Snap back to reality

From Mortgage Professional America:

Homeowners are getting really good at valuing their homes

The gap between the value homeowners put on their refinance mortgage applications and the value assessed by professional appraisers has narrowed for the third straight month.

The gap was 0.63% in July according to the Quicken Loans’ National Home Price Perceptions Index (HPPI). The analysis of 27 metros found that the gap between the two valuations was less than 1% in 20 metros, and only 2 saw a gap of larger than 1.5%.

“As expected, with mortgage rates at three-year lows and the refinance share of mortgage activity continuing to hover above 50%, homeowners are increasingly aware of the true value of their home, said Bill Banfield, Quicken Loans Executive Vice President of Capital Markets. “Prices continue to increase in most areas but the rapid growth of years past has moderated giving homeowners a better sense of their home’s market value.”

This entry was posted in Economics, Mortgages, National Real Estate. Bookmark the permalink.

38 Responses to Snap back to reality

  1. grim says:

    Does that mean realistic asking prices?

    Helllllll no.

  2. dentss dunnigan says:

    Recession on it’s way …inverted yield curve ….sell if you got em’

  3. grim says:

    From CNBC:

    Weekly mortgage refinances spike 37% in one week as rates fall further

    Another sharp drop in mortgage rates sent even more homeowners to their lenders, hoping to save money on their monthly payments.

    Mortgage application volume jumped 21.7% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume zoomed 81% from a year ago.

    The surge was a direct response to another drop in mortgage rates. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to its lowest level since November 2016, 3.93%, from 4.01%, with points decreasing to 0.35 from 0.37 (including the origination fee) for loans with a 20% down payment. That rate was 88 basis points higher a year ago.

    That drove a stunning 37% jump in refinance volume for the week, the highest level since July 2016. Refinance applications were nearly 196% higher than a year ago.

    “The 2019 refinance wave continued, as homeowners last week responded to extraordinarily low mortgage rates. Fears of an escalating trade war, combined with economic and geopolitical concerns, once again pulled U.S. Treasury rates lower,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting.

  4. grim says:

    Recession? May need to pivot from making super premium bourbon to rotgut 200ml pocket flasks.

  5. No One says:

    Breaking news: millennials falling in love with Somerville NJ! Taking the sidewalks back from halfway house residents.

  6. Fast Eddie says:

    No One,

    Thanks for the link. I have a dear friend who lives in Somerville, I’m happy she’s able to enjoy this resurgence.

  7. kev stev says:

    This just means appraisers are getting lazier. When I refi’ed my appraiser asked me what the value of my home is. When the appraisal report came back, he listed no comparable sales or rentals being applicable, despite this being a condo building and 2 floors was down was being rented, and there was a sale 9 months prior in the same line.

    This article is reminiscent of the NYTimes during the last boom, praising “innovations” like negative amortization loans.

  8. The Great Pumpkin says:

    And then they have a kid or two and don’t give a crap about the “walkable” downtown.

    “As Ms. McLachlan, 60, put it: “The kids are coming out of the cities, and back to Mayberry. They want a walking town, they want some night life — but it doesn’t have to be constant — and they want safety.””

    They want the sex and the city life when they are single and young. They then want the walkable downtown when they are in that next transition between single/young lifestyle and adult family in the burbs. They want the home with a yard with a good school system as soon as the kid hits school age. Not rocket science.

  9. xolepa says:

    As having grown up next door to Somerville, I can add a few comments:

    Somerville is getting to be very nice. But, it was the restaurants that started the whole revival about 15 years ago. Very diverse food choices and many are high quality. It still has our favorite all-u-can-eat Sushi restaurant. Love the crunchy spicey seaweed. There was a landfill on the outskirts of town that is finally being paved over. That’s part of the redevelopment project but NYT glosses over that.

    In terms of ethnic diversity, it has a black neighborhood that’s been their since post civil war years. Other side of the tracks, of course, but the feeling all along was that these residents were part of Somerville and everyone treated each other with respect.

    I ran track against these kids from that part of town and preferred hanging out with them because,well because they were so funny and cool. Somerville, in my junior year, broke a state sprint relay record and held onto that record for almost 30 years. I still remember their names – the Plummer brothers, Jones and Hoagland. Hoagland got a full ride to Nebreska and eventually made it up the military brass. Fast and strong kid. Wow, really good times.

    And for Moon, he’s been resting in peace for 35 years.

    I had a retail business (among other things in my life) right outside of Somerville. Many older residents from that area would come in for work on their cars. I would converse and then bring up those kids names. It was all smiles from then on.

  10. abeiz says:

    LL provided me with an appraisal of the property. In retrospect, I should have suspected something when in June when she asked for access to the property so that an “insurance agent” could look/document it.

