Indiana. Another 12 were in California: Butte County (Chico), Humboldt County (Eureka), Solano County (outside Sacramento) and Shasta County (Redding) in the northern part of the state, plus Kern County (Bakersfield), Kings County (outside Fresno), Madera County (outside Fresno), Merced County, San Joaquin County (Stockton) and Stanislaus County (Modesto) in central California. Two others, Riverside and San Bernardino counties, were in southern California. At-risk counties have worse levels of affordability, underwater mortgages, foreclosures and unemployment Major home-ownership costs (mortgage payments, property taxes and insurance) on median-priced single-family homes were considered seriously unaffordable in 33 of the 51 counties deemed most vulnerable to market drop-offs in the second quarter of 2024. That means those expenses consumed at least 43 percent of average local wages. Nationwide, major expenses on typical homes sold in the second quarter required 35.1 percent of average local wages. The highest percentages in the most at-risk markets were in Kings County (Brooklyn), NY (111.8 percent of average local wages needed for major ownership costs); Riverside County, CA (74.4 percent); Washington County (St. George), UT (70.4 percent); Richmond County (Stated Island), NY (66.8 percent) and Passaic County, NY (outside New York City) (65.3 percent). At least 5 percent of residential mortgages were underwater in the second quarter of 2024 in 34 of the 51 most-at-risk counties. Nationwide, 5.1 percent of mortgages fell into that category, with homeowners owing more on their mortgages than the estimated value of their properties. Those with the highest underwater rates among the 51 most at-risk counties were Tangipahoa Parish, LA (east of Baton Rouge) (26.1 percent underwater); Peoria County, IL (16.3 percent); Lake County (Gary), IN (13.2 percent); Orleans Parish (New Orleans), LA (13.1 percent) and Montgomery County (Dayton), OH (10.9 percent). More than one of every 1,000 residential properties faced a foreclosure action in the second quarter of 2024 in 39 of the 51 most vulnerable counties. Nationwide, one in 1,575 homes were in that

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Inventory Peaks at Highest Levels Since COVID, Latest HouseCanary Report Shows

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A Seller’s Market Environment Continues to be Evident in the Housing Market, but Neutralization is on the Horizon with Inventory Levels Continuing to Rise Presumed September Interest Rate Cuts Is Anticipated to Free Buyers and Sellers from Previous Holding Patterns HouseCanary, Inc. (“HouseCanary”), a national brokerage known for its innovation and accuracy of real estate information, released its August Market Pulse Report, finding that inventory remains low from a historical perspective, however, it is now at the highest level since Covid. HouseCanary previously reported that inventory levels were gradually approaching pre-Covid levels, and this sentiment remained unchanged in August as total inventory increased 28.7% from the same period last year. Additionally, contract volume in August 2024 across all price tiers increased compared to August 2023, suggesting a steadier housing market and evidence of demand from potential homebuyers, further demonstrating a seller’s market. Jeremy Sicklick, Co-Founder and Chief Executive Officer of HouseCanary, commented: “The past couple of years have seen a housing shortage nationwide. However, consistent with what we have seen throughout this summer, there have been signs pointing to normalization in the housing market since the pandemic when looking at inventory levels, pricing and contract volumes from a multiyear perspective. Notably, total inventory is up 28.7% from the same period in 2023, and up 9.3% from 2022, indicating improvements in the pool of available properties and an eventual neutralization of the housing market. As we forecast for the back half of the year, we can expect the Fed to begin cutting interest rates at the next FOMC meeting after Powell’s remarks in Jackson Hole. If realized, we can anticipate increased contract volume during the fall season, should demand from prospective buyers remain persistent. Buyers and Sellers who have been sidelined from the market could just about be ready to get back in the game.” Key Takeaways: Source: HouseCanary

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Falling Mortgage Rates Have Yet to Improve Home Sales, With Buyers Uncertain About NAR Settlement, Election

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Pending home sales posted their biggest decline in nearly a year, despite the median U.S. housing payment dropping to its lowest level in five months Pending home sales fell 6.9% during the four weeks ending August 25, the biggest annual decline in nearly a year according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. That’s despite the median monthly U.S. housing payment falling to its lowest level since February as weekly average mortgage rates drop to their lowest level in 15 months. Sales aren’t yet improving because many would-be homebuyers are playing the waiting game. Redfin agents report that house hunters are touring homes, but some of them are hesitant to buy right now. Would-be buyers are waiting for one or all of the following: “I expect more buyers and sellers to jump into the market in a few months, once everyone has a better understanding of how the new NAR rules will play out in actual real-estate deals,” said Fernanda Kriese, a Redfin Premier agent in Las Vegas. “The election and the drop in mortgage rates are also delaying buyers; a lot of them are waiting on the sidelines until November, hoping to get a lower rate and maybe more homes to choose from.” Mortgage-purchase applications are up 1% week over week on a seasonally adjusted basis, suggesting that at least some buyers are coming off the sidelines, but applications are still down 9% from a year ago. 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:https://www.redfin.com/news/housing-market-update-pending-sales-housing-payments-fall

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