The latest economic and policy trends facing mortgage servicers

Join this webinar for an in-depth roundtable discussion on economic and policy trends impacting servicers as well as a look ahead at strategies servicers should employ in the next year.

2021 RealTrends Brokerage Compensation Report

For the study, RealTrends surveyed all the firms on the 2021 RealTrends 500 and Nation’s Best rankings, asking for annual compensation data for the 2020 calendar year.

A real estate professor weighs in on the future of MLSs

According to research done by Sonia Gilbukh, a real estate professor at Baruch College, there are some reasons to be concerned about the current number of real estate agents and the future of MLSs.

Lenders, it’s time to consider offering non-QM products

The non-QM market is making a comeback following a pause in 2020. As lenders rush to implement, Angel Oak is helping them adopt these new lending products.

InvestmentsReal Estate

Single-family rental investors struggle to make money in California

State holds seven of top 10 worst investor rental markets

Rising home prices, low inventory and high demand are all working together in California to create seven of the top 10 worst markets to invest in single-family rentals.

A list released by HomeUnion, an online residential real estate investment management firm, analyzes first-year SFR returns, or cap rates, in each market. The cap rate is the relationship between an investment property’s net operating income, rents less expenses, and the market value of the property.

“Through midyear, owners of SFR investment properties benefited from healthy returns in many markets nationwide, but especially in markets located in the Midwest and Southeast,” said Steve Hovland, HomeUnion director of research services.

“SFRs are outperforming many other investment vehicles, including bonds and gold,” Hovland said. “As interest rates remain low after the June Brexit vote placed downward pressure on U.S. treasuries, bonds and other investments will continue to be low yielding assets.”

“Investment real estate has proven to be a successful part of a diversified portfolio, and these markets offer the largest returns,” he said.

Here are the top 10 highest-yielding markets to invest in SFRs:

10. Philadelphia, Pennsylvania with a cap rate of 8%

philadelphia map

9. Tampa, Florida with a cap rate of 8%

8. Greenville, South Carolina with a cap rate of 8%

7. Memphis, Tennessee with a cap rate of 8%

6. Cincinnati, Ohio with a cap rate of 8.2%

Ohio

5. Milwaukee, Wisconsin with a cap rate of 8.4%

4. Pittsburgh, Pennsylvania with a cap rate of 8.4%

3. Birmingham, Alabama with a cap rate of 8.5%

2. Columbia, South Carolina with a cap rate of 9.7%

1. Cleveland, Ohio with a cap rate of 11.1%

Cleveland

"On the other hand, these [below] markets don’t offer such great returns,” Hovland said. “If an investor’s horizon is long term, these coastal markets might be worth exploring, but the ROI won’t be as immediate as it will in the Heartland.”

Here are the top 10 lowest-yielding markets to invest in SFRs:

10. Portland, Oregon with a cap rate of 3.8%

Portland city skyline

9. Sacramento, California with a cap rate of 3.7%

8. Seattle, Washington with a cap rate of 3.5%

7. New York City, New York with a cap rate of 3.5%

6. Oakland, California with a cap rate of 3.5%

5. San Diego, California with a cap rate of 3.5%

California

4. Los Angeles, California with a cap rate of 3.1%

3. Orange County, California with a cap rate of 2.7%

2. San Jose, California with a cap rate of 2.6%

1. San Francisco, California with a cap rate of 2.5%

Places

No one envies the plight of the homebuyers in California, who struggle against low inventory, high demand, and rising prices. Due to a recent rise in inventory, however, it could be getting slightly better.

California pending home sales increased in June, the third straight month of annual increases, according to the California Association of Realtors.

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Existing home sales pop the 2021 housing bubble boys

So far this year, every existing home sales print has been higher in 2021 than the closing level of sales in 2020, which was 5,640,000. Even with the unhealthy home price gains that we have seen in the last two years, more Americans have bought homes with mortgages in 2020 and 2021 than any single year from 2008-2019, and this looks perfectly normal with our current demographics. HW+ Premium Content

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3d rendering of a row of luxury townhouses along a street

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