In this Real Estate News Brief for the week ending November 27th, 2021... the winter forecast for home sales, what investors are doing with their money, and who's suing lawmakers over real real estate “love letters.”Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week, and a Fed that's growing more concerned about inflation. Central bank officials still believe that prices will rise more slowly next year, but they are acknowledging that inflation pressures could last longer than they anticipated because of labor and supply chain shortages. These issues have pushed the yearly inflation rate to a 32-year-high of 6.2%. If you recall, inflation was close to “zero” about a year ago. The situation could prompt the Fed to begin the tapering of its bond-buying program “before” the end of this year. It has been buying $120 billion in Treasurys and mortgage-backed securities as an economic stimulus. (1)High prices are not preventing consumers from spending money. They have extra cash to spend from pandemic savings along with higher wages and bigger paychecks. That pushed consumer spending up 1.3% in October. According to MarketWatch, about half of the increase is due to inflation, so spending is up about .7%. (2)The latest unemployment report shows the number of people applying for state benefits is now “below” pre-pandemic levels. The Labor Department says initial applications dropped to 199,000 the week before Thanksgiving. That's the lowest level since November of 1969. The number of continuing claims also dropped to a pandemic low of about 2.05 million. (3)New home sales continue to rise. They were up .4% in October, according to the Commerce Department. The median price of a home is now $407,700. That's a new record high. The report also shows that builders are pumping new homes into the market. The supply was up 3.3% to a 6.3-month supply. (4)The sale of existing homes also rose in October, because of high demand, but buyers are still dealing with a lack of supply and higher prices. According to the National Association of Realtors, sales were up .8% between September and October, to a seasonally-adjusted annual rate of 6.34 million. That's also 5.8% lower than the year-ago numbers. (5)Despite the low unemployment figures and the amount of consumer spending, consumer sentiment has now dipped to a 10-year low. The University of MIchigan index dropped from 71.7 in October to 67.4 in November. Consumers are mostly concerned about inflation, and a lower standard of living because of those higher prices. (6)Mortgage RatesMortgage rates held steady last week. Freddie Mac says the average 30-year fixed-rate mortgage is 3.1%. The 15-year is up 3 basis points to 2.52%. (7)In other news making headlines…Cold Winter, Hot Housing MarketThe typical winter slowdown for home sales is probably not going to happen this year. Economists from realtor.com and the National Association of Realtors expect strong demand to continue right through the holidays into next year. (8)Realtor.com's Danielle Hale says the demand continues and that “sellers can expect to see plenty of buyers” while NAR's Lawrence Yun expects “more sales compared to pre-pandemic winters going back all the way to 2006.”In addition to this persistent demand for housing, supply chain issues have delayed some buyers who will continue to search for their dream homes this winter. The limited inventory will also give seller's an incentive to put their homes on the market.Investor Buying SpreeInvestors are also very busy. Redfin reports that investor purchase activity for residential property is up 80% in the third quarter compared to a year ago. It says that investors bought 18% of all the homes sold in Q3, and spent a record $64 billion. If you translate that into the number of homes purchased by investors, the total was a record 90,215 homes. Almost 75% of them were single-family homes. That's also an all-time high. (9)Redfin Senior Economist Sheharyar Bokhari says: “Increasing home prices fueled by an intense housing shortage have created opportunities for investors to reap big profits.” Average monthly rents were up almost 11% year-over-year in September. That's the fastest rent growth in at least two years.Which cities are attracting most of the investor activity? Atlanta; Phoenix; Charlotte, North Carolina; Jacksonville, Florida; and Miami. You can see the full list in the Redfin report. We'll have that link in the show notes.Love Letter LawsuitAn Oregon real estate firm is suing state lawmakers over a ban on homebuyer “love letters.” Those love letters typically offer details about the buyers that could lead to a biased decision by the seller. And that could violate fair housing laws. (10)The plaintiffs at Total Real Estate Group are calling the ban “censorship.” They say the ban is based on mere speculation that sellers might sometimes rely on information in these letters to discriminate based on a protected class.” The Oregon law is the first of its kind, and is set to take effect in January.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/some-on-fed-thought-faster-pace-of-tapering-bond-buys-was-warranted-meeting-minutes-show-11637781873?mod=the-fed2 -https://www.marketwatch.com/story/u-s-consumer-spending-sizzles-in-october-and-its-not-just-all-high-inflation-11637766739?mod=economic-report3 -https://www.marketwatch.com/story/coming-up-u-s-weekly-jobless-claims-11637759464?mod=economic-report4 -https://www.marketwatch.com/story/new-home-sales-inch-higher-in-october-116377673515 -https://www.marketwatch.com/story/existing-home-sales-rise-slightly-as-demand-remains-strong-for-housing-11637593477?mod=economic-report6 -https://www.marketwatch.com/story/coming-up-umich-consumer-sentiment-survey-11637765079?mod=economic-report7 -http://www.freddiemac.com/pmms/8 -https://magazine.realtor/daily-news/2021/11/24/yun-expect-an-unseasonably-hot-winter-for-home-sales9 -https://www.redfin.com/news/investor-home-purchases-q3-2021/10 -https://magazine.realtor/daily-news/2021/11/22/brokerage-sues-oregon-over-ban-on-buyer-love-letters
Terry Painter is the author of The Encyclopedia of Commercial Real Estate Advice. He is the founder of Apartment Loan Store and Business Loan Store, two mortgage banking firms specializing in commercial lending in all 50 states since 1997. He has been a top producer for Lasalle Bank and Lehman Brothers and is known for his exceptional investment consultations and stratagems. For 18 years Terry has spoken nationally to commercial real estate investor groups and real estate professionals about commercial real estate investing and lending. For over 20 years, Terry has built strong correspondent relationships representing Fannie Mae, Freddie Mac, FHA/HUD, Life Companies, Wall Street conduits, Hedge Funds, Regional, and National Banks. He is a member of the Mortgage Bankers Association and the Oregon Bankers Association. Join Robert Manni, author of The Guys' Guy's Guide To Love as we discuss life, love and the pursuit of happiness. Subscribe to Guy's Guy Radio on YouTube, iTunes and wherever you get your podcasts! Buy The Guys' Guy's Guide to Love now!
In this Real Estate News Brief for the week ending November 20th, 2021... home price forecasts for next year, single-family rent growth, and a new record for build-to-rent home starts.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. The number of people applying for unemployment keeps dropping. Last week, just 268,000 people applied for state benefits. That's getting close to pre-pandemic levels which were in the low 200,000's. The number of people already getting state unemployment benefits is also lower. That number dropped to a total of 2.08 million. (1)Home starts were down slightly in October as builders struggled with supply chain issues and a labor shortage. They were down .7% from the previous month, but compared with October of last year, they were up slightly. Single-family starts were down the most, with a 3.9% decline. But there's a strong demand for housing, and builders are preparing for a much faster pace of construction. Permits rose for all types of buildings, with a 2.7% increase for single-families, an 8.2% increase for buildings with two to four units, and a 6.5% increase for larger multi-families. (2)Although builders are dealing with a lot of challenges, they are feeling confident about the market because there's such a huge demand. According to the National Association of Homebuilders, the level of confidence among builders is the highest it's been since last May. It's up three points for November to a reading of 83. (3) Mortgage RatesMortgage rates rose back above the 3% mark. Freddie Mac says the average 30-year fixed-rate mortgage is up 12 points to 3.1%. The 15-year is also up 12 points to 2.39%. (4) Economists are blaming the increase on inflation, and are forecasting higher rates over the next few months. The National Association of Realtors senior economist, Nadia Evangelou, expects the housing market to slow down next year as more homes hit the market at higher prices with higher mortgage rates. (5)In other news making headlines…Where Are Home Prices Going?Zillow just published a new forecast for 2022 home prices. It is predicting that prices will rise 13.6% between October of this year and October of next year. In September, Zillow had predicted a 11.7% increase. Both those figures are lower than the rate of price growth for this year. They were up a record 19.9% between August of 2020 and August of this year. (6)Zillow researchers say: “The strong long-term outlook is driven by our expectations for tight market conditions to persist, with demand for housing exceeding the supply of available homes.”As Fortune reports, not everyone agrees with Zillow's forecast. Goldman Sachs expects 2022 prices to rise another 16%, while Fannie Mae is expecting a lower 7.9% growth rate. CoreLogic is only expecting a 1.9% overall increase in prices, and the Mortgage Banks Association says it'll be more like 2.5%. Single-Family Rents Move HigherAs you can see, home price forecasts are all over the map, but they all expect strong demand for housing to continue. And that's pushing rents higher for single-family homes.CoreLogic's single-family rental index for September shows that national rents are 10.2% higher year-over-year. Miami rents have gone up the most. Those rents are up 25.7% with rents for high-end homes rising the most. Phoenix is second on that list, followed by Las Vegas, Austin, San Diego, and Dallas. (7)John Burns Real Estate Consulting also tracks single-family rent growth. It shows that new lease effective rents were up 6% year-over-year in September. Phoenix was at the top of that list, at 14%. (8)Single-Family Build-to-Rent StartsThe housing shortage is motivating a lot of developers and investors to bring more build-to-rent homes to the market. According to the National Association of Homebuilders, housing starts for those homes hit the highest level ever in the third quarter. Construction has been ramping up, with 47,000 build-to-rent starts over the last year. (9)Builder.com says that's a 17.5% increase over the previous four quarters. It says: “With the onset of the Great Recession and declines in the homeownership rate, the share of build-to-rent homes increased in the years after the recession. And while the market share… is small, it has been trending higher.”That's it for today. Check the show notes for links and more info on these topics. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more. Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/jobless-claims-drop-to-pandemic-low-of-268-000-as-labor-shortage-forces-businesses-to-avert-layoffs-11637242500?mod=economic-report2 -https://www.marketwatch.com/story/new-home-construction-slows-as-builders-grapple-with-supply-chain-headaches-11637157193?mod=economic-report3 -https://www.marketwatch.com/story/home-builders-are-growing-more-confident-as-americans-demand-more-housing-11637075714?mod=economic-report4 -http://www.freddiemac.com/pmms/5 -https://magazine.realtor/daily-news/2021/11/19/inflation-drives-mortgage-rates-over-36 -https://fortune.com/2021/11/18/zillow-changes-2022-real-estate-outlook-what-to-expect-from-home-prices-next-year/7 -https://magazine.realtor/daily-news/2021/11/17/property-owners-see-big-opportunities-in-single-family-rentals8 -https://www.realestateconsulting.com/the-light-bsfri-new-lease-effective-rents-up/9 -https://www.builderonline.com/data-analysis/single-family-build-to-rent-starts-reach-highest-quarterly-volume_c
Longest standing sponsor for Kim's show, Karen Levine (303-877-7516), realtor with RE/MAX Alliance, and show sponsor Lorne Levy, mortgage specialist with Polygon Financial, join Kim in studio to discuss the current housing shortage and interest rates. This weekend listeners will have the opportunity to hear three separate America's Veterans Stories interviews. Sunday at 3pm Kim will interview Nellie Paler, a Vietnam Marine pilot veteran. Saturday and Sunday evenings at 10pm the show will feature veterans from previously recorded interviews. All shows are on KLZ 560 AM and KLZ 1007 FM. Kim's quote from John Maynard Keynes leads to a robust conversation on Keynesian economic theory. Keynes was a supporter of government intervention, including deficit spending, during periods of economic instability. Kim, Karen and Lorne look at Keynesian theory during 2008 and now. Economist Dr. Murray Sabrin analyzes inflation as seen today. We are seeing monetary inflation because of the infusion of trillions of dollars by the government in the money supply. The biggest scandal today is that inflation is running at 6.2% annually while interest rates have not increased for savings accounts. Dr. Sabrin is advocating for a tax deduction on the loss of interest for those savers with Congressional members. Housing prices continue to rise with income increases lagging behind. The government is working to micromanage the economy with central planning. We need a free market focused on lower taxes, less regulation and no infusion of government money so that the economy will run effectively. Karen, on the heels of her returning from the National Association of Realtors convention, reports that the 1031 Exchange has not been dissolved in the infrastructure bill signed by Biden on Monday. This is good news for middle class investors. Additionally, the tax on unrealized gains was not included in the bill. The “Social Infrastructure” bill is yet to be determined. There is limited housing inventory. This has led to the average price of homes in the Denver metro area increasing by 15% over the past year. Refinancing, reverse mortgages and home equity loans have helped many homeowners in various investments. Fannie Mae and Freddie Mac, federal government agencies that back home mortgages, will increase their loan limit to almost $1 million due to home appreciation prices in some areas of the nation. Karen and Lorne agree that this is good for home buyers; without the increase in loan limit, people would not be able to afford homes. Zillow spent big in buying homes at an inflated prices. They realized their mistake and are withdrawing from their program of buying and flipping homes. Karen invites listeners to give her a call at 303-877-7516 if you would like your family to visit Santa with all the trimmings on Saturday, December 11th. Karen stresses that not all realtors are members of the National Association of Realtors. Karen is the person to help you buy or sell your home. Lorne advises potential buyers or those who want to leverage the equity in their home to call him at 303-880-8881.
Plus: Walmart reports higher sales as it raises prices. Home Depot reports better-than-expected sales. Fannie Mae, Freddie Mac will soon back mortgages of nearly $1 million. Trenae Nuri reports. Learn more about your ad choices. Visit megaphone.fm/adchoices
Sasi Yajamanyam is the director of customer success strategy and operations at ServiceNow and author of Reimagining customer success: Designing organizations around customer value. Sasi has an extensive career in customer facing roles from senior consulting and strategy roles at IBM and Freddie Mac to product management and customer success roles at the CEB (Corporate Executive Board). And now at ServiceNow.Sasi saw a problem with how customer success is being implemented, as a siloed department. Not as organization design. In his book he offers a framework for how companies can design their entire organization around customer success and customer value. More about Sasi:His book: https://www.amazon.com/Reimagine-Customer-Success-Designing-Organizations-ebook/dp/B09DX99TWD/ref=sr_1_1?crid=EQ5PQEIV0194&keywords=reimagine+customer+success&qid=1636682836&sprefix=reimagine+customer+success%2Caps%2C399&sr=8-1On Linkedin: https://www.linkedin.com/in/sasiyajamanyam/ Subscribe at helpingsells.substack.com
In this Real Estate News Brief for the week ending November 13th, 2021... the two Fed Chair finalists, the top property investing sector, and the billions earned from a pandemic fee on refinancing loans. Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. President Biden is reportedly close to a decision on who he'll nominate as chief of the Federal Reserve. Fed Chief Jerome Powell's four-year term is up in February, and it appears that Biden is now deciding whether to keep Powell or replace him with Fed Governor Lael Brainard. Brainard is considered more progressive than Powell. She's described in a Barron's article as more “dovish on monetary policy and stronger on bank regulation.” Some Fed watchers also believe that Brainard is more in tune with Biden's economic agenda, but Powell has strong support from moderate Democrats and Republicans, which gives him an edge over Brainard. Biden has said he'll make a decision “fairly quickly.” Some believe he'll announce a nomination by Thanksgiving. (1) (2) Whoever lands that job will be tackling inflation, which surged to a 31-year-high this last week. The consumer price index was up .9% in October, according to the government. That raises the annual rate of inflation from 5.4% in September to 6.2% in October, which is more than triple the Fed's target of 2%. It's also the highest rate of inflation since November of 1990. If you eliminate higher prices for food and energy, the core CPI is about 4.6%. That's up from 4% in September. (3)The gauge the Fed watches more closely is the PCE which stands for personal consumption expenditures. That's rising more slowly. The PCE was 4.4% in September and 3.6% for the core rate. October numbers haven't come out yet.Initial applications for state unemployment benefits dropped again. There were just 267,000 new claims last week while layoffs also fell to a record low. (4) Employers have been struggling to find enough workers to fill positions. There are currently 10.4 million job openings and just 7.4 million people listed as unemployed. One result of this lopsided situation: Companies are increasing hourly rates to attract candidates. Data from Indeed.com shows that jobs offering less than $15 an hour are scarce. (5)Consumers are not very happy about the current economic situation. The University of Michigan Consumer Sentiment Index fell to its lowest level in a decade. The November reading was 66.8. That's a drop of about five points from October, and about 35 points lower than the pre-pandemic reading of 101. (6)Mortgage RatesOn a more positive note, mortgage rates dipped below the 3% level this last week. Freddie Mac says the average 30-year fixed-rate mortgage was down 11 basis points to 2.98%. The 15-year was 2.27%. (7)In other news making headlines…Single-Family Build-to-Rent BoomInvestors are clamoring into the single-family build-to-rent market, as demand and rents soar. A new Green Street report shows that investors are earning 8% on average. That is the highest amount among the 18 property sectors analyzed by Green Street. As reported by the Wall Street Journal, the weighted average return for all property sectors is 6.1%. (8)Housing economics consultant, Brad Hunter, says that builders provided almost 100,000 new rental homes in 2021, and that investors have pumped about $30 billion into this corner of the real estate market. The momentum has created a frenzy for land that's suitable for build-to-rent. One builder told the Journal: “You almost have to find the land before it gets put on the market.”GSE Bonanza from Adverse Market FeeRemember the “adverse market fee” on refinancing loans during the pandemic? It was a 50 basis point fee for refi loans backed by Fannie Mae and Freddie Mac, and it earned those two GSEs a bundle!According to the Federal Housing Finance Agency, Fannie and Freddie earned $5.3 billion from that fee. (9) It says the money will cover about 70% of the cost of the GSE's Covid relief programs, such as the moratorium on foreclosures, and forbearance programs that allowed homeowners to skip their mortgage payments. The adverse market fee was in force for about 10 months, starting in October of last year.Opendoor Buys RedDooriBuyer Opendoor will be able to pre-approve applicants in just “one” minute, with the acquisition of online mortgage broker RedDoor. The mortgage company was founded in 2018 and has partnered up with more than 70 lenders. (10)The announcement comes at a time when Zillow has announced the elimination of its iBuying program, and has created doubts about the profitability of the iBuying business. But as HousingWire reports: “Some investors see add-on services… (like mortgages) as a possible way for iBuyers to eventually turn a profit.”Opendoor expanded into the mortgage business in 2019. And it reportedly “smashed through” earnings estimates for the third quarter with 5,988 homes sold. Year-over-year revenue was up 570%. With Zillow out of the picture, Opendoor now has one less competitor. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke. Links:1 -https://www.barrons.com/articles/federal-reserve-powell-brainard-biden-nomination-516367371032 -https://www.washingtonpost.com/us-policy/2021/11/11/brainard-fed-biden-powell/3 -https://www.marketwatch.com/story/coming-up-u-s-consumer-price-index-for-october-11636550300?mod=economy-politics4 -https://www.marketwatch.com/story/jobless-claims-slip-to-267-000-and-touch-new-pandemic-low-11636552204?mod=economic-report5 -https://www.marketwatch.com/story/job-listings-offering-less-than-15-an-hour-are-starting-to-disappear-in-todays-tight-labor-market-116366575806 -https://www.marketwatch.com/story/u-s-consumer-sentiment-declined-in-early-november-to-decade-low-university-of-michigan-2716367302647 -http://www.freddiemac.com/pmms/8 -https://www.wsj.com/articles/building-and-renting-single-family-homes-is-top-performing-investment-11636453800?mod=hp_lead_pos109 -https://www.housingwire.com/articles/fannie-freddie-made-5-3b-from-adverse-market-fee/10 -https://www.housingwire.com/articles/opendoor-buys-mortgage-brokerage-reddoor/
Don Layton, former Freddie Mac CEO, joins Mike Reynolds, VP of Single-Family Credit Risk Transfer, to discuss the inception of the GSE CRT market and how it supports Freddie Mac's mission. Don and Mike dive into the benefits of CRT, address its criticisms and reflect on CRT's core role in today's financial system.
