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Customer Retention, Down Payment Products; Home Maintenance Study; First American News

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Customer Retention, Down Payment Products; Home Maintenance Study; First American News

By:
Rob Chrisman

Tue, Dec 26 2023, 10:43 AM

Did you receive any SM under the tree this weekend? Call it snail mucus, or snail mucin, it’s all the same to me, which, as a kid, represented a trail to something I could direct the sun’s rays on using my magnifying glass. (Sorry, when you’re a kid on a very limited budget, this counts as amusement.) But times change and now it’s a beauty product? “Next level!” Really? SM aside, Depth’s Kerri Milam reminded me that the key difference between initials and acronyms is that we pronounce acronyms as a word and initials as a list of letters. Put another way, Fannie Mae is an acronym, as is First American Title (FAT), FHA is a set of initials. NASA or ASAP versus MD or DFW. Throw in some numbers and you have… license plates. For those curious, here is a list of vanity license plates rejected by the state of Illinois. Of course, this has nearly nothing to do with mortgages. First American Financial’s customer service woes continue with its cybersecurity failure (more below), but my informal chats recently are still interested in the NAR lawsuit and how it will wind its way through the courts for years. A big question is what will contracts look like for buyer’s agents? (Today’s podcast can be found here, and this week’s is sponsored by Gallus Insights. Mortgage KPIs, automated at your fingertips. Gallus allows you to go from data to actionable insights. If you can use Google, you can use Gallus! Hear an interview with Candor’s Thomas Showalter on the latest in the AI underwriting space.)

Broker and Lender Programs, Software, and Products

How about adding down payment assistance (DPA) to your toolset for 2024? Down Payment Resource, the original keeper of all things DPA, has an extensive database of programs to set your office up with the holiday gift that keeps on giving. With Down Payment Resource, you can reduce declined loans, bring the joy of homeownership to more borrowers, and become a strong contender for referrals and repeat business. To learn more, schedule a demo with the DPR team.

Permissionize revolutionizes servicing retention! Permissionize offers an innovative, cost-effective approach to retaining clients. This cutting-edge technology streamlines retention programs by notifying service providers when borrowers complete a webform, allowing for re-engagement with existing clients before they start the application process. Permissionize constantly monitors for signals, 24/7, whenever a phone number is entered into a webform, enabling you to capitalize on your established business relationships and drive inbound traffic to your call center without requiring opt-ins. This revolutionary technology redefines client retention in the servicing industry. John Lomanno, a seasoned professional in the mortgage industry, states, “We are transforming the servicing industry through automation by providing a cost-effective, extremely reliable way to get in front of your customer when they go online.” Contact us to experience firsthand how our pioneering technology changes everything you thought you knew about servicing retention.

Free eBook: How to Lower Costs, Boost Profitability, and Surge Ahead of the Competition in 2024. Why simply stay alive until ‘25 when you can make more of ‘24? By planning strategically now, you can reduce fixed costs, improve your bottom line, and set the groundwork to win market share as volume begins to improve. Want to learn how? We spoke to senior members of the Maxwell team, each with decades of industry experience, and the result is our new eBook: an actionable guide that will teach you the likely path for rates and volume in 2024, strategies to bulk up your pipeline, why reevaluating your cost structure is vital to achieving profitability, and more. Get your free copy today to inform your 2024 planning: Click here to download Make More Out of ‘24: How to Win Market Share as Your Competition Lags.

First American: This Isn’t the First Cyber Issue

It doesn’t take long for vendor management teams to figure out how much exposure a lender has to certain third-party providers. In this case, First American has been in the proverbial hotseat since last week. There are some who, I’m sure, are thinking about buying stock in First American Financial.

In 2021 we saw, “The Securities and Exchange Commission today announced settled charges against real estate settlement services company First American Financial Corporation for disclosure controls and procedures violations related to a cybersecurity vulnerability that exposed sensitive customer information.”

Last week, ”First American “has experienced a cybersecurity incident. In response, we’ve taken certain systems offline [like the main website above] and working to return to normal business operations as soon as possible.”

Those seeking updates have been pointed to this “non-hacked” site. Word on the street says that First American Financial Corp. cannot estimate how long some of its systems will remain offline after a cybersecurity incident, the company said in a Dec. 22 filing with the U.S. Securities and Exchange Commission.

First American touches many millions around the nation, from the early processing of a loan all the way through trailing docs and servicing. For example, Bob Caruso, the CEO of ServiceMac, sent out, “ServiceMac’s affiliated company First American has experienced a cyber security incident. In response, First American has taken certain systems offline and is working to return to normal business operations as soon as possible.

“ServiceMac’s primary data network and systems are separate from First American, have not been impacted, disrupted, breached, or subject to a cyber-security incident. Black Knight’s MSP platform remains fully operational. ServiceMac’s call centers continue to be operational. For customers, payments made by auto-debit from the customer’s designated account, bill paid through a customer’s financial institution, payment by a check sent to the address on the bill and payments made by overnight courier continue to be managed as normal. For those customers wanting to make a one-time payment or set up reoccurring payments, ServicMac’s Customer Service Representatives can handle those requests as usual at no cost to the customer. Customers can contact ServiceMac directly for that service.

