the WiRE - Weekly Roundup

By: the WiRE - the Week in Real Estate
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  • Your go-to summary of the top stories shaping the real estate industry this week.
    © 2024 The WiRE Podcast Network. All rights reserved. This podcast and its content, including audio, text, and graphics, are the intellectual property of The WiRE Podcast Network. Unauthorized reproduction, distribution, or use is strictly prohibited without prior written consent. For permissions or inquiries, visit thewirefm.com.
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Episodes
  • Riding the Real Estate Roller Coaster: The 2024 Recap

    Riding the Real Estate Roller Coaster: The 2024 Recap
    Dec 23 2024

    Overall Market:

    Existing home sales saw a significant jump in November, marking the second consecutive month of increases following a sluggish summer. (NAR)

    Inventory is up nearly 18% year-over-year, giving buyers more options. (NAR)

    Despite increased inventory, the market remains competitive, particularly at lower price tiers. (CoreLogic)

    Investor activity has slowed, with overall purchases down 25% year-over-year. (CoreLogic)

    This slowdown benefits first-time homebuyers, though competition persists. (CoreLogic)

    "Smaller-scale investors play a powerful but understated role in the market, buoying home prices even as overall demand has softened," (CoreLogic)

    Mortgage Rates:

    The average 30-year fixed-rate mortgage rose to 6.72% for the week ending Dec. 19. (Freddie Mac)

    Despite three consecutive Fed rate cuts, mortgage rates remain elevated and are expected to hover around the 6%-7% range in 2025. (Freddie Mac, HousingWire, Bankrate)

    The Fed's decision to slow the pace of rate cuts in 2025, driven by concerns about inflation, has led to uncertainty in the bond market, pushing mortgage rates higher. (Fed, HousingWire)

    "Treasury yields have also climbed in response to market expectations of inflationary pressures tied to the incoming administration’s proposed policies, such as tariffs and tax cuts, even though these measures have yet to take effect, putting additional upward pressure on mortgage rates.” (Sam Williamson, senior economist at First American)

    Affordability:

    Home affordability worsened in Q4 2024, continuing a trend. (ATTOM)

    Major Midwest metro areas like Chicago, Houston, Detroit, Philadelphia, and Cleveland offer the most affordable options among populous counties. (ATTOM)

    Median home prices in populous counties saw significant increases, notably in the Bronx (13.3%), Wayne County, MI (12.9%), and Cook County, IL (12.1%). (ATTOM)

    New Hampshire, a traditionally less competitive market, is experiencing a housing crisis with soaring prices and limited inventory, creating challenges for economic growth. (HousingWire)

    New Construction:

    Single-family housing starts rebounded in November, driven by cautious builder optimism. (Zillow Research)

    However, total housing starts remain below last year's levels, indicating continued hesitancy from builders. (Zillow Research)

    The mismatch between housing supply and demand, particularly in New Hampshire, highlights the need for increased construction to alleviate affordability concerns. (HousingWire)

    Key Trends & Developments:

    The National Association of Realtors (NAR) issued a cease-and-desist letter to Phoenix Realtors over its "MLS Choice" option, citing concerns about maintaining Realtor brand standards. (Real Estate News)

    REsides MLS launched "Select Subscription", allowing agents to join the MLS independent of their brokerages and NAR membership. (RISMedia)

    This move potentially challenges traditional MLS structures and could impact Realtor associations.

    Looking Ahead:

    The housing market is expected to be volatile in the first quarter of 2025, influenced by upcoming changes to Stamp Duty thresholds in England and Northern Ireland. (Nationwide)

    Experts predict mortgage rates will likely moderate in January but remain elevated throughout 2025. (Bankrate, Realtor.com, First American)

    The potential for a recession in 2025 adds further uncertainty to the housing market outlook. (HousingWire)

    Continued monitoring of inflation, labor market data, and the Fed's actions is crucial for understanding the future direction of the housing market.
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    13 mins
  • Foresights on the Housing Market Outlook for 2025