In this Real Estate News Brief for the week ending November 6th, 2021… why it's a “banner year” for homeseller profits, how much an ADU will increase your home value, and which states are attracting the most newcomers.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. The Federal Reserve has announced its “taper timetable.” The Fed is currently buying Treasurys and mortgage-backed securities at a rate of $120 billion a month an economic stimulus. It now plans to reduce that amount by $15 billion per month in November and December, with similar reductions expected next year. If there's no adjustment to the pace of reductions, the tapering process would be complete by mid-2022. Although the Fed believes the economy is strong enough to begin the taper, Fed chief Jerome Powell says: “We don't think it's time yet to raise interest rates.” (1)The jobless rate dipped again this last week. There were only 269,000 initial claims for state benefits and 2.1 million continuing claims. Altogether, 2.67 million people are collecting either state or federal benefits. Before the pandemic, there were just under 2 million people getting unemployment checks. (2)Construction spending was down slightly in September, compared to August. The census bureau says it was down about a half a percent, with a bigger drop for single-family homes. But compared to September of last year, it's up almost 20%. The National Association of Home Builders blames the dip on supply chain issues, higher material coasts, and the labor shortage. (3)That pullback isn't helping the inventory problem. HouseCanary says it dropped close to record lows in September. And it expects the situation to get worse as we head into the next year. Higher home prices are contributing to the problem as fewer less expensive homes are put up for sale. (4) According to the St. Louis Fed, the nation had 6.5 months of supply in August. That dropped to 5.7 months of supply in September. (6)Meanwhile, the homeownership rate hasn't changed over the last quarter. It's still at 65.4%, which is down from a high of 67.9% in the second quarter of last year. If you determine homeownership by age, it's highest for people over age 65 at about 80%. Regionally, the Midwest is the highest at about 71%. (7)Mortgage RatesMortgage rates are backing off a bit from a recent rise. Freddie Mac says the 30-year fixed-rate mortgage was down 5 basis points to 3.09%. The 15-year was down 2 points to 2.45%. (8)In other news making headlines…New High for Homeseller ProfitsHome sellers are realizing some big gains. ATTOM Data Solutions says they are getting almost 50% more than they paid for the home, or about $100,000. That's for a median-priced single-family home or condo. In the second quarter of this year, sellers typically gained about $89,000. (9)ATTOM's chief product officer, Todd Teta, says: “The third quarter of this year marked another period in a banner year for a housing market boom that's steaming ahead through its 10th year.” He says: “For now, the market engine seems to have nothing but high-octane gas in the tank.”ADUs Add Big Value to HomesADUs can also add a lot of value to your home. According to Porch.com. An accessory dwelling unit can add an average 35% onto the sale price. In some cities, such as Savannah, Georgia and Cleveland, Ohio, it can “double” the sale price. (10)They can also generate passive income as rentals, but they are not cheap to build. The Porch.com study says the average cost of an ADU is $180,000. There are about 1.4 million of them in the U.S., according to 2019 information.States Attracting the Most ResidentsA new study on resident migration shows that Florida is the top destination for people looking to move to another state. The LendingTree analysis looked at mortgage loan data for the last year-and-a-half to identify pandemic migration patterns. The researchers say: “The Sunshine State has a long history of bringing in visitors and new residents, particularly retirees, thanks to a mix of affordable housing, no state income tax, and sunny weather.” (11)The analysis also found that Texas has the highest number of people moving “within” the state. Oklahoma and Florida were close behind Texas, while New York had the highest number of people fleeing the state. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Link: for newsforinvestors.com - https://join.realwealth.com/?utm_content=Real%20Estate%20News%20Podcast&utm_campaign=Join%20for%20Free&utm_term=Description%20Text%20LinkLinks:1 -https://www.marketwatch.com/story/fed-slows-down-bond-buying-says-factors-boosting-inflation-are-expected-to-be-transitory-11635962420?mod=mw_latestnews2 -https://www.marketwatch.com/story/u-s-jobless-claims-drop-to-pandemic-low-of-269-000-as-firms-avoid-layoffs-during-labor-shortage-11636029426?mod=economic-report3 -http://www.mortgagenewsdaily.com/11022021_construction_spending.asp4 -https://dsnews.com/daily-dose/11-04-2021/october-saw-net-new-inventory-levels-drop-once-again5 -https://fred.stlouisfed.org/series/MSACSR6 -http://www.mortgagenewsdaily.com/11032021_homeownership.asp7 -http://www.mortgagenewsdaily.com/11032021_homeownership.asp8 -http://www.freddiemac.com/pmms/9 -https://magazine.realtor/daily-news/2021/11/04/home-sale-profit-margins-hit-10-year-high10 -https://magazine.realtor/daily-news/2021/11/04/study-adus-can-add-35-to-home-s-value11 -https://magazine.realtor/daily-news/2021/11/03/states-with-the-fewest-outgoing-residents
Freddie Mac announcement: https://freddiemac.gcs-web.com/news-r... Report your rent: https://esusurent.com/renters/ See if your landlord has a loan with Freddie Mac: https://myhome.freddiemac.com/renting... ✅ Talk With A Helpful Loan Officer Anywhere in the US & Canada: https://www.winthehouseyoulove.com/apply HOMEBUYER TOOLS: ✅ Max Purchase Price Calculator: https://www.winthehouseyoulove.com/ma... ✅ Step-By-Step Home Buying Timeline: https://www.winthehouseyoulove.com/#t... ✅ Student Loan Savings Calculator: https://www.winthehouseyoulove.com/st... ✅ Today's Interest Rates: https://www.winthehouseyoulove.com/to... Kyle Seagraves - NMLS 1701021 Only for educational usage. All calculations should be verified independently. Win The House You Love LLC is not a lender, does not issue loan qualifications, and does not extend credit of any kind. This is not an offer to lend and should not be used to make decisions on home offers, purchasing decisions, or loan selections. Not guaranteed to provide accurate results, imply lending terms, qualification amounts, nor real estate advice. Read the full disclaimer here: https://www.winthehouseyoulove.com/disclaimer
In this Real Estate News Brief for the week ending October 30th, 2021... the rebound of big city rents, the state and local property tax bonanza, and a tragic reminder to check smoke alarms in rentals.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. The latest report on the GDP shows a big slowdown in the third quarter. The Commerce Department says the economy downshifted from 6.7% in the second quarter to just 2% in the third. (1) The slowdown was expected but the Wall Street Journal had anticipated a beefier 2.8%. Economists say we're experiencing slower growth because government stimulus money is drying up while businesses struggle with supply chain issues and the nation continues to deal with the coronavirus.Consumers are working and spending money however, which keeps the economy on the growth side. Consumer spending was up .6% in September. (2) And, the latest unemployment report shows that new state claims dropped to another pandemic low of 281,000. Existing claims also fell, from 2.48 million to 2.24 million. (3) The unemployment rate is currently at 4.8%. Much of that spending went into new homes. New home sales rose in September despite higher price points. The sales rate grew to an annual rate of 14% while the median price rose to a new record high of $408,800. (4) The sales rate hit a six-month high in September, but it's almost 18% lower than it was a year ago. The sale of existing homes went in the opposite direction. The National Association of Realtors says pending sales were down 2.3% in September, and compared to a year ago, they were down 8%. (5) A tight inventory continues to plague buyers, along with rising prices.According to the latest report from the S&P CoreLogic Case-Shiller Home Price Index, national home prices are up 19.8% from a year ago. (6) For those who can buy, they are making those decisions quickly. The National Association of Realtors says that 86% of homes sold in September were on the market for less than a month. (7)Mortgage RatesMortgage rates continue their slow climb skyward. Freddie Mac says the average 30-year fixed-rate mortgage rose 5 basis points to 3.14%. The 15-year was up 4 points to 2.37%. (8)In other news making headlines…Big City Rents Are ReboundingRents are rebounding in the nation's big cities. Realtor.com says that rents in many cities are now “higher” than they were at the beginning of the pandemic. Rents had dropped as tenants fled to less-crowded areas, but they are rebounding in a big way. (10)Realtor.com's monthly rental report shows that rents in the ten largest U.S. tech cities, are now about 6.3% “higher” than they were when the pandemic first hit. The report says that the annual pace of rent growth for all U.S. rentals is about 13.6% right now. And it says there's no sign of it slowing down.Realtor.com's manager of economic research, George Ratiu, says: “With rents continuing to surge to new highs nationwide, including in big tech hubs, September data confirms the U.S. rental market has moved past the recovery phase and is fully back in business.”Property Tax Bonanza State and local governments have reaped the rewards of higher home prices. An analysis by the National Association of Home Builders shows that property tax collection is now the highest it's been since 2009. (9) That review shows that homeowners paid $703.5 billion from Q3 of last year to Q2 of this year. That's a 13% increase from the previous year. State and local governments rely heavily on property tax. The NAHB says they get about 38% of their revenue from that tax base. Tragic Lesson about Fire AlarmsA story out of Southern California is a tragic reminder to all landlords to make sure smoke detectors are working in all rentals. A fire at a short-term rental in Malibu killed a 22-year-old college student last January, and his father recently filed a lawsuit against the landlords, TripAdvisor, and a TripAdvisor subsidiary for negligence. (11)The lawsuit was filed in Los Angeles by Brad Schneider. It claims his son, Grant, was not able to escape the fire because there were not enough smoke detectors in the home, and the ones that were there were not working. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/coming-up-third-quarter-gdp-11635423260?mod=economy-politics 2 -https://www.marketwatch.com/story/coming-up-spending-income-and-pce-inflation-for-september-11635509727?mod=bnbh_mwarticle3 -https://www.marketwatch.com/story/u-s-jobless-claims-set-to-hit-new-pandemic-low-of-289-000-economists-predict-11635423655?mod=economic-report4 -https://www.marketwatch.com/story/new-home-sales-soared-in-september-but-is-the-housing-markets-rebound-coming-to-an-end-11635257630?mod=economic-report5 -https://www.marketwatch.com/story/coming-up-pending-home-sales-116354289656 -https://www.marketwatch.com/story/home-price-growth-is-slowing-down-but-that-doesnt-mean-prices-are-falling-11635254340?mod=economic-report7 -https://magazine.realtor/daily-news/2021/10/22/inventory-boost-not-enough-to-satisfy-fall-house-hunters8 -http://www.freddiemac.com/pmms/9 -https://magazine.realtor/daily-news/2021/10/26/property-tax-boom-helps-state-local-coffers10 -https://magazine.realtor/daily-news/2021/10/28/urban-rents-soar-as-cities-recover-from-pandemic-hit11 -https://timesofsandiego.com/business/2021/10/22/father-of-mesa-college-student-sues-tripadvisor-com-landlord-after-sons-death-in-fire/
Erica and Gil are delighted to welcome designer Amabel Holland of Hollandspiele, known for making games with challenging themes using an unconventional publishing model. SHOW NOTES 0m58s: Supply Lines of the American Revolution, Table Battles, Irish Gauge, This Guilty Land, Nicea, The Vote. 7m08s: Amabel is talking about her forthcoming game Eyelet. 15m02s: This is Geoff's game Versailles 1919, co-designed with Mark Herman. 17m28s: Benedict Arnold 18m34s: The Shackleton Expedition 21m16s: The Vote 28m22s: Nicea 31m38s: Irish Gauge, Northern Pacific, Iberian Gauge 32m29s: Winsome, Rio Grande 34m23s: Chicago Express 34m55s: Meltwater, An Infamous Traffic 36m11s: RIBBIT: The Jump, Move, and Block Game, Table Battles 38m51s: New Mill 43m45s: Westphalia 48m18s: Freddie Mac and Fannie Mae 49m52s: Cheapass Games 53m46s: Tobacco misinformation campaign 54m37s: Gil was thinking of Brandolini's Law, aka the BS Asymmetry Principle. 57m55s: Horse & Musket 59m03s: Deinocheirus, Pterodactyl, Therizinosaurus
On this week's podcast, we have a special 2 hour episode with Rob Hoehn, CEO of IdeaScale an innovation management solution that links organizations to people with ideas. Rob is also featured in the upcoming season of reality docu-series "4 Days to Save the World." We discuss all things technology and leadership, and I share a glass of The Floor is Java from No Label Brewing in Katy, TX.About IdeaScale: In 2009, IdeaScale founders Vivek Bhaskaran, Rob Hoehn, Josh Folk, and Jessica Day launched IdeaScale in tandem with President Barack Obama's Open Government Initiative. In its first year, IdeaScale was adopted by 23 federal agencies.The following year, the platform's adoption rate expanded to include more than 36 agencies as well as numerous private enterprise-level companies. As the company and the platform continued to grow, so did our community of collaborators. We came to welcome many industry leaders to our ranks, like the Cleveland Cavaliers, Doctors Without Borders, Freddie Mac, Marriott Vacations Worldwide, NASA, the United Way, the US Air Force, and many others.Over the years we've grown our capabilities and offering by acquiring Ideavibes in 2014, InnovationManagement.se in 2016, and (most recently) Betterific in 2020. This suite of solutions offers not only great software, but self-paced training and resources, as well as an entire community of ideators.As of 2020, IdeaScale has maintained its boot-strapped status and profitability and has offices in Washington, DC and headquarters in Berkeley, CA.
Freddie Mac's chief economist expects rates to move higher for the remainder of 2021. We expect rates to average 3.7% for 2022. His reasoning: There are two main reasons why mortgage rates are expected to rise, inflation and monetary policy. Inflation has been more durable than expectations and is rising faster, broadening to affect more goods and services. Despite all the economic headwinds, the economy is growing and putting pressure on consumer demand given the already low and limited supply in many different industries. The supply and demand imbalances due to Covid will cause prices to continue to rise and this will impact rates to the upside until the risk of Covid recedes or the impact on the economy is blunted. On the policy front, the Federal Reserve is positioning for both a removal of asset purchases and they have communicated their desire to start raising the federal funds rate shortly thereafter. Both of these policy actions will cause rates to rise relative to where they would be otherwise.
Rose holds a B.A. from Brandeis University, supplemented by graduate study in social work and education. She is known nationally as a Face Reader, Aura Reader and Empath. Rose is a member of the International Association for Regression Research & Therapies, Inc. (IARRT) and the National Guild of Hypnotists, Inc. (NGH). She is fully certified as a Consulting Hypnotist and a Regression Therapist. She has won teaching awards for her workshops from FIRST CLASS Adult Education Center. Fairfax County Adult Education, in Virginia, grants Continuing Education Units (CEUs) for her classes to physicians, psychotherapists, social works, massage therapists and other professionals. Rose's other clients include Long & Foster Real Estate, Law Resources, Oxford Management, USA Today, Freddie Mac, Andrews Bartlett, Coolfont, Case Managers of South Texas, Chevy Chase Land Company, Washington Inc, Washington Press Correspondents, one of Washington's leading cosmetic surgery practices, Worldgate Sport & Health, and EDS. *** AND NOW *** The ‘X' Zone TV Channel on SimulTV - www.simultv.com The ‘X' Zone TV Channel Radio Feed (Free - No Subscription Required) - https://www.spreaker.com/show/xztv-the-x-zone-tv-show-audio The ‘X' Chronicles Newspaper - www.xchroniclesnewspaper.com (Free)
Rose holds a B.A. from Brandeis University, supplemented by graduate study in social work and education. She is known nationally as a Face Reader, Aura Reader and Empath. Rose is a member of the International Association for Regression Research & Therapies, Inc. (IARRT) and the National Guild of Hypnotists, Inc. (NGH). She is fully certified as a Consulting Hypnotist and a Regression Therapist. She has won teaching awards for her workshops from FIRST CLASS Adult Education Center. Fairfax County Adult Education, in Virginia, grants Continuing Education Units (CEUs) for her classes to physicians, psychotherapists, social works, massage therapists and other professionals. Rose's other clients include Long & Foster Real Estate, Law Resources, Oxford Management, USA Today, Freddie Mac, Andrews Bartlett, Coolfont, Case Managers of South Texas, Chevy Chase Land Company, Washington Inc, Washington Press Correspondents, one of Washington's leading cosmetic surgery practices, Worldgate Sport & Health, and EDS. *** AND NOW *** The ‘X' Zone TV Channel on SimulTV - www.simultv.com The ‘X' Zone TV Channel Radio Feed (Free - No Subscription Required) - https://www.spreaker.com/show/xztv-the-x-zone-tv-show-audio The ‘X' Chronicles Newspaper - www.xchroniclesnewspaper.com (Free)
Rose holds a B.A. from Brandeis University, supplemented by graduate study in social work and education. She is known nationally as a Face Reader, Aura Reader and Empath. Rose is a member of the International Association for Regression Research & Therapies, Inc. (IARRT) and the National Guild of Hypnotists, Inc. (NGH). She is fully certified as a Consulting Hypnotist and a Regression Therapist. She has won teaching awards for her workshops from FIRST CLASS Adult Education Center. Fairfax County Adult Education, in Virginia, grants Continuing Education Units (CEUs) for her classes to physicians, psychotherapists, social works, massage therapists and other professionals. Rose's other clients include Long & Foster Real Estate, Law Resources, Oxford Management, USA Today, Freddie Mac, Andrews Bartlett, Coolfont, Case Managers of South Texas, Chevy Chase Land Company, Washington Inc, Washington Press Correspondents, one of Washington's leading cosmetic surgery practices, Worldgate Sport & Health, and EDS. *** AND NOW ***The ‘X' Zone TV Channel on SimulTV - www.simultv.comThe ‘X' Zone TV Channel Radio Feed (Free - No Subscription Required) - https://www.spreaker.com/show/xztv-the-x-zone-tv-show-audio The ‘X' Chronicles Newspaper - www.xchroniclesnewspaper.com (Free)
In this Real Estate News Brief for the week ending October 23rd, 2021... the Fed's new rate hike schedule, a new wave of foreclosures, and a rent growth surprise for some single-family homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week with comments from Fed Chief Jerome Powell. It looks like the timeline for interest rate hikes has been pushed up again. Last month, there was more of a debate as to whether it would happen in 2022 or 2023. Powell indicated that conditions for a rate hike would probably be reached next year. That includes the Fed's goal of maximum employment. The inflation requirement has already been met. That's when inflation remains above 2% for a sustained period of time. Powell also said that now is the time to begin tapering the Fed's bond-buying strategy. Policymakers will discuss a tapering plan next month. Jobless claims fell to a fresh pandemic low last week. There were only 290,000 initial claims for state benefits. Continuing claims also fell. They were down 290,000 to 2.48 million. (2) Millions of jobs are going unfilled, however, which is making it difficult for businesses to meet the demand for goods and services. That's also creating supply chain issues that are driving up prices, and inflation.Home buyers are going full steam ahead to lock in deals before mortgage rates rise any higher. The National Association of Realtors say that existing home sales were up 7% from August to September. That's a seasonally-adjusted annual rate of 6.29 million homes. (3) Part of that increase is due to more inventory, but NAR Chief Economist Lawrence Yun says that inventory was quickly gobbled up. On the other side of the housing supply issue, residential construction was down due to those supply chain issues, and a labor shortage. The government says that September home starts were down 1.6% compared to August, and that permits were down 7.7%. Multi-family permits were down the most. They fell 21% while single-family permits were down just 1%. (4) Despite all the headwinds that builders face, the National Association of Home Builders monthly confidence index shows an increase of four points to a reading of 80. Anything over 50 is positive. Although builders have to keep raising prices, they are encouraged that demand and home sales “remain strong.” (5)Mortgage RatesMortgage rates rose slightly this last week. Freddie Mac says the 30-year fixed-rate mortgage was up four points, to 3.09%. The 15-year was up three points, to 2.33%. (6)In other news making headlines…Foreclosures on the RiseForeclosure filings jumped higher in September, after pandemic-related moratoriums were lifted. ATTOM Data Solutions released its Q3 foreclosure report which shows that foreclosure filings were up 24% compared to August, and 102% from a year ago. (7)Economists have been predicting a spike in foreclosures, but RealtyTrac's Rick Sharga says: “Despite the increased level of foreclosure activity in September, we're still far below historically normal numbers.” He says they are almost 70% lower than they were before the pandemic. And light years away from the number of foreclosures in mid-2009.Foreclosure filings were approaching 600,000 per quarter back then. Currently, there are 45,500 filings for the third quarter of this year.Single-Family Rent GrowthSingle-family rent growth quadrupled in August. CoreLogic says the year-over-year rate of growth was 9.3%, and represents the fastest annual rent growth in 16 years. (8)The single-family category includes both detached and attached units, such as duplexes, triplexes, quadplexes, townhomes, row homes, co-ops, and condos. Rent growth spiked the most for detached homes. Annualized rent growth for attached units was 6.4% while the rent for detached homes rose 11.7%.The city with the highest rent growth was Miami. Rents in Miami were up 21.5%. That pushed Phoenix into second place for the first time in almost three years. Rounding out the top five are Las Vegas, Austin, and Dallas. New Forecast for Top Markets in 2022New forecasts are coming out about next year's hot real estate markets. PwC just released its 2022 Emerging Trends in Real Estate report. The report includes a top-10 list of highly ranked real estate markets for 2022. Several of them are also on our list of recommendations for single-family rentals. Those markets include Tampa/St. Petersburg, Charlotte, Dallas/Fort Worth and Atlanta.PwC is also recommending those cities, and others, for the construction of new homes. If you have been following RealWealth, you know that we have expanded our focus on existing single-family rentals to also include the construction of new rental homes. Our recommended markets include Charlotte, North Carolina; Cincinnati and Dayton, Ohio; Dallas, Texas; Park City, Utah, and several Florida markets.You can find out more by joining RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/feds-powell-says-elevated-inflation-could-last-well-into-next-year-11634917919?mod=economy-politics2 -https://www.marketwatch.com/story/jobless-claims-fall-to-pandemic-low-of-290-000-as-businesses-try-to-avoid-layoffs-due-to-labor-shortage-11634819765?mod=u.s.-economic-calendar3 -https://www.marketwatch.com/story/existing-home-sales-rise-as-some-buyers-are-motived-by-fomo-11634826649?mod=economic-report4 -https://www.marketwatch.com/story/construction-on-new-homes-slows-as-supply-chain-woes-hit-the-housing-market-11634647997?mod=economic-report5 -https://www.marketwatch.com/story/home-builders-grow-more-confident-in-spite-of-continued-supply-chain-headaches-11634565934?mod=economic-report6 -http://www.freddiemac.com/pmms/7 -https://www.attomdata.com/news/market-trends/foreclosures/attom-september-and-q3-2021-u-s-foreclosure-market-report/8 -https://www.corelogic.com/intelligence/single-family-rent-growth-approaches-double-digits/9 -https://fortune.com/2021/10/18/hot-real-estate-markets-2022-outlook-real-estate-buying-a-house/
In this Real Estate News Brief for the week ending October 16th, 2021… more home loans for the self-employed borrowers, a surge in jumbo loans, and a rise in closing costs.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. Inflation ticked higher again. The government reports a .4% increase for September, mostly due to higher prices for food, gas, and rent. That raises the yearly rate of inflation from 5.3% to 5.4% which is more than double what the Federal Reserve considers “ideal.” But the Fed pays more attention to the PCE or Personal Consumption Expenditures index which is lower but still more than double the Fed's target. Economists, along with the Fed, say that means prices will probably remain high into next year. (1)Well-known stock investor Cathie Woods has her own theory on inflation. She's the owner of Ark Invest and a collection of stock funds that lean toward more innovative tech companies and start-ups. She told CNBC that the current migration from expensive cities will help keep inflation in check. She says: “The exodus, or the great migration, is from very high-rent areas of the world to much lower rents.” She is moving her own company from New York to St. Petersburg, Florida, to take advantage of a lower cost of living. (2)Consumers don't seem to be that concerned about high prices. U.S. retail sales rose .7% last month. That's after a big gain in August. Economists say Americans have plenty of money to spend from their pandemic savings, and a job market that is paying higher wages. One thing holding them back is a short supply of goods like cars and consumer electronics because of supply chain issues. (3)Initial jobless claims dipped below 300,000 for the first time since the beginning of the pandemic. The government reports just 293,000 new state claims. Ongoing claims also dropped to a pandemic low of 2.59 million. The total number of people collecting benefits from eight state and federal programs is 3.65 million. That's after more than 11 million people dropped off the list last month due to the expiration of an emergency federal program. (4) The “quit rate” jumped higher in August, to the highest it's ever been since the government started tracking the number of people leaving their jobs in 2000. This so-called quit rate was up almost 3% to 4.27 million private-sector employees. That's about double what it was during the early part of the pandemic. This recent spike coincides with a spike in coronavirus cases tied to the delta variant. (5) Mortgage RatesLet's check on mortgage rates. According to Freddie Mac, the 30-year fixed-rate mortgage rose 6 basis points to 3.05%. The 15-year was up 7 points to 2.3%. (6)In other news making headlines...Credit More Available for Self-Employed The credit market is opening up a bit, making it easier to get a home loan. The Mortgage Bankers Association's Credit Availability Index rose 1.5% in September, with most of the growth going to self-employed borrowers. That's great for real estate professionals who are often self-employed. (7)The index benchmark is 100, and the current reading is 125.6. It's the highest it's been since May. The MBA's Joel Kan says: “But, even with increases in seven out of nine months thus far in 2021, total credit availability is still around 30% less than it was in February 2020” which is right before the pandemic struck.Jumbo Loans Surge Due to High Home Prices Lenders are also handing out more jumbo loans because of high home prices. Researchers at Bank of America said in a weekly report that loan originations for jumbo loans are rising to levels we haven't seen since before the 2008 financial crisis. (8)The current limit for a conforming loan is about $548,000. Anything above that is a jumbo loan, although high-priced areas like New York City and San Francisco have higher limits. Several lenders have already announced higher conforming loan limits up to $625,000 for next year.Buyers Paying Higher Closing CostsHigh home prices are also driving closing costs higher. Residential real estate data firm ClosingCorp said the national average for single-family properties was $6,837 during the first half of this year. That includes taxes, and represents a 12.3% year-over-year increase. Without taxes, the national average is up 10.5% to $3,836. For refinancing loans, closing costs are up about 5% to around $2,400. (8)ClosingCorp's CEO, Bob Jennings, says that even though closing costs are higher, they are not going up as fast as home prices, because lenders are holding those costs down. He says: “Although the average home price increased by nearly $45,000, the closing cost, excluding taxes, on property only increased by $400.”That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more. Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/consumer-prices-rise-at-5-4-yearly-pace-in-september-and-stay-at-30-year-high-11634129045?mod=inflation2 -https://markets.businessinsider.com/news/stocks/cathie-wood-inflation-exodus-expensive-cities-ark-invest-2021-103 -https://www.marketwatch.com/story/u-s-retail-sales-rise-sharply-again-but-high-inflation-also-means-goods-cost-more-11634302108?mod=economy-politics4 - https://www.marketwatch.com/story/jobless-claims-sink-to-new-pandemic-low-and-fall-below-300-000-for-first-time-in-a-year-and-a-half-11634215581?mod=economic-report5 -https://www.marketwatch.com/story/i-quit-a-record-number-of-u-s-workers-are-telling-their-bosses-11634051980?mod=economic-report6 -http://www.freddiemac.com/pmms/7 -https://www.housingwire.com/articles/lenders-are-courting-self-employed-borrowers-again/8 -https://magazine.realtor/daily-news/2021/10/13/rising-home-prices-lead-to-105-hike-in-closing-costs
In this episode I have an intriguing conversation with Michael Bradley from Freddie Mac Single-Family. He and I talk about how COVID has affected our day-to-day business practices, the future of AI in the mortgage industry, and the strategy Freddie Mac uses to implement the massive amounts of data they received. Michael Bradley is Senior Vice-President in Freddie Mac's Single-Family Division, which provides liquidity, stability and affordability to the nation's residential housing markets. Michael is responsible for setting the modeling and analytics strategy, as well as positioning Freddie Mac to become the best credit guarantor. He's been a senior executive with other companies like Citigroup and CoreLogic, and bachelor's, Master's & Doctorate in Economics. Michael holds a Bachelor of Science in economics from the University of Delaware and a Master of Science and a doctorate, both in economics, from the University of Illinois. For more information, please visit www.FreddieMac.com and follow on Twitter @FreddieMac If you are enjoying the podcast, please take a second and LEAVE US A REVIEW! MME is a founding member of the Industry Syndicate Podcast Network - check out the entire line-up on our website!