“Certain customer and client facing technology features, such as the customer portal/website, the client portal, the IVR and the document management system, which depend on having a DNS that translates a domain name to an IP address, are back to normal operations for our internal team members. Because the outage is limited specifically to our DNS provider, external parties will have limited or no access to our systems like Client Portal, inbound SFTP sites, and Reporting.

“In addition, we are experiencing issues processing external emails. Please continue to communicate directly with your Account Executive and/or their leaders should you need anything. Once our DNS provider is restored, all services will be available to our clients and any of their customers who may have been affected. We will continue to provide updates as available. Should you have any additional questions our team is happy to set up a call with you to walk through together.”

Average Cost of Home Maintenance

Unsurprisingly, initial costs of upkeep were higher for new owners of older homes than for those who had lived in their homes for at least 10 years, according to recently released Census Bureau data. About 61 percent of owners of older homes started a home improvement project between 2019 and 2021, spending a median of $4,100 on all their home improvement projects during that time. Homes built before 1950 made up about 17 percent of homes and their owners spent a median of $1,800 a year on upkeep.

Owners of older homes who had moved in within the past two years tended to spend more on overall upkeep. These new owners spent a median of $3,900 per year, while longtime owners who had lived in older homes for at least 10 years spent about $1,500 annually. About 61 percent of owners of older homes started a home improvement project between 2019 and 2021, spending a median of $4,100 on all their home improvement projects during that time. Median annual spending on maintenance alone was around $540 for owners of older homes. Among owners of older homes, 59 percent of new owners who had moved in within the last two years did interior projects, compared to 46 percent of longtime owners who had lived in the home at least 10 years.

Capital Markets

Are these the best of times for stocks and bonds? Interest rates have been behaving themselves, and U.S. stocks on Friday ended largely higher, extending its amazing bull run to eight straight weeks. Sentiment this week has been boosted by favorable economic data, led by inflation data showing price increases are simmering down. The bond market may be ahead of itself, but, for now, the “smartest guys in the room” are talking about how inflation is in a downward trajectory and the Federal Reserve will lower benchmark interest rates in 2024.

Economic data released over the last week showed the U.S. economy is still expanding. That is despite November’s Leading Economic Index falling 0.5 percent, the 20th consecutive decline and typically a sign that the economy is currently in recession. Consumer spending increased 0.3 percent in November and for the first time in eight months, discretionary purchases surpassed non-discretionary. The spending gain can be attributed to a 0.4 percent rise in real disposable personal income.

Meanwhile, falling mortgage rates boosted existing home sales in November which rose 0.8 percent and snapped a five-month streak of declines. New home sales fell 12.2 percent in November due mostly to a sharp decline in sales in the South region. New home sales were up 1.4 percent on an annual basis. Lower mortgage rates could be a catalyst for a rebound in sales in the new year. And the Fed’s preferred gauge of inflation barely rose last month, and by one measure even trailed the policymaker’s 2 percent target. That marks the first time in three years the Fed has achieved its definition of price stability after waging war on inflation.

U.S. markets return today, and the calendar kicked off with the non-market moving Chicago Fed National Activity Index for November along with Philadelphia Fed non-manufacturing for December. Later today brings October house prices from Case-Shiller and FHA, Dallas Fed Texas manufacturing for December, and a Treasury auction of $57 billion 2-year notes. The rest of the week is light on data, though we do receive December PMI on Friday. We begin the abbreviated trading week with Agency MBS prices unchanged from Friday and the 10-year yielding 3.89 after closing Friday at 3.90 percent.

Employment

“Citizens has garnered attention for its clear vision, strong leadership, and disciplined execution through challenging market conditions and is looking for talented salespeople (sales managers, loan officers, and more) in Retail throughout the Northeast, MidAtlantic, Midwest, and Florida. Our deep product mix allows us to help with many different loan needs, from affordable loan programs such as HomeReady to a best-in-class one-time close construction to permanent product. Our specialty loan programs such as condo/co-op financing, rate protection programs with extended rate locks, along with an amazing Private Wealth discount value proposition for high net worth banking clients, ensures you have all the tools to win in this challenging market. Contact Carl Minott or visit here. During this holiday season we would like to express gratitude and appreciation to our customers and partners for their continued business this past year. While interest rates may go up and down our commitment to serving customers with their homeownership needs has never wavered. We look forward to serving our communities in even more ways in 2024!”

In the Northwest and California, Banner Bank is searching for Mortgage Loan Officers looking to create lasting Realtor and builder relationships at a bank focused on the market today. Banner has opportunities for lenders looking for local decision making with FHA, VA, USDA, state bond and true Portfolio lending opportunities along with servicing retained Fannie and Freddie loans to assist in client retention. Additional highlighted products cover CRA lending with private label no payment down payment assistance to help assist all borrowers with the right opportunity. Banner is the right fit for an established team, or the individual looking to grow their business and take the next step in their career. Please send resumes to Aaron Miller.