    The appraisal report compared her multi comprising of 3BR/1BA and 3BR 1BA + .5BA jerry rigged toilet below a staircase… to homes having two full baths in every unit. I would think that one less full bath on each floor in each of the three bedroom units is a significant negative both from the investment perspective, and that of the prospective renter who is likely looking to move a family in.

  11. The Great Pumpkin says:

    Maybe this rule doesn’t apply anymore? I’m not saying I know, but it’s a damn good question. It looks like it doesn’t work anymore…

    dentss dunnigan says:
    August 14, 2019 at 7:25 am
    Recession on it’s way …inverted yield curve ….sell if you got em’

  12. The Great Pumpkin says:

    Houses are becoming more affordable by the day. Everyone that wants a job, has one. You read the wsj commentary piece talking about the economy from the New Hampshire view point. Economy is a f’en beast right now. Best of our lifetime. It’s unbelievable.

  13. The Great Pumpkin says:

    As these boomers retire every day, we need immigrants. There is no way we can fill the jobs this economy needs right now without immigrants. Trump better think long term.

  14. Libturd, seen crazy things done with ping pong balls. says:


    I appreciate your advice and support. Don’t worry man, I almost never go short. That is a fool’s game and I’m glad you hedge the sh1t out of your positions for protection.

    Just to clarify. When I move from 100 aggressive/0 defensive in my non-asset portfolio to 50/50, I am going from 100% VUG (Vanguard Large Cap Growth ETF) to 50% VUG and (in this case) 25% each of XLP (Consumer Staples ETF) and XLU (Utilities ETF). My goal is to reduce the losses in the case of a pull back in exchange for the opportunity cost of a roarin’ 20’s. If my spidey sense tells me a pullback is imminent, I will then shift more of my remaining VUG into a bond fund or some other similar product that is supposed to remain stable during corrections.

    And yes, the inverse yield curve is just another sign of the coming apocalypse.

    I have never nailed the top nor the bottom (in equities). I am almost always a little early and on the way out and when I get back in. But as long as I’m less than 50% away from the top and the bottom when I do it, I’m significantly ahead of the Pumpkin crowd. And in most cases, my timing has been uncanny. It’s the only way I’m surviving (and by being Captain Cheapo with frugality) among the D’s medical bills and our lack of wage growth over here.

  15. Libturd, seen crazy things done with ping pong balls. says:

    I see I wrote SHORT position yesterday. My apologies.

    In other news, today alone, I have saved myself more than a year’s worth of car payments based on my moves made yesterday.

    Maybe I’ll celebrate over some canned pancakes?

  16. Juice Box says:

    re: “Maybe I’ll celebrate”

    Seesawing markets mean quick money to be made. VIX is up 20% today.

  17. Juice Box says:

    re: super premium bourbon

    I don’t think you will be slinging hooch from the back of a van anytime soon. How about the export market for the stuff? Asia loves their premium booze.

  18. ExEssex says:

    How about a premium salad shooter?

  19. Blue Ribbon Teacher says:

    So SF bans e-cigarette sales, but marijuana sales are fine and dandy?

  20. Libturd, seen crazy things done with ping pong balls. says:

    Why shoot salad when you can shoot Latinos?

  21. ExEssex says:

    Oh Lib. Shaking head. You are toooooo much.

  22. ExEssex says:

    BRT not sure of the science but following legalization out here:

  23. Libturd, seen crazy things done with ping pong balls. says:

    Now Trump is blaming the FED for the inverted yield curve after begging the FED to cut rates (which in his pea brain, was probably meant for personal gain by lowering the rates on all of his real-estate debt).

    Do the deplorables still have a hard on for this moron in chief?

  24. ExEssex says:

    In Gawd We Twust

  25. No One says:

    Deplorables don’t know what a yield curve inversion is. Neither did Trump till Kudlow told him about it.
    I thought I mentioned the 3m 10y yield curve inversion a month or two ago.

  26. The Great Pumpkin says:

    Didn’t I just say this in my morning post? It’s bs. The yield curve is not a guaranteed predictor of recession. They keep ignoring how strong the economy really is, instead they focus only on what they want to see…a recession. They can’t handle the idea that a recession isn’t due. Like an ADHD child, throwing tantrums because this bull keeps going.

    No bull has raged this long, so surely it must mean recession is around the corner…I have listened to this nonsense for how long now? Past 5 years? Jesus, it never fails. Every 4th quarter they look for reasons to drive down the market…it’s comical.

    “Janet Yellen says yield curve inversion may be false recession signal this time

    -Markets should place less weight on this yield curve inversion, former Federal Reserve Chair Janet Yellen said Wednesday.

    -“Historically, [the yield curve inversion] has been a pretty good signal of recession and I think that’s when markets pay attention to it but I would really urge that on this occasion it may be a less good signal,” Yellen said on Fox Business Network.

    -The bond market’s main yield curve inverted on Wednesday, worrying investors that a recession is coming.”