    Foresights on the Housing Market Outlook for 2025
    Dec 16 2024
    Key Themes:Cautious Optimism for 2025: Experts predict a more balanced market with increased sales, stabilizing mortgage rates, and growing inventory, creating a more favorable environment for both buyers and sellers.Affordability Remains a Challenge: While rising inventory and stabilizing rates are positive signs, affordability remains a concern, especially for first-time buyers, due to high home prices and potential rent concessions.Regulatory Scrutiny and Policy Changes: The National Association of Realtors (NAR) faces legal challenges and scrutiny over commission practices, while potential overhauls of banking regulators could significantly impact the mortgage industry.Innovation and Adaptation: The rise of ADUs (accessory dwelling units) and the exploration of reverse mortgages represent efforts to address housing shortages and cater to the aging population.Important Findings:Housing Market Outlook:Increased Sales: NAR projects existing-home sales to increase by 7-12% in 2025 and 10-15% in 2026, with new home sales rising by 11% in 2025 and 8% in 2026. ("More Home Buyers Expect Rosier 2025 Housing Outlook")Stable Mortgage Rates: Mortgage rates are expected to stabilize near 6% in 2025 and 2026, potentially becoming the "new normal". ("More Home Buyers Expect Rosier 2025 Housing Outlook")Growing Inventory: Housing inventories are predicted to continue rising in 2025, driven by stabilizing rates and improving market conditions, providing more opportunities for buyers. ("More Home Buyers Expect Rosier 2025 Housing Outlook", "housing-hot-spots-for-2025-top-markets-amid-stabilizing-rates-report-12-12-2024.pdf")Rising Distressed Properties: An increase in distressed properties could signal a slowdown in the 2025 housing market. ("Distressed properties signal a slowdown in 2025 housing market")Resilient Demand: Despite high mortgage rates, housing demand remains resilient, fueled by firm consumer income growth and a bullish stock market. ("Mortgage rates cool again ahead of Fed meeting")Affordability and Buyer Behavior:Rent Concessions Complicate Buying Decisions: Potential rent concessions might discourage first-time buyers from entering the market. "If they're being offered no rent increase and perhaps a concession to stay in that apartment, that's going to be tough to turn down in this market," cautions Mike Fratantoni, chief economist at the Mortgage Bankers Association. ("A mix of optimism and uncertainty as forecasters look to 2025")National Debt Impacts Mortgage Rates: Addressing the national debt is crucial for lowering mortgage rates meaningfully, according to Lawrence Yun, chief economist at NAR. ("A mix of optimism and uncertainty as forecasters look to 2025")Mortgage Delinquencies Increase: Rising mortgage delinquencies suggest ongoing affordability challenges for some homeowners. ("CoreLogic: Mortgage delinquencies kept climbing in September")Buyer Sentiment Improves: A record-high share of consumers expect mortgage rates to decline in the next 12 months, contributing to increased optimism about buying a home. ("Mortgage rates cool again ahead of Fed meeting")Regulatory Landscape:NAR Under Scrutiny: The Department of Justice's investigation into NAR's commission practices continues, raising concerns about potential anticompetitive behavior. ("DOJ to SCOTUS: We never agreed ’not to reopen’ NAR investigation", "Opposition to approval of NAR’s settlement continues")NAR Implements New Rules: NAR's new rules regarding buyer agent compensation transparency are causing adjustments in real estate practices and forms. ("Wrapping Up a Year of Real Estate Practice Changes", "The Ten: NAR’s new rules and the ‘messy’ race to comply")Potential Banking Regulator Overhaul: Trump administration's proposed changes to banking regulators, including potential consolidation or elimination, could significantly impact the mortgage industry. ("Trump reportedly explores overhaul of banking regulators")Emerging Trends:ADUs Gain Momentum: The increasing popularity of ADUs presents a potential solution to the housing shortage, but zoning laws and community acceptance remain barriers. ("ADUs are gaining momentum — can they help fix the housing shortage?")Aging in Place and Reverse Mortgages: The focus on aging in place highlights the need for accessible housing options, with reverse mortgages potentially playing a role. ("AARP assesses aging in place, role for reverse mortgages", "Survey names best and worst cities for aging in place")Top Housing Markets for 2025:NAR has identified ten housing markets expected to outperform in 2025, including Boston, Charlotte, Grand Rapids, Greenville, Hartford, Indianapolis, Kansas City, Knoxville, Phoenix, and San Antonio. These markets exhibit strong economic indicators, demographic trends, and favorable housing market conditions. ("housing-hot-spots-for-2025-top-markets-amid-stabilizing-rates-report-12-12-2024.pdf")
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    16 mins
  • Rising Star in the Housing Market: Manufactured Homes

