Category: Mortgage News

Mortgage Market Update (2/12/24)

Posted on by Jon Dao

Welcome to Homeseed’s Mortgage Market Update, where we dive into the latest trends, insights, and changes shaping the dynamic landscape of the housing and lending industries.

Mortgage Rate Trends & Forecasts

  • Mortgage rates are higher this week as a result of strong labor market and manufacturing data.
  • The BLS Jobs Report showed nearly double the amount of jobs were added to the market than expected.
  • The ISM Non-Manufacturing PMI was also higher than expected and the upbeat economic data put additional upward pressure on rates.


BLS Jobs Report

  • The report for January showed that the 353,000 jobs created were nearly double the expected 180,000.
  • One thing to be mindful of is that January is a month of heavy adjustments due to new benchmarks, seasonal adjustments, and population controls.
  • Despite the job gains, the entire labor force is working on average 30 minutes less per week, which is equivalent to 2.4M jobs lost.
  • We will have to wait for February data to see if the labor market tightening once again.


Home Values Continue to Appreciate

  • The two most notable housing indices, Case-Shiller and FHFA, both recently released data showing that home prices set new highs.
  • Although data for December 2023 is not available yet, both indices show that home values were on pace to appreciate by 6% in 2023.
  • Lower numbers for existing inventory and active listings will continue to be supportive of home prices throughout 2024.
  1. RATES MOVE HIGHER – Upbeat economic reports provide the catalyst for higher week-over-week rates.
    https://www.mortgagenewsdaily.com/…
  2. MEDIA SAYING HOUSING CRASH – But housing credit data today looks nothing like what was seen in 2008.
    https://www.housingwire.com/…
  3. BOOST TO HOUSING SENTIMENT – The Fannie Mae Home Purchase Sentiment Index reached its highest level in nearly two years.
    https://www.fanniemae.com/…
  4. TWO SIDES TO JOB MARKET – Economists and reports say the labor market is strong, but job seekers don’t share the same confidence.
    https://www.cnbc.com/…

Wealth Through Homeownership: A Decade-by-Decade Analysis

Posted on by Jon Dao

Homeownership has long been considered a cornerstone of the American dream, providing not only a sense of stability and security but also a unique avenue for building wealth. For many, purchasing a home is not just about having a place to call their own; it’s a strategic financial move that can lead to long-term prosperity. Below we’ll provide a decade-by-decade analysis on home values and explore how homeownership is a powerful investment tool, enabling individuals to leverage their assets and capitalize on the appreciation of real estate.

Historical Appreciation By The Decade

Consistent Appreciation: Regardless of the decade, those who invested in homeownership and held onto their properties for 10 years experienced positive appreciation on average. This consistency underscores the enduring nature of real estate as a wealth-building asset.

Diversification of Investments: The data highlights how real estate can serve as a valuable diversification tool for investment portfolios. While other assets may experience volatility, real estate has historically shown a trend of appreciation over time.

The Power of Leverage in Real Estate

One of the unique aspects of real estate investment is the ability to use leverage. When you purchase a home, you typically make a down payment (an initial investment) while borrowing the rest through a mortgage. This means you control an asset’s full value with a relatively small upfront payment. As the property appreciates, the return on your investment is calculated based on the property’s entire value, not just your down payment. This leverage magnifies the potential for wealth accumulation.

Homeseed Can Help You Get Started

Discover the possibilities with our exclusive loan programs that offer little to no down payment options. This means you can potentially start building equity and wealth with very little upfront investment. Our commitment is to make homeownership accessible and financially advantageous for you. Contact us today to discuss your goals, explore available opportunities, and make informed decisions about your real estate investment. Your path to homeownership and financial prosperity starts with a conversation. Let’s connect and turn your homeownership dreams into reality!

Mortgage Market Update (1/29/24)

Posted on by Jon Dao

Welcome to Homeseed’s Mortgage Market Update, where we dive into the latest trends, insights, and changes shaping the dynamic landscape of the housing and lending industries.

Mortgage Rate Trends & Forecasts

  • Mortgage rates are relatively unchanged week-over-week with some volatility mixed in due to economic data and bond auction results.
  • Last week saw 2-year, 5-year, and 7-year Treasury auctions that were met with weak demand and put upward pressure on mortgage rates.
  • Recent GDP and labor market reports came in stronger than expected and the Fed would like to see more economic weakness to support disinflation.


