CHICAGO – Nov. 11, 2016 – The housing market remains strong this fall, and it's poised to remain that way for the rest of the year, says Jonathan Smoke, realtor.com®'s chief economist. Still, the economy and housing inventory woes may present some challenges in the months ahead.

Total home sales for this year through September have increased 4 percent compared to the same time period in 2015. Existing-home sales are up 3 percent, and new-home sales have surged 13 percent.

"The new-home market is gaining momentum as the existing-home market struggles with very low levels of inventory," Smoke says. "As a result, new homes represent 10 percent of home sales now; a year ago, they represented only 8 percent."

Persistent tight supply of housing in many markets has led to stronger-than-normal price appreciation, Smoke notes. Existing-home prices rose a median of 6 percent over last year in September.

"The housing market outperformed the U.S. economy in the first half of the year, as growth in sales and prices was stronger than the growth in GDP," Smoke writes. "Housing outperformed because of ample demand from buyers who haven't yet been successful – buyers who just happen to be from the two largest generations in American history."

Millennials and baby boomers are reaching turning points in their lives. Millennials are getting married and starting families while baby boomers are looking toward retirement. Older millennials – aged 25 to 34 – are representing the largest buying age demographic in the housing market currently, according to the National Association of Realtors®' 2016 Profile of Home Buyers and Sellers report.

"A stronger consumer outlook on top of historically high numbers of people turning 30 as well as 65 will provide the support for continued gains in the months ahead," Smoke says. "The key challenges will be continuing low levels of available homes for sale combined with navigating marginally higher mortgage rates."

Source: "Magic 8 Ball Alert: Housing Market Likely to Stay Strong for the Rest of 2016," realtor.com® (Nov. 3, 2016)

© Copyright 2016 INFORMATION, INC. Bethesda, MD (301) 215-4688   

WASHINGTON – Oct. 27, 2016 – The U.S. Department of Housing and Urban Development (HUD) released a mortgagee letter on Wednesday outlining the requirements for FHA-insured financing for condominium buyers if a development has an owner-occupancy ratio as low as 35 percent.

For FHA (Federal Housing Administration) funding to be approved, the letter says that the development must show it has "higher reserves, a low percentage of association dues in arrears, and evidence of long-term financial stability."

The 35 percent ratio was enacted into law this summer in NAR-backed legislation called "The Housing Opportunity Through Modernization Act," H.R. 3700. The law says the 35 percent ratio would become law automatically unless HUD released a different figure by Oct 28. In its release Wednesday – one day before the deadline – HUD announced that it would approve the 35 percent ratio as long as stricter conditions are met to ensure the newer loans don't put the FHA insurance fund at undue risk.

"HUD believes that it would be possible to protect the fund while allowing a lower owner-occupancy percentage if certain adjustments are made to enhance other requirements that affect the financial stability of the project," the agency said.

The letter is a step in the right direction, but the lower ratio should be available to all FHA-approved developments," says Tom Salomone, president of NAR and broker-owner of Real Estate II Inc. in Coral Springs, Florida. "NAR has been fighting for changes to FHA's condominium rules for years, and the mortgagee letter announced will bring some much-needed relief to the market. Condominiums will have a much easier time getting certified by FHA, and Realtors will have more options for clients looking to purchase a condo with an FHA mortgage."

Salomone calls the change a big win for NAR. "And while we believe all condominiums should have the rules applied to them equally, we believe FHA has heard the concerns of Realtors and is moving in the right direction," he adds.

NAR is hosting a live webcast on Friday at 2 p.m. ET to walk through all of the FHA condo financing changes. In addition to the owner-occupancy ratio, these include a maximum commercial-space ratio, "spot loans" (loans made for a condo purchase in a development that isn't yet FHA-approved) and recertification requirements for condo boards.

To register for NAR's webcast, visit the association's website.

© 2016 Florida Realtors®   

TALLAHASSEE, Fla. – Nov. 4, 2016 – A Florida Supreme Court ruling announced yesterday threatens more homeowners with foreclosure actions.

In general, lenders have five years to foreclose on a home thanks to the state's statute of limitations. In some cases, however, the courts have dismissed a foreclosure action, making it difficult for banks to finalize the foreclosure in time since the process must begin again.

Yesterday, though, the Supreme Court ruled that the five-year timeline for a foreclosure "resets" when a case is dismissed. That means lenders now have another chance to foreclose on homeowners who had their case dismissed, providing they try again within the next five years. The case consolidated three separate cases involving "standard residential mortgages."

Some foreclosure experts think the ruling will lead to a new wave of foreclosures.

