First there was anecdotal evidence that the implementation of the Consumer Financial Protection Bureau’s TILA-RESPA Integrated Disclosures rule in October had caused issues with the housing industry, but now, concrete data is beginning to show just how much the impact of TRID is being felt – and the news isn’t great.
Last week, the latest Origination Insight Report by Ellie Mae showed the average time to close a loan increased by 3 days during the month of November to 49 total days, making it the longest time needed to close a loan since Feb. 2013.
And according to the latest report from the National Association of Realtors, those closing delays helped considerably slow down existing-home sales in the month of November.
According to NAR’s latest report, the total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 10.5% to a seasonally adjusted annual rate of 4.76 million in November.
Existing-home sales cooled to the slowest pace in 19 months during November, NAR’s report showed, to the lowest seasonally adjusted annual rate since April 2014 when it was 4.75 million.
This it the second month in a row that existing-home sales have fallen. In October, total existing-home sales decreased 3.4% to a seasonally adjusted annual rate of 5.36 million.
After last month’s decline, which NAR said was the largest since July 2010 at 22.5%, existing-home sales are now 3.8% below a year ago, which is the first year-over-year decrease since Sept. 2014.
According to NAR Chief Economist Lawrence Yun, the decline is not entirely due to TRID, but TRID certainly isn’t helping.
NAR’s report also showed extended closing times, which Yun said may be pushing sales out into December, with the hope being that closings are just being delayed, not disappearing entirely.