The key to implementing non-QM products

With the refi boom falling off and the margin compression happening to lenders nationwide, lenders are looking at non-QM to help fill in those gaps. Learn how to implement non-QM products here!

RealTrends 2021 Team Profitability Study

Brokerage firms have often speculated about how well teams perform from a profit and loss point of view, as well as how productive they are. In this research study, RealTrends answers these two big questions.

Proven Strategies for Accelerating eMortgage Adoption with Freddie Mac and Better

This webinar will cover how the industry is working to overcome challenges lenders experience in adopting eClosings. You’ll hear from industry leaders at Snapdocs, Freddie Mac and Better Mortgage. Register now!

Logan Mohtashami on existing home sales, mortgage rates

Today’s HousingWire Daily begins the Rundown miniseries where HousingWire’s Editor-in-Chief Sarah Wheeler and Lead Analyst Logan Mohtashami will talking about housing and economics every Monday.

Real Estate

Fewer Americans are moving

...mobility is what this recovery needs

Some say there is no spark in today’s economy. Others claim we’ve hit a speed bump. Nonetheless, everyone will agree the housing market is light years ahead of where it stood a year ago. But has the recovery cooled?

Back in my younger days — about six months ago — when my husband and I were looking to buy our first house, the market was pure insanity. I’m talking about ten-offers-in-one-day insanity. It was undeniably a seller’s market. Homes were flying off the market in hours and any offer below list price was laughable.

We were even forced to throw in a picture of our pup to help persuade the sellers to chose us.

Nolan

But it seems that the market has slowed considerably since then. In fact, this year the number of people moving to a new home fell dangerously close to the record lows set in 2011 after rising in 2012, according to data from Trulia (TRLA).

“Last year the Census reported an increase in mobility in 2012 to 12.0%, led by an increase in longer-distance moves.  However, new 2013 data suggest that the mobility rebound we saw in 2012 might have been short-lived,” said Trulia Chief Economist Jed Kolko.

We can only assume rising interest rates coupled with an increase in home prices is the culprit behind this. Historically, rates are still very low at 4.62%. (My father-in-law’s first house was financed at 14% or something equally ridiculous.) But compared to the 3.5% I was able to get six months ago, this seems high to a lot of people.

And after all… isn’t my generation, the Millennials, a big weight holding housing down? We are drowning in student debt, unable to find high-paying jobs and are scared to death of an interest rate above 4.0%.

Heck… the fear of closing with an interest rate above 3.5% motivated me to put in an offer above list price just so I could sneak into the house I bought six months ago before rates rose any further.

So what is the solution here? How can we get the momentum back?

Well, it doesn’t appear feasible for my generation to even put together a downpayment on a home, let alone finance a mortgage with the amount of student debt we are facing. What we need is move-up buyers, and we need them fast.

Nominal wages and salaries increased by 0.4% from July to August, according to Capital Economics. Households are getting (slightly) richer, but we need this number to improve in order for people to start thinking about moving up the property ladder.

In order to sustain the liquidity needed to fuel the recovery, it will be essential that established households start looking at higher-priced homes. Not only will this help the market gel, it will open up affordable housing for the Millennials who are able to buy a home right now.

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