Mortgage Demand Surges By 40 Percent From a Year Ago Amid House-Buying Spree, Low Rates
The year-on-year comparison is usually in single digits.
|
The end of August usually marks the beginning of the slow season for housing, but as with everything else, this year’s trends are like no other.
Mortgage applications to purchase a home rose 3 percent last week from the previous week and were a stunning 40 percent higher from a year ago, according to the Mortgage Bankers Association’s seasonally adjusted index. Read more from NBC News.
|
Zillow: Nearly 2 Million Renters Can Become Homeowners, Thanks to Telecommuting
Priced-out renters might be able to afford mortgage payments for less than rent.
|
Telecommuting is growing in popularity as more companies establish work-from-home protocols. With this new flexibility, nearly 2 million renter households could become homeowners, according to Zillow.
Renters who are employed with a job that could be done remotely and might be priced out of their current market could afford to buy the typical starter home elsewhere in the U.S.
“If remote work becomes a bona fide long-term option especially with the pandemic, that could reshape the U.S. housing market by opening up homeownership to people renting in expensive parts of the country,” said Zillow Economist Jeff Tucker in a statement. Read more from Housing Wire.
|
More Millennials Are Living At Home Than At Any Other Time This Century |
- More millennials are living at home than at any other point this century, according to Zillow.
- The number of adults aged 23 to 37 staying or returning home to their parents has been steadily rising since 2000.
- Experts say the unaffordable housing market is keeping millennials at home, rather than a failure by millennials to hold jobs or launch careers.
|
Home Prices Up 13%, Biggest Increase Since 2013
Buyers seem undeterred, as pending sales soar 28% and a 9% increase in new listings brings little relief.
|
- Median home sale price increased 13% from 2019 to $319,178—the highest on record. The 13% year-over-year increase was the largest since October 2013.
- Pending home sales climbed 28% year over year, the largest increase since the four weeks ending August 2, 2015.
- New listings of homes for sale were up 9% from a year ago—the largest increase since the four weeks ending December 20, 2015.
- Active listings (the number of homes listed for sale at any point during the period) fell 28% from 2019 to a new all-time low. The year-over-year decline has been about the same for the past couple of months.
- 46.4% of homes that went under contract had an accepted offer within the first two weeks on the market, the highest level since at least 2012 (as far back as our data on this measure goes).
- The average sale-to-list price ratio, which measures how close homes are selling to their asking prices, rose to 99.3%—an all-time high and a full percentage point higher than a year earlier.
- For the week ending September 6, the seasonally adjusted Redfin Homebuyer Demand Index was up 21% from pre-pandemic levels in January and February.
|
Consumers More Upbeat on Buying and Selling Despite Lower Price Expectations |
Fannie Mae says its Home Purchase Sentiment Index (HPSI) which, before a slight setback in July, had been rebounding strongly from its April COVID-19 related plunge, got back on track last month. The August index, based on responses to six questions in the National Housing Survey (NHS), increased 3.3 points to a 77.5 reading.
Five of the six components rose from their July level with consumers reporting a more optimistic view of both homebuying and home-selling conditions, but a slightly more pessimistic view of expected home price growth. The Index remains down 16.3 points year-over-year. Read more from Mortgage News Daily.
|
Sellers Are Calling the Shots, But for How Much Longer? |
The housing market continues to outperform historical standards as prices accelerate to new highs and homes sell faster, according to realtor.com®’s latest Weekly Recovery Report. “Sellers are calling the shots in today’s market,” says Danielle Hale, realtor.com®’s chief economist. “Prices are rising and housing inventory is vanishing almost as fast as it appears.”
However, Hale points to two housing indicators that may hint at a turn in the market. Housing demand from buyers has cooled slightly, while new listings showed a smaller decline than previous weeks, Hale says. “This could be a hiccup in weekly activity, or, if these trends continue, they could signal a shift in market dynamics leading into the fall when political, economic, and health-related uncertainties abound,” she says. Read more from NAR's Realtor Magazine.
|
Mortgage Market Update
Rates Remain Low.
|
Low rates have ignited robust purchase demand activity, which is up twenty-five percent from a year ago and has been growing at double digit rates for four consecutive months. However, heading into the fall it will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity. |
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
Doylestown Office: 215.345.7600
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.
|
|
Follow us on social media! |
PMA & PHFA/NJHMFA can make it easier for first-time buyers to purchase a home!
|
are Easier with PMA's
In-House Approvals!
|
|
