Mortgage News for the Week of May 29, 2020
Pending Home Sales Plummet in April, but May Signal a Rebound for Housing - Realtors
  • Pending home sales, which measure signed contracts on existing homes, fell a steeper-than-expected 21.8% in April, compared with March, according to the National Association of Realtors.
  • Sales were down 33.8% compared with April 2019. That is the largest decline since the NAR began tracking this metric in January 2001.
  • Demand, however, is already coming back, and the housing picture is starting to brighten.
Jump in Mortgage Applications for Home Purchases Shows Buyers are Coming Back
Purchase apps last week were 6.7% higher than a year ago, MBA says.
Applications for mortgages to purchase homes gained for the   sixth consecutive week  to a level that was 6.7% higher than a year ago, back when a deadly pandemic wasn’t interrupting the spring home-buying season.

A seasonally adjusted index measuring purchase applications jumped 9% last week, according to a report from the Mortgage Bankers Association. Applications for refinancings fell 0.2% from the prior week, though the level was 176% higher than a year ago, MBA said. Read more from Mortgage News Daily.Housing Wire.
Why Homebuilders are Winning the Covid-19 Race to Recovery
The housing market appears to be a surprise and early winner in the race to economic recovery from Covid-19 and it is starting with the nation’s homebuilders, which have seen their stocks rise sharply over the past month. CNBC’s Diana Olick reports.
April New Home Sales Crush Forecasts
New home sales, rather than dropping like a rock, rose 0.6 percent in April according to the U.S. Census Bureau and the Department of Housing and Urban Development. Part of the gain is due to a revision of the March sales numbers from an original estimate of 627,000 seasonally adjusted annual units to 619,000. This added to the month's 15.4 percent decline from February. While April's sales of newly constructed homes were down 6.2 percent from a year earlier, the April estimate of 623,000 units is totally unexpected. Read more from Mortgage News Daily.
Most Vulnerable Housing Markets
Analysis of the American Community Survey (ACS) suggests that renters and young adults under the age of 34 are likely to face higher prolonged unemployment risks as a result of the coronavirus pandemic hitting the labor market. The labor market risks are also uneven across states, with state economies heavily reliant on leisure, entertainment, retail and personal services being most vulnerable . Read more from the National Association of Hombuilders.
April's Forbearance Requests Slow to a Relative Trickle
Black Knight says its research is showing that the numbers of new forbearance plans for homeowners financially affected by the COVID-19 pandemic have slowed to a trickle compared to the tidal wave in early April. Only 7,000 new plans were put in place during the week ended May 26 compared to a 325,000-net increase in the first week of May and 1.4 million in the first week of April . Read more from Mortgage News Daily.
Mortgage Market Update
Mortgage Rates Hit Another All-Time Low
The 30-year fixed-rate mortgage has again hit the lowest level in our survey’s nearly 50-year history, breaking the record for the third time in just the last few months. These unprecedented rates have certainly made an impact as purchase demand rebounded from a 35 percent year-over-year decline in mid-April to an 8 percent increase as of last week—a remarkable turnaround given the sharp contraction in economic activity. Additionally, refinance activity remains elevated and low mortgage rates have been accompanied by a $70,000 decline in the average loan size of refinance borrowers this year. This means a broader base of borrowers are taking advantage of the record low rate environment, which will benefit the economy.
We hope you enjoyed this week's Market News. For more information about how PMA can help you, please contact us.
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Information and analysis is obtained through third parties and is deemed accurate but not guaranteed. Philadelphia Mortgage Advisors is a licensed mortgage lender by the PA Dept. of Banking and Securities, NJ Dept. of Banking & Insurance, the state of DE, the Florida Office of Financial Regulation, MD Mortgage Lender #23004 and VA State Corporation Commission #MC - 6797. NMLS #128570.
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