Manufactured housing appears to be making a comeback. Boosting the supply of prefab homes is a major part of a new government initiative. Factory-built housing is also getting the attention of real estate investors looking for hard-to-get rental homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.The Biden Administration announced its Housing America initiative last month. One component of that initiative is to increase the supply of manufactured homes. Other components include things like down payment assistance, the rehabilitation of existing homes, new loan options for manufactured homes, and collaboration with local governments to reduce zoning limitations. (1)Prefab Homes Gaining New RespectThe manufactured housing component could be a game changer for a market that has so few affordable options. And with improvements to the manufacturing process, prefab homes are losing the stigma they once had for being inferior to site-built homes.In 2020, a HUD report says: “Factory-built housing has undergone many physical changes that have made it more similar to, and in many ways indistinguishable from, conventional site-built housing… Quality improvements in construction and installation practices have increased durability so that the life expectancy of factory-built housing increasingly is comparable to that of site-built or onsite housing.” (2)The Manufactured Housing Institute says essentially the same thing. In a 2021 industry overview, it says: “Today's manufactured homes can deliver outstanding quality and performance at prices that are up to 50 percent less per square foot than conventional site-built homes. These savings allow more and more Americans to own their own homes.” (3) That also applies to investors who might want to buy more affordable rental homes.Cost Savings for Prefab HomesSo what are the price points for manufactured homes compared to site-built homes? The Institute says the average price of a manufactured home is $81,900. If you break it down to price per square foot, that's about $57 compared to $119 for a site-built home. Average size for a prefab home is about 1,450 square feet. The average for a site-built home is 2,500 square feet, so the price of a prefab home is about ¼ the cost of a site-built home.According to rebusinessonline, manufactured housing accounts for about 5.5% of U.S. homes. They also accounted for 9% of home starts last year. That's about 95,000 homes, which is double the number of prefab homes shipped in 2011.Strong Investment ActivityAccording to Chad Hagwood at Lument, investors are paying attention. He said in an interview for rebusinessonline.com: “The market for investment sales is the strongest it's ever been.” He says: “Having been an active participant in this industry for almost two decades. The sales volume, the interest, the activity is unlike anytime I've ever seen.” Lumen provides loans for multifamily, affordable housing, and senior housing. (4)Lument recently produced a white paper on the manufactured housing industry. It begins with comments about the need for affordable homes and the “growing popularity of lower density living” and how that's providing a new option for both homeowners and investors. (5)It says: “The combination of robust cash flow growth, particularly in Sunbelt and Western markets, cap rate compression, and liquidity provided by the GSEs makes a compelling case for manufactured housing community acquisitions and refinances.”In the section about revenue trends, it says the inventory-weighted average rent of $840 for prefab homes in 31 markets compared favorably to other rentals in the same areas. That includes rents of about $1,100 for C+ to B- apartments, and $1,400 for overall average apartment rents.Pros and ConsLet's take a look at the pros and cons of manufactured housing.According to that HUD report: Modular housing construction is faster and takes place in a climate controlled environment which saves time and avoids unpredictable weather events and damage to materials. Due to improvements in design and quality that make manufactured homes more similar to site-built homes, public perception has gotten better (although it still needs improvement). The trend could build quickly as potential homebuyers, renters, and investors learn more about this type of housing.Getting a loan for a prefab home is also getting easier. Last month, the Federal Housing Finance Agency announced that Fannie Mae and Freddie Mac would be allowed to purchase loans for single-section manufactured homes. On the other hand: Builders are concerned about switching to factory-built homes because they'd lose workers they may not be able to get back, if needed. Transportation of modules can be expensive. Pre-construction costs could be significantly higher - as much as 50%. Public perception of manufactured homes needs further improvement to prevent NIMBY attitudes.NIMBY Issue Somewhat NeutralizedThe NIMBY issue has been somewhat neutralized by recent trends in minimalist living. Tiny homes have been popular for people who want to simplify their lives, and the lack of housing has encouraging many homeowners to add small rental units or ADU's to their properties. Legislation in California makes it perfectly legal to do so on any single-family lot that's big enough. There's also some extremely innovative ideas for manufactured housing that are getting the attention of the real estate world.We just interviewed the co-founder of Boxabl on our other podcast, The Real Wealth Show. (6) The Nevada-based start-up has a very unique product that addresses the transportation problem by making the unit “fold-up” for delivery. Once it arrives at its destination, it takes just a few hours to set up. There are also plans to make the smaller “casita” units modular so they can be put together into larger homes. The concept has caught the attention of Tesla and SpaceX founder, Elon Musk, who reportedly lives in one. We'll have a link to that interview and the other reports in the show notes at newsforinvestors.comYou can also learn more about rental investing at our website by joining RealWealth for free. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources. That includes experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.And please remember to hit the subscribe button, and leave a review!Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.housingwire.com/articles/manufactured-housing-is-key-to-affordable-homeownership/2 -https://www.huduser.gov/portal/periodicals/em/WinterSpring20/highlight2.html3 -https://www.manufacturedhousing.org/wp-content/uploads/2021/05/2021-MHI-Quick-Facts-updated-05-2021.pdf4 -https://rebusinessonline.com/lument-manufactured-housing-communities-garner-investor-interest/5 -https://www.lument.com/wp-content/uploads/2021/08/Lument-white-paper-manufactured-housing-2021.pdf6 - https://www.realwealthnetwork.com/real-wealth-show-podcast/?utm_source=Podcast&utm_medium=Real%20Wealth%20Show&utm_campaign=2020wp-login.php%3Fredirect_to&reauth=1&wchannelid=nnhnv5t81j&wmediaid=gjwh7p0qfp
FHA LOAN LIMITS INCREASED! FHA increased loan limits on multi family housing another $8 billion per year on each enterprise Fannie Mae and Freddie Mac…totaling $156 billion/year in multi family properties. And word is that the $412,850 FHA single family loan limit will go up substantially higher than this level. Both actions are designed to increase housing affordability in low down payments and more homes which qualify for FHA. Zillow Is Bringing Artificial Intelligence to Real Estate - Zillow is working on called a floor plan generator, where they can take the images people upload and generate an actual floor plan with a house for you and find the house you're really looking for...combining that AI with their other AI algorithm (Zestimate). may result in making actual offers on homes. Don't hold your breath. Q2 Title Insurance Premiums of $6.5 Billion Break Records - That's alot of cash corresponding to an approximate 3.5% payout ratio...or approximately $222 million - but for what - errors or overlooked issues that weren't corrected before closing? Do we have full transparency in the title insurance industry with Billions of dollars collected and only millions in payouts? However, title insurance companies didn't exactly lose during this period. During the first six months of 2021, the industry overall paid out $221.1 million in claims, down from $232.9 million from the same period a year prior. Maybe we ought to consider modeling after Iowa's title insurance which is far cheaper and requires title defects to be corrected prior to closing. Curbio will gift a First American home warranty to your clients who complete a Curbio project!. Curbio is the leading home improvement company for Realtors® and their selling clients in the US, with a fast and effortless process to repair and update those areas that will get the largest renovation ROI. Tech Leaders Discuss Artificial Intelligence and its Impact on the Real Estate Industry - Chatbots and voice assistants are extremely popular right now as they allow real estate professionals to provide around-the-clock support that doesn't require a human," said Vin Vomero, CEO of Foxy AI. "Foxy AI's ‘Remodel It' uses computer vision to help consumers get instant and customizable home renovation estimates by analyzing the photos on listing websites by ZIP code. Some companies avoid using A.I. because of the perceived costs and resources required to use it, a lack of trust in A.I. products, the difficulty in explaining what it does behind the scenes and a fear of an A.I. takeover related to job displacement," said Julianne Heller, data scientist at NAR.
Federal agencies take 7 steps to improve affordable housing supply and reduce homelessness Increasing the funding of low-income housing tax credit investments through Fannie Mae and Freddie Mac to $852 million each annually. Sharing specific details about the HOME-American Rescue Plan so more than 600 eligible communities can start accessing funds designed to address local homelessness. Providing communities with five percent of their HOME-ARP grants upfront to support planning activities for local affordable housing projects. Restarting the Federal Housing Administration (FHA) Section 542(c) Housing Finance Agency Risk-Sharing Program with the Department of Treasury's Federal Financing Bank. The program gives state housing finance agencies access to low-cost capital that aids in the building and development of affordable housing units where they are needed. Removing the dollar cap from the Section 542(c) program so the FHA can provide firm approval letters for HFA-underwritten mortgages that meet program standards. Making more single-family homes available to individuals, families and non-profit organizations by limiting the sale of FHA-insured and HUD-owned properties to large investors. Sharing HUD research on innovative strategies state and local governments use to remove regulatory barriers to affordable housing and increase housing supply.
In this Real Estate News Brief for the week ending October 9th, 2021... new conforming loan limits, self-touring option for home buyers, and a way to save gas when you're house hunting.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review. Economic NewsWe begin with two economic reports, from this last week, on the job market. The one for unemployment shows that initial state claims were down 38,000 to 326,000. Economists say it's a sign of a strengthening labor market. The unemployment numbers keep dropping and are getting closer to pre-pandemic levels, but we're not quite there yet. Before the pandemic, initial state claims were in the low 200,000s. Ongoing benefits were also down 98,000 this last week, to a seasonally adjusted 2.71 million. (1)The number of people collecting benefits from a total of eight state and federal programs dropped dramatically at the start of the month. They went from 11.3 million last month to just 4.17 million. That's mostly due to the expiration of a special federal program to help people hurt by the pandemic.The other job market report shows that 194,000 jobs were created in September. That's far less than a Wall Street forecast for a half a million new jobs. MarketWatch says the numbers are falling short of expectations because of low employment at public schools. The official unemployment rate did drop almost a half a percentage point. It went from 5.2% in August to 4.8% last month. (2)Mortgage RatesMortgage rates are teasing us again. After a brief rise above 3%, Freddie Mac says the 30-year fixed-rate mortgage dipped down two basis points, to 2.99%. The 15-year was down five basis points to 2.23%. (3)In other news making headlines…Average Mortgage Amount Creeps HigherLow mortgage rates can help offset higher home prices, but they aren't totally preventing loan amounts from rising. The average amount that homeowners are borrowing has risen to $410,000. That's according to the Mortgage Bankers Association. (4) The MBA's Joen Kan says: “Applications for larger loan amounts continue to outpace lower-balance loans.” In July, they had risen at an annual rate of 19%. There are more homes coming into the market right now, but inventory is still much tighter than it was a year ago, and that's putting a lot of pressure on prices.Higher Loan Limits for Pricier HomesTwo big lenders are responding to the need for larger loans by raising their conforming loan limit caps. PennyMac and United Wholesale Mortgage announced this last week, that they are raising their caps to $625,000. (5)That's about $75,000 more than the 2021 conforming loan limit of about 550,000 set by the FHFA. The FHFA is also expected to increase that amount for 2022, with an announcement sometime next month.Redfin's New Self-Tour FeatureRedfin is expanding it's “Direct Access” program to 22 U.S. markets. This feature allows buyers to unlock vacant homes with the Redfin app, and tour those homes without an agent. This will give buyers a faster way to look at homes they might want to buy. (6)ADT security is supplying the smart locks and sensors that allow buyers to enter the homes. They also keep track of who's entering and exiting. Once the homes are sold, buyers can keep that equipment.Redfin's Bridget Frey says: “In this hot market, more than a third of homes are finding a buyer within the first week, and buyers are hustling to see new homes as quickly as possible.” Newly added markets for the self-touring feature include: Austin, Boston, Dallas, Denver, Las Vegas, Phoenix, San Francisco, and Orange County California.Google Maps Intros New Eco-Friendly ToolYou might be able to save on gas as you tour all those homes by using Google Maps. The company has introduced a new eco-friendly tool that shows you which route is more fuel-efficient. (7)When the fastest route and the most eco-friendly route have a similar ETA, Google Maps will default to the eco-friendly one. Fuel consumption is estimated according to the incline of the road, traffic congestion, and traffic patterns. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review! You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/u-s-jobless-claims-sink-38-000-to-326-000-in-sign-of-improving-labor-market-11633610565?mod=economy-politics2 -https://www.marketwatch.com/story/u-s-adds-just-194-000-jobs-in-september-as-delta-worsens-labor-shortage-11633697488?mod=mw_latestnews3 -http://www.freddiemac.com/pmms/4 -https://magazine.realtor/daily-news/2021/10/01/average-mortgage-amount-increases-to-4100005 -https://www.housingwire.com/articles/pennymac-uwm-raise-conforming-loan-limit-ceiling/6 -https://www.housingwire.com/articles/redfin-allows-buyers-to-tour-homes-without-an-agent/7 -https://magazine.realtor/daily-news/2021/10/06/google-maps-can-help-you-use-less-fuel
Today's Flash Back Friday comes from Episode 505, originally published in April 20, 2015. Jason starts by talking about the Millennial demographic and its benefits for real estate investors. In relation to this, he reads an article on the renter market and why fewer people are purchasing homes. He also takes the time to answer a couple of listener questions about home-owner risk mitigation and renting versus owning property on today's show. Key Takeaways: 2:00 – Millennials have seen their parents get burned by the real estate crash. 7:40 – Millennials are putting off marriage, living with their parents, and have massive student loan debt. 9:35 – It's hard to get good stats on individual home owners or single family homes. 11:35 – If Fannie Mae and Freddie Mac were to go away, it would free up 25 million new renters. 14:30 – Jason answers a listener question about risk mitigation for properties. 19:20 – Jason answers another question about renting versus owning. 27:05 – Next episode Jason will have Dan Mitchell, Senior Fellow from the Cato Institute, on the show. Tweetables: “When interest rates are low and it's easy to qualify for loans, you have this market where everybody moves out and they buy.” “I think Fannie Mae and Freddie Mac should go away. They cause distortions in the market.” “We get to own and control things while we're alive and it's come upon us to do the best job that we can with our financial resources.” Mentioned In This Episode: Affluent Apartment Renters Slow to Buy a Home For transcription click HERE: The WEALTH TRANSFER is happening FAST! Protect your financial future now! Did you know that 25% to 40% of all dollars ever created were dumped into the economy last year??? This will be devastating to some and an opportunity to others, be sure you're on the right side of this massive wealth transfer. Learn from our experiences, maximize your ROI and avoid regrets. Free Mini-Book on Pandemic Investing: https://www.PandemicInvesting.com Jason's TV Clips: https://vimeo.com/549444172 Asset Protection, Tax Savings & Estate Planning: http://JasonHartman.com/Protect What do Jason's clients say? http://JasonHartmanTestimonials.com Easily get up to $250,000 in funding for real estate, business or anything else http://JasonHartman.com/Fund Call our Investment Counselors at: 1-800-HARTMAN (US) or visit https://www.jasonhartman.com/ Guided Visualization for Investors: http://jasonhartman.com/visualization
Hear from Sharon Bartlett former Director of Vendor Management for Freddie Mac and host of the Real Estate Roundtable, and Charlette Williams former Vendor Management Manager with Freddie Mac and cohost of the Real Estate Roundtable as they provide an overview of the Five Star Conference and share their key takeaways.
In today's episode of the As Told by Nomads Podcast, join me and Deana Jean as we speak about how one can be limitless in a life that is limited. Before, Deana was contented with staying on the frontlines of sales. But after a mentor made her realize how she could use her ability to connect to influence the development of others, Deana transitioned to consulting and coaching as a business. Today, she shares her opinions on why anybody can use a coach, the practical steps to transforming your life, why introspection and self-awareness are important, and why there is power in taking action no matter what your fear is.Young Deana At The Job FairDuring the exchange, Deana recalled an experience she had in a job fair during her senior year in college. In that job fair, things were unfolding in her favor. Deana described herself as the type that is always ready to out-hustle anyone. She knew she had the will and the intention. As she moved around, she came across this management trainee position at SCORE! Educational Centers. By this time, Deana already bagged an offer from Freddie Mac. The offer will pay her a salary of $60-70k a year. However, the position at SCORE's only offered $30k annually. It was the early 2000s; comparing the two in terms of benefits would've been a no-brainer to most. But Deana took into consideration a different factor. For one, she knew that what SCORE! does wasn't only close to her heart but also to her mother. Knowing herself, she also knew she'd land this management position. Because the job was a management role, Deana saw a path. In her mind, Deana pictured that she would've already moved close to a salary that's at the same range as FreddieMac's offer in two to three years. To some, the choice would've easily been FreddieMac. But for Deana, it's not all about that. In her words, "I am betting on myself and my abilities to make anything happen when I am working in my zone of genius and when I'm passionate about what I'm doing."Outline of the episode:[03:30]Deana Jean – what I thought I was going to become…[04:55]The ability to convince people to do things and advocate for themselves.[08:01]A leap that not a lot of people are ready to take.[11:47]Where do you start when figuring out your passion points?[16:35]You are the person you're trying to serve.[21:03]"The person who cannot identify what their transformation is worth is not my ideal client."[25:12]Does the client have an abundance mindset or a lack mindset?[27:32]The best athletes in the world all have coaches![32:42]Is it the job that pays $30k/year or the job that pays $70k/year? [39:25]The opposite of fear is action.Resources:Facebook Page: https://www.facebook.com/intentionalexcellenceconsultingllc/Clubhouse: https://www.clubhouse.com/event/MOG59vl0Connect with Tayo Rockson and the As Told By Nomads Podcast on:Personal Website: https://tayorockson.comUYD Management: https://uydmanagement.com/ See acast.com/privacy for privacy and opt-out information.