"Basically, banks are getting a do-over," says Jonathan Kline, a foreclosure-defense attorney in Westin, Fla. He predicts an uptick in state foreclosures over the next 12 to 24 months, and says it could affect "tens of thousands" of homeowners in South Florida alone.

"When a mortgage foreclosure action is involuntarily dismissed … the effect is revocation of the acceleration, which then reinstates the (borrower's) right to continue to make payments," Justice Barbara Pariente wrote in the opinion. Homeowners who missed a number of mortgage payments can then keep their home if they begin making payments again. But under the ruling, that also gives lenders the right to foreclose again "based on (any) subsequent defaults," she wrote.

A bank's "attempted prior acceleration in a foreclosure action that was involuntarily dismissed did not trigger the statute of limitations to bar future foreclosure actions based on separate defaults," the opinion says.

Source: Florida Politics, Jim Rosica, Nov. 3, 2016

The Supreme Court's decision is posted online.

© 2016 Florida Realtors®

There can be no doubt our nation has been blessed by God. The republic founded by our forefathers has endured for over 200 years, a miracle in itself. We find ourselves today in a position not unlike the one faced by the founders. Government has become too large and controls too much of the lives of the governed. A group of elites from both parties seems intent on enriching themselves at the expense of the people. Everything they do fails to provide the promised benefits. People are suffering, yet they do the same things over and over again. It is madness!

Our nation is in the place it is today because those in authority care only about retaining personal power. They are infected with greed and have forgotten how to lead. It is clear that they do not remember why people came to these shores over 400 years ago. They have forgotten the words that were spoken about the land that became the United States of America. They have abandoned THE VISION. 

The Bible tells us in Proverbs 29:18 "Where there is no vision, the people perish". The original Vision for our nation was declared by the passengers of the Mayflower before they set foot on the land they risked their lives to occupy. Theie declaration was this: "Having undertaken, for the Glory of God, and advancements of the Christian faith and honor of our King and Country, a voyage to plant the first colony in the Northern parts of Virginia, do by these presents, solemnly and mutually, in the presence of God, and one another, covenant and combine ourselves together into a civil body politic; for our better ordering, and preservation and furtherance of the ends aforesaid"

Many in our current government, and some running for office in this election cycle reject this vision. They have attempted to replace it with a vision of their own, a secular state that in the name of "tolerance" suppresses Christianity. They deny the influence of Christianity and the Bible in our founding documents, and seek to appoint judges that will ignore the Christian traditions preserved in our Constitution. Because they reject the Vision of God for our country, we are perishing.

The Pilgrims understood the power of words, and the necessity to record the Vision of God for posterity. They were familiar with the prophet Habakkuk's statement “Write the vision and make it plain on tablets, that he may run who reads it." (Hab 2:2) This land was claimed by God and those who follow Him for His glory and the advancement of the Christian faith. The Declaration of Independence mentions God specifically, and the three branches of our government set forth in the Constitution came from a pattern that James Madison found in the Bible. Leaders who forget our Christian heritage do so at their peril. An America that forgets it's Christian heritage is a perilous place to live. . 

As we cast our ballots in this election, it is important to ask several questions: "Which candidates are most likely to govern from a commitment to our Christian heritage? " Which candidates stand for life and the freedom of Christians to serve and obey the God of the Bible without government interference? " Which candidates  abhor the slaughter of the unborn, and which candidates approve the destruction of innocent life even in the ninth month of pregnancy? " Which candidates are closest to the VISION OF GOD? 

The future of our nation hangs in the balance. God grant us mercy, and God Bless America!

Pastor Ramon

WASHINGTON – Oct. 25, 2016 – Both government-sponsored enterprises (GSEs) – Fannie Mae and Freddie Mac – announced plans to simplify and speed up the mortgage underwriting process. Together the GSEs back more than half the mortgages in the U.S.

While Fannie and Freddie don't loan directly to consumers, lenders often originate loans and sell them to the GSEs, which means those loans – over half of all U.S. mortgage lending – must adhere to GSE standards. If Fannie and Freddie ease their loan buying requirements, market lenders usually follow suit.

Freddie Mac

Freddie Mac says it will add new capabilities to its Loan Advisor Suite that reduce the cost of originating a loan. The new capabilities, slated to become effective in spring 2017, include:

• A no-cost automated appraisal alternative
• Automated borrower income verification
• Automated borrower asset verification
• Automated assessment of borrowers without credit scores

Loan Advisor Suite also plans to offer collateral representation and warranty relief in early 2017 to "significantly relieve mortgage lenders from the risk of loan repurchase due to appraisal defects." Currently, Freddie Mac only offers collateral representation and warranty relief in select circumstances.

