Shelter Six: Conforming Loan Limit Shoots Up to $548,250

November 28, 2020 by · Leave a Comment 

The 2021 Maximum Conforming loan limit for loans purchased by Fannie Mae and Freddie Mac is increasing 7.42% from $510,400 to $548,250.

The 2-Unit limit is increasing to $702,000, the 3-Unit limit to $848,500, and the 4-Unit limit to $1,054,500.

October New Home Sales remained steady around 1M units for the fourth straight month.

The October Core PCE Price Index was just 1.4% higher than a year ago, down from last month’s 1.5%, and well below the Fed’s stated target of 2%.

Great news for 2021 home sales, a recent Lending Tree survey found that 46% of Americans are thinking about moving within the next year.

Respondents indicated that 44% are seeking a reduction in living expenses, 27% a larger home, 27% different home features, and 12% a different part of town in which to live.

Rate Update

There has never been a better time to lock in a rate as pandemic and economic concerns have driven rates back down near all-time lows and well under 3%.

This Week

The highly anticipated monthly Employment figures are due out on Friday.

Shelter Six: October Home Sales Surge to Best Level Since 2006

November 23, 2020 by · Leave a Comment 

October economic reports released last week painted a strong picture of recovery starting with Existing-Home Sales, which were 4% higher than the previous month and to the best level since 2006.

The Median Existing-Home Price was 16% higher than a year ago and up to a record $313K.

Retail Sales increased for the 6th straight month and were .3% higher than in September.

Single-family Housing Starts rose 6% from September, were 29% higher than a year ago, and are now up to the highest level since 2007.

Builder Confidence surged to a record high level for the 3rd straight month.

Housing Inventory levels were down 20% from a year ago to just a 2.5-month supply nationally, well below the 6.0-month supply considered a healthy balance between buyers and sellers.

Rate Update

Last week’s positive news about progress on a Covid vaccine was offset by rising coronavirus cases with the net result being rates remaining unchanged and near all-time lows.

This Week

New Home Sales, Durable Orders, and the Core PCE Price Index, the inflation indicator favored by the Fed, will all be released on Wednesday.

Shelter Six:  Mortgage Rates Holding Steady

November 16, 2020 by · Leave a Comment 

Pfizer’s vaccine report last week caused rates to immediately shoot up .125%, however, this week’s equally optimistic Moderna vaccine report didn’t cause rates to budge.

October Consumer Price Inflation figures were just 1.6% higher than a year ago, a little higher than the last few months but still far below 2.3% pre-pandemic readings.

Fannie Mae’s October Home Purchase Sentient Index rose for the fifth time in six months as respondents claiming it is a good time to buy increased 9% from September.

Respondents claiming it is a good time to sell increased 6% from September.

After peaking in June at 8.55%, forbearance figures decreased to only 5.2% of all mortgages, as of Nov 10 per Black Knight.

The maximum Conforming loan limit is expected to increase over the next few weeks from $510,400 to somewhere between $545K and 555K.

Rate Update

Rates ended the week with little change and near record lows. The main thing driving rates right now is the pandemic. Pessimistic concerns influence rates lower, and vice versa.

This Week

Retail Sales will be released on Tuesday, Housing Starts on Wednesday, and Existing Home Sales on Thursday.

Shelter Six:  Mortgage Rates Drop Near All-Time Lows

November 9, 2020 by · Leave a Comment 

The economy gained a substantial 638K jobs in October, which was close to expectations.

More than half of the 22 Million jobs lost in March and April have now been recovered.

The Unemployment Rate plunged from 7.9% to 6.9%, far below the consensus forecast.

Thursday’s Fed meeting produced no surprises and had no impact on mortgage rates.

Black Knight, in its September Mortgage Monitor report projected that, for the first time ever, the market is on track to top $4 Trillion in mortgage originations in 2020.

Temporary mortgage underwriting flexibilities related to the pandemic have been extended for most types of loans with application dates prior to December 31st.

Rate Update

The bond market liked the mixed election / divided government results and purchase mortgage rates fell last week back down near all-time low levels.

This Week

The JOLTS report will be released on Tuesday and the Consumer Price Index on Thursday. Mortgage markets will be closed on Wednesday in observance of Veterans Day.

Shelter Six:  Homeownership Rate Surges to 70.8% in the South

November 2, 2020 by · Leave a Comment 

GDP surged at an annualized rate of 33.1% in the 3rd Quarter. This was a magnificent rebound after declining 31.4% in the previous 2nd Quarter.

September New Home Sales dropped 4% from August but remained near the best levels in the last 14 years and were 32% higher than a year ago.

After four months of gains, Pending Home Sales were down a tad but still at the second highest level on record.

The number of serious mortgage delinquencies dropped by 43K in September, which was the first improvement since the start of the pandemic, according to Black Knight.

The U.S. Homeownership Rate was 67.4% nationally (70.8% in the South) in the 3rd Quarter, up 2.6% from a year earlier, according to the U.S. Census Bureau.

The FHFA Home Price Index indicates that Conforming loan amounts will most likely increase around $40K at the end of November.

Rate Update

It is election week, so expect volatility. Despite significant economic and pandemic news over the last week, mortgage rates continue to hold steady and near record low levels.

This Week

Tuesday’s election will be the focal point. The Fed also meets on Thursday and Employment figures are due out on Friday.