In this Real Estate News Brief for the week ending October 2nd, 2021... we'll look at inflation frustration for the Fed, a mortgage rate surprise, and a new checklist for today's homebuyers. Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic News We begin with economic news from this past week, and new predictions about inflation. Fed Chief Jerome Powell says that inflation has been worse than expected because of supply-chain bottlenecks, but he still expects prices to settle back down next year, once those supply-chain issues are resolved. He said during a forum with central bank leaders: “It's frustrating to see the supply chain problems not getting better, in fact they are probably getting worse.” (1)The annual rate of inflation is about 4.2% right now, according to the Fed's preferred PCE index. The more popular CPI is about the same. It is currently at 4.3%. When you remove energy and food, the CPI is about 3%. The Fed likes to see the inflation rate at around 2%. (2)New jobless claims hit a two-month high this last week thanks to a surge in California and Michigan. The government says new state claims were up 11,000 to 362,000. The California numbers are due to the processing of a claims backlog while the Michigan case load is likely due to a surge in delta infections. (3) Housing is one segment of the economy that hasn't slowed down. The National Association of Realtors reports that pending sales surged unexpectedly in August. NAR says pending home sales were up 8.1% compared with July. Economists had expected an increase of less than half a percent. NAR'S chief economist, Lawrence Yun, says: “Rising inventory and moderating price conditions are bringing buyers back to the market.” (4)Builders continue to run into headwinds because of expensive building materials, and a shortage of labor and land. The Commerce Department says that overall construction spending was flat in August. It says that an increase in public spending was offset by a decline in residential spending. It was down .7% for single-family construction and .8% for multi-families. (5) Meanwhile, home prices continue their march skyward. The S&P CoreLogic Case-Shiller Home Price Index shows a year-over-year increase of 19.7% in July. That represents the fourth month in a row for record home price growth. The 20-city index is even higher with a 19.9% year-over-year reading. (6)There are mixed reports from consumers on the state of the economy. The consumer confidence index dropped several points, to a seven-month low while the University of Michigan Consumer Sentiment Survey rose slightly. (7) (8)Mortgage Rates Mortgage rates for all kinds of loans have risen due to a jump in the 10-year Treasury yield. Freddie Mac says the average 30-year fixed-rate loan rose 13 basis points to 3.1%. The 15-year was also up 13 basis points to 2.28%. (9)In other news making headlines…New Homes Are Bigger with More BedroomsHomes are getting larger with more bedrooms, thanks to a demand for more space. The National Association of Homebuilders says the share of single-family homes with four or more bedrooms rose from 42% in 2018 to 45% in 2020. (10)A desire for multigenerational homes is also driving the increase. The NAHB says about 16% of buyers expressed a desire for that kind of home last year, compared to just 11% the year before.Homebuyers Consider Disaster RiskAnother important consideration for homebuyers is the risk of a natural disaster. According to a survey conducted by realtor.com, three in four homebuyers say they assess the risk of a disaster when choosing a location. (11)Tornadoes have created the most concern, with severe cold or winter storms close behind. Floods come next, followed by hurricanes, earthquakes, wildfires, droughts, and sinkholes. While 39% said they are worried about tornadoes, only 8% said they are worried about sinkholes.Home With More Light Are Healthier Homebuyers may want to consider how much natural light they get in a home, and the benefit of “smart windows.” A new study shows that people who live in a home with smart windows experience less stress and anxiety, and sleep better at night. (12)Smart windows have technology that allows them to automatically adjust the tint, to allow for a maximum amount of light throughout the day. The study was done by the International Journal of Environmental Research and Public Health which tracked people with smart windows, and compared the result to people with standard windows.The result shows a delay in the production of melatonin for people with standard windows. That kept them from falling asleep as quickly, and from getting as much sleep overall. Researchers say the people with smart windows not only slept better, but experienced less stress and anxiety. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke. Links:1 -https://www.marketwatch.com/story/feds-powell-says-high-u-s-inflation-could-last-into-early-next-year-due-to-shortages-11632938138?mod=federal-reserve2 -https://www.marketwatch.com/story/u-s-inflation-rises-sharply-again-in-august-and-remains-at-30-year-high-pce-shows-11633092039?mod=bnbh3 -https://www.marketwatch.com/story/u-s-jobless-claims-jump-to-two-month-high-amid-surge-in-california-11633005982?mod=economic-report4 -https://www.marketwatch.com/story/pending-home-sales-unexpectedly-surge-higher-as-the-housing-market-paves-the-way-for-a-rebound-11632924670?mod=economy-politics5 -https://www.reuters.com/world/us/us-construction-spending-flat-august-2021-10-01/6 -https://www.marketwatch.com/story/home-prices-rise-at-record-pace-for-fourth-consecutive-month-but-economists-arent-worried-about-the-housing-market-just-yet-11632835548?mod=economic-report7 -https://www.marketwatch.com/story/u-s-consumer-confidence-slumps-to-7-month-low-on-delta-and-inflation-worries-11632838499?mod=economy-politics8 -https://www.marketwatch.com/story/u-s-consumer-sentiment-rises-in-late-september-depressed-optimism-continues-university-of-michigan-2716330983149 -http://www.freddiemac.com/pmms/10 -https://magazine.realtor/daily-news/2021/09/30/more-new-homes-are-being-built-with-4-plus-bedrooms11 -https://magazine.realtor/daily-news/2021/09/28/buyers-consider-disaster-risk-in-purchase-decisions12 -https://magazine.realtor/daily-news/2021/09/24/homes-with-more-daylight-may-improve-moods
The racial gap in home appraisals is a real phenomenon, one that sabotages the wealth-building power of homeownership in Black and Latino neighborhoods, mortgage giant Freddie Mac said.The company released an analysis Monday showing that appraised values are more likely to fall short of the contract price for homes in census tracts with a higher share of Black and Latino households. The conclusion was based on Freddie Mac's examination of 12 million appraisals ordered for purchase transactions from 2015 to 2020.The appraisal gap matters because it creates a barrier for Black and Latino consumers hoping to buy homes.Join your host Sean Reynolds, owner of Summit Properties NW, and Reynolds & Kline Appraisal as he takes a look at this developing topic.https://www.seattletimes.com/business/real-estate/black-neighborhood-home-appraisal-gap-is-real-and-persistent-freddie-mac-reports/Support the show (https://www.patreon.com/seattlerealestatepodcast)
Show Notes From Original Episode: On today's episode of The Brian Nichols Show, I am joined by Michael T. Hutchins, author of Irreconcilable Politics: Our Rights Under a Just Government. Michael was trained as an economist and has over thirty years of experience in finance. Much of his career was in investment banking at Salomon Brothers and UBS. He is currently the executive vice president at Freddie Mac, responsible for the investments and capital markets division. Hutchins earned his PhD in economics from the University of North Carolina, Chapel Hill. In Irreconcilable Politics, Michael explores successful models in which differing political views exist yet do not impinge on agreements being reached, and also dissects the dynamics of modern social decision-making. Listen as we discuss the theory of “collectivity,” needed reform to government structure, and modern social decision-making in the 21st century. Later, we discuss the concepts of voluntary government and the interrelationship between political ideology and centralized governmental decisions. We conclude by taking a closer look at collective rules, services, and decisions, and why voting, freedom of speech, and freedom of the press are not in and of themselves sufficient control rights for citizens of a diverse country like the United States and discuss how our divided nation struggling to reach political agreement and how the structure of the federal and state governments interfere with this effort. Find Michael Hutchins Online: https://www.mikehut.com/ Purchase Irreconcilable Politics: Our Rights Under a Just Government: https://www.amazon.com/Irreconcilable-Politics-Rights-Under-Government-ebook/dp/B07F17WT6C Learn more about your ad choices. Visit megaphone.fm/adchoices
Jackie Cooper, the first female president of the Houston Black Real Estate association, has had a lot of doors slammed in her face. That didn't prevent her from convincing homesellers, homebuilders and even Freddie Mac and Fannie Mae to give Black real estate agents in Houston their business. She shares some memories after HBREA created an award in her honor. Connect with Rebecca Schuetz. Read: Houston Black Real Estate Association recognizes members, continues COVID aid Support the show: https://offers.houstonchronicle.com/?offerid=125&origin=newsroom&ipid=podcast See omnystudio.com/listener for privacy information.
Jeff and Kenon discuss Clear Capital's recent acquisition of CubiCasa and Jeff's new title. Then they dive into Freddie Mac's long-anticipated research paper, "Racial and Ethnic Valuation Gaps In Home Purchase Appraisals." Jeff's Real Estate Joke of the Pod gives us a buyer's-eye view of today's real estate market. Interview with Ribbon Co-Founder & CEO Shaival Shah.
In this Real Estate News Brief for the week ending September 25th, 2021... what the Fed is saying about rate hikes, tax changes that could deflate your self-directed IRA, and ultra-white paint that could replace your AC.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review. Economic NewsWe begin with economic news from this past week, and a Fed meeting on monetary policy. The Fed's senior policymakers are now saying they could raise interest rates sooner than they expected. They had previously anticipated higher rates in 2023, but are now saying they could raise the short-term rate by a quarter point, sometime next year. Higher interest rates will help control inflation which is currently running around 4%, or “double” what the Fed would like to see. (1)New claims for unemployment benefits jumped to a one-month high of 351,000. The surge is due to a backlog of claims in California. They apparently piled up as California worked on new technology to improve efficiency and prevent fraud. Weekly claims had hit a pandemic low in early September of 312,000. (2)Housing starts and new permits were both up in August as builders ramped up their residential construction activity. The Census Bureau reports that housing starts were up 3.9% compared to July, and 17.4% compared to August of last year. Permits were up 6% month-over-month, and 13.5% for the year. But this surge in activity was mostly for the construction of multi-families. (3) Realtor.com reports that multi-family demand is being driven by renters and remote workers who are moving back to the cities. (4) Confidence among builders is also moving higher. NAR says its September confidence index increased one point to 76. That's after a three-month decline. NAR's chief economist Robert Dietz says: “The single-family building market has moved off the unsustainably hot pace of construction of last fall and has reached a still hot but more stable level of activity.” (5) All that construction activity has resulted in an increase in new home sales. The government says new home sales rose 1.5% to an annual rate of 740,000. There's currently a 6.1 months supply of new homes on the market, with a median price of $391,000. (6) Existing home sales were down in August as buyers scoff at high prices and a lack of affordable inventory. According to the National Association of Realtors, sales were down 2% to a seasonally-adjusted 5.88 million. Compared to August of last year, they were down 1.5%. NAR's chief economist, Lawrence Yun, says: “Although there was a decline in home purchases, potential buyers are out and about searching, but much more measured about their financial limits and simply waiting for more inventory.” (7) The good news: inventory is rising. MarketWatch reports that it's up about 16% since a low point last winter.Mortgage Rates Mortgage rates are still idling below the 3% level. Freddie Mac says the average 30-year fixed-rate mortgage rose just 2 basis points last week, to 2.88%. The 15-year was up 3 points to 2.15%. (8)In other news making headlines…Tax Law Changes Threaten SDIRA InvestmentsCongress is considering some tax law changes that could ban real estate deals from self-directed IRAs. The proposals are aimed at the super wealthy who realize enormous gains with this kind of investment, but the changes could potentially impact everyone who uses a self-directed IRA for their real estate deals. (9)Supporters of this legislation say that current rules allow for private-placement deals. SEC rules state that only “accredited investors” can participate in those deals which means those investors must have a net worth of a million dollars or more, or earn more than $200,000 a year. Legislation supporters say that retirement accounts should be used for investments that are available to everyone, like publicly-traded stocks, not just accredited investors.Bill critics say there are many mom and pop investors who are also trying to increase their wealth with these kinds of deals and the legislation would devastate many retirement portfolios for people who are not super wealthy. Michael Hadley of the firm Davis & Harman told MarketWatch: “These accounts belong to retirement savers. They understand the investments they are most comfortable with. We don't believe the government should be picking and choosing.” If this legislation is approved, self-directed IRA holders would have two years to remove those kinds of investments from their portfolios. If you don't like the sound of this proposal, you should contact your representatives in Congress and let them know.Could Ultra-White Paint Replace Your AC? Scientists at Perdue University are working on a way to cool your home with white paint. They say this ultra-white paint can reflect more than 98% of sunlight, and that surfaces coated with this paint are “cooled below the surrounding temperature without consuming power.” (10) Their research shows that the white paint on a 1,000 square foot roof can provide cooling that's equal to the use of 10 kilowatts of power, and that's “more powerful than the air conditioners used by most houses.”The paint has already been listed by Guinness as the whitest paint ever, but it's not yet available to the public.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/fed-dot-plot-signals-higher-u-s-interest-rates-in-2022-but-powell-warns-its-not-set-in-stone-11632337181?mod=home-page2 -https://www.marketwatch.com/story/u-s-jobless-claims-jump-to-one-month-high-of-351-000-largely-due-to-big-increase-in-california-11632401406?mod=economic-report3 -https://www.marketwatch.com/story/new-home-construction-activity-improves-as-builders-focus-on-high-margin-projects-11632229206?mod=economy-politics4 -https://magazine.realtor/daily-news/2021/09/22/multifamily-construction-booms-single-family-starts-slow5 -https://www.marketwatch.com/story/home-builder-confidence-improves-as-housing-demand-remains-strong-11632146831?mod=u.s.-economic-calendar6 -https://www.marketwatch.com/story/new-home-sales-turn-higher-despite-record-prices-11632493064?mod=economy-politics7 -https://www.marketwatch.com/story/existing-home-sales-decline-as-buyers-hold-out-for-better-prices-more-options-11632320151?mod=economy-politics8 -http://www.freddiemac.com/pmms/9 -https://www.marketwatch.com/story/people-are-upset-will-proposed-ira-tax-changes-targeting-the-rich-hurt-smaller-nest-eggs-1163234897310 -https://magazine.realtor/daily-news/2021/09/20/ultra-white-paint-could-cool-homes-better-than-air-conditioning
In this Real Estate News Brief for the week ending September 18th, 2021… inflation eases up overall, but rents and building materials soar, while mortgage rates hold steady.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from the past week. Concerns about inflation have eased up a bit. Prices rose at their slowest pace in August since about seven months ago. The consumer price index was up .3% which brought the annual rate down a tenth of a percent to 5.3%. The core rate, which strips out prices for food and gas, was only up .1% to an annual rate of 4%. That's down from 4.3% in June. MarketWatch economists say that could be a sign that the recent price surge is peaking. (1)There's been a lot of debate about the risk of higher inflation and whether it will remain above the 2% mark. The Federal Reserve isn't worried. It expects prices to come back down toward that 2% level sometime next year.Jobless claims rose last week because of Hurricane Ida, but they are still near a pandemic low. The U.S. Department of Labor says initial jobless claims for state benefits were up about 20,000 to 320,000. The pandemic low point is 318,000. Continuing claims also fell to a seasonally adjusted 2.67 million. That “is” a pandemic low. (2)Consumers were spending money in August which is a sign of strength for the U.S. economy. The Census Bureau reports that retail sales were up .7%, although MarketWatch says that higher prices could account for at least part of that increase. (3) The numbers are not as strong as they were in the spring, but consumers are buying different things right now. In the spring, they were stocking up on goods. Now they are spending more on things like restaurants and travel. Retail sales numbers are 15% higher than August of last year.Consumers are expressing a slightly higher level of confidence in the U.S. economy than they did over the summer. The University of Michigan's consumer sentiment survey shows a reading of 71 for September. (4) In August, it was 70.3. MarketWatch says that people are still worried about their financial situations, including higher prices. They are also feeling pessimistic about the purchase of homes, vehicles, and large appliances, which are all in short supply.Mortgage RatesMortgage rates haven't moved much for two months. According to Freddie Mac, the 30-year fixed-rate mortgage went down just 2 basis points to 2.86% this last week. The 15-year dropped a little more. It was down 7 basis points to 2.12%. (5) Freddie Mac says the holding pattern is the result of a slowdown in the economic recovery. But it says other factors are in play, such as increased migration, the remote work trend, the use of automation, and a focus on a more energy efficient economy, which, it says, will probably lead to increased economic growth.In other news making headlines…Rents Soaring in Cities Across the CountryIt isn't just home prices that are shooting skyward. Rents are increasing even faster than home prices. A new Redfin report says that August rents hit a national year-over-year growth rate of 11.5%.That's the first double-digit rate of rent growth ever and represents a median rent of $1,633, or about $169 more per month for renters. (6) If you look at apartments of different sizes, the median is $1,338 for a studio, $1,524 for a 1-bedroom, and $1,828 for a 2-bedroom.Cities seeing the most rent growth are Tampa, Florida; Riverside, California; Miami, Florida, and Phoenix, Arizona. Rents in all four of those metros were more than 25% higher on a year-over-year basis.Lumber Costs Lower, But Other Costs RiseBuilders are getting a break on lumber prices, but the cost for other materials is climbing. According to government data, home building materials have risen 19% in the past year. At one point last spring, lumber prices had topped $1,500 for a thousand board feet, but they have come back down and are now closer to $400. But there's a long list of materials that have gotten a lot more expensive. (7)The National Association of Home Builders says that steel mill products have gone up the most, followed by building paper and building board mill products, asphalt, plastic water pipe, fertilizer materials, laminated veneer lumber, and other materials used frequently by the building industry. Prices for steel mill products are up 81% year-over-year.Those price increases are pushing new home prices higher. In July, the median sales price of a home was $390,500. That's an 18.4% increase from July of last year.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/surge-in-u-s-consumer-prices-slows-in-august-cpi-shows-11631623600?mod=newsviewer_click_realtime&mod=article_inline2 -https://www.marketwatch.com/story/u-s-jobless-claims-rise-in-latest-week-11631795929?mod=mw_latestnews3 -https://www.marketwatch.com/story/retail-sales-surge-in-august-despite-spread-of-delta-signal-economy-is-still-strong-11631796054?mod=economic-report4 -https://www.marketwatch.com/story/u-s-consumer-sentiment-mired-at-near-decade-lows-university-of-michigan-survey-finds-11631888208?mod=economy-politics5 -http://www.freddiemac.com/pmms/6 -https://www.realtor.com/news/trends/rental-prices-soar-as-pandemic-drags-on/7 -https://magazine.realtor/daily-news/2021/09/10/building-material-costs-continue-to-surge
About Shagun Malhotra and SkyStem: Shagun is the visionary behind the product and user experience. A CPA, CIA and an experienced auditor and process consultant, she designed ART for accountants. Having gone through the broken and inefficient process various times over, she believed there was a more efficient and user friendly way to do reconciliations. Being process focused, Shagun injected process within ART to deliver a product that is highly integrated and process centric. Shagun started her career in public accounting and has worked in Fortune 100 companies such as Marriott and Freddie Mac. Her work focused primarily on internal controls and risk mitigation in both, the international and domestic arenas. She has been an inspirational speaker for Fast Trac – a Kauffman Foundation programs and NY Business Plan Competition Awards ceremony. She is very passionate about entrepreneurship. Month-End Close and Account Reconciliation Automation Software SkyStem strives to bring soul to software by providing intelligent and intuitive solutions that eliminate redundant work and provide our customers the opportunity to focus on more dynamic, strategic and fulfilling work. We emphasize the human touch, so that customers get the best of both worlds — cutting edge SaaS technology paired with fanatical customer service. Replace manual controls with automated internal controls in ART. Whether your organization is publicly traded or privately held, compliance becomes easy when ART manages the reconciliation process for you. Our workflow keeps your team on task and on schedule during the close. System reconciliation kicks in upon meeting thresholds set by management. Rules, alerts, and reminders ensure timely execution of activities, reviews and reporting, building efficiency directly into the workflow. If you are a Financial Controller, CFO or Accounting Manager, ART puts you at the controls of your financial close process with status dashboards, variance views, and reconciliation scorecards. Expect improved internal controls, well-documented account reconciliations, a central repository for supporting documents, and an audit trail with controlled auditor access where they can get what they need within just a few clicks. It's time for account reconciliation automation! ART equips accounting teams with striking insight into their balance sheet by transforming the close and account reconciliation process. Do away with spreadsheets, crazy emailing and manual distractions. Enjoy ART's powerful workflow management and reporting tools to automate the closing process as well as account reconciliations each month. Become more productive without ever installing software.
Hyepin Im, CPA, MBA, and Master of Divinity, has a B.S. from U.C. Berkeley, M.B.A. from USC, and M.Div., summa cum laude, from Wesley Theological Seminary. She is a frequent speaker on CNN and NPR and her opinions have appeared in the Los Angeles Times and the Washington Post. She is the President and Founder of Faith and Community Empowerment (FACE), a national nonprofit serving as a bridge between the Asian American community and the greater community at large. Since its inception in 2001, FACE has had over 800 partners ranging from the White House to Fortune 500 companies to various community organizations. She was a U.S. Presidential Appointee on the Board of the Americorps. Her successful initiatives include educating 10,000+ homebuyers and helping them receive over $1.6 million in down payment assistance and saving over $91 million in mortgages from foreclosure, partnering with both FDIC and Freddie Mac in developing a Korean curriculum in financial literacy and homeownership, implementing a historic $5 million U.S. Department of Labor workforce development program for Asian youth, and hosting joint conferences with the White House and the U.S. Department of Housing and Urban Development to mobilize 5000 Korean American churches for economic development. She is on the Mayor's Interfaith Collective, Pittsburgh Theological Seminary Metro-Urban Institute Advisory Council, U.S. Army Advisory Board. Prior services include Board Member of Greenlining Institute, Community Advisory Board of MUFG Union Bank and Torrey Pines Bank, the Pacific Council on International Policy, the Western Partner for the Council on Foreign Relations, and L.A. County Supervisor's Empowerment Congress and Board of FTE (Forum for Theological Exploration) and Advisory Board for Pittsburgh Theological Seminary Urban Institute.
