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Latest Housing Data Laced With Harsh Extremes

Phil Hall
Sep 30, 2015
Housing Market Pic

What happens when you have too few potential homebuyers, too much regulatory burden and too many fast-growing markets in two states? You have the day’s latest housing industry data.

The Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Sept. 25 fell 6.7 percent on a seasonally adjusted basis and seven percent on an unadjusted basis from one week earlier. Both the seasonally adjusted and the unadjusted Purchase Index decreased six percent from one week earlier and was 20 percent higher than the same week one year ago. And the Refinance Index dropped eight percent from the previous week while the refinance share of mortgage activity inched down to 58 percent of total applications from last week’s 58.4 percent.

Government lending programs mostly saw positive activity, with the FHA share of total applications increased to 13.8 percent from 12.9 percent the week prior while the VA share of total applications increased to 10.3 percent from 10 percent in the same period. The USDA share of total applications remained unchanged from 0.7 percent the week prior.

While potential homebuyers were mostly MIA last week, the mortgage industry was still struggling to get ready for this Saturday’s deadline for implementing the new TILA/RESPA Integrated Disclosure (TRID) rule. The MBA released a new survey of 70 executives from its member companies to determine how the industry is preparing for TRID Day.

According to the survey, two-thirds of the companies stated they were ready for “Know Before You Owe,” but one-third of the respondents claimed they lacked the time to test and integrate new systems and train their employees to meet the new requirements demanded by the Consumer Financial Protection Bureau (CFPB). And approximately half of the respondents expressed concern that their customers will face confusion or worse in the post-Oct. 3 transition period.

"We believe the results highlight the need for more explicit CFPB action instituting a formal enforcement grace period," said MBA Senior Vice President Residential Policy and Member Engagement Pete Mills. "MBA believes the Know Before You Owe rule will make the mortgage process better for consumers. However, as the survey shows, implementation has proven far more difficult than both industry and the CFPB anticipated due in large measure to the complexity of the technology and systems that have put in place over the years and the challenges of integrating separate systems across the industry."

Ah, but consumers have their own problems—not the least being that nine of the top 10 fastest-growing local economies are not located in 49 states. A new survey from WalletHub on the cities with the fastest growing municipal economies put a ridiculous majority of metropolitan growth markets squarely in Texas—only Kent, Wash., coming in seventh place, was located beyond the Lone Star State.

Odessa topped the Texas hot spots, followed by Frisco, Midland, Mission and College Station. Midland experienced both the highest job growth (at seven percent) and the highest growth in GDP per capita (at 13.3 percent), while McAllen, Texas, had the highest household income increase at 6.9 percent.

Separately, Realtor.com released its September list of the nation’s hottest markets (as determined by the number of views per listing on Realtor.com and the median age of inventory in each market). Eight of the top 10 markets were based in California, with San Francisco-Oakland-Haywood market at the peak of the list; the only non-California markets in the top 10 were Dallas-Fort Worth-Arlington (in second place) and Denver-Aurora-Lakewood (in third place).

“Sellers across all these markets continue to see listings move much more quickly than the rest of the country in September, and the seasonal slow-down is not as strong in these markets,” said Realtor.com Chief Economist Jonathan Smoke.

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