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

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Both 15-year fixed and 30-year fixed refinances saw their mean rates slump this week. The average rates for 10-year fixed refinances also slumped.

  • 30-year fixed refinance: 7.01%
  • 15-year fixed refinance: 6.36%
  • 10-year fixed refinance: 6.09%

Mortgage rates have been dropping since early November but remain relatively high, so millions of homeowners are staying put until rates ease more. But with the Federal Reserve taking its third consecutive pause from its aggressive rate-hike policy and promising three rate cuts throughout 2024, the opportunity to refinance might come sooner rather than later.

That’s especially true for homeowners who bought homes with rates near or above 8%. “The best bet there is to keep an eye on day-to-day rate changes and have a game plan on how to capitalize on a big enough drop,” said Matt Graham of Mortgage News Daily.

About these rates: Like CNET, Bankrate is owned by Red Ventures. This tool features partner rates from lenders that you can use when comparing multiple mortgage rates.

Refinance rates for homeowners

In today’s high-rate environment, refinancing is less attractive. Rates are currently between 6% and 7%, but your personal interest rate will depend on your credit history, financial profile and application.

Here are the average refinance rates provided by lenders across the US. We track refinance rate trends using data collected by Bankrate:

Today’s refinance rates

Product Rate A week ago Change
30-year fixed refi 7.17% 7.21% -0.04
15-year fixed refi 6.36% 6.45% -0.09
10-year fixed refi 6.09% 6.20% -0.11

Rates as of December 26, 2023.

What does it mean to refinance?

When you refinance your mortgage, you take out another home loan that pays off your initial mortgage. With a traditional refinance, your new home loan will have a different term and/or interest rate. With a cash-out refinance, you’ll tap into your equity with a new loan that’s bigger than your existing mortgage balance, allowing you to pocket the difference in cash.

Refinancing can be a great financial move if you score a low rate or can pay off your home loan in less time, but consider whether it’s the right choice for you. Reducing your interest rate by 1% or more is an incentive to refinance, allowing you to cut your monthly payment significantly. But today’s mortgage market conditions aren’t ideal. If you decide to refinance, compare rates, fees and the annual percentage rate — which reflects the total cost of borrowing — from different lenders to find the best deal.

30-year fixed-rate refinance

The average 30-year fixed refinance rate right now is 7.17%, a decrease of 4 basis points from what we saw one week ago. (A basis point is equivalent to 0.01%.) A 30-year fixed refinance will typically have lower monthly payments than a 15-year or 10-year refinance, but it will take you longer to pay off and typically cost you more in interest over the long term.

15-year fixed-rate refinance

For 15-year fixed refinances, the average rate is currently at 6.36%, a decrease of 9 basis points over last week. Though a 15-year fixed refinance will most likely raise your monthly payment compared to a 30-year loan, you’ll save more money over time because you’re paying off your loan quicker. Also, 15-year refinance rates are typically lower than 30-year refinance rates, which will help you save more in the long run.

10-year fixed-rate refinance

The current average interest rate for a 10-year refinance is 6.09%, a decrease of 11 basis points from what we saw the previous week. A 10-year refinance typically has the lowest interest rate but the highest monthly payment of all refinance terms. A 10-year refinance can help you pay off your house much quicker and save on interest, but make sure you can afford the steeper monthly payment.

What is influencing the direction of refinance rates?

When mortgage rates hit historic lows during the pandemic, there was a refinancing boom, as homeowners nabbed lower interest rates on their home loans. But with current rates, refinancing might not actually save you money.

Though refinancing activity has picked up recently, the overall level of refinance applications is still very low compared to early 2021. Mortgage rates are expected to go down throughout 2024.

When to consider a mortgage refinance

Homeowners usually refinance to save money, but there are other reasons to do so. Here are the most common reasons homeowners refinance:

  • To get a lower interest rate: If you can secure a rate that’s at least 1% lower than the one on your current mortgage, it could make sense to refinance.
  • To switch the type of mortgage: If you have an adjustable-rate mortgage and want greater security, you could refinance to a fixed-rate mortgage.
  • To eliminate mortgage insurance: If you have an FHA loan that requires mortgage insurance, you can refinance to a conventional loan once you have 20% equity.
  • To change the length of a loan term: Refinancing to a longer loan term could lower your monthly payment. Refinancing to a shorter term will save you interest in the long run.
  • To tap into your equity through a cash-out refinance: If you replace your mortgage with a larger loan, you can receive the difference in cash to cover a large expense.
  • To take someone off the mortgage: In case of divorce, you can apply for a new home loan in just your name and use the funds to pay off your existing mortgage.

How to find personalized refinance rates

The rates advertised online often require specific conditions for eligibility. Your personal interest rate will be influenced by market conditions as well as your specific credit history, financial profile and application. Having a high credit score, a low credit utilization ratio and a history of consistent and on-time payments will generally help you get the best interest rates. To get the best refinance rates, make your application as strong as possible by getting your finances in order, using credit responsibly and monitoring your credit regularly. And don’t forget to speak with multiple lenders and shop around.