Matthew Sullivan is the CEO and Founder of QuantmRE, a company that supports homeowners by helping them unlock some of the equity in their home without taking on more debt. A seasoned entrepreneur, Matthew has a proven track record in real estate innovation through his experiences as Co-Founder of the $50M Secured Real Estate Income Strategies Fund, and as Founder and a President of Crowdventure.com, a real estate crowdfunding company. In this episode we talked about: Matt's Bio & Crowdfunding Background What home equity contracts are and how they work How to qualify for home equity contracts Releasing equity in your home without taking on more debt Getting money now by selling some of the future value in your home How to tap into a formerly untapped asset class Leveraging equity in your home to get cash with no extra debt Mentorship, Resources and Lessons Learned Useful links: https://www.linkedin.com/in/mattsullivanco/ https://www.quantmre.com Transcriptions: Speaker 0 (0s): Welcome to the working capital real estate podcast. My name is Jesper galley. And on this show, we discuss all things real estate with investors and experts in a variety of industries that impact real estate. Whether you're looking at your first investment or raising your first fund, join me and let's build that portfolio one square foot at a time, or at least in gentlemen, my name's Jessica galley, and you're listening to working capital the real estate podcasts, another special guest today. But before we get there, just wanted to let listeners know we have a website up for we've had our up for a while, but working capital podcast.com. If you have any questions regarding the show, anything real estate related or anything related to our guests, feel free to reach out there. There's a just asked Jesse section. Now without further ado, I have Matthew Sullivan on the show. Matthew is the CEO and founder of quantum R E a company that solves a real problem for homeowners by helping them access a portion of their home equity without taking on more debt, Matt, how's it going, Speaker 1 (1m 4s): Jesse? Thanks for having me on. Speaker 0 (1m 7s): So Matt excited to have you on the show. It's a, you know, very, very unique kind of discussion. We're going to have specific to, you know, the product that you're offering. So maybe before we start with that, what we normally do with guests is have a little bit of a background, you know, for listeners, how you got into real estate judging by the accent. You didn't grow up in salt lake city. Speaker 1 (1m 29s): Yeah, no, that's right. No, it was a Birmingham, Alabama, actually, there we go. Now I'm originally from the UK, moved over here about eight years, eight years ago. And I've been an entrepreneur all of my life, which literally translated means I have been unable to get a job for most of my life. So congenitally unemployable from the get go started out life as a stockbroker in the late eighties, which was a tremendous fun breaking countries like Hong Kong, Singapore, Malaysia, Indonesia, Philippines, Thailand, you know, when they were all the assay and tigers then moved into stint with a few buddies at a small corporate finance house. And then really just decided that I really wasn't very good working for anybody else or other that was decided for me. So I decided to become an entrepreneur, got involved in telecoms and then the internet came along and really just, there was this fantastic sort of journey dealing with all things technical and platform based. And finance-based spend a few years working with sir Richard Branson with the Virgin group. And we worked on projects like V2 music and Virgin clothing and Virgin cosmetics. But w one of the things I never did, but always wanted to do was get involved with real estate. So when I moved over here, about eight years ago, I set up a real estate crowdfunding company. So it was one of the very first crowdfunding companies to come out of the changes in regulation and legislation that was, that was created by the jobs act or the jumpstart, our business startups act that was signed into action by Barack Obama. And what that act did was it enabled you to publicly solicit for funds for what are essentially private placements say beforehand, you couldn't publicly solicit, or you couldn't advertise private placements, but the jobs act allowed you to publicly advertise your deal or your, your PPM. And that really created, or was the birth of a number of different crowdfunding platforms. And so that's, that was my baptism by fire into real estate, but it was sort of leveraging everything that I'd learned beforehand about, you know, platforms and technology and regulations and, you know, securities laws. So, you know, it was a, it wasn't a path that was totally untrodden Speaker 0 (4m 9s): Right on. And by that solicitation, I assume you're referring to, what's known in the states is a regulation. D I think it's correct me if I'm wrong. 5 0 6 B and 5 0 6 C. One of them is only to accredited investors. And then the other one is open advertising. Is that right? Speaker 1 (4m 25s): If you say five or six, B is actually available to accredited and non-accredited investors, but you have to have a prior significant prior relationship with those people say, you can't generally solicit, so you cannot advertise it five or six C only available to accredited investors. And you have to prove that they're accredited through independent third parties. So you can't just self-certify that you are an accredited investor under five or 60, but you are allowed to advertise your deal or your PPM or your, your offering to, you know, to a wider market. Speaker 0 (5m 7s): So you move from the space that your, you were currently in prior to real estate, you go into kind of crowd funding, this idea that I guess basically the democratization of private placements, to a certain extent we saw in our industry, a bunch of these crowdfunding companies start up, where do you go from there in, in your career? Speaker 1 (5m 28s): Oh, I gave him one of the challenges really of trying to start something in a, in a new environment is that it's difficult to get that initial traction. So one of the gaps that I had was, you know, local or US-based real estate knowledge to say it was never my intention really, to do anything other than partner with people in the U S who have real, you know, you're, you know, real estate background. So as very fortunate, meet a couple of guys that I'm still working very closely with today, who are, you know, very successful and profit real estate developers and investors. So there are, they became our partners. But one of the things that I also came across in the early years about five or six years ago, was this concept, or rather a construct, an agreement that allowed owner occupied properties allowed the owner to access some of their equity without having to borrow money, say it was, it was something that wouldn't have worked a few years ago because the agreement itself was structured in a way that meant that it was either not investible, or it would have created all sorts of potential issues for the homeowner, but I sort of kept a close watch on it, and it was fascinated by it and intrigued by it saw that industry begins to develop in the contracts, begin to develop and decided that this is something that really could be an incredibly large untapped industry. So it felt like I was at the beginning of mortgage securitization. And so I really wanted to get involved. We set up quantum Ari with the mission to enable homeowners, to unlock their home equity without taking on more debt. And at the same time, creating a marketplace where the paper that is created when you allow a homeowner to access their home equity, where that could be traded and creating liquidity for home equity effectively. So, so, you know, this, this whole idea of making home equity accessible investible and tradable was, you know, fascinating, intriguing, and it's something that still, you know, is hugely exciting, you know, even today for four years on, yeah. Speaker 0 (8m 1s): When you say the CMBS feel like you're on the ground level, just reminds me of the big short kind of that scene when they, when they first started realizing they're tradable securities that they could package in terms of, you know, before we get into the nuts and bolts of it. Cause it, it really is one of those things where if you haven't heard of this type of, I don't know if you'd call it an asset of structure before, it's almost too good to be true. People are thinking, okay, how do, how is it possible to unlock equity in my home without taking debt? But before we get into that, can you just talk a little bit about this concept of house rich and cash poor? Speaker 1 (8m 36s): Well, it's a real problem. And even though it sounds relatively benign for people that have the bulk of their wealth tied up in their home, even though on paper, they may be worth hundreds of thousands of dollars. The only way that they can access that is to go back to the bank and borrow money. Now, particularly with the current economic circumstances that have been, you know, triggered by COVID. And in particular, we're seeing today more and more people that are in the strange position where on paper, you know, they're, they're worth a lot of money, but on a day-to-day basis, they are struggling to find the cash to meet their everyday expenses, expenses, you know, like grocery bills, school fees, that sort of thing. And so the term house rich cash poor really is sort describes this position where, and there are tens of millions of Americans that are in this position where your, the bulk of your wealth is in a single, concentrated nonfinancial, non cash flowing asset, which is effectively the equity in your home. And the only way, if you don't want to borrow money, the only way, you know, previous to, to, to what we offer is to sell your home. So you're, it's a bit, you know, it's a two-edged sword, it's this, the wealth becomes this, this, you know, the, the sort of necessary evil, why would you want to sell your home? So that is what we mean by that is it's something that is, and we're seeing this even more with the rampant house price appreciation over the last year or so, you know, that gap is widening, you know, even more, Speaker 0 (10m 16s): Yeah, fair enough. So in terms of the actual mechanics of it, I believe home equity contracts is, is the, I guess you call it a product. I would, I would say, Speaker 1 (10m 26s): Yeah, I, you know, in the same way, it's a financial product. Exactly. Speaker 0 (10m 29s): So this, you know, financial instrument, this product basically run us through it. What is it exactly? And how would it work for, you know, somebody that would be interested that has, you know, maybe a 50, 60, 70% plus equity in, in terms of their, their equity to, to their asset value. Speaker 1 (10m 50s): Sure. Well, let's, let's start really by, and again, I'm very conscious of what you said earlier, which is that this is too good to be true because that's, that's something that we come across frequently and we can really understand why somebody thinks that. But if we start by saying what, it's not in a home equity agreement or home equity contract, it's an agreement, it's not a loan, so we are not lenders. So it's not a home equity line of credit. It's not a mortgage, it's not any form of debt. And the easiest way of describing it is if you look in the commercial world, the capital stack of any sort of commercial development comprises a number of different layers. So you've got your senior debt, junior debt, there's mezzanine financing, that's preferred equity, the shared appreciation mortgages, which have a combination of debt and equity, pure equity. So there are different types of funding layers within the typical cake that you get in a, in a, in a commercial real estate transaction, if look at residential real estate, the capital stack there it's, it's primarily debt. So a few different flavors of debt, you know, there might be a home equity line of credit. There might be a reverse mortgage. There might be a, you know, standard sort of mortgage. There might be a variable rate mortgage, but it's kind of variations of the same thing. So the equity portion of the home, which in, in your example, if you've got 50, 60, 70% equity, that's the majority of the capital stack doesn't have any mechanisms attached to it, to enable other people to invest in that. So currently from an investor's perspective, you've got a $23 trillion asset class, and that's all of the equity in, in residential homes in the U S that you can't invest in because you can buy some of the debt. Sure. You can go and buy a tape of, of, you know, first position or second position performing a non-performing notes, but how'd you get your hands on the equity in homes that are not for sale. So it's really interesting from an investors perspective, but from the homeowner's perspective, what instrument, the option agreement in its simplest form, it's a transfer of ownership. So we do not entendres owners. The agreement states that the owner commits to share in some of the parent and future value of home in exchange for cash lump sum today. So the trade is we're investors. We're not lenders as we're not lenders, there's no interest. If there's no interest, there's no monthly payments. So that sort of that's, that's how we don't have that, that issue there, but we do get paid and we do make money on the transaction. And the way we do that is by sharing in the appreciation when you get to sell your home. And the way we do that, as I said is through this agreement, that really is very similar to an option agreement. So it sits on the side of the ownership structure of the home. It's protected by a lien on title. So that means that when the home is sold and when we go through the SBA process, the lien holders such as us, we get paid before the homeowner gets the balance. But what that enables us to do in exchange for that initial investment is get our investment back together with a return on that investment by way of a share of the appreciation. Speaker 0 (14m 24s): Yeah, that makes sense. The way, when I first heard you, it's funny, we, we connected, you know, one way, but I also, I remember I was like, these things sound so familiar. I've heard a podcast on this before, and we'll be holed. It was a, it was a podcast you were on. And the way it was easy for me to think about, it was kind of this idea of having a, you know, a player in the juniors that you're basically kind of making an agreement with them that, you know, provided you go pro we're going to take a little bit of a piece of that, your future, you know, future earnings at the point where there's some sort of capital event. So if I understand it correctly, correctly, you know, say just for, instead of percentages is figures say you have $500,000 of equity. Number one, I assume you, you know, you can take a piece of it. You can T you can have this product for all of the, all of it, and whatever way you go, you, you get this product. And basically you're providing capital to me. There's no interest payment, it's not a debt instrument. So I don't have anything going out. However, if you know, use Toronto as a good example of, we've had a bit of a hockey stick graph in terms of appreciation in our market. So what you would see in five years from now, if I go to sell this house, it's almost as though there was a lien on the house that you're in, you're in first position that you have, I assume in your agreements, maybe you could talk a little bit more about this. You'll have a, you know, a certain percentage return that that is basically paid out to you, kind of like a waterfall. And then anything above that would be, you know, equity appreciation that I've made on the home. Do I have that right? Speaker 1 (15m 55s): Yeah. It's we are partners and we share in the appreciation. And what we do when we go into that agreement is we are very specific about what that percentage is. So the agreement is clear and we say, you know, this is the investment, it's an absolute sum. So it's a, it's a number. This is the current value of your home. And we agree on that by using a third party appraisal. So these are people that we don't instruct ourselves. They're instructed through a third party intermediary. So it's, you know, we try and be as arms length as possible. So we've got the starting point. And we then say that when you sell your home, a fixed percentage of the value of the home goes to us. So effectively, what you're doing is you're selling some of the current value of your home to us or the, or the, the rights to that at a discount. So it's the whole present value, future value calculation. In other words, money today is worth more the money in the future. So we're going to get our money in the future, but if we're going to do that, then we want some sort of discount to factor in all the various risks that could happen along the way. And that's really what it is, and it's in its simplest form. Speaker 0 (17m 18s): So if you were to explain it a little bit more to people in my industry on the commercial real estate side, would you, would you start the conversation by saying, think about this as preferred equity? Yeah. Speaker 1 (17m 29s): It's exactly what it is. It's, it's a preferred equity position where our equity, you know, is paid before your equity. So the definition of preferred equity, we get out our equity first, but it's not debt. So we're always in a sort of junior position, or we're always behind the primary or the secondary lenders. So the debt portion of your home will always take precedence. If you don't have any debt, then obviously we'll be in first position. But in most cases, we're in, you know, second position we try and avoid being in third or lower. Speaker 0 (18m 8s): So your subordinate to the debt, if any, but you are senior to the current equity or, or the, you know, which is likely the homeowners. Speaker 1 (18m 17s): Exactly. But there's also a much more of a partnership element with a debt product. Your capital is always do no matter what the value of the underlying security is. So, you know, the lender will always hope that the security is worth more than the capital. Some should. They have to call the loan in our agreements. The amount that you repay is directly proportionate to the value of the home when you sell it, or when you decide to refinance, if you want to buy us back. So there is a potential for our investors to get a lower return, or, or if house prices do significantly fall and you sell, we may be in a position where we get back less than we invested so that the other big differences, the repayment is directly correlated with the value of your home when you sell it. Speaker 0 (19m 14s): So, one of the things that when I started looking into these, what I was curious about is this aspect of, you know, regulatory environment changes regardless, you know, depending on state country, one of the things for us, we found that when we would do say a cash out refinance or a home-ec, let's, let's use the home equity line of credit, because it's a little bit easier. So say you have an ability to take a 300,000 of a home equity line of credit. Now you don't have to tap into it yet, right? That's the whole point of it is that it's going to be there. Now, what we have found is that from a credit perspective, it will affect your credit because you have the ability, basically the bank knows that you have the ability to access it. So, so I've seen a bit of a shift that people are careful with how much that they take out. I remember in the past, it used to be, get as much as you can have it, sit there, but now it's a burden to a certain extent, from a credit perspective, how does this play into, you know, how banks look at you is if somebody is, you know, getting approved for another mortgage for a different property, how does this show up? How does the home equity contract, if it does it all? Speaker 1 (20m 23s): Well, again, that's the thing. It doesn't because it's not debt. So because it's not debt, there's couple of other advantages, one it's effectively your own capital that we have bought from you at a discount. So it's, it's the sale of something that you already own. So there is no debt element to it. So it just does not appear on your credit report as debt, even though we do check your credit report, before we go into the agreements, to make sure that your someone that we'd like to invest alongside when the transaction is completed, it's not a debt transaction. So your credit score is not affected. It doesn't appear as an additional line item. Now, the benefits of that is that you can use that money to pay off other creditors that are part of your credit score. So if you have existing credit card debt, or if there is some lane that you want to refinance, you can do that because you're not robbing Peter to pay Paul as it were. Now, you're not over leveraging, you're actually reducing your leverage. And again, these are all concepts that psychologically one sort of struggles with because you're always, you know, tuned to think of this as debt, but you're not, you're actually paying off your credit card or your other debt with wealth that you have been able to access from your home equity. Hmm. Speaker 0 (21m 50s): Yeah. That makes sense. In, in terms of the, like you mentioned before, you know, call up or basically it's, it's an option. What I'm curious about, you mentioned if, if there was a situation where a market changes now, obviously it's not like shorting a stock. There is an unlimited losses. We don't go to negative numbers in real estate. However, if, if there was a 20 or 30% downturn in a given market, and for whatever reason the owner had to sell, how would that, how would that play out in, in terms of what the payout would be for, for that preferred equity position? Okay. Speaker 1 (22m 25s): Th there's a, there's a calculation for the amount for the upside, and there's also a calculation that's agreed for the downside. So in other words, whatever, the percentage that we've agreed at the, at the beginning, that, that standard, the two, and normally with our agreements, the two are the same. There are other companies in our space and they have slight variations. So they'll pay a certain amount or you will pay a certain amount on the upside and the investor will pay a slightly different number on the downside. But those figures are all agreed on the basis that if the property does fall below a certain threshold, the investor is going to get back less than they invested. You know, there is no recourse to the homeowner. There is no ability for us to set a minimum return because then that starts falling into the purview of being alone. So, you know, you've either gotta be fish or foul in the solar business. So, you know, if it is a risk-based agreement, then we have to take risk. Speaker 0 (23m 28s): So I, I imagine somewhat similar to syndications or other private placements. It's not a guaranteed return. There's a bit of a preferred return. Speaker 1 (23m 38s): It is exactly. But what you do is in the underwriting stage, you're careful with where you're investing. We're not investing in properties where we're not likely to see house price appreciation. And there are a number of states where you're not going to see the same level of appreciation. Then you're going to see in California or New York or Florida, for example. So we tend to operate in only a certain number of states. And in addition to that, we're careful about where we invest. So there's certain minimum house prices and the certain maximum house prices and the ha the maximum house price is sort of counter-intuitive because you would've thought we would want to invest in a $20 million Hollywood mansion. But the problem is when the market starts getting a little uncertain, if you get three appraisals round one, we'll say it's worth 10 million. One was that it's worth 20 and another will say it's worth 30. So you can't price. Those types of houses say, w you know, we stay very much in a sweet spot where price transparency and price discovery is far easier. So we try and reduce the opportunities for our investors to, to lose money. But again, there has to be risk. Otherwise it's not an investment, but, but, you know, we try and mitigate that risk by using intelligence and underwriting and information and forecasting to, to give us the best chance. Speaker 0 (25m 2s): Yeah, it makes sense. But Matthew, you know, we always have three appraisals, the, the broker, the buyer and the bank. Yeah, exactly. Speaker 1 (25m 8s): Yes, yes. Speaker 0 (25m 9s): That's. So that was basically leading up to my next, my next question. It was more from, from the business standpoint, in terms of market selection, it seems like, you know, one of the challenges we always have as real estate investors is that we want areas that are appreciating from a price perspective where we can force appreciation, but also, you know, the double-edged sword, we don't want cap rates to be compressed. It seems like you're, you're in a position where you can at least focus a little bit more on what are fundamentally a good markets for price appreciation. How do you model that out? What do you look for in those markets? Speaker 1 (25m 43s): Well, first of all, the difference between this and other investments is the scalability, because we are investing in homes that are not for sale. So this investment has a number of benefits compared to ownership of real estate. So if we're looking