Personal Consumption Expenditures (PCE)

  • Headline inflation rose 0.17% in January, close to the expected 0.2%, while the year-over-year reading remained at 2.6%.
  • Annualized core PCE over the last 6 and 8 months is 1.85% and 2.08%, respectively, which are close to the Fed’s target of 2%.
  • Although the Fed prefers the Core PCE measure for gauging inflation, it should be noted that the CPI tends to move the markets a bit more.


Pending Home Sales

  • Pending Home Sales (signed contracts on existing homes) surged 8.3% from November to December.
  • The large jump was attributed to the decline in mortgage rates we’ve seen since the highs back in October 2023.
  • The Chief Economist at the National Association of Realtors, Lawrence Yun, noted that sales are expected to rise significantly in each of the next two years.
  • An increase in the supply of homes on the market will be essential to satisfying all of the demand that current exists.
  1. RATES UNCHANGED WEEK-OVER-WEEK – Mortgage rates were volatile within a narrow range over the last week but are relatively unchanged.
    https://www.mortgagenewsdaily.com/…
  2. ECONOMY BOOSTED BY NEW HOME SALES – Continue demand for new housing helped employ workers, stimulate the purchase of goods, and avoid a recession in 2023.
    https://www.housingwire.com/…
  3. ACTIVE INVENTORY RISES – For the 11th straight week, active listings grew and looks to improve availability and affordability heading into the spring season.
    https://www.calculatedriskblog.com/…
  4. INFLATION CONTINUING TO COOL – The recent PCE report showed inflation continuing to cool and near the Fed’s 2% target.
    https://www.cnbc.com/…

Seizing the Opportunity: An Ideal Time to Enter the Housing Market

Posted on by Jon Dao

At some point in our lives, we’ve all pondered the age-old question: when is the ideal moment to embark on the journey of homeownership? This decision is often influenced by personal finances and life circumstances. Fortunately, for those with the desire and means, the current market offers an advantageous time to make the move into homeownership. Despite some headwinds like rising home prices and higher interest rates, the numerous benefits of purchasing now far outweigh these obstacles.

An Investment to Build Wealth:

  • Owning a home builds equity, but that takes time for the asset to grow. The earlier you can start the better. Remember, time in the market beats trying to time the market.
  • Mortgage payments contribute to your ownership stake, unlike rent payments that go into your landlord’s pocket.
  • In the future, your home equity becomes a powerful financial tool to be leveraged for other investments or major life expenses.
  • Property values historically trend upward, providing you one of the safest investments you can make.
  • Homeowners enjoy tax incentives, with tax-deductible mortgage interest payments.

An Opportunistic Time to Purchase Now:

  • Forecasts indicate an expected decline in mortgage rates in 2024, which will likely increase affordability and heighten competition on the limited supply of homes.
  • Purchasing now grants an advantage ahead of the projected surge in competition, while allowing you to capitalize on equity gains and refinance opportunities once rates drop.
  • The higher loan limits for 2024 contribute to an increase in affordability for you, especially in the earlier part of the year as home prices are expected to continue rising throughout 2024.

Homeseed’s Programs & Strategies for First-Time Homebuyers

  • Down Payment Assistance Programs: Programs designed to aid with down payment and closing costs, providing valuable financial support to ease the initial financial burden of purchasing a home.
  • Zero Down Payment Loans: Loan programs requiring no down payment, particularly beneficial for veterans (VA) or those residing in rural areas (USDA).
  • First-Time Homebuyer Programs: Loan programs with lower down payments and improved rates that are created for low- to moderate-income first-time homebuyers.
  • Seller Concessions: We offer financing strategies where the seller can help provide additional assistance to reduce the cash you need to close.

Choosing homeownership over renting is a strategic move that goes beyond the immediate advantages of financial investment. It’s a commitment to building wealth and securing long-term benefits for you and your family. With Homeseed’s support and specialized programs for first-time buyers, the path to homeownership becomes even more attainable. Take the next step with Homeseed and make the move towards homeownership today.

Homeseed’s 2024 Mortgage & Real Estate Market Forecast

Posted on by Jon Dao

Welcome to Homeseed’s 2024 Mortgage & Real Estate Forecast! As we enter the exciting year of 2024, the anticipation and speculation surrounding the mortgage market and housing industry have prospective homebuyers carefully watching. In just the last three years, we’ve gone from seeing all-time low mortgage rates to some of the highest mortgage rates in the last two decades due to significant global events and economic shifts. To better understand what potentially lies ahead for this year, let’s dive into a forecast for the mortgage market and housing industry in 2024.