"As the cost of originating a mortgage has more than doubled since before the financial crisis, we're collaborating with lenders to create innovative tools that reduce the costs of producing and selling high-quality loans to us," says David Lowman, executive vice president of Freddie Mac's Single-Family Business.

"By pairing big data with advanced analytics, we're creating efficiencies and reducing costs for lenders and borrowers," adds Andy Higginbotham, senior vice president of strategic delivery for Freddie Mac's Single-Family Business.

Fannie Mae

Fannie Mae announced its "Day 1 Certainty" initiative. It says the program will provide its customers with "freedom from representations and warranties on key aspects of the mortgage origination process."

Under its new program, Fannie Mae is offering:

• Income, assets, and employment validation services to lenders through Desktop Underwriter, its mortgage underwriting system
• Freedom from representations and warranties on appraised values through Collateral Underwriter and enhanced waivers of property inspection requirements on refinances

Fannie Mae says the changes will deliver greater speed, simplicity and certainty to lenders and borrowers, along with stronger risk management and more digitization of data.

"Ultimately, we want our customers to have the confidence to lend, so that more qualified borrowers have access to affordable mortgage credit," says Timothy J. Mayopoulos, president and chief executive officer, Fannie Mae.

Fannie Mae's high-profile changes for borrowers

• Validates loan application data upfront and gives lenders faster verification of key loan data components, such as income, assets and employment information.
• Borrowers will save time using electronic data versus collecting documents, such as paystubs, bank statements and investment account statements.
• Income validation is available today. Asset and employment validation will be available on Dec. 10, 2016, as will Collateral Underwriter and Enhanced Property Inspection Waiver upgrades.
• When a property receives a qualifying score through Collateral Underwriter, customers will receive representation and warranty relief for the appraised value of the property.
• Refinance transaction customers are eligible for a waiver of the property inspection requirement if using Desktop Underwriter.

© 2016 Florida Realtors®   

WASHINGTON (AP) – Oct. 25, 2016 – U.S. home prices climbed at a solid pace in August as more homebuyers competed for fewer available properties.

The Standard & Poor's CoreLogic Case-Shiller 20-city home price index rose 5.1 percent in August, after a 5 percent gain in July. Portland, Seattle and Denver reported the strongest year-over-year increases for the seventh month in a row, with gains of 11.7 percent, 11.4 percent and 8.8 percent, respectively.

Steady hiring, low mortgage rates and some early signs of rising pay have encouraged more Americans to buy homes. Sales of existing properties increased 3.2 percent in September from August, the National Association of Realtors said last week.

Yet the number of homes for sale has fallen nearly 7 percent from a year ago, the NAR said. Just 2.04 million homes were for sale in September.

"Demand is high and enthusiasm for homeownership remains strong, especially among all-important young, minority and would-be first-time buyers," Svenja Gudell, chief economist at real estate data provider Zillow, said. "Still, the market can't stay on this course forever, and continued inventory shortages are leading to intense competition, escalating prices and mounting buyer frustration, with the average home search over the past year taking more than four months."

The Case-Shiller index covers roughly half of U.S. homes. The index measures prices compared with those in January 2000 and creates a three-month moving average. The August figures are the latest available.

Developers are building more new homes, but not quickly enough to restrain price increases. Builders broke ground on 783,000 single-family homes at a seasonally adjusted annual rate in September, up 5.4 percent from a year earlier. Apartment construction fell sharply.

Many institutional investors bought homes after prices fell sharply in the housing bust and are continuing to rent them out, rather than sell them.

Home prices rose 8.1 percent in Dallas from a year ago, 7.1 percent in Miami, and 6.7 percent in San Francisco. All 20 cities recorded price increased from a year earlier.

Home prices plunged 35 percent from their peak in July 2006 until they bottomed out in March 2012. They have since risen to just 7.2 percent below the peak.

 Copyright 2016 The Associated Press, Christopher S. Rugaber. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.   

TALLAHASSEE, Fla. – Oct. 21, 2016 – The Florida Insurance Guaranty Association (FIGA) protects homeowners if their property insurer suddenly goes under. Funded by all insurance companies in the state, FIGA does not necessarily have to pay the same level of benefits stated in the homeowner's now-defunct policy.

"When obtaining an insurance policy, the policyholder obtains no vested right to a future government bailout if the insurer becomes insolvent," Supreme Court Justice Charles Canady wrote on behalf of a unanimous court.

The Florida Legislature created FIGA as a homeowner protection that pays at least a portion of any insurance claim after a property insurer goes broke, the court said, calling it "a limited statutory safety net for the insured."

The decision in Fuente vs. Florida Insurance Guaranty Association made it clear, however, that benefits paid by FIGA are determined by the Florida Legislature.

