Housing Market News for the Week of October 8, 2021
Why This Fall Is a Big Opportunity for Buyers
The housing market has been fiercely competitive over the last few months, but hopeful buyers who keep getting shut out may soon find better luck. Several signs in the housing market point to a potential opening to buy this fall, housing analysts say.

For one, competition is reportedly cooling and listings are receiving fewer offers. In September, the real estate brokerage Redfin reported that bidding wars reached their lowest level this year.

Also, more listings are coming to market, offering buyers more choices. A recent realtor.com® report shows housing inventory is at a high for 2021. Nearly one-third of the 50 largest metros saw increases in the number of newly listed homes compared to last year. Read more from NAR's Realtor Magazine.
Opening a Credit Card Threatens Buyer’s Dream of Homeownership
Opening new credit during the mortgage process can jeopardize your closing.
Aspiring home buyer Cassidy Gard learned a tough lesson on making any financial moves on your way to buying a house. Gard posted a video on TikTok, which has since gone viral, that shares her emotional story of opening a Home Depot credit card to buy a can of paint for $9.

But that $9 purchase on a newly opened credit card has now jeopardized her ability to qualify for a mortgage. As she explains in the video, her credit plummeted more than 100 points after she opened the account back in May—a card she forgot she even opened.
Mortgage applications fall 6.9% with reduced refi appetite
Refi activity dropped by 10% last week to the lowest level in three months, according to MBA
Mortgage application volume dropped 6.9% for the week ending Oct. 1, as higher rates reduced borrowers’ waning appetites for refis even further, according to the Mortgage Bankers Association (MBA). On an unadjusted basis, the index fell 7% in the period.

Pushing the decline was the refinance index, which dipped by 10% from the previous week to its lowest level in three months. Meanwhile, the purchase activity decreased by 2% from the prior week, the trade group said.

The MBA’s overall mortgage application index decreased by 15% compared to one year ago, showed the survey published today. The purchase index shrank 13%, and the refi index contracted 16%. Read more from Housing Wire.
More Renters Residing in Suburbs
The suburbs have seen an increase of renters over the past decade.

It was not just the COVID-19 pandemic that sent renters scrambling to the suburbs for more space and a lower cost of living. Over the past 10 years, more than 100 suburbs that had previously been a homeowner majority are now comprised of more renters, with more than 50 suburbs expected to follow this trend over the next five years, according to a report from RENTCafé. Comparatively, only four suburbs switched from renter majority to owner majority in the same time period. The report found that 21 million people now rent in the suburbs, up 3.7 million from 2010, with the renter share growing 22%, compared to just a 3% increase in suburban homeownership in the same time period. Today, renters makeup 39% of residents in suburbs of larger cities. Read more from the PA Association of Realtors.
Myth-Busting Millennial Tropes: 8 Common Myths Busted
Millennials are faulted with killing off a myriad of things: department stores, paper napkins, ironing, and yes, even doorbells. A quick Google search reveals no shortage of things they have killed. Homeownership and the dream of homeownership, well, that's not one of them. Let's tackle some myths about Millennials, spending, and student debt.

Myth 1: Millennials do not want to buy a home.
Millennials are the largest adult generation today and they are the largest generation of home buyers at 37%. Millennials and first-time buyers face multiple challenges such as rampant competition in the housing market, low housing inventory, and buyers who are able to pay all cash for properties. While the homeownership rate for those under the age of 35 is lower than past generations at the same age, they are active in the housing market. They are also not all first-time home buyers. While 82% of millennials aged 22 to 30 are first-time buyers, the majority (52%) of older millennials aged 31-40 are repeat buyers. Read more from the National Association of Realtors.
Mortgage Market Update
Mortgage rates continue to hover at around three percent again this week due to rising economic and financial market uncertainties. Unfortunately, with the expectation that both mortgage rates and home prices will continue to rise, competition remains high and housing affordability is declining.
We hope you enjoyed this week's Market News. For more information about how PMA can help you, please contact us.
Plymouth Meeting Office: 610.834.8700
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Ocean City, NJ Office: 609.398.8600
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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