to buy real estate in certain areas with that comes the burden of management, you know, debt servicing, perhaps, you know, tenants, servicing, finding tenants, repairs, et cetera. So, you know what we're doing, doesn't involve any of the burdens associated with home ownership. So we have a much wider of pitch or a much wider field to look at because we are co-investing in properties that are not for sale. So that's a slightly different, we're a very different dynamic than actually thinking, where are we going to buy? So what we're looking at really is generally over time, we know that, you know, real estate will appreciate in any 10 year period, and it is most likely to outpace inflation the way that the agreement is structured, it builds in a form of structural leverage. So what that means is even though your house may only appreciate by three or 4% a year, the agreement itself gives the investor a bigger return than the underlying house price appreciation. So we're not looking to get a one for one, the agreements are structured. So we get maybe a two or three X return on what the underlying house price appreciation is. So if your house goes up by 5% and you sell it, we're probably going to make about three times that once we've got our share of the equity back. So there's we, so we have that non debt leverage that's built in. So you've got an option agreement that has a leveraged return, but we're not using debt. There's a bit of downside protection because we're buying into your property at a discount. So, so there is some protection for the investor. So that gives us the ability to actually look at quite a wide range of real estate, because we're not restricted to just look at property that's for sale. So we can actually go and pick some really prime estate real estate that is owner occupied and could be owner occupied for the next, you know, 20 or 30 years. Speaker 0 (28m 10s): So if I understand that correctly, say you have a million dollar asset. It goes up in a given period by say, 6%, $60,000, but you have built in an equity position of a hundred thousand dollars or preferred equity. So now that six 60,000 is 60 per 60,000 with the initial investment of a hundred. And that's how that multiplier kind of plays out. Speaker 1 (28m 32s): Yeah. I mean, the numbers are, if you have a million dollar home and we unlock, we access for you a hundred thousand dollars, that's 10% of the current value of the home. What we will then do is say, when you sell your home, you give us 16% of the value of your home at the time you sell it. So let's say you sold it for 1.1 million. We would get 16% of 1.1 million. So we would get about 170,000. So our a hundred thousand dollars becomes $170,000. So that's a good return for us now, from your perspective, you know, over a period of years, the re you know, the, the actual returns compress. So it becomes close to the sort of costs that are the average home equity line of credit would be, but that's, that's in the, in the longer term, in the shorter term. However, if you sold your home, that would be quite expensive. So we build in a cap where the most that we can get as a return on our investment is kept each so that if your property does rocket up, and then, you know, the amount that we get is actually kept so that the balance goes to you. So, but in any case, we are buying some of your current value at a discount, and that serves two purposes. One, it gives the investor some cushion in case the property goes down in value, but secondly, it gives the investor, this sort of structurally leveraged upside. And for you, the homeowner, it's great because you've got access to some of your capital. It's free and clear. So there's no monthly payments, there's no tax implications. And I'll talk about that in a second. So you don't have to pay income or capital gains tax at the time that you get the capital and you can use that money for what, and if you're paying off credit cards at 30% a year, then you're, you're doing very well. Or if you're investing as a down payment in another property, because that's not debt, then you've suddenly got yourself another, another property in your portfolio. Speaker 0 (30m 42s): Yeah, I would imagine also no land transfer tax, because like for the, on the investor side, because you're not, you're not purchasing exactly. Speaker 1 (30m 50s): There's no, no change of ownership, but there's no, no triggers. So from a mortgage perspective, there's no, you know, early settlement due to, you know, sale or transfer. There's no partial transfers. It doesn't trigger property tax reevaluations. It doesn't trigger capital gains tax. Now, the interesting thing is there's obviously a cost of the money. So if we provide you with a hundred thousand dollar investment is going to cost, you let's say $150,000. If you settle a few years time, now that $50,000, which is the cost of the capital, you can use to offset against any capital gains tax liability you may have on that property. So, in other words, if you were going to, if you had a $500,000 gain, you can reduce that gain by $50,000 now. Yeah. Speaker 0 (31m 40s): I mean, that's, that's where the first, you know, first thing that comes to mind is too good, too. Good to be true. It's it's like a tales. I wouldn't heads you lose, but Speaker 1 (31m 50s): Yeah, again, it's just think of it in terms of what, what is the preferred equity structure in a commercial deal? Yep. Same, same thing. So the owner of a commercial property gets to offset the cost of the, in the app to against the capital gains, because it's, it's, there's, there's no magic. All you're doing is you're just using financial structures that are used everyday in the commercial world. You're just using it in the, in residential world. Yeah. It used to it. And that's the thing, isn't it? There's no difference. Speaker 0 (32m 22s): Yeah. It, it, you know what I, it really is. And I'm sure this is, this is what made me, whether you'd use the word challenging, but this is the thing, the education piece, where people are so caught up in the idea, especially with residential, anytime I'm taking money out of this house, it has to be attached to some sort of debt structured that where, whereas in the capital gains example, again, even, even myself, I've been in commercial real estate industry industry, my whole career, and the way I think of it, even having to catch myself, oh, that's right. It's a cost of the transaction. It'll reduce your liability. Speaker 1 (32m 55s): Exactly. And that's the biggest challenge we have is the psychological attachment. People have to the equity in their homes. The biggest challenge we have, if all the, I'd say the biggest roadblock is for people who don't like the idea of giving away something that they haven't got, you know, so that they're trading the expectation of having future equity. That, and the interesting thing is people look at this in a very narrow focus. So when you talk to them about the, the future value of their home, excuse me, they see that as absolute. Well, they don't take into account is w what could happen to them and their lives and their job, or, or, you know, healthcare bills, or that they're assuming that everything in five years or 10 years time will be exactly the same as it is today. And their equity will be there for them. So what, after, you know, a bit of conversation, then people begin to start unpacking that stuff and realize that, you know, if I do have a life change, or if my, I do lose my job, then I'm never going to be able to borrow money. So that equity, you know, I might, I might have might as well have $20 million worth of equity because I can't ever get my hands on it. Speaker 0 (34m 13s): Yeah, for sure. I mean, it's one of those things, I think as real estate investors, we're a little bit more open to the idea of the, of the fact that if you have a hundred percent of your house paid off, or a hundred percent of an asset income producing asset paid off, it would be looked at as a negative thing from a real estate investors point of view, see your return on equity is going lower. Speaker 1 (34m 34s): Yeah, exactly. So trying to have that conversation, you can do it, but you have to pick your, your moment because what you end up doing is you're not just talking about your product. You're then embarking on this sort of financial education journey, where you're talking to people about the value of their home. People want to pay their mortgages off because they want to be debt free. But then you say, well, look, you realize that your house that was going up in real terms, 15 or 20% a year is now going up by 3% a year, because you've lost that three to one or four to one leverage. So there is this such a thing as good debt, if you can't afford the payments and you're getting that leverage effect. Yeah. So sure there is education is that it does lead onto a whole other conversation, but you know, all of it's very positive because you know that there is no gotcha. There's no catch to what we do. The decision is this is what it's going to cost you. This is, this is how we make our return. This is what you get in exchange. You know, what do you think, you know, here, here is everything black and white. And so you can make very informed decisions about this, which is, which is great. But as I said, it's not, it doesn't suit everybody. Speaker 0 (35m 50s): Yeah, for sure. I could definitely see it from that psychological barrier, especially, you know, the, the American kind of idea of home ownership is, is sacrosanct. And you kind of toying with that or talking about that. If it's not done, like you said, if you don't pick your pick your place or your spot, I'm curious Matthew, the, the actual investor side of the coin. So when you're, when you're looking for investors to invest in these products, what does that side of the equation look like in terms of how you raise capital or how you source investors and Instructure that side of the, the coin Speaker 1 (36m 23s): Biggest challenge? Again, this is something that we came across right in the very early stages, four or five, six years ago, you've got a, an asset that potentially doesn't pay off for 30 years. And in the meantime, there's no flow. So it's like, so everybody wants stuff that pays off next year with tons of cashflow. So it's like, you know, well, how do you, how do you go about fixing that problem? And there are investors. So there are, you know, hedge funds and family offices that have capital allocations that are suited to long-term asset backed investments. So, you know, money comes from those areas, but what we've built on our is an exchange. So our objective is to create a, you know, a system, a marketplace where the paper that's generated when you create a home equity agreement, that return profile that is backed by the lean on real estate. So you've got a real estate asset backed investment with a structurally leveraged return and downside protection on residential real estate in prime areas. It's a really good investment downside, no cash flow because it's equity based. And potentially you've got a ways a long time before you get the liquidity event. If we can create a marketplace where, where you can sell your interest. So as the underlying value of the property goes up, your return is going to go up because the two are directly linked. So in the same way that there's a marketplace for, you know, life insurance, settlements, and other types of, you know, non-cash fling, you know, securities, we've created a marketplace where you will be able to buy and sell fractions of home equity agreements. So you can or will be able to build a portfolio of homes or the equity in homes that are not for sale. And you don't have to buy the whole chunk we're using blockchain technologies and the efficiencies that we're partnering with the algorithm protocol. So what we do is we take a home equity agreement. We use these super efficient blockchain technologies to chop it up into little pieces. And the blockchain allows us effectively to keep track of where the ownership is of all of those little pieces at any one time. So we can use that and we can create this marketplace where those fractions can be bought and sold, that creates more liquidity or liquidity options for the investor. And then that suddenly completes the picture. Speaker 0 (38m 55s): So in terms of, you know, you have the average investor looks into a home equity contracts wants to go forward with it, ha what's the first step that they would take. Speaker 1 (39m 5s): This is stuff that w that is in the pipeline. We have a few weeks away from being able to get our first few deals on the platform. So there's a lot of structuring, fair amount of technical work. That's still in the finishing touches. You can go to our website today and register as an investor. You can see what the platform looks like, and it's going to be very familiar. It's very similar to crowdfunding platforms, or, you know, E-Trade or platforms where you see the investment. You can find out details about what's behind the investment, what the terms of the agreements are, and you can make informed investment decisions. You can't do that yet, but it's going to happen very soon. Speaker 0 (39m 49s): So the, the markets just generally speaking, I assume, right now, the focus is a U S specific markets in the U S or like you said before, there's, you know, there is cushion in terms of which markets you can look at. And like you said, it's, you're, you're buying houses that aren't for sale or, sorry, you're, you're investing in, in home ownership partnerships with homes that aren't for sale. Speaker 1 (40m 12s): I think really, for us to move into, I mean, we're active directly in California and indirectly through partners in 18 other states. And that's probably going to be about the number of states, because there are a number of states where you, you have regulatory issues. You've got challenges like in Texas, for example, homestead regulations there make it unattractive for investors, because it's very difficult to, you know, protect the investors if, if something goes wrong with the agreement. So it's a combination of where is the appreciation going to be? How predictable is that appreciation or depreciation and how liquid, or how, how attractive is that marketplace? And also what's the regulatory, what regulatory hurdles, or would we have to overcome. And again, the us is sorry to be master of the bleeding obvious, but it's a very large place. There are tens of millions of homeowners who have more than 50% equity in their home. So, you know, th th th th it would just be unfeasible to make even a tiny dent in that available marketplace, you know, in, in our lifetime. Speaker 0 (41m 32s): Yeah. It's pretty, it's pretty crazy in terms of the actual number. I think you mentioned earlier right now, from an equity point of view, roughly 20, 22. Speaker 1 (41m 41s): Yeah. Freddie Mac, the, they publish their figures frequently. If you look at the entire residential marketplace, the amount of equity compared to debt is around 20, 23 trillion. That doesn't mean to say that that's available equity. I think the available equity figures around 9 trillion, which is still enough to keep you occupied for a few weeks Speaker 0 (42m 4s): And not to put you on the spot here, but I know it's always ebbed and flowed in the states in terms of percentage of people that own their homes. You, I think, you know, from the sixties to low seventies to we're we're where are we at right now? Roughly? Speaker 1 (42m 17s): Yeah. I don't know. Okay. I don't know. I know where to find that information right now. I, again, may I, may I plead the fifth on that Speaker 0 (42m 29s): And you plead the fifth, it's something I'm always curious about because it's usually in stark contrast to European countries w you know, with, with home ownership percentages, obviously being lower, Speaker 1 (42m 39s): It's a lot less, I mean, if you read it. Yeah. I remember reading lots of articles, which really it's astonishing how low home-ownership is today compared to where it was maybe in 20, 30 years ago. So, you know, my sort of memory is that it is in decline, which is counter intuitive, but, you know, I think I'll stop digging at that point. Speaker 0 (43m 1s): Yeah, no, I'll check that out. And yeah, we'll, we'll look that up and put a link to any of the stuff we see. I, I think it peaked, I remember reading a book 10, 15 years ago, where it was talking about kind of the Bush one in that era being over 70%. And I was like, wow, that seems like a high figure if not higher, but I'm right on. I want to be respectful of your time here, Matthew, but we'll, we'll talk a little bit about where people can reach out and link to you, but we have four questions. We ask every guest. So if we change gears, if you're game for that, I'll, I'll hit you with them. Speaker 1 (43m 34s): Yes. Now I haven't actually prepared for these. So you've actually got me on the spot. So I don't, Speaker 0 (43m 41s): Oh, they're easy ones. You'll, you'll be fine. You've had a bit of a storied career. You've, you've done different things. If you kind of went back to the beginning of your career, gave yourself advice, you know, what would you, what would you say to a younger Matthew Speaker 1 (43m 58s): Buy low, sell high, not the other way around you idiot. Speaker 0 (44m 3s): All right. Take it easy on, on younger Matt in term, in terms of mentorship, you know, obviously you're working with a company, you have team members, what's your view on mentorship for younger people in our industry? I think Speaker 1 (44m 17s): It's one of those things. The funny thing is you don't realize you need it until you need it until you've, you know, it's one of those things that I wish I had embarked on at a much earlier age, but the headstrong, yeah. Matthew of younger years felt that I should have written a book when I, when I, when I was younger. Cause I knew everything and you know, you don't, and there are, there's such value that people bring its perspective. The key word is perspective. They may not have specific knowledge about your marketplace and it doesn't matter if they don't and you know, don't ignore them because you think, how could you possibly help me? Because you don't know what the high-speed split-level taper Shang ratio is. It's they bring perspective. They bring experience in things that are very similar. So I am a great believer in mentorship. I wish I had, you know, listen to other people at a much earlier age. And you know, I think I, I learned from other people is my, is, is what I, Speaker 0 (45m 23s): For sure. I'd like to read that book then, you know what all book odd that there was no citations in it in terms of resources or books you're reading right now. Is there anything you, you kind of have on the go, you could share with listeners? Yeah, no, Speaker 1 (45m 39s): I don't really read that much. And cause you know, you're constantly sort of where is the time, but, or I'll pick a couple of books up and just read the first few chapters, but there's a book. I can't remember the author it's called something like getting stuff done and I'll, we'll find out what it is, but it's something that I picked up because one of the things that I'm thinking Speaker 0 (46m 3s): Of getting things done, David Allen, Speaker 1 (46m 6s): David Allen, that's it. Yeah, exactly, exactly. That it's a brilliant book because for those of you who stay awake on Sunday nights until three in the morning, going through countless lists of stuff, you've got to do, he just explains that that is absolutely the last thing you should be using your brain for your mind is for creativity's for it's for creating things. And if you try and use your brain as some sort of storage mechanism, or you're going to go mad B, you're going to run out of storage capacity very quickly. And this is not designed to do that. So get a book or some trusted source and write the stuff down that you need to do there. And then you can rely on that and go to sleep thinking. I haven't got to worry about this stuff because I know what I've got to do because it's in my book and then your brain is suddenly unfettered and free of this clutter. And then you can start creating stuff. So, but all of that was it. There's one of these few books that you read that you think, God, this is good shit. This is actually useful. And so David Allen, you know, you know, my hat goes off to you. So if we're writing something that is incredibly Speaker 0 (47m 16s): Useful, you know, it's funny, you mentioned reading a couple chapters in a book. I was just talking to a friend about this book. Cause I think they, I think they updated it because a lot of it, I mean he wrote it, he was a pioneer. It was I think at the beginning of Excel. So there w there was a lot of, it was physical storage, storage and filing systems. But the takeaway from that book, what I told my friend, I was like, the biggest takeaway was like, your brain is not for storing things. If you have something amazing idea, whatever it is, get it out of your brain as quickly as possible because that's, you know, once it's in there long enough, you'll lose it and, and then it's gone or potentially gone. Speaker 1 (47m 53s): And he does. And you just, as I said, you just go mad. Cause you, you keep trying to remember stuff and you just never, you know, you say you're, it's it doesn't do you any good at, Speaker 0 (48m 2s): Yeah, for sure. Anybody also we'll put a link to that, that book as well. And anybody interested as well, I've found useful is the idea of a brain dump mind map, whatever you want to call it. You know, maybe it's Monday morning, you just write everything. Don't worry about if it's not organized, just get it out of your head. But yeah, we'll, we'll put a link to that. All right. Last question. My favorite softball first car make and model. Speaker 1 (48m 27s): It was an Austin mini 1000. It was, there's a little story that, cause I was about eight 17, just passed my test and I'd been working at a fruit packing firm to save up the money to buy it. So I bought these cars 200 pounds from this gun, the farm, and I go to at home and I had to didn't even have my driving license at that point. And it was a 1973 yellow mini 1000. And so when I woke up the following morning, ran outside to see my new car at 17 road and there was a flat tire. And so I got the Jack out of the back and started jacking the car up to, to, to change the wheel. Cause I thought, well, I can do this. And I'm jacking away in Jacqueline way for like, you know, you know, a very long period of time, far longer than it should have been. And then I sort of realized that the Jack has actually gone through the floor because the, the, you know, the whole car is so rusty that it's literally just like, you know, and there was a lump sponge that had been stuffed in the back and painted black to, you know, to pretend there's metal. So I then realized at that point that, you know, the, the, the world was not full of honorable people, but most importantly, men is of a certain age. We're prone to Russ say, yeah, that was my, I still remembered. I'm traumatized by this. Speaker 0 (49m 47s): It's amazing. What a memory is. We bring up with that last question. That's that's fantastic. We've never had a mini, I would venture to guess if, if it was of that era, I mean, that car wouldn't even be a leader. I'm thinking 6,998 Speaker 1 (50m 0s): CC Speaker 0 (50m 1s): 98 CC. All right. I was going to say it was 800 or 900 CC, Speaker 1 (50m 5s): 60 miles an hour in approximately four weeks. Speaker 0 (50m 7s): Yeah. Yeah. That's great. All right, Matthew, I appreciate taking the time. It was great to, to kind of dive into these contracts. I found that, you know, it's like, oh, could we talk about one thing for half an hour, 40 minutes? And these ones, I think you really can and need to, to understand the product. So for listeners that want to get more information, if they have other questions work in, they head to, Speaker 1 (50m 30s): Yeah, the website is quantum Ari, Q U a N T M R e.com. Everything's on there. So we have a calculator where you can see how much equity we can unlock there's details about the investment side. We've got all sorts of eBooks and podcasts and videos and articles say it's a fairly rich site. We've been around for a few years. So, you know, there's quite a library of information that you can, you know, download or, or read or listen to. And also we have a phone number, so there are human beings behind the site. So if you want to speak to one of us, ask us a question, just, you know, pick up the phone and, you know, feel free. Speaker 0 (51m 8s): My guest today has been Matthew Sullivan. Matthew, thank you for being part of working capital, Jesse, Speaker 1 (51m 13s): Thank you for having me. And it was my pleasure. Speaker 0 (51m 23s): Thank you so much for listening to working capital the real estate podcast. I'm your host, Jesse for galley. If you liked the episode, head on to iTunes and leave us a five-star review and share on social media, it really helps us out. If you have any questions, feel free to reach out to me on Instagram, Jesse for galley, F R a G a L E, have a good one. Take care.
Single-Family Senior Vice President of Modeling, Econometrics, Data and Analytics, Michael Bradley discusses the advantages of AI and Machine Learning for mortgage lenders with Amy Gromowski, Senior Leader, Science & Analytics at CoreLogic and Frank Poiesz, Managing Director of Product, Origination Technology with Black Knight.
