Dubbed the great American "Rural-Urban Divide", or an "Urban-Rural Divide" sometimes when reported by writers from urban areas, there has been a lot of talk about the differences that set Americans from different locales apart. Our analysts and writers are less interested in politics, but we are curious about differences in ideals and motivations that drive American homebuyers, so we can learn to better serve and empower them.
Credit risk transfer (CRT) or sharing is the process in which the government-sponsored enterprises bundle up the mortgages they buy from lenders and sell a portion of the risk to private investors. Instead of the GSEs shouldering the loan risk alone, selected investors help offset any potential risk from loan defaults. CRT began as a test in 2012 and is now quickly ramping up as investor interest and governmental oversight grows. Governmental oversight makes sense—we don’t want another 2007. But why are more investors becoming so interested in CRT?
It has been said that when it comes to housing, the West leads the way. California has been ahead of the recent years’ real estate market run-up, and has garnered international attention for its jaw-dropping home prices. The Golden State enjoys the trifecta of being the most populated state in the nation, one of the most affluent with robust growth industries, and having the unique climate and geographical advantages that continue to make the state appealing to potential homeowners.
In the latest ValueInsured Modern Homebuyer Survey, conducted in April 2017, California homeowners and buyers seem to express apprehension and caution concerning the housing market..
According to NAR, over 65% of all U.S. homes sold in 2016 went to repeat homebuyers. So why do we constantly see more spotlights on first-time homebuyers? For starters (no pun intended), the decline in overall homeownership rate has been largely attributed to first-time homebuyers, whose share of total buyers dropped to a near-30 year low in 2014. Secondly, it is presumed, rightly so, that the entrance of first-time buyers helps expand the overall U.S. housing market, as buyers typically don’t go back to renting by choice once they have owned their first home.
However, as the industry encourages more first-time buyers to convert to homeownership, it is important to remember that without repeat homebuyers who upgrade to bigger, more expensive homes, starter home inventory cannot be freed up for first-time buyers, and the market size would stay stagnant. It has been reported that home sales this Spring has been slowed by low inventory; and one key reason for the shortage is would-be sellers holding onto their current homes, concerned that they may not be able to find desirable homes to upgrade to. In other words, it is not far-fetched to say that not only are repeat buyers responsible for two-thirds of all home sales, they have a hand in helping close the other one-third as well.
Americans remained as confident in the U.S. housing market as they have been, but this cautious optimism may be on shaky ground. That, at least, is the conclusion of ValueInsured’s quarterly Modern Homebuyer Survey, released Thursday.
The survey index ended Q1 at 67.7 out of 100, which was down less than 1 percentage point from Q4. According to the index, the so-called Trump bump “has plateaued after two interest rate increases in three months.”
Americans Still Value Homeownership and Want to Buy, According to ValueInsured’s Modern Homebuyer Survey
DALLAS, May 3, 2017 – Americans remain generally confident in the country’s housing market and the value of homeownership despite recent interest rate hikes, according to ValueInsured’s quarterly Modern Homebuyer Survey.
The survey produced an overall ValueInsured Housing Confidence Index score of 67.7 on a hundred-point scale, down less than one percentage point from January. The index is the aggregate mean of seven multidimensional confidence measures collected through the survey.
Don’t believe the hype: contrary to popular belief, the vast majority of Generation Y, better known as millennials, want to own a home — and most actually do, new data suggests. That’s good news for boomerang parents whose twenty-something-aged offspring moved back home in recent years due to the economic downturn.
Loan officers see Mortgage +Plus℠ with down payment protection as key differentiator.
DALLAS, TX (PRWEB) APRIL 28, 2017
After a launching in January, First Heritage Mortgage’s new Mortgage +Plus℠ program is seeing significant growth heading into the Spring buying season. As the only mortgage company to offer loans with down payment protection in the Maryland, Virginia and North Carolina markets, First Heritage Mortgage remains focused on delivering positive, pro-homebuyer down payment protection solutions within its fast-paced mortgage service area.
“As home prices and competition across the Mid-Atlantic continue to heat up, we find that many potential borrowers are seeking greater confidence in the home buying process,” said Scott Kinne, Vice President, First Heritage Mortgage. “If home prices do become volatile, having peace of mind in knowing that their down payment can be protected is a game changer.”
America is famously youth-obsessed. Every few decades, we obsess over the next wave of young people, the new “it” generation. We talk about how they will change the world, drive trends, buy lots of stuff, and propel the economy. Take a look at the daily news headlines: “how Millennials spend their money”, “where Millennials want to work”, “what will Millennials watch this fall”…it goes on.
But how about Gen-Xers? They used to be the media darling. Sandwiched between Baby Boomers and Millennials, and with a smaller head count, are Gen-Xers the forgotten generation? We thought we would devote this week’s trend post to the former “slacker generation” that is making positive waves in housing today.
Millennials do not want to live in the same white picket-fence house for 40 years – it’s fair to say this is something that has been safely established. But a few recent reports and the latest ValueInsured Modern Homebuyer Survey provided new insights that shed more lights on this next-generation cohorts, their priorities, and how that may affect their plans to become homeowners.
Pacific Union Financial LLC today introduced PacificPlus, an innovative new mortgage program that protects a homebuyer’s down payment. PacificPlus has +Plus down payment protection by ValueInsured embedded directly into the mortgage loan, and is now available nationwide through Pacific Union Financial. Purchasing a home with PacificPlus gives the homebuyer a sense of safety and security that their down payment investment is protected should the home be sold in a declining real estate market.
We have all read the headlines: Millennials feel pessimistic about their future; Millennials are the gloomy generation. But according to the latest quarterly Modern Homebuyer Survey by ValueInsured, Millennials reported to be rather upbeat, at least when it comes to their outlook on the American housing market and their prospects of achieving the American Dream.
The results are rather jarring. In all measures, except one – more on that later – Millennials surveyed in the research appear more optimistic than their Gen-X and Baby Boomer counterparts. In the survey conducted in January 2017, Millennials were more likely to think the current American housing market is healthy, and more likely to believe buying a home today is a good investment (even when they are less likely to currently own a home compared to the Gen-Xers and Baby Boomers surveyed). Interestingly, despite more likely to be renters and to prefer a more nomadic lifestyle, Millennials in the survey are more likely to believe buying a home is financially more beneficial than renting. Here are samples of Millennials’ relative optimism regarding our current housing market
According to a pair of new studies, Millennials’ disinterest in owning a home is a myth
By Erik J. Martin CTW Features
Don’t believe the hype. Contrary to popular belief, the vast majority of Generation Y, better known as Millennials, want to own a home, and most actually do, new data suggests. That’s good news for boomerang parents whose twentysomething-aged offspring moved back home in recent years due to the economic downturn.
It has been 10 years since the great American housing crisis that began in 2006 and came to a halt in 2008. In the past decade, best-selling books, Academy Award-nominated film and countless business school lectures have been devoted to dissecting what happened and how to avoid a repeat of history. During this period, 10 million families who lost their homes due to foreclosures and many more affected by the crisis struggled to rebuild their life and their financial credits. It has not been an easy recovery for the housing industry and for many homebuyers.
Since 2008, federal regulations were put in place, mortgage practices – especially but not limited to subprime lending – have been tightened considerably, and home prices came back closer to earth in many markets. Well, prices were closer to earth, until recently.