In the case, a Tampa homeowner with HomeWise Preferred Insurance Co. held a homeowners policy that included sinkhole insurance. In 2011, HomeWise was declared insolvent two months after Fuente submitted a sinkhole claim that had not yet been settled. While the Florida Legislature had approved a more restrictive state law in 2011, Fuente argued that it shouldn't apply in this case because it would make the law retroactive.

But the Supreme Court disagreed, reversing an earlier Leon County ruling that awarded Fuente $130,000.

Source: Florida Politics, Michael Moline, Oct. 20, 2016

© 2016 Florida Realtors®

WASHINGTON (AP) – Oct. 19, 2016 – Homebuilders pulled back on construction for a second straight month in September, with a plunge in apartments offsetting gains in single-family homes. Building activity was weak in all parts of the country except the Midwest.

Construction tumbled 9 percent in September to a seasonally adjusted annual rate of 1.05 million units, the Commerce Department reported Wednesday. It was the slowest pace in 18 months. Construction had fallen 5.6 percent in August.

The weakness last month reflected a 38 percent drop in construction of apartments, which overshadowed an 8.1 percent rise in single-family construction.

Despite the two months of declines, home construction has been one of the bright spots in the economy this year. Builders have been scrambling to keep up with rising demand amid continued strong job gains and low mortgage rates.

The September performance was weaker than expected. Analysts had been forecasting a rebound. But they noted that the smaller apartment segment of construction is often volatile from month to month.

"Given the volatility of the multifamily sector, there is not enough in this report to suggest the steady uptrend in housing starts is changing yet," economists at Contingent Macro Research said in a research note.

Applications for building permits, a good sign of future activity, posted an increase of 6.3 percent in September. It was the biggest one-month gain since last November, pushing activity to an annual rate of 1.22 million units.

By region of the country, construction starts rose 6.6 percent in the Midwest, the only region showing a gain. Construction fell 31.5 percent in the Northwest, 15.6 percent in the South and 4.4 percent in the West.

A survey of builder sentiment on Tuesday showed that builders' confidence about the future eased back a bit this month after surging to the highest level in nearly a year in September.

NEW YORK – Oct. 18, 2016 – About 17 million first-time homebuyers may enter the housing market within the next five years, according to a new TransUnion study – and nearly three million first-timers are expected to enter the housing market in 2017.

TransUnion's study found that younger consumers (ages 20-39) represent an increasing majority of first-time homebuyers. At the start of the new millennium, first-time homebuyers comprised less than half of agency and government loan purchases; by 2015, this had grown to over 55 percent. In the fourth quarter of 2015, consumers in this age group represented 60 percent of first-time homebuyers, up from 44 percent five years earlier.

The youngest consumer subset observed, those ages 20-29, also has seen major growth among first-time homebuyers: Their share has risen from 17 percent to 28 percent over the same timespan.

"First-time homebuyers are valuable prospects in the eyes of many mortgage lenders, as that time in a borrower's life often corresponds to additional financial needs," says Joe Mellman, vice president and mortgage line of business leader at TransUnion.

Mellman says that potential first-time buyers have "distinct credit characteristics that distinguish them from non-buyers." Those characteristics include higher credit scores than non-buyers" but they're also "more credit active and exhibit more credit responsible behavior."

Partnering with AnswerMine, TransUnion developed a model examining thousands of credit attributes and scores. The resulting "First-Time Homebuyer Propensity Model" identifies specific consumers likely to become first-time homebuyers. By using this model, TransUnion determined that there could be nearly three million first-time homebuyers over the next year.

"We are quite pleased with the model's accuracy in identifying first-time homebuyers. In a study earlier this year, we predicted just over 500,000 first-time homebuyers for the first quarter of 2016. Looking back at that time now, it turns out that is how many first-time homebuyers there actually were," says Mellman.

Looking over the next five years, TransUnion estimates 13.8 to 17.1 million first-time homebuyers will enter the housing market based on U.S. consumers who don't currently have a mortgage, long-term estimates for growth, and the percentage of first-time homebuyers in the agency and government purchase market.

If the model is accurate, it would add a significant number of consumers to the mortgage pool. For comparison, 6.2 million consumers opened a new mortgage in 2015, approximately three million of which were first-time homebuyers.

"It's clear that there should be many new homebuyers in the market in the next few years," says Steve Chaouki, executive vice president of TransUnion's financial services business unit. "Our hope is that, with the use of trended data, mortgage lenders can better serve these consumers. We anticipate the benefits of trended data will continue to expand to other lenders, as we believe this is the future of credit scoring."

© 2016 Florida Realtors®