Refinancing can be a great move if you get a good rate or can pay off your loan sooner, but consider whether it’s the right choice for you at the moment.

Source: cnet.com

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The holiday season is just around the corner and it is time to gear up for the festival. Christmas will be celebrated on 25 December, but the preparations will begin way before the actual date. People start decorating their houses and setting up Christmas trees to celebrate the festival with their loved ones. The holiday season is a magical time when every corner of people’s homes is decorated with festive lights, colours, decorative items, and other ornaments.

People often look for home decor ideas before the Christmas season. They want the rooms to be cosy and well-lit for the festival time. It is important to look through different ideas available online before you start decorating your house. You can use different items while decorating the rooms to give the holiday season a feel. We have some ideas.

Source: thequint.com

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New home sales in the US dropped in November as mortgage rates slowly retreated from their highest levels this year.

Sales of newly constructed homes dropped 12.2% in November to a seasonally adjusted annual rate of 590,000 from a revised rate of 672,000 in October, according to a joint report from the US Department of Housing and Urban Development and the Census Bureau. Sales were up just 1.4% from a year ago.

Affordability challenges, particularly with high mortgage rates, likely kept buyers on the sidelines. Typical mortgage rates reached their highest levels in 23 years – hitting 7.79% for a 30-year, fixed-rate loan – and have been coming down since.

At a the prevailing 6.5% interest rate, a family would need an income of nearly $130,000 to be able to afford to purchase the median-priced new home in the U.S., according to calculations from Sturtevant. The median household income in the U.S. is about $75,000.

People are also reading…

Check out these charts to see where home sales are trending in Madison.

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Source: madison.com

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Kyle Joseph, a specialty finance equity research analyst at Jefferies, believes that the worst of the current mortgage cycle may be behind us, a sentiment shared by most analysts covering this industry.

“Barring any sort of unforeseen consequences, I’d like to think so,” Joseph said in an interview. “Obviously, this cycle was fast and furious – for lack of a better term – in terms of how quickly rates went up, and volumes basically got cut into a third of what they were two-plus years ago. It really sent shockwaves through the industry.”

Joseph anticipates potential growth in originations next year, both in purchase and refis. 

“If anything, every day seems to be a higher likelihood that rates are not going higher next year,” he said. 

Warren Kornfeld, senior vice president of the financial institutions group at Moody’s, provided a detailed forecast, stating, “We will see three to four decreases in the Federal Reserve funds rate next year, starting sometime in the second quarter. Mortgage rates will moderate down to about 6% to 6.25%.”

Kornfeld expects mortgage originations to range from $1.8 trillion to $2 trillion in 2024. On the refinance side, he predicts a moderate increase in cash-out activity as rates decline, with customers using the resources to consolidate debt and extract some home equity build-up. 

Kornfeld said that for companies under his coverage, including major U.S. lenders, “The horrible period was the last half of 2022 and Q1 of this year. In Q2 and Q3, they’re okay. Q4 will be down. But once again, not a horrible year for 2023, and with the Fed pivot we’ll see further improvement next year.”

Bose George, managing director at Keefe, Bruyette & Woods (KBW), has adopted a more cautious stance for the coming year. He estimates the 10-year Treasury yields may average 4% for the full year, mortgage spreads should tighten “a little bit more,” and mortgage rates will average around 6.75% for the year. 

Regarding origination volumes, George said, “Even the MBA numbers, to be honest, look a little bit high.” The Mortgage Bankers Association (MBA) on Dec. 18 released a $2 trillion forecast for one-to-four family loan originations in 2024.

According to George, there will be “a small amount” of cash-out refinances, and the purchase market might see “a little bit of an improvement,” but overall, 2024 “doesn’t look better.” Additionally, predicting the market recovery’s timing is challenging. “We’re not saying 2025. But it’s possible. It might really be 2026,” George said. 

Given these distinct macro forecasts for 2024, what should originators keep in their playbook for next year? HousingWire spoke to analysts covering mortgage companies to gain insights into the challenges ahead. 

The macro challenge: Still not much inventory

Analysts unanimously agree that inventory will continue to be a significant issue entering 2024. There are also lingering questions about where home prices will settle, a crucial factor in the current affordability challenges.

Eric Hagen, managing director and mortgage analyst at BTIG, said the “biggest anomaly in the whole episode of rising rates is that we would normally expect housing prices to have some sensitivity” – meaning, a tendency to decrease. 

However, in the current market downturn, home prices “had almost the opposite sensitivity that you’d expect,” Hagen said. To exacerbate the situation, he expects the trend could persist in 2024 while “affordability is still tight for the marginal homebuyer.”

Kornfeld agrees that “the biggest wildcard” in 2024 will be related to home sales, with the current “lock-in effect” in place. Individuals with mortgages at 2-3-4% rates are less inclined to move and sell their homes in a higher-rate environment, further limiting the number of homes available for sale.

