Real Estate

Home flippers are fleeing the market as their profits shrink

Real Estate CNBC - November 1, 2018 - 1:34pm
A combination of higher costs and lower demand is putting a chill on the once hot house-flipping market. Following the epic housing crash, flippers bought up distressed properties at bargain prices, fixed and flipped them to residents or investors.
Categories: Real Estate

Home flippers flee market

Real Estate CNBC - November 1, 2018 - 1:03pm
CNBC's Diana Olick reports on home flippers turning away from the business.
Categories: Real Estate

CBRE CEO on how they're challenging WeWork with the launch of Hana

Real Estate CNBC - November 1, 2018 - 12:58pm
CBRE CEO Bob Sulentic joins 'Power Lunch' to weigh in on the commercial real estate industry, trade war concerns, earnings, midterm elections and how they're planning on taking over WeWork.
Categories: Real Estate

NAR: Midterm Results Won’t Change Your Path Forward

NAR Daily News Magazine - November 1, 2018 - 12:00am

REALTORS® will remain the leading influence on real estate policy no matter which political party gains the edge next Tuesday, association officials say at the REALTORS® Conference & Expo kickoff event.

Categories: Real Estate

In Danger? Your Lapel Pin Can Help

NAR Daily News Magazine - November 1, 2018 - 12:00am

Your REALTOR® pin lets consumers know you’re a professional who subscribes to a code of ethics. But it can also be transformed into a secret way to let a dispatcher know you’re in trouble.

Categories: Real Estate

How Does Your State Rank in Down Payments?

NAR Daily News Magazine - November 1, 2018 - 12:00am

See where your buyers can expect to save—or spend—when it comes to their down payment.

Categories: Real Estate

Millennials Boosting U.S. Homeownership Rates

NAR Daily News Magazine - November 1, 2018 - 12:00am

A greater number of Americans bought a home during the summer months, increasing the percentage of homeowners. 

Categories: Real Estate

Report: Sellers are Getting $61K at Resale

NAR Daily News Magazine - November 1, 2018 - 12:00am

See where homeowners saw the highest percentage earnings after selling their home.

Categories: Real Estate

China has been 'measured' in economic policy: Reyl Singapore

Real Estate CNBC - October 31, 2018 - 10:27pm
Daryl Liew of Reyl Singapore says China cannot stimulate its economy across the board because that could cause the property bubble to "escalate" even further.
Categories: Real Estate

Getting a Mortgage Is Now Easier, but It Could Backfire

RisMedia Consumer News - October 31, 2018 - 3:25pm

(TNS)—Clearing the hurdles to qualify for a mortgage used to be much harder. House hunters with too much debt had their home-buying hopes dashed after being denied a mortgage.

That’s changing as mortgage lenders ease lending guidelines to expand mortgage credit to more people.

Borrowers with a high debt-to-income ratio now have more leeway than since the subprime mortgage meltdown of a decade ago. Your debt-to-income ratio, or DTI, is the percentage of monthly income you pay toward your monthly debts, including a new mortgage payment. It’s a key factor—along with your credit—that lenders use to determine whether you can repay a loan. The more debt you have, the higher your DTI ratio—and that’s a red flag for lenders evaluating your potential for risk.

Some consumer advocates worry that borrowers who are already struggling to stay afloat might get in over their heads with today’s laxer lending requirements. On the flip side, expanding access to mortgage credit could help creditworthy borrowers in higher-priced housing markets join the homeownership ranks they’ve increasingly been shut out from.

How Getting a Mortgage Has Gotten Easier
Fannie Mae and Freddie Mac, the two government-sponsored enterprises that back most U.S. mortgages, have eased their lending rules in recent years. Fannie Mae increased its maximum DTI ratio to 50 percent, up from 45 percent, in July 2017. Both agencies allow borrowers to finance up to 97 percent of a home’s purchase price, which is considered a high loan-to-value ratio.

Conventional lenders charge higher interest rates on high DTI loans to mitigate their risk. They also require a higher FICO score and more cash reserves.

Raising DTI limits is just one way lenders have made it easier to get a mortgage. LTV ratio increases help borrowers who don’t have a large down payment; however, you’ll pay private mortgage insurance when you put less than 20 percent down—and you might not be able to borrow as much as you need to buy a home.

Some conventional lenders have rolled out their own low down payment programs without private mortgage insurance in exchange for a higher interest rate. Government-insured loans require little to no down payment, and generally have more relaxed credit score requirements than conventional loans.

Mortgage Credit Standards Still Tighter Than Boom Times
Borrowers who don’t fit into a pristine credit box now have more options, says Joel Kan, associate vice president of Industry Surveys and Forecasting with the Mortgage Bankers Association. There’s more balance to the lending equation nowadays after the regulatory pendulum swung too far in the opposite direction—a move that shut out otherwise capable borrowers, Kan says.

Although standards have loosened considerably in recent years, today’s lending practices are still more stringent than they were before the housing crisis. The days of doling out loans without verifying income or employment are long gone.

“We’re still about one-quarter of where we were compared to the pre-housing boom,” says Kan of mortgage credit accessibility. “Standards are looser now than they were from 2010 to 2012 when credit access was the tightest, but it’s not subprime.”

