Many homebuilders went out of business in the recent months, resulting in a historic housing shortage. Find out how this could possibly affect investors who are vying for homes.

US Home Sales On Track For The Best Year Since 2006

According to a report from the National Association of Realtors, home sales were up for the second month in a row in October despite low supply and rising prices. 

Existing home sales increased 0.8 percent month over month, including single-family homes, townhomes, condominiums, and co-ops. After slumping during the summer, sales picked up in September, with a 7% gain month over month. Home sales were down 5.8% year over year from October 2020, when the pandemic surge in home buying reached its cyclical peak. Lawrence Yun, NAR’s chief economist, said that sales are on course to transcend 6 million homes this year, which would be the best performance since 2006.

Homeowners Besieged By Unsolicited Offers

Following the housing meltdown, many homebuilders went out of business, resulting in a historic housing shortage. Now, large and small investors are vying for homes as the scarcity of supply continues to drive up prices. According to Freddie Mac, the inventory of homes is over 4 million short.

Big companies like Redfin and Opendoor, as well as numerous individual speculators, real estate agents, and other predatory outfits, have been calling homeowners in the hopes of persuading them to sell to some random person on the phone.

Michael Froehlich, an attorney with Community Legal Services in Philadelphia, says homeowners should be cautious about responding to any direct solicitation. According to him, people are nearly always better off listing their home for sale, receiving several offers, and selecting the best one.

Sky High Home Prices May Push Fannie Mae And Freddie Mac To Back Loans Of Nearly $1 Million

Home prices have skyrocketed across the country in the last year, as demand for homes has surged and inventory has plunged.

However, increased costs are anticipated to push conforming loan limits to what analysts predict will be record highs in 2022, with the maximum loan limit in high-cost areas reaching over $1 million. The Wall Street Journal revealed the projected increases on Tuesday, and industry journals have also predicted the changes. Non-conforming or “jumbo” mortgages are those that exceed the “conforming” loan restrictions set by federal mortgage giants Fannie Mae and Freddie Mac and come with higher interest rates.

The new conforming loan limitations are likely to be announced by the Federal Housing Finance Agency, which regulates the two mortgage powerhouses, by the end of November. However, the method for raising the limitations each year considers how much property values have risen in the previous year, which in 2021 has been quite significant.

Next weeks potential market moving reports are:

  • Monday, November 29th – Pending Home Sales
  • Tuesday, November 30th – Home Price Index, Consumer Confidence Index
  • Wednesday, December 1st – Employment Report, Construction Spending
  • Thursday, December 2nd – Initial Jobless Claims, Continuing Jobless Claims
  • Friday, December 3rd – Unemployment Rate

As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends.  I welcome the opportunity to serve you in any way I possibly can. Please feel free to reach me at (800) 216-1047

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Do You Have An FHA Home Loan? STOP Wasting Money: Refinance NOW And See How Quick it will Clear Away Your PMI/Mortgage Insurance

If you have an FHA loan, you may be getting tired of paying mortgage insurance every month in addition to your house payment and property taxes. There are so many advantages to FHA loans, but they do require you to pay mortgage insurance, sometimes called MIP (Mortgage Insurance Payments). On a conventional mortgage, mortgage insurance can also be called PMI (Private Mortgage Insurance). Unlike your life insurance policy, MIP doesn’t protect your family if you should become ill or die. It protects your lender and the amount of money they have loaned for your home.

Can you remove mortgage insurance from an FHA loan?

If you paid less than 10% down payment on an FHA loan, you will pay mortgage insurance for the life of your loan. Part of the insurance is a one-time mortgage insurance premium, which is paid when you took out the loan. Usually, the lender will finance this one-time insurance payment as part of your loan. You’ll also continue to pay an annual mortgage premium based on the length of your mortgage.

FHA rules for mortgage insurance payments are complicated. If you got your FHA loan after June 3, 2013, and you made a down payment of more than 10% on a 15, 20, 25 or 30-year FHA loan, you are eligible to apply for cancellation of your mortgage insurance payment (MIP) after 11 years. For older FHA loans taken out before June 3, 2013, you will pay MIP up to 78% LTV based on your original purchase price. Older FHA loans with borrowers who paid more than 22% down never had a MIP requirement. You may be able to refinance your FHA loan with a lower MIP depending on your equity in the home. If you’ve missed a mortgage payment during your loan, you won’t be able to drop the MIP until or unless you refinance into a conventional loan. HUD and FHA can change these rules at any time at their sole discretion.  So it’s best to reach out to an independent mortgage broker and home loan professional at California Platinum Loans for the most current guidelines as they relate to your specific FHA loan. 

Can you refinance your FHA mortgage to eliminate MIP?

Another option for getting rid of mortgage insurance is refinancing the mortgage completely. You have many options for different home loan products which could not only eliminate your mortgage insurance requirement, but could also provide you with lower monthly payments.

If you’re tired of paying mortgage insurance every month and you want to put the money to better use, contact a home loan professional today to learn your options for eliminating mortgage insurance on an FHA mortgage by refinancing your current FHA loan into a new conventional mortgage loan.

Sources

https://thelendersnetwork.com/refinance-out-of-fha-loan/

https://themortgagereports.com/7570/fha-mip-cancel

 

Source

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The US housing market has always been historically slow in autumn, but somehow, the current pandemic housing market appears to be thriving.

Home Selling Sentiment at Record High

Fannie Mae’s Home Purchase Sentiment Index (HPSI) gained a single point from September’s level, rising to 75.5, as consumer views about purchasing and selling homes improved in October.

Whether now is a good time to buy a property drew positive replies from 30% of those polled, up 3 points from the September poll. When asked if it was an excellent time to sell a home, 77% replied, yes, a 5 point increase from the previous month. Additionally, home prices are expected to continue to grow by 39% of the respondents. The net positive number of those who said they aren’t worried about losing their work in the next 12 months is 69%, up 4 points from September. 

The number of those expecting lower mortgage rates continues to decline. Only 5% of people expected any rate reduction in October, while 55% expected rates to rise and 33% expected them to stay the same. The final factor, change in household income, a net of 11% of respondents stated their household income had increased in the previous year. Read More

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