In this Real Estate News Brief for the week ending September 11th, 2021... a record high for home equity, a drop in Zombie foreclosures, and the house flippers' hunt for homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic News We begin with economic news from this past week. It was a short week because of Labor Day, with not much economic news after that. The weekly unemployment report shows that initial state claims fell to a new pandemic low of 310,000. The average number of claims before the pandemic was just 90,000 less, at 220,000 per week. (1) Continuing claims were also down to almost 12 million for state benefits and 7 other state and federal programs. That number had risen above 30 million during the pandemic.Last week was also the last full week for many of those benefits. Bank of the West chief economist estimates that 7.5 million people will drop off the unemployment list, and another 3 million will see their benefits cut by $300 a week.Economists are watching to see if the loss of benefits sends more people back to work, and helps ease the worker shortage that many companies are experiencing. They are also expecting a possible rise in claims because of Hurricane Ida. And there are plenty of jobs available. The Labor Department reported an all-time high of 10.9 million job openings in July. It's the fifth month in a row that job openings broke that record. (2)Mortgage RatesMortgage rates are still idling below 3%. The average 30-year fixed-rate mortgage was up just 1 basis point last week, to 2.88%. The 15-year was also up 1 basis point, to 2.19%. Freddie Mac chief economist, Sam Khater, blames it on the current wave of new COVID cases. He says it led to “weaker employment, lower spending and declining consumer confidence.” But he says that lower rates are also giving consumers “more time to find the homes they are looking to purchase.” (3)In other news making headlines...New Home Equity RecordHomeowners are reaping the benefits of higher home values. Black Knight says that housing equity has hit a new record high after surging 40% compared to a year ago. It analyzes equity among mortgage holders, and says the average mortgage holder now has $173,000 in equity. That's up about $20,000 from the first quarter of this year. (4)Black Knight Data Analyst, Ben Graboske, says recent growth is the strongest growth he's ever seen. He also says 98% of the homeowners who are in forbearance have at least 10% equity in their homes. That should help them avoid foreclosure, as foreclosure moratoriums are lifted.Zombie Foreclosures Nearly Non-ExistentHigher levels of home equity, along with the moratoriums, have led to a big drop in zombie foreclosures. That's when a foreclosure process stalls after a homeowner defaults on mortgage payments and abandons the home. The house ends up sitting vacant, in foreclosure limbo. (5)A report from ATTOM Data Solutions on third-quarter vacant properties and zombie foreclosures shows that 1.3 million homes are vacant in the U.S. That's about 1 in every 74 homes. The number of homes that have fallen into zombie status is just 1 in every 13,000 homes for a total of about 7,500 homes.ATTOM'S chief product officer, Todd Teta, says: “Vacant properties in foreclosure, and the resulting potential for neighborhood decay, continue to be a non-issue overall in most of the country.” He says: “But that could easily change over the coming months as lenders are now free to take back properties from delinquent homeowners.” He says the foreclosure issue will depend on individual banks, and how aggressively they pursue foreclosures once the moratoriums are gone.Fixer-Upper Homes Are ScarceWill we see more inventory in the near future as the housing market adjusts to a post-pandemic economy? Right now, it's tough on house flippers and businesses that rely on renovating older homes and foreclosures. There's inventory out there but the competition is tough.According to an ATTOM report, just 2.7% of homes sales were flips during the first quarter of this year. (6) That's the lowest percentage of flips in about 20 years. House renovator, Ed Stock, told the Wall Street Journal that he expects to do just 15 flips this year. In 2014, at the height of the foreclosure crisis, he did 53 flips. He says: “Investors like me, we're like ants on a sugar hill all fighting for the same projects.”It is possible to find inventory however. And it's a whole lot easier when you are part of an investing network, like RealWealth. As a member of our network, you have access to the Investor Portal where you can view sample property pro-formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more. It's free to join at newsforinvestors.com, and free to make use of our resources. That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review! Thanks for listening. I'm Kathy Fettke.Links:1 -https://www.marketwatch.com/story/u-s-jobless-claims-fall-sharply-to-post-pandemic-low-of-310-000-11631191386?mod=the-conversation2 -https://www.marketwatch.com/story/job-openings-hit-another-record-high-in-july-11631110730?mod=economic-report3 -http://www.freddiemac.com/pmms/4 -https://www.blackknightinc.com/black-knights-july-2021-mortgage-monitor/5 -https://www.attomdata.com/news/market-trends/foreclosures/attom-q3-2021-vacant-property-and-zombie-foreclosure-report/6 -https://magazine.realtor/daily-news/2021/09/08/flippers-struggle-to-find-enough-fixer-upper-houses
In this Real Estate News Brief for the week ending September 4th, 2021... new FHFA rules on the foreclosure bidding process, the for-sale homes needed for a “normal” market, and the renters who don't think they will ever be homeowners.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. The number of people applying for unemployment has dropped again. The Department of Labor reported that 340,000 people filed for state claims last week. That's a decline of 14,000 from the week before and the lowest it's been since the start of the pandemic. Continuing claims are also down, to a total of 2.75 million, and the total for all 8 state and federal programs is 12.2 million. That's down from 30 million at the peak of the pandemic. (1)More disappointing is the August report on hiring. The Wall Street Journal had estimated an additional 720,000 jobs, but the Bureau of Labor Statistics reported a disappointing 235,000 new jobs. That's the lowest number we've seen in more than a half a year. Job growth suffered the biggest decline in the retail sector. New government jobs were also down, along with jobs in the construction industry. The official unemployment rate is currently 5.2%, but of course that doesn't include people who are not looking for a job. (2)Meanwhile, home prices recorded a third month of record-high price growth. The latest S&P CoreLogic Case-Shiller Home Price Index is up 18.6% in June, on an annual basis. The 20-city index is ever higher, at 19.1%. S&P DJI investing strategist Craig Lazzara says the data is consistent with the hypothesis that the pandemic drove buyers from urban areas to the suburbs. (3)Pending home sales dipped a little in July. The National Association of Realtors says they were down 1.8%. MarketWatch economists had expected a slight increase. NAR's chief economist Lawrence Yun says: “The market may be starting to cool slightly, but at the moment there is not enough supply to match the demand.” (4)Consumers are also feeling more anxious about the economy. The Conference Board says that consumer confidence fell to a six-month low of 113.8 in August. The worry list includes inflation and the spread of the Delta variant, although there's some evidence that Covid caseloads have peaked in some of the hardest hit areas. (5)Mortgage Rates Mortgage rates are holding steady. Freddie Mac says the 30-year fixed-rate mortgage stayed the same this last week at 2.87%. The 15-year was up one basis point to 2.18%. (6) In other news making headlines…New Rules on Foreclosure Bidding ProcessOwner-occupants are getting more time to buy foreclosures before investors are allowed to big on them. The Federal Housing Finance Agency announced that it is extending the amount of time that owners have to view and buy foreclosures from 20 days to 30 days. It's part of the First Look Program first launched in 2009 to help promote owner occupancy and stabilize neighborhoods.The FHFA's acting director, Sandra Thompson says: “Extending the amount of time owner-occupants have to bid on an REO property, without competition, is especially important for neighborhood preservation while the supply of homes for sale is severely limited.”Housing Gap is 1.5 Homes Short of NormalThe housing market needs another 1.5 million for-sale homes to help fill the inventory gap. Analysts at Morgan Stanley say that would get us back to a housing market “normal.” That applies to both the resale market and the building market. (7)Morgan Stanley strategists say that inventory is lagging about three years behind demand. And the number of homes needed could be as high as 5 million, depending on how you add it all up.That imbalance is reflected in the rate of home price growth, although DataTrek analyst Nicholas Colas says: “While house prices are certainly trending above long-run growth rates, they are not yet as elevated as 2005 on an 8-year trailing appreciation basis.”Renters Who Say They'll Always Be RentersMany renters hope to someday buy their own homes, but according to a LendingTree survey, half of them don't think that will ever happen. (8) LendingTree surveyed 2,500 people and 83% said they'd prefer to own their own homes, but 48% said they have doubts about their ability to buy.So what's keeping them from buying a home?More than half said they can't afford a down payment. About a third said home prices are too high or their credit scores are not good enough. A quarter of them said they don't have a stable job right now or they are not sure “where” to settle down. Some of the other reasons include student loan debt and plans to get married first.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke. Links:1 - https://www.marketwatch.com/story/u-s-jobless-claims-fall-to-new-pandemic-low-of-340-000-despite-delta-surge-11630586480?mod=economic-report2 - https://www.marketwatch.com/story/u-s-adds-just-235-000-jobs-in-august-as-delta-dents-hiring-11630672922?mod=economy-politics3 - https://www.marketwatch.com/story/home-prices-see-record-growth-for-third-straight-month-but-relief-is-in-sight-for-home-buyers-11630416326?mod=economic-report4 - https://www.marketwatch.com/story/pending-home-sales-slide-for-second-month-in-a-row-11630333300?mod=economy-politics5 - https://www.marketwatch.com/story/consumer-confidence-in-the-u-s-sinks-to-7-month-low-on-delta-anxiety-11630419114?mod=economic-report6 - http://www.freddiemac.com/pmms/7 - https://magazine.realtor/daily-news/2021/09/03/fhfa-gives-buyers-wider-advantage-over-investors8 - https://news.yahoo.com/housing-market-needs-15-million-more-homes-on-sale-to-get-back-to-normal-morgan-stanley-211442251.html9 - https://magazine.realtor/daily-news/2021/09/01/survey-nearly-half-of-renters-fear-they-ll-never-own
Listen carefully! In this podcast, I'm going to share a Freddie Mac Appraisal Secret! If this secret gets out, it could mean the downfall of the residential real estate appraisal industry as we know and love it! I'm completely serious (not)! This secret is so applicable, so practical, you won't believe you've never seen it anywhere else. And really, you haven't. Such a powerful secret should be part of an appraiser's QE and CE. But, as you are well aware, it is not! And that's a shame, too! Since, when you learn it, and put it into practice, your life as an appraiser may get just a bit easier. Let me know in the comments, would you? This Freddie Mac appraisal secret was not all that hard to uncover. Really! But, since we are all appraisers, and are all in the same boat, I figured, why not share it? As I just wrote, this secret is not part of real estate appraisal QE or CE. There are plenty of webinars and seminars out there that hint at this secret, true. But, insofar as I can tell, this is the only place to get this secret unadorned. You won't find this secret rendered this simple, this straightforward, in any other place on the internet. You won't find this secret in any real estate appraisal text. Not even in the Freddie Mac Single-Family Seller/Servicer Guide. So, the Freddie Mac Appraisal Secret is out! But you won't be in any danger if you choose to apply it. In fact, apply it! You'll find that you life an an appraiser runs more smoothly. You'll likely get fewer stupid stips from AMC reviewers. And your state appraisal board will likely stay off your case. Those sound like pretty positive benefits, don't you think! But don't tell anybody about the Freddie Mac Appraisal Secret. It must stay between us!
For today's HousingWire Daily, Finance of America Companies CEO Patti Cook joins us for another episode of the Women of Influence series that spotlights the latest accomplishments of our award winners. As a 2021 Woman of Influence, Cook has been a pioneer in financial services since her earliest days in the industry. Over the course of her career, Cook has held executive roles at numerous companies, including Prudential, JPMorgan, and Freddie Mac.Cook shares her personal journey for how she got into the industry, as a woman in the finance space who has risen to the highest level of her business. She also addresses one of her most notable accomplishments — taking the company public in the midst of a global pandemic. Now, as CEO, Cook highlights how Finance of America helps advance women into leadership positions and offers other women in the industry advice on how to advance their own careers.
Terry Painter is a real estate investor, a member of The Forbes Real Estate Council and is a contributing writer for Forbes Online Magazine, founder of Business Loan Store, and Apartment Loan Store, a company that offers a full line of apartment and multifamily loan options, and a creator of mortgage banking firm specializing in commercial lending in all 50 states since 1997. He has been a top producer for Lasalle Bank and Lehman Brothers. He is the author of "The Encyclopedia of Commercial Real Estate Advice" published by John Wiley & Sons. He is also known for his exceptional investment consultations and stratagems. For 18 years, he has spoken nationally to commercial real estate investor groups and real estate professionals about commercial real estate investing and lending. For over 20 years, he has built strong correspondent relationships representing Fannie Mae, Freddie Mac, FHA/HUD, Life Companies, Wall Street conduits, Hedge Funds, Regional, and National Banks. KEY POINTS Property valuation Commercial real estate lending Commercial versus residential real estate investing Best return-driven investment in multifamily space Value-add real estate The risk of buying property based on a pro forma versus actuals Transitioning to the world of commercial real estate Common mistakes in commercial real estate investing Terry's investing outlook in 2021 LIGHTNING QUESTIONS 1. What was your biggest hurdle getting started in real estate investing, and how did you overcome it? Trying to figure out what properties to buy that earn interest, and so find a mentor to help with it. 2. Do you have a personal habit that contributes to your success? Eliminate distractions by not answering the phone, checking on emails, and social media all the time. 3. Do you have an online resource that you find valuable? https://www.loopnet.com/ (LoopNet) 4. What book would you recommend to the listeners and why? https://www.franklincovey.com/the-7-habits/ (The 7 Habits of Highly Effective People) book by Stephen Covey 5. If you were to give advice to your 20-year-old self to get started in real estate investing, what would it be? Buy properties at a young age! RESOURCES https://www.amazon.com/Encyclopedia-Commercial-Real-Estate-Advice/dp/111962911X/ref=sr_1_1?dchild=1&qid=1630155927&refinements=p_27%3ATerry+Painter&s=books&sr=1-1 (The Encyclopedia of Commercial Real Estate Advice) https://apartmentloanstore.com/ (Apartment Loan Store) Visithttp://m/gp/product/B00NB86OYE/ref=as_li_tl?ie=UTF8&tag=jacob0ee-20&camp=1789&creative=9325&linkCode=as2&creativeASIN=B00NB86OYE&linkId=100a9d2905599266aa7088bba0a33d55 ( Audible) for a free trial and free audiobook download!
In this Real Estate News Brief for the week ending August 28th, 2021... which lender will let you pay in Bitcoin, why a Covid-19 vaccine will get you a discount on closing costs, and the rising popularity of patios, for outdoor living.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe have economic news from this past week, but first, big news on the latest federal eviction moratorium. If you haven't heard, the U.S. Supreme Court blocked that mandate after a new legal challenge by the Alabama Association of Realtors and a group of landlords. The plaintiffs argued that the CDC doesn't have the authority to issue this kind of mandate. The justices agreed, saying the policy should've come from lawmakers, and not the CDC. (1) As Newsweek reports, progressive members of Congress are now considering legislation that would reinstate the moratorium, as the nation continues to deal with the pandemic. (2) So the battle continues.Members of the Federal Reserve met virtually for their annual Jackson Hole Symposium, and discussed the need to pull in the reigns on its bond-buying policy. (3) After the meeting, Fed Chair Jerome Powell said a majority of Fed officials, including himself, believe that tapering should begin this year. He has been saying that the economy needs to make “substantial further progress” before the Fed would cut back on its stimulus policy, and he said for the first time in his speech, that that test has now been met. An announcement on “when” tapering might begin is expected in September.Meantime, the inflation rate has now hit a 30-year high, according to the PCE Index. That stands for Personal Consumption Expenditure index. It's the one that the Fed pays close attention to. It was up .04% in July and brings the annual rate of inflation to 4.2%. (4) That's lower than the Consumer Price Index or CPI, which shows an annual rate of 5.4%. (5) Both are much higher than the Fed's 2% inflation target.A revised report on second quarter GDP shows the economy grew at an annualized rate of 6.6%. That's up from 6.5%. (6) The number of new weekly jobless claims rose for the first time in more than a month. The Labor Department says they were up 4,000 to about 353,000 for last week. Claims have been falling overall but have still not returned to pre-pandemic levels of about 220,000 per week. If you add all the people with ongoing claims, the total is about 12 million. That's down from a high of 30 million toward the beginning of the pandemic. (7) On to real estate: New home sales reversed a three-month decline, with a 1% increase for July. If that rate continued for an entire year, the sales total would hit 708,000. Currently, the median price for a home is $390,500. (8)Existing home sales are also higher in July. The National Association of Realtors says they were up 2% to a seasonally-adjusted annual rate of 5.99 million homes. The increase in sales is being attributed to an increase in inventory. The median price for an existing home is now $359,900, or 17.9% more than it was a year ago. (9)Mortgage RatesMortgage rates are still idling below the 3% level. Freddie Mac says the 30-year fixed-rate mortgage was up 1 basis point to 2.87%. The 15-year was also up just one basis point to 2.17%. (10)In other news making headlines…Paying Home Loans with BitcoinUnited Wholesale Mortgage made a big announcement about Bitcoin. It says that it will begin accepting cryptocurrency payments for home loans. UWM is the 2nd-largest lender in the U.S. The plan to accept crypto for payments is the first for the national mortgage industry. (11)Lender Discount for the VaccinatedWhat appears to be another industry first, is an announcement by Neat Loans to offer a discount to borrowers who are vaccinated against Covid-19. It would apply to $500 on closing costs for residential and refinancing loans.The concern is that an unvaccinated person would be more likely to get sick and be out of work, making it difficult to keep up with mortgage payments. Borrowers who are unable to get the vaccine for health or religious reasons, would also qualify for the discount. (12)Patio Popularity is SkyrocketingNew data shows that the popularity of patios jumped another notch higher in 2020. The National Association of Homebuilders reports that the share of new homes with patios rose to 61.4%. It's the first time that number has ever been higher than 60%. At the beginning of the Great Recession, it got as low as 44.8%, but has been continually increasing since then, with a big jump in 2020. It rose from 59.6% to the current 61.4%. You'll also find more homes with patios in warmer Western and Southern states. (13)That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 - https://www.inman.com/2021/08/27/supreme-court-shoots-down-latest-eviction-moratorium/2 - https://www.newsweek.com/whats-next-eviction-moratorium-progressives-eye-legislation-after-scotus-ruling-16236863 - https://www.marketwatch.com/story/fed-chair-powell-says-he-supports-starting-to-taper-bond-purchases-this-year-11630072826?mod=federal-reserve4 - https://www.marketwatch.com/story/inflation-rate-hits-30-year-high-pce-shows-as-u-s-confronts-major-shortages-11630068319?mod=economic-report5 - https://www.cnbc.com/2021/08/11/cpi-report-july-2021.html6 - https://www.marketwatch.com/story/u-s-economy-grew-slightly-faster-6-6-pace-in-second-quarter-new-gdp-figures-show-11629982344?mod=economic-report7 - https://www.marketwatch.com/story/jobless-claims-rise-for-first-time-in-five-weeks-to-353-000-but-still-near-pandemic-low-11629981525?mod=economic-report8 - https://www.marketwatch.com/story/new-home-sales-rebound-despite-prices-hitting-record-high-11629814766?mod=economy-politics9 - https://www.marketwatch.com/story/new-home-sales-rebound-despite-prices-hitting-record-high-11629814766?mod=economy-politics10 - http://www.freddiemac.com/pmms/11 - https://www.cnbc.com/2021/08/19/united-wholesale-mortgage-will-accept-bitcoin-other-cryptocurrency.html12 - https://magazine.realtor/daily-news/2021/08/26/lender-offers-mortgage-discount-to-the-vaccinated13 - https://eyeonhousing.org/2021/08/share-of-new-homes-with-patios-climbs-to-record-61-percent/
In this Real Estate News Brief for the week ending August 21st, 2021... we'll look at second quarter home prices, a big surge in rents for single-family homes, and a softening demand for vacation homes.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin with economic news from this past week. The Fed released the minutes of its last big meeting in July and acknowledged what many economists have been saying, that the current surge in U.S. inflation could continue into next year. That's mostly due to a shortage of labor and materials as the nation deals with the latest wave of the pandemic.MarketWatch reports that the Fed's July summary mentioned the delta variant six times after not one mention of the virus in June. The Fed previously said that high prices might last a little longer, but in this summary, Fed officials also acknowledged that the “spread of the delta variant may temporarily delay the full reopening of the economy and restrain hiring and labor supply.” And that could put more pressure on prices. (1) On a more positive note, St. Louis Fed President James Bullard doesn't believe that the spread of the delta variant will derail the economy. He told MarketWatch: “The economy has clearly adapted to the pandemic situation.” He says both businesses and consumers have found ways to deal with it. (2)According to published reports, there's growing support among Fed officials to begin the tapering process. The Wall Street Journal says that public statements from those officials suggest an announcement could be made next month, with a reduction in bond-buying activity beginning a month or two later. (3)The latest unemployment report shows that initial claims have reached a new pandemic low. They were down to 348,000 for the week ending August 14th, which supports the idea that the economy will weather this new outbreak. We'll know more next month when many people are expected to return to work as extended unemployment benefits run out, kids return to school, and the coronavirus is hopefully under better control. (4)Supply chain issues are still impacting home builders. The Census Bureau reported a 7% decrease in housing starts last month. Housingwire says the news is not all bad because housing starts are still 12% higher than last year and the number of single-family homes under construction is the highest since 2007. (5)But home builder confidence has dropped. The National Association of Homebuilders say the monthly confidence index fell five points in August, to a reading of 75. That's the lowest it's been in more than a year, mostly because of supply chain issues and high home prices. (6)Mortgage RatesMortgage rates didn't move much last week. Freddie Mac says the 30-year fixed-rate mortgage was down 1 basis point to 2.86%. The 15-year was up 1 basis point to 2.16%. (7)In other news making headlines…Home Prices Up Again in Q2Home prices pushed higher in the second quarter due to overwhelming demand and a short supply of homes. The National Association of Realtors says the sales price for the median single-family existing home was $357,900. That's up 22.9% year-over-year. (8)Looking at metros, NAR says that prices were higher in 182 of the 183 metros it analyzes. And in 94% of those metros, the median price was more than 10% higher. Metros with the strongest price growth have been in the South and West. The top gainer was Pittsfield, Massachusetts which is not in either of those regions. Second and third on the list of gainers was Austin, Texas and Naples, Florida. The only metro that posted a decline was Springfield, Illinois.That said, the overall market has cooled off a bit. NAR's chief economist Lawrence Yun says: “The housing market looks to move from ‘super-hot' to ‘warm,' with markedly slower price gains. Single-Family Rents Push HigherStrong demand for single-family rentals has also continued, and that's pushing rents higher. CoreLogic says U.S. single-family rents are up 7.5% year-over-year in June. That's five times higher than rent growth in June of last year. But rent growth is not the same across all price points with the fastest rent growth at the upper end. (9)Demand for single-family rentals really took off during the pandemic, and it hasn't slowed down. CoreLogic says they are overwhelmingly preferred by would-be homebuyers who have been either priced out of the market or can't find a home to buy.The 7.5% increase includes detached homes, duplexes, triplexes, quadplexes, townhomes, row-houses, condos, and co-ops. If you look at the rent growth for “just' detached single-family homes, it was 10.5% year-over-year in June and just 4.6% for “attached” rentals.Demand Slows for Second HomesThe pandemic also produced a surge in demand for second homes, but Redfin says that trend has died down quite a bit. The real estate website says second-home demand fell 21% in July compared to last year. But it also remains higher than it was before the pandemic. (10)Redfin's lead economist, Taylor Marr, expects a high level of interest in second homes to continue among those working remotely. He said in a statement: “If you build it -- amid a historic housing shortage -- they will come. I expect vacation homes to remain popular as more homes are built.”That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke and this Real Estate News for Investors.Links:1 - https://www.marketwatch.com/story/fed-worries-delta-could-prolong-shortages-and-keep-inflation-high-into-2022-11629314744?mod=the-fed2 - https://www.marketwatch.com/story/marketwatch-interview-feds-bullard-says-delta-covid-variant-wont-derail-economy-11629309073?mod=economy-politics3 - https://www.marketwatch.com/story/fed-officials-nearing-agreement-to-begin-tapering-in-november-wsj-2021-08-164 - https://www.marketwatch.com/story/jobless-claims-drop-to-pandemic-low-of-348-000-in-sign-companies-still-hiring-despite-delta-11629376754?mod=bnbh_mwarticle5 - https://www.housingwire.com/articles/housing-starts-tumble-in-july-due-to-choked-supply-lines/6 - https://www.marketwatch.com/story/home-builder-confidence-sinks-to-lowest-level-in-over-a-year-as-home-prices-soar-11629208832?mod=mw_latestnews7 - http://www.freddiemac.com/pmms/8 - https://www.realtor.com/news/real-estate-news/home-prices-jumped-across-the-u-s-in-second-quarter/9 - https://www.corelogic.com/intelligence/preference-for-detached-properties-pushes-single-family-rents-higher/10 - https://www.inman.com/2021/08/17/demand-for-second-homes-drops-for-second-straight-month/
Welcome to the second year of Coale Mind!In a previous episode of this podcast, I questioned whether the U.S. Court of Appeals for the Fifth Circuit – the federal appellate court for Texas, Louisiana, and Mississippi – may have grown more conservative than the U.S. Supreme Court under the leadership of Chief Justice Roberts. In particular, I looked at two Fifth Circuit cases that the Supreme Court reviewed in the last term—Collins v. Yellen, about the structure of the regulator for Fannie Mae and Freddie Mac—and California v. Texas, about the constitutionality of the Affordable Care Act. The Supreme Court has now ruled and the answer to the question is . . . it depends. These cases ultimately show that not all conservativism is the same . . . .
