Market Conditions

Mortgage-Bond Sales Soar in Sign U.S. Crisis Wounds Healing

29.06.2015
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Almost seven years after the financial crisis, bond investors are rediscovering their appetite for new debt tied to the U.S. housing market.

Issuance of home-loan securities that don’t have government backing has accelerated this year to more than $32 billion from $18 billion a year ago, according to data compiled by Bloomberg and Bank of America Corp. This time around, investors are mainly buying types of bonds that weren’t around when the debt helped spark the crash, such as securities tied to defaulted mortgages and rental homes.

The recovery in housing is luring investors back to a market that unraveled amid soaring defaults and tumbling home prices. The revival is helping to reduce taxpayers’ risks and boost the profits of private-equity firms, real estate investment trusts and hedge funds — and is poised to do more to aid home buyers.

“The market’s healing,” said Chris […]

Increase in HELOC Delinquencies Is Likely as Loans Come Due

12.06.2015
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There could be a new wave of delinquencies among home equity line of credit borrowers as a large percentage are moving into the repayment phase, a report from Experian said.

There are $265 billion in outstanding HELOC loans originated between 2005 and 2008 which are reaching the point where consumers can no longer borrow against them, according to Experian.

These outstanding HELOC loans could have significant implications for consumers, as well as the greater lending industry. The increased repayment burden could bring higher monthly payments for the consumer, making them more likely to go delinquent on the HELOC loan along with other types of debt.

HELOC delinquencies had gone back down to pre-recession levels. According to the Experian analysis, 0.5% of loans are in late-stage delinquency (90-180 days past due) compared to 2009, when they were 1.81%, their highest. However, between 2013 and 2014, borrowers […]

Housing Growth Will Take Wage Growth: Economists

11.06.2015
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The labor market is the No. 1 driver of housing, and it will take a return to full employment and appreciable gains in wages to spur housing growth this year, mortgage industry economists said.

Even though employment and pay have strengthened, U.S. economic data is not there yet, said Leonard Kiefer, Freddie Mac’s deputy chief economist.

Speaking at the Mortgage Bankers Association’s Secondary Market Conference in New York, Kiefer predicted it would take some time before conditions are right for housing to expand. Furthermore, the timing will vary greatly by region, with areas such as Texas and California having an edge over other parts of the country.

Projections of 6 million home sales in 2015 are still well below what should be seen in a well-functioning housing market, Kiefer said.

That is the short-term outlook. For 2017 and beyond, household formations and other demographic factors […]

Murdoch Bid to Dethrone Zillow

26.05.2015
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Can Rupert Murdoch take an online fixer-upper and turn it into a digital real estate profit spinner? We’re about to find out.

Murdoch’s News Corp. plunked down $864 million in cash and assumed $88 million in costs in November to acquire Realtor.com’s parent company, Move Inc., setting up a testy head-to-head rivalry with the unmatched king of online home-sales information, Zillow Group Inc. Zillow has bounded to the top in part because of a feature that includes price estimates for almost every house in America.

Now, Realtor.com, enriched and emboldened after the News Corp. purchase, is fighting to claw away at Zillow’s mainstay “Zestimates,” contending they just aren’t that accurate. Realtor.com argues it offers home sellers and shoppers a better online experience by listing more properties with accurate information as opposed to the guessing involved in Zestimates.

“We […]

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