The Feds & Housing

PTC-Computer-Solutions-Parker-Associates-blog-January-2019-Mortgage

Feds may scale back Housing Mortgages in 2019

The federal government may scale back its mortgage market role in 2019. Mark Calabria was nominated to lead the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac. He wants Uncle Sam out of the market.

Two big steps he could take: Raise lender fees, Cut conforming loans’ size. The GSEs charge lenders a fee to back their mortgages on the secondary market. Upping those could make other financial institutions more attractive buyers for lenders. The GSEs can buy only loans of a certain dollar amount, known as conforming loans. Private lenders try to stay below that limit, as they want to sell their loans to the GSEs. Lowering the maximum and increasing the fees would reduce Uncle Sam’s exposure to the housing market and maybe attract private capital, letting him step further back.

Single Family Rentals on the Rise

Construction of single-family homes intended to be rentals is on the rise. Last fiscal year, 43,000 single-family rentals were built … up 30% from 2017 and the most since 2004. Single-family homes comprise half the rental market …two-thirds of all rentals in rural areas. In the-five biggest metro markets – New York, Los Angeles, Chicago, Philadelphia and Dallas – the typical size in 2017 was 1,463 square feet, 66% smaller than the median size of all new single-family home construction that year.

Individuals and small investors dominate the market. Most own between one and 50 such rentals. Collectively they own 21 million properties … 95% of all available inventories. Institutional investors are getting in on the game, owning about 2% of all such rentals. Large investors are concentrating on Atlanta, Chicago, Dallas and Indianapolis. Bonds backed by single-family rentals are on the rise, allowing big investors to expand.

Housing is more expensive today than it was at the peak of the 2006 bubble. Steep prices, rising interest rates and low inventories are squeezing home affordability. The National Association of Home Builders (NAHB) estimates that a $1,000 bump in the median price of new homes would price about 128,000 households out of the market this year.

A quarter-point mortgage rate increase would put a home out of reach for 1 million people. Enough folks have felt the pinch to finally start forcing home prices down, however. Renting is cheaper than buying in big cities, including Houston, Lost Angeles, Phoenix and San Diego. But, rents are climbing, too…faster than wages in many areas.

The Team of experts at PTC Computer Solutions is ready to assist with Technology for Business and the Sales & Marketing Process. We are experts and ready to help your business move forward with technologies in your business and retail worlds.  If you need some assistance and guidance, contact us to set up a personal meeting.  We’re happy to discuss your personal situation and offer some ideas on how you can better handle technological advances.

Parker Associates works closely with Builders and Developers to ensure that the planning is done up front so that the final product is as good as it gets.  Finding the highest and best use is important, but filling the market space is also equally important. New Home Builders that Parker Associates and the REMA Team work with are great examples of this.  The REMA Team works closely with their customers to ensure they are planning the development and the homes with all of the most affordable and functional features while considering the holistic design of the site and home on the site.  It doesn’t happen without a focused approach and they are very good at making sure this happens.

There are so many difficult questions that must be faced in a great many developments and building construction. We can help. Contact our seasoned professionals at info@realestatemarketingteam.us or (904) 607-8763.

If you are building or developing or have or are living in a community that is in need of improving their position, give us a call or email us.  We offer FREE advice.  Stay on top of the competition.  Know the latest data and market research that can help improve your chance for success in business and the real estate industry.  PTC Computer Solutions, Parker Associates, and REDdot Marketing work closely as the REMA Team to provide a great number of services for developers, builders, and professional business operations.  Contact REMA for more information.

David WB Parker is a principal of Parker Associates of Jacksonville, Florida, marketing consultants to the real estate industry as well as the President of PTC Computer Solutions, IT Consultants and Strategists, and also an active real estate sales professional with PARFAM REALTY.  Though based out of Jacksonville, Florida, David and the team at Parker Associates have worked in 17 Countries and 33 States through the years as well as 65 out of 67 counties in Florida.  David can be reached at 904-607-8763 or via email davidp@ptccomputersolutions.com.

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