“The average time to sell is still 3.5 months. Homes don’t remain on the market for very long, which is just so surprising, given how horrible affordability is because of rates and prices. So, the big wildcard is when do homeowners start putting their homes on the market,” Kornfeld said.

Kornfeld added: “We’re talking about our scenario of a mortgage rate of about 6.0% to 6.25% by the end of the year. I think people are still gonna be pretty locked in. And it’s really going to take several years to start seeing more housing activity or existing home sale activity.”

George agrees that inventory will remain a problem. “Unfortunately, a big part of the housing supply issue seems to be related to the fact that all these borrowers are sitting on three-and-a-half percent mortgages, and they don’t want to give that up and move. If rates stay with our expectation here, whatever high six is, that piece doesn’t change.”

The KBW 2024-2025 housing forecast calls for home price growth of 2%, which is below wage inflation, but anticipates home sales growth of just 2%, marking a 41-year per capita low. Meanwhile, it expects a structural supply shortage of 1.5-2.5 million homes.

According to KBW analysts, affordability is 30% below the long run with payment-to-income of 27% compared to 20% between 2002 and 2004. Alongside lower mortgage rates and 3-4% annual wage growth, the estimate suggests it would “take two to three years to normalize affordability.” 

The originations challenge: Addressing overcapacity

Reducing capacity may still be a feature of the mortgage lender playbook in 2024, but in a more nuanced approach, analysts said. 

According to Kornfeld, “finding continued areas to cut costs without hurting franchise and quality of origination” will be a challenge. 

“If you look at companies that we rate, the massive job cutbacks happened last year and into this year. But in the last several quarters, the headcount and compensation have been very flat. We’ll see some additional selective cost-cutting, but not a heck of a lot. For most large companies that we rate, the cost-cutting is over,” Kornfeld said.

Does this suggest these companies will experience stronger profits? It’s possible, but analysts believe that any rise in profit will be due to a slight growth in volume next year, not because there’s room for significant cost reductions.

According to the analysts, many top mortgage lenders retained a bit of excess capacity, anticipating numerous refi booms in the coming years.

“Capacity has come down quite a bit. And I think the best indication is that margins have been somewhat stable – gross margins for the last couple of quarters. In Q4 2023 and Q1 2024, the net margins will probably be lower just because of seasonality,” George said. “It seems like there’s probably more [capacity] that needs to come out. But there are large originators who want to keep some capacity as well.”

Hagen also believes that for the top nonbank originators, “a lot of the capacity has been pretty much right-sized for this rate environment.” Meanwhile, less-scaled companies have tried to “hang on to their stuff for as long as possible in the hopes the market comes back.”

According to Joseph, analysts’ conversations with mortgage executives have shifted from “How much more do you have to cut?” to “Are you going to be able to participate if the industry regrows?” or “Have you cut too much?”

“The outlook, at least from investors, is better, and I would also highlight that if you just look at gain-on-sale margins, they are really stabilized. To us, that implies that supply finally caught up with demand and that there’s an equilibrium in the market.”

The servicing challenge: Managing the MSR portfolio size 

According to analysts, lenders facing liquidity issues may have opted to sell their mortgage servicing rights (MSRs) throughout 2023, putting them at a disadvantage when the next refi boom emerges.

Kornfeld anticipates an increase in MSR sales in 2024, driven by the ongoing financial challenges some lenders face. However, according to him, lenders are “getting a short-term gain in liquidity, but at the expense of a weaker franchise in the future.”

Jefferies’ Joseph said, “We’re taking a little bit of a contrarian [view] that if you have a high coupon mortgage that you’re servicing, it’s actually going to be beneficial next year to the origination segment and more than offset any potential negative impacts on the servicing side.”

Regarding these negative impacts, analysts at Fitch said in a report issued in late November that rate declines expected by the end of 2024 could pressure MSR valuations, which could drive modest increases in leverage, especially if earnings from originations remain weak. 

According to the report, the balance sheet exposure to market risk is rising above historical levels for some companies, with MSRs as a share of equity up to 180% in some cases. 

George adds that regulation will also weigh on the decision of selling MSRs, mainly the Basel III Endgame rules, which increase capital requirements for banks.

“The Basel III Endgame seems to be one catalyst for some of the MSR sales,” George said. “On the other hand, we’re still waiting to see what the final version is going to look like. It’s possible that they make some of that a little less onerous on the banks in terms of MSR holdings and the LTV on mortgages. So, we have to see how that plays out.” 

Source: housingwire.com

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The U.S. Treasury’s proposed interest rate freeze plan will likely only help three percent of subprime borrowers currently stuck in adjustable-rate mortgages, the Center for Responsible Lending said today.

Based on the nonprofit organization’s analysis of recent industry data, loan modifications will only prevent about 118,000 foreclosures among the 3.7 million subprime borrowers holding ARMs.