    Rising Star in the Housing Market: Manufactured Homes
    Dec 9 2024
    Overall Market TrendsThe housing market is currently experiencing a period of uncertainty and volatility.Mortgage rates are fluctuating, but forecasts suggest a potential stabilization and slight easing in 2025.Inventory remains low, particularly in areas with high demand, creating a competitive market for buyers.Home prices continue to rise, albeit at a slower pace compared to previous years.The labor market remains strong, with steady job gains, but there are signs of potential cooling which could influence the Fed's decisions on interest rate cuts.Key Factors Influencing the MarketMortgage Rates: The volatility of mortgage rates throughout 2024 has significantly impacted affordability and buyer demand.Current rates hover around 6.69% for a 30-year fixed-rate loan. (Source: Freddie Mac, Dec. 5, 2024)Experts predict potential for rates to drop further if the economy slows down or inflation cools, but acknowledge the possibility of upward movement as well. (Source: Sam Williamson, senior economist at First American)Refinance activity remains low but could jump if rates drop significantly. (Source: Mat Ishbia, CEO of UWM)Inventory Levels: Low inventory is a persistent issue, especially in desirable areas, contributing to a competitive market and driving up prices.This lack of inventory is particularly challenging for first-time buyers and those seeking affordable options. (Source: Altos Research data cited in "Is now a good time to buy a house?")Economic Uncertainty: Potential for a recession and the unknown impact of political and global events contribute to market unpredictability.Investors are closely watching economic indicators and Fed policy decisions for signals on the future direction of the market. (Source: Lisa Sturtevant, chief economist at Bright MLS)Affordability Challenges: Rising home prices and elevated mortgage rates continue to strain affordability for many potential buyers.This affordability crisis is leading some to consider renting instead of buying in 2025. (Source: "Housing Market Predictions: Buyers Will Choose to Rent in 2025")Noteworthy Events and Policy ImpactsFHA Extends Foreclosure Moratorium for Hurricane Victims: This extension aims to provide relief and support to those affected by Hurricanes Helene and Milton.It highlights the importance of disaster preparedness and the role of government agencies like FEMA and HUD in assisting communities during recovery. (Source: "FHA extends foreclosure moratorium for hurricane victims")NYC Council Approves Sweeping Housing Plan: The "City of Yes" plan calls for the construction of 82,000 new homes over 15 years to address the city's housing crisis.This ambitious plan, while facing some controversy, demonstrates efforts at the local level to increase housing supply and address affordability. (Source: "NYC council approves sweeping plan that includes 82,000 homes")Wells Fargo Expands Down Payment Grant Program: This expansion aims to assist underserved borrowers in 12 additional metro areas, showcasing efforts within the lending industry to improve access to homeownership. (Source: "Wells Fargo expands $10K down payment grant program")Expert Insights and PredictionsFitch Ratings Revises Mortgage Sector Outlook to "Improving": This revision, based on forecasts of lower mortgage rates and increased origination volumes, provides a positive outlook for the industry. (Source: "Fitch Ratings says the 2025 mortgage sector outlook is ‘improving’")Realtor.com Forecasts Low Sales but Rising Prices in 2025: This prediction suggests a continuing trend of tight inventory and steady price growth, potentially favoring sellers in the market. (Source: "Realtor.com's 2025 housing forecast: Low sales but rising prices")Redfin Predicts Resilient Homebuyers in 2025: This forecast anticipates sustained buyer demand despite affordability challenges, pointing to a continued competitive market. (Source: "Redfin's 2025 housing market forecast predicts resilient homebuyers")Amidst these changes, the need to adapt stands out. Agents need to guide buyers realistically and make rental properties attractive for investor clients. The rise of manufactured homes and the expansion of assistance programs like those from Wells Fargo also present new avenues.Key Themes:Mortgage Rate Fluctuation: Mortgage rates are experiencing significant volatility, influenced by economic indicators, inflation concerns, and Federal Reserve decisions.Housing Inventory Challenges: While some predict a "silver tsunami" of inventory from aging homeowners, experts note this inventory may not be located in areas where it is most needed.Affordability Concerns: High home prices coupled with fluctuating mortgage rates continue to pose affordability challenges for potential homebuyers.Resilient Homebuyers: Despite these challenges, many forecasts predict a resilient market with buyers adapting to market conditions.Impact of Policy and Economic Events: Political decisions, such as Trump's ...
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    23 mins

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