Inflation: The Driving Force for Mortgage Rates

Inflation has emerged as a pivotal factor shaping the mortgage market. After reaching a near 40-year high of 5.3% in March 2022, Core Personal Consumption Expenditures (PCE) has been on a gradual decline and now hovers at 3.2%, which is near the Federal Reserve’s (Fed) goal of 2%. Given the improvement on inflation, the Fed signaled they would begin rate cuts to their Fed Funds Rate before reaching the 2% target in hopes of easing into its inflation goal with minimal negative effects to the economy. With shelter accounting for 21% of Core PCE, CoreLogic’s most recent measure of shelter costs showed a 2.5% year-over-year increase in their real-time blended rents data. This suggests a continued improvement for inflation lies ahead as the shelter data used by the PCE report lags the real-time shelter data, and the markets are now predicting the first rate cut by the Fed as early as March 2024.

Supply and Demand: Limited Inventory Pushes Home Prices Higher

The housing market continues to grapple with enduring challenges in inventory shortage, fueling a steady increase in home prices. Despite efforts to address the housing deficit, housing starts persist below household formations, indicating a sustained scarcity of available homes for sale coming to the market that is unable to meet the escalating demand. This ongoing imbalance between the supply of homes and demand from buyers will likely intensify competition if mortgage rates continue to come down, leading to the possibility of bidding wars and soaring prices once again.

Mortgage Rate and Real Estate Forecasts

Given the trajectory of inflation, we forecast the 30-Year Fixed Rate Mortgage to fluctuate between a rate range of 5.75%-6.75% throughout 2024. If rates fall below 6%, this will potentially unlock move-up buyers who are current homeowners that want to upgrade their homes.

For home price appreciation, we forecast home values to increase between 4-5% in 2024. Values should stay strong as demand will remain high due to more households being formed than homes coming to market.

Seizing the Opportunity: A Time for Homeownership to Build Wealth

As we navigate the intricacies of 2024, this period stands as an opportunistic time for prospective homebuyers. With the likelihood of interest rates coming down and home prices on a continued ascent, buyers can consider the strategic move of securing a home now and later benefiting from potential refinancing opportunities in the near future. Here at Homeseed, we offer a Home Equity Forecast tool, shedding light on the significant wealth-building potential through home appreciation and amortization. It emphasizes that homeownership is not merely about costs and interest rates but extends to the concept of a home evolving into one of your most substantial investments for building wealth.

Mortgage Market Update (12/19/23)

Posted on by Jon Dao

Welcome to Homeseed’s Mortgage Market Update, where we dive into the latest trends, insights, and changes shaping the dynamic landscape of the housing and lending industries.

Mortgage Rate Trends & Forecasts

  • Mortgage rates move lower once again this week with the biggest improvement happening yesterday after the Fed Meeting.
  • The improvement in rates were due to the Fed signaling that they plan to cut rates multiple times in 2024.
  • This week’s Consumer Price Index and Producer Price Index also showed inflation moving lower.


This Week’s Fed Meeting

  • The Federal Reserve had their last meeting of 2023 yesterday and maintained its benchmark Fed Funds Rate, opting to not raise or cut rates.
  • The big improvement in mortgage rates occurred when the Fed signaled it will likely cut rates by 0.75% in the year ahead, which is an increase of 0.25% from their previous meeting in September.
  • Remember, the Fed Funds Rate does not directly impact mortgage rates but this shift in outlook directly affects the bond market that mortgage rates are tied to.


CPI and PPI Inflation Reports

  • This was a good week for inflation news as many reports and forecasts showed inflation moving lower.
  • Tuesday’s release of the Consumer Price Index (CPI) report showed inflation moving lower year-over-year from 3.2% to 3.1%.
  • Yesterday’s Producer Price Index (PPI) report showed producer inflation falling from 1.2% to 0.9% year-over-year.
  • The Fed also announced yesterday that they also project inflation will fall to 2.4% in 2024, which is better than the 2.5% they projected in September.
  1. GOOD NEWS FOR MORTGAGE RATES – Mortgage rates moved to the lowest levels since May with the help of some good news coming from the Fed yesterday.
    https://www.mortgagenewsdaily.com/…
  2. FED MEETING RECAP – The Fed had their final meeting of the year and signaled rates cuts and a lower inflation prediction for 2024.
    https://www.yahoo.com/…
  3. LARGE INCREASE IN MORTGAGE ACTIVITY – The Mortgage Bankers Association said that mortgage application volume was up 7.4% last week as rates continue to move lower.
    https://www.eyeonhousing.org/…
  4. CONSUMER PRICE INDEX – The CPI for November showed inflation falling further to 3.1% compared to the pandemic-era peak of 9.1% in June of 2022.
    https://www.cnbc.com/…

Investor Cash Flow Loan Program

Posted on by Jon Dao

ARE YOU INTERESTED IN BECOMING A REAL ESTATE INVESTOR?