“The Treasury plan will be a welcome relief for those it helps, but given the magnitude of today’s economic woes, the plan won’t help nearly enough to avoid further widespread economic damage from foreclosures,” a release from the center said.

Of the loans studied, industry data revealed that for every loan modification made by a lender, 7 times as many foreclosures are initiated, and that number nearly doubled to 13 to 1 for subprime ARMs.

The group also slammed mortgage lenders for crediting themselves for executing “repayment plans” in which homeowners’ monthly mortgage payments actually rise, while terms on the loan don’t necessarily change.

And noted that lenders have no obligation to report the outcome of modifications, pointing out that Countrywide said most of its mods “involved deferring overdue interest or adding the past due amount to a loan,” not lowering mortgage rates or reducing loan balances.

“The most effective policy for significantly reducing foreclosures would be permitting court-supervised modifications of distressed mortgages—but homeowners are specifically excluded from such relief under current bankruptcy law,” said Eric Stein, senior vice president of the Center.

“Legislation to remove this barrier is now moving through both the House and the Senate. Congress has the power to prevent 600,000 homes from being lost to foreclosure, at no cost to the national Treasury,” said Stein.

“We urge Congress to pass this necessary legislation, both for homeowners and the nation’s economy.”

American Securitization Forum Proposes Changes to FHA Secure

In related news, a study circulated within the American Securitization Forum said the current FHA Secure program is positioned to help only about 44,000 subprime borrowers, or five percent of those who are more than two months behind on their payments.

The group said revised guidelines would help 607,000 subprime borrowers, or 68 percent of those who are severely delinquent, by offering the program to borrowers in fixed-rate mortgages, among other situations.

The changes would also open FHA Secure to borrowers who became delinquent for any reason and who made any six monthly payments since the loan was originated and three on-time payments after a rate adjustment.

Source: thetruthaboutmortgage.com

Apache is functioning normally

November home sales dropped from October levels, posting the lowest median sales price in eight months, according to the RE/MAX National Housing Report for November 2023. The report revealed the number of homes for sale also fell slightly.

Indicative of the usual year-end slowdown, home sales in November dropped by 9.8% compared to October and declined 6.5% versus the same period last year. This decline can also be attributed to rising interest rates most of this year and last. Interest rates have decreased over the last two months, which could result in more activity in the market.

The number of homes for sale changed slightly – dropping 1.6% from October and declining 2.6% compared to November 2022.

Across the 52 metro areas surveyed, homes sold for a median price of $405,000, which was $5,000 less than in October but $13,000 higher than in November 2022. New listings, though up 1.5% year over year, were down 19.1% from October.

Key Findings:

  • Homes sold were on the market an average of 40 days–four days longer than in October and one day more than in November 2022.
  • Homes sold in November for an average of 99% of the listing price–the same as in October and up from 98% in November 2022.
  • Months’ supply of inventory in November was 2.6, larger than 2.3 in October and 2.5 in November 2022.

“Although November results are in line with trends we’ve seen this year, there’s reason to think 2024 could be more active, especially with prices and interest rates coming down a bit recently,” said Nick Bailey, President and CEO of RE/MAX, LLC. “When we look at the national picture, it’s a collection of local snapshots, each with different conditions. As the report shows, new listings in a few markets, including Omaha and Orlando, were up more than 25% year over year, while they decreased in others. So, while the results tell an overall story, the key for homebuyers and sellers is to work with a local real estate agent who can speak to the unique local conditions.”

Steve Silcock, Broker/Owner of RE/MAX Heritage in Clermont, FL, said, “November inventory in the Orlando area increased for the sixth month in a row to bump up months’ supply to a level not seen since January 2019. But we are still well below what many consider to be a balanced market, and median home prices are down slightly. However, December activity to date looks promising, especially in our retirement markets, and considering the recent drop in interest rates and the change in tone from the Federal Reserve, we are really looking forward to what we hope will be a strong and exciting 2024.”

New Listings

Of the 52 metro areas surveyed in November 2023, the number of newly listed homes was down 19.1% compared to October 2023 and up 1.5% compared to November 2022. The markets with the biggest decrease in year-over-year new listing percentage were Anchorage, AK, at -20.3%, Birmingham, AL, at -12.7%, and Honolulu at -11.5%. The markets with the biggest year-over-year increase in new listings percentage were Omaha, NE, at +33.2%, Burlington, VT, at +25.9%, and Orlando, FL, at +25.2%.

Closed Transactions

Of the 52 metro areas surveyed in November 2023, the overall number of home sales is down 9.8% compared to October 2023 and down 6.5% compared to November 2022. The markets with the biggest decrease in year-over-year sales percentage were Burlington, VT, at -19.1%, Portland, OR, at -17.1%, and Seattle at -15.9%. The markets with the biggest increase in year-over-year sales percentage were Manchester, NH, at +9.2%, Omaha, NE, at +6.5%, and Orlando, FL, at +4.9%.