The share of new, conventional conforming home loans with a DTI ratio above 45 percent spiked after Fannie Mae raised its DTI limit, according to research from CoreLogic. From early 2012 up until last summer, the share of these high DTI loans held steady between 5 percent to 7 percent. In the first quarter of 2018, that share nearly tripled, jumping to 20 percent. The average DTI ratio for these home loans rose by two points to nearly 37 percent from Q1 2017 to Q1 2018.

Even as high DTI loans gain popularity, lenders haven’t budged on credit score standards. Borrowers’ average credit score for conventional, conforming purchase loans remained unchanged at 755 in the first quarter of 2018 compared to the same period a year ago, CoreLogic found. That’s significantly higher than homebuyers’ average credit score of 705 in 2001—before the downturn.

Expansion of Mortgage Credit Has Its Drawbacks
High DTI and LTV loans aren’t without risks. A high LTV ratio increases borrowing costs, and you’ll likely have to pay mortgage insurance to offset the lender’s risk.

For starters, lenders calculate your DTI ratio using your gross monthly income (before taxes and payroll deductions) and debts that appear on your credit report. They’re not including monthly expenses like groceries, gas, auto or health insurance, daycare/tuition, utility bills and other recurring bills that can eat up a good chunk of your monthly budget, says Rebecca Steele, CEO and president of the National Foundation for Credit Counseling.

“It puts some borrowers in a more precarious position,” Steele says of high DTI loans. “Today, people have significantly less savings in reserve. To have that you need a stable income, and some consumers struggle with that. Most people have little disposable income, especially because rents are going up.”

A job loss or other major financial hardship could land you in a tighter spot than if you had paid down your debt and shored up your emergency savings fund before buying a home. You’ll also pay more interest with a high DTI loan, Steele says.

Another key issue that some first-time buyers overlook are the hidden costs of homeownership, says Jeff Levine, a certified financial planner with BluePrint Wealth Alliance in Garden City, N.Y. When you’re stretching your income to cover monthly debt payments, you won’t have as much cash on hand for maintenance expenses, homeowners association dues and major repairs that inevitably pop up. Borrowers should factor those expenses into the mix and avoid overextending themselves, Levine says.

“Just because you can get approved for a mortgage doesn’t mean you should get one,” Levine says. “People got into trouble (in the downturn) because they borrowed up to the hilt and didn’t have the capacity to repay.”

©2018 Bankrate.com
Distributed by Tribune Content Agency, LLC

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Categories: Real Estate

Southern California home sales plummet

Real Estate CNBC - October 31, 2018 - 1:15pm
CNBC's Diana Olick reports on how Southern California's housing sales are indicating what could come for the rest of the U.S. market.
Categories: Real Estate

San Francisco Bay area home sales suffer their slowest September in 11 years

Real Estate CNBC - October 31, 2018 - 1:04pm
High prices and rising mortgage rates are taking their toll on home sales in the pricey San Francisco Bay Area. Sales fell to the slowest pace in 11 years in September. Prices, however, are still gaining, although not as much as in previous  months. 
Categories: Real Estate

Billionaire Sam Zell: Trump economy can withstand Democrats winning the House in the midterms

Real Estate CNBC - October 31, 2018 - 8:52am
The economy under President Trump is "doing pretty well" and can stay on track even if the Democrats win the majority in the House, Zell says.
Categories: Real Estate

The problem with housing is prices have recovered but demand hasn't: Real estate mogul Sam Zell

Real Estate CNBC - October 31, 2018 - 8:20am
"We're dealing with a changed housing market," the billionaire investor says.
Categories: Real Estate

Stock market swings may have hit mortgage applications, down 2.5%

Real Estate CNBC - October 31, 2018 - 6:01am
Total mortgage application volume fell 2.5 percent last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. 
Categories: Real Estate

A Home Where Someone Died: Does That Need to Be Disclosed?

NAR Daily News Magazine - October 31, 2018 - 12:00am

You’re trying to sell a home that the former owner passed away in. Do you have to reveal that to home buyers, and will it give some buyers the creeps?

Categories: Real Estate

How to Sell a Spooky House Without Scaring Off Buyers

NAR Daily News Magazine - October 31, 2018 - 12:00am

Homeowners want you to sell their house. There's one problem: The house carries a reputation of being haunted. Is this sale doomed?

Categories: Real Estate

Haunted House For Sale? Sure, I’ll Buy It, But …

NAR Daily News Magazine - October 31, 2018 - 12:00am

Home buyers may be so anxious to find a home that they aren’t even spooked if it’s rumored to be haunted.

Categories: Real Estate

REALTORS® in Costume: What Would You Dress Up As for a Listing?

NAR Daily News Magazine - October 31, 2018 - 12:00am

Unicorns, T. rexes, the Incredible Hulk, and more—real estate professionals across the country are donning costumes for some unique photo shoots of homes they're trying to sell.

Categories: Real Estate

ANZ chief: The Australian market is now more cautious

Real Estate CNBC - October 30, 2018 - 5:45pm
Shayne Elliott, CEO of ANZ, says the Australian bank is "playing the long game" and focusing on the owner-occupied real estate segment.
Categories: Real Estate