Gen Z and Millennials Plan on Buying Homes in Larger Numbers

Posted To: MND NewsWire

The share of adults who told the National Association of Home Builders (NAHB) they were considering a home purchase in the next year has now fallen year-over-year for the fifth consecutive time. NAHB’s survey for its fourth quarter 2019 Housing Trends Report found only 11 percent of its respondents had such plans, a 2-percentage point drop from the survey a year earlier and less than half the share in the fourth quarter of 2017. Rose Quint, writing in NAHB’s Eye on Housing blog blamed the steady decline in planned participation on the persistent low levels of housing inventory. Offsetting this discouraging news however is data on both the ages of those who are planning on buying and their current homeownership status. Nineteen percent of Millennials (those born between 1981 and 1996) said they…(read more)

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Source: Mortgage News Daily

MBS Week Ahead: Light Data Week Leaves Focus Overseas

Posted To: MBS Commentary

In addition to being a 4-day trading week due to yesterday's holiday, there's also a general lack of big-ticket economic data on tap. In fact, there isn't a single report that qualifies as "top-tier" in terms of market movement potential and the only candidates that come close are the Markit PMIs on Friday. That's unfortunate because the US bond market is desperately in need of some direction after almost half a year of broad consolidation and 1-3 months of intense consolidation. "Broad" and "intense" are subjective terms, so let's quantify them quickly. In the chart below, the broad consolidation isn't highlighted, but it would begin in the first 2 weeks of September, which marked a much smaller jump between highs/lows than the one seen…(read more)

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Source: Mortgage News Daily

Non-QM, Digital Tools; Population Shifts in Lending; Capital Markets

Posted To: Pipeline Press

Everyone is aging, right? “I finally did it! I bought a new pair of shoes with memory foam insoles. No more forgetting why I walked into the kitchen!” People change, populations change, and loan officers must adapt. economists have revised 2020 growth prospects higher and revised down recession probabilities, many economic indicators are positive: consumer spending and confidence is high, unemployment remains low, and inflation is tame. Not only must every lender pay attention to overhead costs, what competitors are doing, customer service trends, and guideline changes from investors, but they must also pay attention to population shifts, forecasts, and business opportunities. For example, more international trade will expand rental and for-sale housing demand in markets dependent…(read more)

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Source: Mortgage News Daily

MBS RECAP: Bonds Cap Extraordinarily Tame Week Despite Excuses

Posted To: MBS Commentary

We've seen a whole lot more movement in the bond market for a whole lot less motivation than we had this week. Back to back econ data shockers (Philly Fed and Housing Starts) were scarcely able to get yields back up to Monday morning's highs, and yields hadn't fallen very much to begin with. In other words: "Housing Starts Surge 40% Annually to The Highest in 13 Years" isn't really a headline that jives with 10yr yields rising less than 2bps by the close of business. Oh, and stocks hit all time highs on 4 out of the 5 days. Oh, and the phase 1 trade deal signing went off without a hitch. All that to say that bonds were more than entitled to end up somewhere other than smack dab in the middle of the consolidation range that's been in effect for close to half a year…(read more)

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Source: Mortgage News Daily

Mortgage Rates Off Recent Lows

Posted To: Mortgage Rate Watch

Mortgage rates moved slightly higher over the past two days as strong economic data and corporate earnings coaxed investors into riskier assets like stocks. Bonds (which dictate interest rates) are always being bought and sold, but demand varies depending on investors’ risk appetite. If demand for bonds falls as it has in the 2nd half of this week, rates move higher. Fortunately, this move has been very small in the bigger picture. Mortgage rates, specifically, have moved even less than rates associated with other bonds. The average lender is still able to offer 30yr fixed rates of well under 4% on top tier scenarios. And the average borrower wouldn’t see more than 0.00125% of difference from the lowest rates in more than 3 months. Bottom line, while rates are slightly higher than their best…(read more)

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Source: Mortgage News Daily

Markets Wrapping Things Up Ahead of Long Weekend

Posted To: MBS Commentary

Sometimes the market moves in clear response to a headline event or the scheduled release of an economic report. We have clear examples of this recently. last week's Iran-related escalation (and de-escalation) had massive and immediate impacts that lined up perfectly with key events in the news. This week's most noticeable move followed perfectly on the heels of yesterday's big beat in the Philly Fed Index (an economic report that frequently moves markets when it's much better or worse than expected). Now today, we're seeing a similar level of movement but without any over cause and effect with respect to news or data. That said, there is still something to connect it to! Simply put, markets moved when a certain portion of the trading community began its day and when a certain…(read more)

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Source: Mortgage News Daily

December's Housing Starts Surged to 13-Year High

Posted To: MND NewsWire

While permits fell from the previous month, the U.S. Census Bureau and the Department of Housing and Urban Development said December was another exceptional month for residential housing starts. Those starts soared to a seasonally adjusted annual rate of 1,608,000 during the month, a 16.9 percent increase from November’s estimate which was revised from 1,365,000 to 1,375,000. The December number was the highest monthly rate for starts since the same month in 2006 and was 40.8 percent higher than last year’s December pace. Both single-family and multifamily construction were strong. Single-family starts rose 11.2 percent to an annual rate of 1,055,000 from the revised (from 938,000) rate of 949,000 in November. Single-family starts were 29.6 percent ahead of last December’s rate of 814,000….(read more)

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Source: Mortgage News Daily

Renovation Products; CEOs Can't Ignore LIBOR Transition; Cap. Markets

Posted To: Pipeline Press

I’ve gotta hand it to those writers who put out listings for real estate agents. Maybe if I had a bunch of money I could live in a “secluded retreat” or an “enchanted villa.” I have never lived in a place described as a “retreat,” having stunning or remarkable views or panoramic vistas in a “gorgeous natural setting.” No luxury living, nor a delightful “chalet.” No soaring ceilings in the spacious great room or mudroom, filled with “warm ambiance.” Prestigious enclave? Nope. Has a house ever brought me conveniences and lifestyle? No. I’ve never lived in a house with casual banquette dining, nor in a “one-of-a-kind cottage.” Sure those are the terms real estate agents use to sell houses. They are…(read more)

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Source: Mortgage News Daily

Home Builders Confidence Remains Near 20-Year High

Posted To: MND NewsWire

The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) settled back a bit after its 5-point surge in December took it to its highest level since 1999. The Index, a measure of builder confidence in the market for newly constructed homes, dipped 1 point in January to 75, still remaining above that earlier high. NAHB said, “With the Federal Reserve on pause and attractive mortgage rates, the steady rise in single-family construction that began last spring will continue into 2020. However, builders continue to grapple with a shortage of lots and labor while buyers are frustrated by a lack of inventory, particularly among starter homes.” The HMI is derived from a monthly survey that NAHB has been conducting for more than 30 years. The association’s new home builder…(read more)

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Source: Mortgage News Daily

MBS Day Ahead: Robust Day of Econ Data and Corporate Earnings

Posted To: MBS Commentary

Bonds continue to be well-contained by the prevailing consolidation range–a series of higher lows and static highs that's been in place in its current form since mid October. A big break outside that range could serve as a cue for sustained momentum in the direction of the break. Think of such patterns as the bond market's way to pause and reflect before choosing the direction of new momentum. As for the underlying data and events that could spark such a breakout, this morning's econ data is the most robust of the week with Philly Fed, Jobless Claims, Import Prices, Builder Confidence and the headliner: Retail Sales. But even this line-up isn't up to the task of generating enough bond movement to break the range (update: the data just came out and indeed, bonds are little-changed…(read more)

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Source: Mortgage News Daily