Median Sales Price

In November 2023, the median of all 52 metro area sales prices was $405,000, down 1.2% compared to October 2023 and up 3.3% from November 2022. The markets with the biggest year-over-year decrease in median sales price were San Antonio, TX, at -5.7%, Coeur d’Alene, ID, at -3.7%, and New Orleans at -3.6%. The markets with the biggest year-over-year increase in median sales price were Trenton, NJ, at +15.5%, Des Moines, IA, at +15.1%, and San Diego at +12.7%.

Close-to-List Price Ratio

In November 2023, the average close-to-list price ratio of all 52 metro areas in the report was 99%, flat compared to October 2023, and up from 98% in November 2022. The close-to-list price ratio is calculated by the average value of the sales price divided by the list price for each transaction. When the number is above 100%, the home closed for more than the list price. If it’s less than 100%, the home sold for less than the list price. The metro areas with the lowest close-to-list price ratio had a three-way tie between Bozeman, MT, Coeur d’Alene, ID, and Miami at 95%. The metro areas with the highest close-to-list price ratios were Hartford, CT, at 103%, followed by a tie between San Francisco and Trenton, NJ, at 102%.

Days on Market

The average days on market for homes sold in November 2023 were 40, up four days compared to the average in October 2023 and up one day compared to November 2022. The metro areas with the lowest days on market were Baltimore at 13, Washington, DC, at 15, followed by a tie between Philadelphia and Trenton, NJ, at 16. The highest days on market averages were in Fayetteville, AR, at 86, Coeur d’Alene, ID, at 80, and Bozeman, MT, at 71. Days on market is the number of days between when a home is first listed in an MLS and a sales contract is signed.

Months’ Supply of Inventory

The number of homes for sale in November 2023 was down 1.6% from October 2023 and down 2.6% from November 2022. Based on the rate of home sales in November 2023, the month’s supply of inventory was 2.6, up compared to 2.3 in October 2023 and 2.5 in November 2022. In November 2023, the markets with the lowest months’ supply of inventory were Trenton, NJ, at 0.8 and Hartford, CT, at 1.0, followed by a tie between Manchester, NH, and Seattle at 1.1. The markets with the highest months’ supply of inventory were San Antonio at 5.3, followed by a tie between Bozeman, MT, and Miami at 4.8.

To read the full report, including more data, charts, and methodology, click here.

Source: dsnews.com

Apache is functioning normally

No matter how many movies you’ve seen with the New York skyline in the background, it’s hard to get over the magic of the city. Whether you’re a born-and-raised New Yorker or you’re dreaming of moving to the Big Apple, it’s no secret that the cost of living in New York is high.

Calling New York an expensive city is an understatement. The overall cost of living index is 137.8 percent above the national average. This is the highest in the country. It means the average price of almost everything will be higher, and it could be challenging to try and save money if you’re living on a tight budget.

Nearby cities will offer many price breaks, but many New Yorkers need to call at least one of the five boroughs home. So, let’s crunch some numbers and see what it’s really going to cost you to live in this most expensive city.

New York City housing prices

Between broker’s fees, rent-controlled apartments and often unregulated landlords, finding somewhere to live in New York can sometimes feel like a full-time job. Then, there’s also the monthly cost of having an N.Y.C. mailing address. Housing costs are 382.7 percent above the national average. None of the other big cities across the country even come close to this rate, adding hugely to the cost of living in New York.

Generally considered too high to live alone as a single person, rents in New York almost always make it necessary to have at least one roommate. One-bedroom rents in New York are up 18 percent over last year with an average monthly rent of $5,014.

Home prices are holding steady from last year, and the median price in New York is $816,500. Homes aren’t on the market for too long, nor are they flying off the shelves. The median days on market is 49, about a month and a half.

New York City’s prices by neighborhood

One of the best ways to potentially lower the cost of living in New York is by selecting what neighborhood you live in. Not all of them carry such a high price, and N.Y.C. residents know where to look.

Although neighborhoods like Chelsea ($7,049) and SoHo ($5,900) knock many people out of the running with such high one-bedroom rents, New Yorkers can catch a break in Harlem ($2,575) or even Queens ($1,900).

Other New York neighborhoods definitely have lower rents, but you need to compare the cost with safety and local amenities to ultimately find the best place to call home.

New York City food prices

New York has some of the best chefs in the world serving delectable food in everything from a deli to a high-end restaurant. Even on the lower end of dining, food is more expensive when eating out, adding to the cost of living in New York.

Groceries in N.Y.C. are also on the high end of the spectrum at 44.4 percent above the national average. This is significantly higher than in both Queens and Brooklyn which are both right nearby. A steak from a Manhattan grocery store will cost $15.76 per pound versus the same steak in Austin, which is only $10.63. Expect to pay $2.77 for a dozen New York eggs and $4.43 for a loaf of bread in the city, as well.

New York City utility prices

Weather in N.Y.C. is an exercise in extremes. Winters throughout the five boroughs get cold. Average lows can drop to 26 degrees Fahrenheit. Summers, as highs slowly creep up into the 80s, send city dwellers on the hunt for at least one AC window unit.