Becoming a real estate investor can be a wise financial decision for homeowners looking to build long-term wealth. With the investor cash flow (DSCR) loan program that Homeseed offers, it has become easier than ever to finance investment properties. Our DSCR loan program does not require you to qualify personal debt or income, and it simply looks at the property’s cash flow to decide on its approval. Real estate has historically proven to be a stable and profitable investment, and DSCR loan programs make it accessible to clients interested in becoming investors. Attached is a flyer with more information. Share or reach out with any questions!

How To Reduce Trigger Leads

Posted on by Jon Dao

WHAT IS A TRIGGER LEAD?

Trigger leads are generated when a consumer’s credit report is accessed during a loan application process. Credit bureaus like Equifax, Experian, and TransUnion can sell the consumer’s information as trigger leads to other companies, and these companies will begin calling you multiple times to solicit business. It’s frustrating as Homeseed needs to request your credit scores from the credit bureaus for the purpose of a mortgage loan.

IS THIS LEGAL?

The sale of trigger leads is currently legal, but there is a proposed bill called the Trigger Leads Abatement Act of 2022 that aims to prohibit their creation and sale.

HOW DO I STOP THEM?

There is no way to completely stop trigger leads, but taking steps such as opting out of pre-approved credit offers can reduce them significantly.

  1. Opt-Out of Phone Calls and Texts
    Visit www.optoutprescreen.com to register yourself for the Electronic Opt-Out for 5 years. You can also register yourself by calling 888-567-8688. Visit www.donotcall.gov and register up to 3 phone numbers. Be sure to click on the link emailed to you from register@donotcall.gov within 72 hours to confirm your registration.
  2. Opt-Out of Email and Mail Offers
    Visit www.dmachoice.org and select Email Opt-Out Service to register up to 3 emails. Be sure to click on the link emailed to you within 30 days. You can also register up to 5 records for your household for 10 years. Please note they do charge a $4 admin fee for registration.

2023 Conforming Loan Limits

Posted on by mmttest2

Every year the Federal Housing Finance Agency (FHFA) announces their conforming loan limits for the upcoming year immediately following the November release of their House Price Index (HPI). FHFA uses this data on home price appreciation to set the new loan limits for the upcoming year. For areas in the country that are considered high cost, FHFA increases loan limits further and will go up to 150% of the baseline conforming loan limit.

In 2023, the new conforming loan limit for most of the US for one-unit properties will increase to $726,200, an increase of $79,000 from $647,200 in 2022. This means in areas of high-cost or with special statutory provisions, the loan limit can reach as high as $1,089,300. An example in Washington State would be the counties of King, Snohomish, and Pierce, where the loan limit will increase to $977,500, an increase of $86,250 from $891,250 in 2022. This significant increase will help home buyers access more credit in many markets where home prices are still seeing double digit appreciation year-over-year.

If you have any questions or want to find out if you qualify for a conforming loan, please reach out today!

2023 Conforming Loan Limits By County

Lock & Shop: Lock in your rate today before you find a home

Posted on by mmttest2

Purchasing a home should be an exciting process, but having to worry about interest rates rising in this market can dampen some of the joy. That is why Homeseed is offering our Lock & Shop program to clients. Potential homebuyers will now be able to lock in your rate before you have a fully executed purchase contract, so you can have peace of mind that your interest rate will not go up while searching for your home.

Homeseed has developed our Lock & Shop program to allow for your rate to be protected for up to 60 days. Extensions are also available for more time. By locking in your rate now while you look for your home, the Lock & Shop program gives you the opportunity to save money should interest rates continue to rise as many experts predict they will throughout 2022. Locking in a rate now also helps you manage your home budget by removing any surprises of a higher monthly mortgage payment if interest rates were to rise.

Please reach out today with any questions. The Homeseed Team is ready to get you pre-approved and help strengthen your offer by letting sellers know you are certified for financing with an interest rate that is already locked!

Get Started in Less Than 10 Minutes

Get pre-approved with our online mortgage application. It’s simple, fast & secure!

Apply Now