  27. The Great Pumpkin says:

    Labor market good…check.

    Euphoria kicking in? Nope. Check.

    Earnings good? Check.

    Rates are lowering. Check.

    Any signs of bubbles. Nope. Check.

    Housing market overheated? Nope. Check…hasn’t even started.

    Just a few signals that tell me there is nothing to worry about.

  28. The Great Pumpkin says:

    Where is the overproduction? Where is the high inflation? Deteriorating labor market? Where is it? Get out of here with the recession talk.

  29. ExEssex says:

    That’ll Do Pumpkin….That’ll Do.

  30. leftwing says:

    Lib, good to hear LOL. Was concerned when I saw the 50 short IRA….wanted to say “WTF are you out of your mind” but I figured I would be more politically correct in case you actually meant it….

    Re: me, I’m all options on shorts. These positions represent a small portion of my overall portfolio but added a little more than 6% to my return on my total portfolio since the start of earnings season a month ago (market is down 5.5%).

    I’m very disciplined in what I enter, the value I have at risk relative to my overall portfolio, the setup, and maybe most importantly a very hard stop loss. Bottom line, I’ve been able to breakeven on these positions even if I call only a third correctly. I’ve been hitting just shy of 60% historically.

    Mentioned GOOS yesterday. They reported this morning. With all the ruckus today haven’t had a chance to listen to their call. It’s down 7.5%…really bummed, the damn thing actually popped for the first 20 minutes after open, what an opportunity to establish a position…Only so much time…I’m going to do a deep dive into the company by gut tells me she’s probably a good longer term short still. Particularly if she bounces again.

  31. DuckVader says:

    Hello to everyone. I was a lurker here for several years; having lived in Bergen County. Moved out in 2015 because the job took me to the Philippines. I live in the country of Duterte, so you can believe how that feels as well. Although I had issues with our New Jersey house and cursed it on days (and repair costs), it still holds some of the fondest memories of my kids growing up and of days spent playing in the yard. For anyone here who had kids below 10, here’s my one single piece of advice — regardless of whether you believe devices are good or bad, take the time to get them away from those things and spend with them, playing, reading, building, school work, even just walking through the mall and getting ice cream. Highly unlikely we are returning to NJ since we don’t have family there. But I just remembered this site and the personalities that I saw on it. I hope all of you are well, regardless of your political bent.

  32. Blue Ribbon Teacher says:

    Any signs of bubbles. Nope. Check.

    haha, bookmarked for later

  33. The Great Pumpkin says:

    The good news is that the U.S. isn’t confronted with severe excesses to unwind, as it was in the mid-2000s with the housing boom or the late 1990s with tech-stock gains. Because of that, some economists said any downturn might be mild.
    Many past recessions were traced to high interest rates instituted by the Federal Reserve, as in the early 1980s; to bubbles bursting such as the dot-com bust of 2000 and 2001; to financial instabilities as in 2007, 2008 and 2009; or some combination of the above.
    Some experts predict that if a recession comes, this time it will be driven by lower business investment.

  34. The Great Pumpkin says:

    That’s what I’m saying..

    “Not quite global. US fundamentals are sound. Low inflation, low (and still positive) interest rates, strong consumer demand, non-stressed supply chain, and low commodity prices. Don’t take the bait. Short securities and stay cool”

  35. Libturd, seen crazy things done with ping pong balls. says:

    What about the Trump bubble? You know. The one where you don’t pay taxes if you repatriate earnings supposedly earned overseas (you know, like Apple profits in Ireland) on top of the giant corporate ass kissing which resulted in a huge buyback of shares which juiced earnings. Where will the future earnings come from?

    And if the economy is so great, why are there so few gains at all but at the tippy top of the food chain. Credit card and student debt are at all time highs.

    Nothing to see here.

  36. leftwing says:

    “haha, bookmarked for later”
    “Nothing to see here.”

    Stop trying to wrestle with a pig. You get dirty while the pig is entertained.

    He’s playing you guys. His entire existence is getting a rise out of you. He is/was the kid in school who only existed to the extent he could rile someone. Hide someone’s lunch. Tell someone’s girlfriend lies. Anything to get the most attention, whether negative or positive. And always negative, as he has no positive contribution to make. Treat him like you treated that little snot nosed douchebag kid. Ignore him. Stop letting him hang around. For real. It will crush him and he will just go away.

  37. leftwing says:

    Released today. Some interesting snippets…

    SFH view on present sales basically at LTM high
    Forward six months view not at same relative high
    Forward six months gap between present/forward at LTM high
    Traffic finally breaks 50 again

    Northeast weakest view with highest level of volatility
    On rolling 3M, northeast declines, other areas flat/increasing

    Look at Table 5, regional History. Interesting how you can see the timing and rollout by region of recovery. Interesting point here, Midwest and West started an unmistakable decline in 2018.

Comments are closed.