Fortunately, utilities in New York are only 3.3 percent above the national average. For energy costs, most residents see a bill of around $181.50 per month. This is similar to what you’d find in places like Colorado Springs or Portland, OR, but less than costs in nearby Brooklyn.

New York City transportation prices

New York City public transit is an iconic part of N.Y.C. The subway (regardless of how you feel about maintenance and delays) does go everywhere, allowing residents to forgo a car and save on transportation expenses. The New York cost for transportation lands 17.6 percent above the national average, a decrease of 11.6 percent over last year.

The average car commute for a New Yorker is 40 minutes, according to a recent study. That’s not so bad for city dwellers who can’t avoid driving a car, but you’ll also have to factor parking into your budget. Meters across the five boroughs have hourly rates that range from $1.25 to $7.50.

You can opt to navigate the perfect grid that is New York City by foot or bike as an alternative. The city has a walk score of 99, and if you prefer two-wheels, N.Y.C.’s bike score is 86. There’s also plenty of infrastructure for this mode of transportation.

Taking the subway (or bus)

When you’re ready to forgo a car and pay for public transportation in the city, you’ll ride the MTA. This includes both bus and subway services.

New York has a 100 transit score, thanks to the MTA. The base fare for both buses and the subway is $2.75, however, you can save some money by getting an unlimited MetroCard. This lets you swipe your card as many times as you want within a certain period. A 7-day unlimited pass is $33, and a 30-day unlimited pass is $127.

New York City healthcare prices

Between insurance, pre-existing conditions and changing prescription prices, it’s hard to navigate the healthcare system — no matter what state in America you’re in.

In Manhattan, though, you have access to more than a handful of hospitals depending on where you’re located in the city. N.Y.C. hospitals include Mount Sinai, New York-Presbyterian and Lenox Hill, among others.

The cost of living in New York for healthcare is about 7.9 percent above the national average. A doctor’s visit will set you back $112.50 on average, while a prescription drug, without insurance, costs upward of $435.12.

These prices and rates are similar to other expensive cities in the country but more affordable than you’d think. For example, Manhattan doctors’ prices are $70 less than a visit in Boston and almost $65 less than in San Francisco.

New York City goods and services prices

New York City is 33.1 percent above the national average when it comes to goods and services. This category includes all the entertainment costs you put into your monthly budget, as well as certain things you enjoy doing, but could live without.

Meeting friends at the movies? Grab a movie ticket for $17.92 before heading out to pay an average of $13.59 for a New York-style pizza with your besties.

If you’re into yoga, a class costs $26.88 on average. Luckily, you can also get in your steps on the way there and back, thanks to the city’s walkability.

If these prices feel high bring your estimated monthly costs down with some free fun in the New York metro area. Enjoy a long walk through Central Park or along the High Line with friends both human and canine alike. This is something you can’t do in other cities and it won’t cost you a single cent.

Just remember, the cost of living here is high — you’re in one of the most expensive cities — and in order to save some money, cutting back on items within this category is probably the easiest thing to do.

Taxes in New York City

Looking at taxes is never a fun thing. This goes for calculating income tax, paying property taxes and even thinking about sales tax while you’re shopping.

In New York state, the sales tax rate is 4 percent. Localities are able to add their own percentages, though, so in New York City itself, sales tax is 8.875 percent. This means for every $1,000 you spend shopping, you pay $88.75 in taxes alone.

Income tax gets handled a little differently in N.Y.C. The city itself has its own local income tax on top of the state tax. This isn’t often how it’s done, but the city rate you’ll pay varies by income from 3.078 percent to 3.876 percent. This gets added to your state income tax rate which will be somewhere between 4 percent and 8.82 percent. This percentage could get high as your salary goes up.

How much do I need to earn to live in New York City?

If you follow the advice of most financial experts, you should spend around 30 percent of your salary on rent. Taking into account that an average one-bedroom in the city costs $4,908 in monthly rent, if you wanted to pay the price for living alone, you’d need to make almost $200,000 a year to spend the suggested amount on rent.

That’s really not so easy to do. Even in N.Y.C., a starting salary is much lower, and the median household income in Manhattan is significantly below this estimated salary at $67,046.

To save money on housing, and give yourself more options, you can calculate your budget more exactly with our rent calculator. You should also consider bringing in a roommate (or two) and looking at living slightly outside of Manhattan where the cost of living overall is often lower.

Living in New York

From Broadway plays to picnics in Central Park and a city where you literally have everything within reach, New York City is where it’s at. Every single one of these amenities balances out the high cost of living in New York and makes it worth calling such an expensive place home.

As Frank Sinatra sang, if you can make it here, you’ll make it anywhere. All you have to do is figure out if you can afford it.

The Cost of Living Index comes from coli.org.
The rent information included in this summary is based on a calculation of multifamily rental property inventory on Rent. as of August 2022.
Rent prices are for illustrative purposes only. This information does not constitute a pricing guarantee or financial advice related to the rental market.

Source: rent.com