July Home Sales Show Recovery Is Sticking – According to the National Association of REALTORS® report, existing-home sales soared 24.7% in July, outpacing their record growth of 20.7% in June. Now 8.7% higher year over year, the strong rise in existing-home sales (including single-family homes, townhomes, condominiums, and co-ops) is fueling optimism in the real estate market through the rest of the year. “The housing market is well past the recovery phase and is now booming with higher home sales compared to the pre-pandemic days,” says NAR Chief Economist Lawrence Yun. “With the sizable shift in remote work, current homeowners are looking for larger homes and this will lead to a secondary level of demand, even into 2021.” Home prices are reaching new all-time highs, with the national median existing-home price hitting $304,100 in July, the first time it’s ever broken $300,000, according to NAR.
Source and link to the full article: National Association of REALTORS®
FHFA Will Charge Extra Refi Fee Starting Dec. 1 – According to the announcement from the Federal Housing Finance Agency, they will delay the implementation of a loan refinance fee until December 1, 2020. The “adverse market fee,” which was announced August 13th and was previously scheduled to take effect September 1st, will add a 0.5% surcharge on most mortgages backed by Fannie Mae and Freddie Mac that are refinanced into lower rates. The FHFA also announced that low-balance refinances are exempt. Homeowners refinancing mortgage loans with balances below $125,000 will not be charged the new fee. Borrowers with Home Ready and Home Possible program loans are also exempt. According to the FHFA, nearly half of those low-balance loans are held by lower-income borrowers at or below 80% of the area median income. The decision to delay and exempt lower-income homeowners comes on the heels of a letter sent by the National Association of REALTORS® and a coalition of housing groups. The letter requested that the FHFA reevaluate the fee, which could potentially amount to $1,400 in extra costs on an average $300,000 GSE-backed refinanced loan.
Source and link to the full article: National Association of REALTORS®
Inventory on the Way: New Homes Post Big Gains – According to Commerce Department reports, housing is giving a boost to the economic recovery and housing inventories. Single-family and multifamily construction jumped nearly 23% last month. This marks the highest production rate since February. Broken out, single-family construction jumped in July by 8.2% to a seasonally adjusted annual rate of 940,000. The multifamily sector, which encompasses apartment buildings and condos, rose 58.4% to a 556,000 pace, the Commerce Department reports. “The market is being buoyed by historically low interest rates, a focus on the importance of housing, and a shift to the suburbs as more buyers are seeking homes in suburban communities, exurbs, and more affordable low-density markets,” says Robert Dietz, the NAHB’s chief economist. New construction for single-family and multifamily units now nearly matches pre-pandemic activity from the first quarter. “Such growth is needed to steadily relieve the housing shortage,” says Lawrence Yun, chief economist of the National Association of REALTORS®. “This kind of growth is also a major contributor to local economic recovery.” However, Yun cautions that the increase in multifamily units may lead to an oversupply of apartment buildings, notably in city centers where there has been some shift in consumer preference for single-family homes in the suburbs during the pandemic.
Source and link to the full article: National Association of REALTORS® and National Association of Home Builders
VA Loans Surge to Best Year Ever – Based on VA data, home loan activity through the Department of Veterans Affairs has jumped to a new high, climbing 114% since the beginning of the 2020 fiscal year. Refinance loans are a big portion of the increase, with homeowners looking to lock in lower mortgage rates. During the first three quarters of fiscal 2020, the VA loan program backed more than 865,000 loans, a record high. The VA’s fiscal year doesn’t end until September 30th, and its home loan program could back over 1 million more loans before then, Veterans United Home Loans predicts. The VA’s previous record was set in 2017 with 740,386 loans. VA purchase activity is up 7% year over year. Millennial and Generation Z buyers are fueling the growth, Veterans United Home Loans reports. They were the only age demographics to see year-over-year increases in the third quarter of the fiscal year. Despite lenders tightening their credit requirements and employment checks during the pandemic, VA loans had timely closings. The average VA purchase loan in June closed in 47 days, one day faster than a year ago, according to Ellie Mae data.
Source and link to the full article: Veterans United Home Loans