In this Real Estate News Brief for the week ending August 14th, 2021… where lot values are surging, how rent payments can help new home buyers, and a contest for tiny home designs.Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.Economic NewsWe begin today's episode with economic news from this past week. Two inflation reports show that prices are still heading higher. The consumer price index was up .5% in July. That's down from .9% in June which prompted some economists to say that inflation is moderating. But the yearly rate is 5.4% which is the same as June, and well above the Federal Reserve's 2% target. The core rate is a bit lower. That omits prices for energy and food. It was up .4% to a yearly rate of 4.3% which is slightly lower than the June rate. (1)Although the numbers show that inflation is backing off a little, it's still a whole lot higher than it was last year. The consumer price index was running at 1% annually while the core rate was about 1.6%. And… a report on wholesale prices also came out last week, and that's running hot. It shows the cost of goods rose .6% in July, mostly because of higher energy prices. Wholesale food prices were down 2.1% however. The producer price index also has a core rate which strips out food, energy, and trade margins. That was up .9% and boosted the core rate of wholesale inflation to 6.1%. MarketWatch says that's one of the highest wholesale inflation levels in several decades. (2)Economists say inflation could settle back down when everyone returns to work and supply chain bottlenecks are eliminated, but as MarketWatch reports, many feel that higher inflation may be here to stay. Fed Chief Jerome Powell has also acknowledged that inflation could run hotter than the Fed expected for a longer period of time. (3) The latest unemployment report shows that fewer people are asking for benefits, and fewer people are collecting them. The Labor Department says that initial claims dropped 12,000 to 375,000 last week. That's still higher than a pandemic low of 368,000 that occurred last month. But continuing claims were also down and they hit a new pandemic low of 2.87 million. If you tally up all the state and federal programs available, there are a total of 12.1 million people collecting unemployment checks or about 10 million more than there were before the Covid outbreak. (4)One of the more stunning reports from last week is from the University of Michigan. It shows that consumer sentiment took a nose dive in August to a reading of 70.2. That's down from 81.2 in July, and is now the lowest reading in a decade. That means it's lower right now than it was during any other month of the pandemic. MarketWatch economists believe that people are worried about inflation and a virus that may not go away anytime soon. (5)Mortgage RatesMortgage rates did a small u-turn last week. They had been slowly sinking lower, but Freddie Mac says the 30-year fixed-rate mortgage rose 10 basis points. The average is now at 2.87%. The 15-year was up 5 basis points to 2.15%. (6)In other news making headlines...Lot Values Are SurgingLot values are surging. An analysis by the National Association of Builders shows that lot values for single-family homes that broke ground last year, have appreciated 18% to a record high of $53,000. That's close to the lot value record in 2005-2006, before the housing meltdown. Lots were going for $43,000 back then but that's equal to about $55,000 in today's dollars. (7)Lots are most expensive in New England at about $120,000 or more, but due to zoning laws, they are also usually much larger making them less expensive per acre. In the West, the median lot value is $203,000 but those lots are smaller making them the most expensive lots of all. In the Mountain region, the median value is $73,000. In the West South Central region, the median value is about $60,000 which is the least expensive but is also double what they were valued at just eight years ago. New Underwriting Bonus for HomebuyersOn-time rent payments could help renters get a home loan. Fannie Mae announced that rent payment history can be used during the underwriting process. That will help people who don't have enough credit history to qualify for a loan. (8)FHFA Director Sandra Thompson said in a press release: “There is absolutely no reason timely payment of monthly housing expenses shouldn't be included in underwriting calculations.”Lenders will have to get permission from mortgage applicants to check bank statements for rent payments. The new underwriting feature will be available starting September 18th.Tiny Home Design ContestSalt Lake City is holding a contest for the design of tiny homes. The city is soliciting designs for a master-planned tiny home community for the homeless. But all the submitted designs will be put into a library that can be used by homeowners and city officials. (9)The contest is open to both students and professionals. The two winners will each get $1,000. Runners-up will get $500. The deadline to register is September 10th. Submissions are due by October 29th.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review! You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.Links:1 - https://www.marketwatch.com/story/u-s-core-consumer-inflation-moderates-in-july-11628686146?mod=economic-report2 - https://www.marketwatch.com/story/u-s-wholesale-prices-surge-again-and-show-inflation-still-rampant-ppi-finds-11628772476?mod=economic-report3 - https://www.marketwatch.com/story/u-s-inflation-is-still-running-high-and-it-doesnt-look-like-it-will-fade-fast-soon-11628344325?mod=article_inline4 - https://www.marketwatch.com/story/u-s-unemployment-claims-fall-to-375-000-and-return-close-to-pandemic-low-even-as-delta-variant-surges-11628772686?mod=economic-report5 - https://www.marketwatch.com/story/u-s-consumers-suffered-a-stunning-loss-of-confidence-in-early-august-u-mich-survey-finds-116288641646 - http://www.freddiemac.com/pmms/7 - https://nahbnow.com/2021/08/lot-values-surge-at-record-breaking-pace/8 - https://nahbnow.com/2021/08/fannie-mae-to-include-rent-payment-history-as-part-of-mortgage-approval-process/9 - https://www.builderonline.com/design/awards/salt-lake-city-offers-cash-prizes-for-tiny-home-designs_c
Transcript00:00:00 Intro [Speaker] Kathy FettkeIn this Real Estate News Brief for the week ending August 7th, 2021... another single-family eviction moratorium, legislation to extend Opportunity Zones, and sellers who use spy cams at showings.Hi, I'm Kathy Fettke and this is the Real Estate News for Investors.Economic NewsWe begin with economic news from this past week. The job market picked up speed in July with the creation of 943,000 new positions. Most of those jobs are for leisure and hospitality, but a large portion were also government jobs. According to MarketWatch, July's hiring spree is the largest in about a year. It also helped reduce the unemployment rate from 5.9% in June to 5.4% in July. (1)The weekly unemployment report also shows that fewer people applied for benefits. Initial state claims dropped to 385,000 for the last week of July. That's the lowest number we've since the start of the pandemic. Continuing claims are down to 2.93 million. (2) If you add all the benefits that people are collecting from eight state and federal programs, the total is 12.98 million. For reference, that's still a very big number. Total weekly claims before the pandemic were less than 2 million.Home prices continue skyrocketing. According to CoreLogic, the annual rate of growth hit 17.2% in July. That's up from 15.9% in May. It's also the largest increase in price growth since 1979. (3) CoreLogic CEO Frank Martel says that “home prices have been rising in the mid-single digits for some years now. The recent surge to double-digit price jumps reflect the convergence of exceptional demand and persistent low supply.”Home builders are putting more money into residential construction. The Commerce Department says it was up 1.1% in June to an annual rate of $1.55 trillion. The overall outlay for all kinds of construction was just .1%. (4)Mortgage RatesMortgage rates sank a little bit lower last week. Freddie Mac says the 30-year fixed-rate mortgage was down 3 basis points to 2.77%. The 15-year stayed the same at 2.1%. This is great news for people who need to refinance. The rates are drifting lower in step with the 10-year Treasury yield because investors are worried about the Delta variant of COVID-19. (5)In other news making headlines...Eviction Ban Extension for SFRsThe FHA announced a new eviction ban extension for single-family homes going through foreclosure. The CDC ban expired on July 31st. This new ban extends the moratorium another two months, through the end of September. (6)Under this order, mortgage servicers for FHA-backed loans may continue with a foreclosure process but they can't evict anyone who lives in the home, including owner occupants and tenants.Opportunity Zone ExtensionThe Opportunity Zone program may get an extension past its current 2026 deadline. A group of representatives announced legislation called The Growth and Opportunities Act. California Representative Michelle Steel issued the press release. She says: “The beauty of America is that everyone has the opportunity to build their own American dream. Opportunity Zones are an important tool that give more people the resources they need to grow this dream.” (7)Opportunity Zones encourage investment in distressed communities with tax incentives. There are currently more than 8,760 Qualified Opportunity Zones across the U.S.. This legislation would open the program to new Qualified Opportunity Zones every ten years. It would also restart a tax incentive timeline in January of 2027.Sellers Use Spy Cams for ShowingsNow here's something that might put you on guard next time you go to an open house. A new Lending Tree study says that almost one-third of all sellers use spy cams during a showing. (8)Survey participants offered several reasons for doing it. Almost half said they want to understand what home buyers like and dislike about the home. A little more than a third said they wanted to get information that would be useful during negotiations. And almost a quarter were doing it to spy on their agent, to see what he said about the home. Many were also monitoring their homes for safety reasons. The survey found that owners were using doorbell and security cameras for the most part. Some also used baby monitors and nanny cams.Sellers Taking the Kitchen Sink AND the ToiletsSellers are also doing something else you might not expect. Many are taking fixtures, appliances, and even backyard fruit trees with them. The New York Times reports that expensive toilets are at the top of the seller's “take it with them” list. High-end appliances are also disappearing with the seller. This is mostly happening because of the appliance shortage, and concerns about getting what sellers need for their new homes. (9)One realtor told the Times that people selling a $2 million home dug up a pair of fruit trees for sentimental reasons, and left two big holes in the back yard. Another realtor involved with the purchase of a $15.5 million home had to tell the buyers that the sellers were taking all the kitchen cabinets.Usually, anything “fixed” to the home or yard goes along with the sale.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.00:05:51 EndLinks:1 - https://www.marketwatch.com/story/u-s-creates-943-000-jobs-in-july-and-unenmployment-rate-sinks-to-5-4-11628253659?cx_testId=22&cx_testVariant=cx_1&cx_artPos=1&mod=home-page-cx#cxrecs_s2 - https://www.marketwatch.com/story/u-s-jobless-claims-fall-again-to-385-000-as-unemployment-shrinks-despite-rise-of-delta-11628167412?mod=economic-report3 - https://www.worldpropertyjournal.com/real-estate-news/united-states/irvine/real-estate-news-corelogic-june-2021-home-price-index-hpi-forecast-for-june-2021-frank-nothaft-frank-martell-12650.php4 - https://www.marketwatch.com/story/construction-spending-inches-higher-in-june-11627913458?mod=economic-report5 - http://www.freddiemac.com/pmms/6 - https://www.builderonline.com/money/mortgage-finance/fha-extends-single-family-eviction-moratorium-through-september_o7 - https://steel.house.gov/media/press-releases/rep-steel-introduces-bill-extend-opportunity-zones8 - https://magazine.realtor/daily-news/2021/07/30/nearly-one-third-of-sellers-admit-using-spy-cams-during-showings9 - https://magazine.realtor/daily-news/2021/08/03/sellers-taking-toilets-appliances-with-them
Transcript00:00:00 IntroKathy Fettke [Speaker]In this Real Estate News Brief for the week ending July 31st, 2021… an inflation surprise for the Fed Chief, where single-family rents are growing the most, and a pet's influence on home buying decisions.Hi, I'm Kathy Fettke and this is Real Estate News for Investors.Economic NewsWe begin with economic news from this past week. Fed Chief Jerome Powell uttered words that many economists had predicted -- inflation has risen higher and faster than he expected. But he still believes that prices will settle back down. As to when it will happen, he says that inflation will probably return closer to the central bank's 2% mark in the next year… or so. There was “no” change to the Fed's bond-buying strategy, or short-term interest rates. (1)The unemployment lines were a little shorter last week. Initial jobless claims were down 24,000 to 400,000. That's after a surge that brought them to a two-month high. The previous increase was partially due to the shutdown of auto manufacturing plants for retooling during the last few weeks of July. The total number of continuous claims from all state and federal programs is still above 13 million. (2)Consumer spending was up as Americans took long overdue vacations and services they avoided during the pandemic. The government reported a 1% increase in spending for the month of June. (3) But some of that spending is due to higher prices as inflation ticks up. Prices were up 5.4% year-over-year in June. If you exclude food and energy, they were up 4.5%. (4) Turning now to real estate, new home sales slid 6.6% in June. That's the lowest level since the beginning of the pandemic. Buyers have been discouraged by increasingly higher prices, and a diminishing supply of affordable homes. New homes sales had surged to an annual rate of 1 million at the beginning of the year, but they are now down to a rate of 676,000. (5)Pending home sales for existing homes also fell in June, but not as much. The National Association of Realtors says they were down 1.9% nationally. They were up in the Midwest and the Northeast, but declined in the West and South. (6) So what about those high home prices? Case-Shiller says the national composite index hit a new record in May for the second month in a row. It was up 16.6% year-over-year. That's up from 15% in April. The 20-city index shows an even higher increase of 17% in May. The Federal Housing Finance Agency reported similar results. That index shows a record 18% increase for the year. (7) There are mixed results on consumer confidence. The Consumer Confidence Board says the index edged up a bit in July because consumers are feeling good about the lifting of Covid restrictions, although the Delta variant is threatening our newfound freedom. (8) A survey on consumer sentiment by the University of Michigan shows that consumers are more pessimistic. That index fell from a reading of 85.5 to 81.2, in part due to worries about inflation. (9)Mortgage RatesMortgage rates didn't move much. Freddie Mac says the average 30-year fixed-rate mortgage was up 2 basis points to 2.8%. The 15-year was down by the same amount to 2.1%. (10)In other news making headlines...Single-Family Rent GrowthSingle-family rents have been soaring in many parts of the country. Core Logic's latest update shows the national year-over-year increase for May was 6.6%. That's up from 1.7% in May of last year.CoreLogic economist Molly Boesel says: “Strong job and income growth, as well as fierce competition for for-sale housing, is fueling demand for single-family rentals.” (11)Rents in Phoenix have gone up the most. Those rents are up 14%. Tucson was second highest with a gain of 11.1%. Las Vegas was third, with a 10.7% year-over-year increase.CoreLogic also broke the data down into price tiers. At the lower levels where rent is 75% or less than the regional median, rents were only up 4.6%. The increases grow larger for the higher-priced SFRs. Rents for homes that were 125% of the regional median or more, were up 7.9%.Eviction Moratorium DeadlineThe eviction moratorium expired on July 31st despite last ditch efforts by some members of Congress to get an extension. The moratorium was initially imposed by the CDC, and the Supreme Court ruled that it could remain in place until the end of July, but after that, it could only be extended by Congress. (12)Democrats scrambled on Friday to get enough votes for an extension, but that legislation was rejected, and the House adjourned for August recess. President Biden has asked state and local governments to “immediately disburse” rental assistance funds to help renters, and their landlords.Pets As Home Buyer PriorityThere's new evidence that home-buying decisions are largely based on the needs of pets. A Home.com survey found that 68% of homeowners said they had moved to a new home to accommodate their pets. Of the renters who bought a home, two thirds did so because they wanted to get a pet or keep the one they already had. (13)One in five people said they rejected a home because it wasn't pet-friendly enough. Some of the things they are looking for are secure fencing, yard space, hardwood floors, and a mudroom. They also want to be close to parks and places where dogs can play.Last year, Realtor.com did a survey with similar results.That's it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review! You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.Thanks for listening. I'm Kathy Fettke.00:06:37 EndLinks:1 - https://www.marketwatch.com/story/feds-powell-admits-inflation-has-risen-higher-than-expected-but-he-still-thinks-it-will-all-fade-away-11627500977?mod=federal-reserve2 - https://www.marketwatch.com/story/jobless-claims-fall-after-hitting-two-month-high-11627562987?mod=economic-report3 - https://www.marketwatch.com/story/consumers-boost-spending-in-june-and-spearhead-u-s-economic-recovery-11627649220?mod=economy-politics4 - https://www.cnbc.com/2021/07/13/consumer-price-index-increases-5point4percent-in-june-vs-5percent-estimate.html5 - https://www.marketwatch.com/story/sales-of-new-homes-slump-to-the-lowest-level-since-start-of-pandemic-high-costs-and-low-selection-are-to-blame-11627308798?mod=economic-report6 - https://www.marketwatch.com/story/pending-home-sales-dip-in-june-after-surging-in-prior-month-11627567417?mod=economy-politics7 - https://www.marketwatch.com/story/no-letup-in-home-price-gains-in-may-case-shiller-11627391524?mod=economic-report8 - https://www.marketwatch.com/story/u-s-consumer-confidence-rises-slightly-in-july-to-16-month-high-11627394776?mod=economic-report9 - https://www.marketwatch.com/story/u-s-consumer-sentiment-falls-in-july-as-inflation-expectations-hit-13-year-high-11627655744?mod=economy-politics10 - http://www.freddiemac.com/pmms/11 - https://www.worldpropertyjournal.com/real-estate-news/united-states/irvine/real-estate-news-single-family-rental-report-for-2021-corelogic-may-2021-single-family-rent-index-sfri-molly-boesel-home-rental-data-for-2021-12637.php12 - https://www.marketwatch.com/story/biden-calls-on-congress-to-extend-eviction-moratorium-2021-07-29?mod=mw_latestnews13 - https://magazine.realtor/daily-news/2021/07/29/consumers-are-moving-for-their-pets
Transcript00:00:00[Speaker] Kathy Fettke: Americans behind on their mortgage payments are facing the end of a long pandemic-induced foreclosure ban. The moratorium officially ends on July 31st for federally-backed mortgages, and with forbearance programs also coming to an end, the government is offering new options to keep borrowers from losing their homes.Hi I'm Kathy Fettkie and this is Real Estate News for Investors.The pandemic left millions of Americans unemployed and struggling to pay their mortgages. Many went into forbearance programs that allowed them to put their payments on pause. Black Knight says the number of loans in forbearance peaked last August and September at about 4.4% of all active mortgages. But those numbers have been dropping over recent months.Forbearance Volume Drops to about 2 MillionAccording to the latest survey by The Mortgage Bankers Association, servicers are reporting that forbearance volume has dropped for at least 19 weeks in a row. As of July 4th, it fell another 11 basis points to about 3.76% of all active mortgages. That's about 1.9 million homeowners who are currently in forbearance plans. (1) A large portion of the loans are backed by Fannie Mae and Freddie Mac. The MBA says that the share of government-backed loans in forbearance dropped 8 basis points to 1.91%. And it's the second week in a row that those loans dipped below 2%.The MBA's chief economist, Mike Fratantoni, says that forbearance rates have been coming down quickly since April, and that delinquency rates were also lower in June -- meaning that many borrowers are getting their finances and mortgage payments back on track.But he also says that: “Borrowers who are exiting forbearance now are likely to have been in relief for over a year, with almost 60% of borrowers in forbearance for longer than 12 months.” You may remember that borrowers could get up to 18 months of forbearance. These delinquent borrowers must now get back to making payments, or risk losing their homes because they will no longer be protected by a foreclosure moratorium once their exit forbearance.The foreclosure moratorium was extended one last time in June, for an additional month, until the end of July. The forbearance enrollment window was also extended three months, until the end of September, so some borrowers may still have many months of forbearance protection ahead of them. But to help borrowers who are currently exiting forbearance programs, the government is offering new options.Government Offers Help for BorrowersOne is a loan modification and payment reduction plan. (2) Homeowners with loans backed by the FHA, the FHFA, the VA, and the USDA will be able to extend the length of their loans with lower interest rates. This help will be offered to borrowers who are still impacted by COVID-19. That's defined as homeowners who are “looking for work, re-training, having trouble catching up on back taxes and insurance, or are continuing to experience hardship for another reason.” Loan modification options will also differ depending on the agency. (3)For a loan backed by Fannie and Freddie, borrowers will be able to lower their principal and interest payments by 25%. That will include interest at the current market rate with a new 30-year loan term.For a USDA loan, borrowers will get a 20% reduction with reduced rates, longer terms, and something called a “mortgage recovery advance.” That has to do with repaying previously missed payments.Borrowers with a VA loan, will be able to get a reduction of 20% or more by spreading the payments over 40 years instead of 30. That could reduce monthly payments, but will probably add more total interest to the loan.Ginnie May is also working on a new securities pool that will give all the agencies the flexibility to extend mortgage terms to four decades. But that pool won't be up and running until later this year.The FHFA has also killed the controversial “adverse market fee.” That was a 50-basis-point fee added to refinancing loans during the pandemic. (4)The FHFA began charging that fee last year to cover higher costs and risks during the pandemic. Critics claim it was imposed to help raise capital for Fannie and Freddie during last year's refinancing boom. It is being eliminated as of next month. The Consumer Financial Protection Bureau is also offering some homeowner protection. It is telling lenders that before any foreclosure proceedings can take place, they have to reach out to borrowers to see if they qualify for a loan modification or a lower interest rate. The next few months could be a bumpy ride for some delinquent borrowers, but it appears they will have some options. You can read more about some of these changes by following links in the show notes at newsforinvestors.com.You'll also find a link to join our RealWealth network of investors. It's free and easy to join. As a member, you'll have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.If you like our podcasts, be sure to subscribe, and leave us a review! Thanks for listening. I'm Kathy Fettke.Links:1 - https://www.housingwire.com/articles/forbearance-exits-are-speeding-up/2 - https://magazine.realtor/daily-news/2021/07/26/foreclosure-ban-nears-end-white-house-vows-more-aid3 - https://www.whitehouse.gov/briefing-room/statements-releases/2021/07/23/fact-sheet-biden-administration-announces-additional-actions-to-prevent-foreclosures/4 - https://www.housingwire.com/articles/fhfa-to-kill-the-adverse-market-fee/