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.

Steve Murray on the importance of protecting property rights

In this episode, Steve Murray, RealTrends advisor and industry stalwart, discusses some of the issues facing private property rights, including how a case in Germany could potentially affect U.S. legislation.

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.

Real Estate

First-time buyers catch a break, NAR’s Yun says

Low mortgage rates are making up for lagging income growth

The cheapest financing in more than three years is making it easier for first-time buyers to afford a home. A tiny bit easier.

Instead of having just enough income needed to buy a median-priced starter home at current mortgage rates, they now have a small buffer, according to Lawrence Yun, chief economist of the National Association of Realtors.

In 2019’s second quarter, first-timers had 100% of the median household income to buy a home, as measured by NAR’s First-Time Homebuyer Affordability Index that crunches income, financing rates and home prices. By the third quarter, the index showed they had 105% of the income they needed.

“The low mortgage rates are clearly helping the market conditions,” Yun said in an interview with HousingWire. “Home prices consistently rising at a faster pace than people’s income growth has hurt, but because of the historically low rates, it’s providing marginal opportunities for first-time buyers.”

Lower mortgage rates compensate for higher home prices and lagging income growth because the cheaper financing lowers a buyer’s monthly payments.

The average U.S. rate for a 30-year fixed mortgage was 3.94% in 2019, according to Freddie Mac. That’s the lowest annual average since 2016 when it was 3.65%. The average for 2020 and 2021 probably will be 3.8%, the mortgage financier said in a forecast last month.

Home prices grew 3.2% in 2019, according to the forecast. That’s a slower pace than in 2018 when the growth rate was 5.1%.

However, income growth has been lethargic. The median household income was $66,043 in November, a gain of 1.9% higher than a year ago, adjusted for inflation, according to Sentier Research.

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

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