December saw a double-digit annual increase for home prices across the country, according to the Case-Shiller Home Price Index from S&P Dow Jones Indices and CoreLogic.

The nine U.S. Census regions showed a 10.4% annual gain in December, up from 9.5% in the previous month.

The 10-city composite annual increase came in at 9.8%, up from 8.9% in the previous month. The 20-city composite posted a 10.1% year-over-year gain, up from 9.2% in the previous month.

Prices rose in all 19 reporting cities, with Seattle, Washington, D.C. , Boston, Cleveland, Miami, and Phoenix each showing a 1.5% increase.

Digging deeper into the numbers, Phoenix saw a 14.4% year-over-year price increase, Seattle saw a 13.6% increase and San Diego saw a 13.0% increase. Eighteen of the 19 cities reported higher price increases in the year ending December 2020 versus the year ending November 2020.

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In the last few years, the number of existing single-family homes for sale has decreased. But home prices have increased. To make homeownership a possibility for everyone, there needs to be a higher supply of affordable homes.

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The Federal Housing Finance Agency also reported a 1.1% increase, noting home prices rose in all nine of the report’s regions in December 2020. The East-South-Central (+1.7%) and Mountain (+1.4%) regions showed the largest month-on-month increase.

Industry experts didn’t know what to expect when the COVID-19 pandemic hit the country last March, and initially, price growth decelerated in May and June. Then, mortgage rates plummeted to historic-lows, opening the homebuying floodgates and propelling prices skyward.

Rates have slowly climbed back towards 3% in the past few months, but inventory is still low, keeping prices high. Finally, lumber and other building materials are still scarce, forcing construction companies to delay projects and prevent an inventory build-up.

Of course, this is all fantastic news for anyone looking to sell their home in 2021.

December 2020’s 10.4% gain “marks the best performance of housing prices in a calendar year since 2013,” said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones. “From the perspective of more than 30 years of S&P CoreLogic Case-Shiller data, December’s year-over-year change ranks within the top decile of all reports.”

Zillow Economist Matthew Speakman added that homes in some major markets are going under contract more than a month faster than they were at this time last year.

“This forces would-be buyers to move very quickly to put an offer in on a home they desire, increases the likelihood that multiple offers will be fielded by the seller, and ultimately places more upward pressure on prices,” Speakman said.

Last year also saw a massive exodus of people moving from urban apartments into larger, suburban homes as work-from-home and contactless interaction became the norm in the midst of the pandemic.

“This may indicate a secular shift in housing demand, or may simply represent an acceleration of moves that would have taken place over the next several years anyway,” Lazzara said. “Future data will be required to address that question.”

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Consumer credit activity rose in the fourth quarter of 2020, as low interest rates and high housing demand continued to fuel mortgage demand, according to TransUnion’s latest industry insights report.

Serious delinquency rates in mortgages declined year-over-year to 0.7% in the fourth quarter of 2020. Delinquency rates were at 1% in the fourth quarter of 2019.

“On the surface, the consumer credit market is performing quite well,” said Matt Komos, vice president of research and consulting at TransUnion. “Additional stimulus and flattening unemployment rates point to a continuation of this trend. However, the performance of those accounts still in accommodation will help shape the true consumer credit picture.”

The final delinquency tally for December 2020 showed that, by year’s end, 1.54 million more delinquent and 1.7 million more seriously delinquent mortgages were reported than at the start of 2020, according to a separate January report from Black Knight.

With nearly 2 million extra overdue loans in the pipe, that’s approximately 3.4 million loans in total at December’s end. Overall, the data analytics company estimates a more than 250% increase in 90-day default activity year-over-year.

Komos added that many accounts are expected to come out of accommodation between March and May – including mortgage accounts.

“We will soon see the true impact of those programs for both consumers and the credit marketplace,” he said.

A total of 50.5 million mortgage loans were issued in the fourth quarter of 2020. That’s up from 50.1 million in the fourth quarter of 2019.

As an aside, the third quarter of 2020 saw mortgage originations skyrocket, reaching nearly 4 million total loans – the highest level of originations since the Great Recession. That’s also 67% higher than the third quarter of 2019. The delinquency rate in the third quarter of 2020 was down 57 basis points from the second quarter of 2020 and up 368 basis points year-over-year.

The average balance of new mortgage loans in the fourth quarter of 2020 was $296,505 – nearly $10,000 higher than the average balance in the fourth quarter of 2019. In all, new mortgage origination loan amounts surpassed $1 trillion in 2020.

However, TransUnion Senior Vice President and Mortgage Business Leader John Mellman said he expects a rise in delinquencies in 2021 due to expiring forbearance plans.

“Refis continue to be a major driver of the increase in activity,” he said. “While reported delinquencies are currently low, we expect to see a rise in delinquency levels at the end of the first quarter and into the second quarter.”

Here are some additional mortgage numbers from TransUnion’s fourth quarter 2020 report:

  • Originations were spread evenly between refinancing and new purchases, with a 52% refinance share and a 48% purchase share
  • New mortgage volumes grew the most, at 118% year-over-year for lower risk consumers
  • The overall 90+ consumer level delinquency rate dropped to .83% in the fourth quarter, down from 1.16% in the fourth quarter of 2019
  • The average debt per borrower was $220,244, up from $212,040 in the fourth quarter of 2019. As a comparison, the average debt per borrower in the fourth quarter of 2017 was $201,737.

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Title insurance upstart States Title announced this week $150 million in debt financing from HSCM Bermuda, which will go towards developing a more modern home closing experience.

CEO Max Simkoff said the financing will held them “wipe the system clean” and build a homebuying system from scratch – one that is simple, efficient and digital, he added.

“Home buying, which is already stressful and overwhelming, should set the standard for easing customers’ journeys rather than lagging behind other digital solutions,” Simkoff said in a statement. “[HSCM] sees immense value in how we are overhauling the system and, together, we now have greater capacity to tackle this enormous market, with significant tailwind behind what we’re doing.”

The financing follows a $123 million Series C filed last May, which went towards States Title’s continued goal of digitizing real estate closings.

The debt financing will go towards product development, investment in go-to-market growth, and the refinance of debt to Lennar Corp., which helped fund the 2019 acquisition of North American Title Co. (NATC) and North American Title Insurance Co. 

After acquiring NATC’s underwriting in 2019, State Title’s intelligence platform suddenly had volumes of publicly-available closing data. As a result, State Title was able to patent technology that removed entire chunks of the closing process.

Now, even more cash will be allotted towards the company’s technological advances in the field of homebuying, Simkoff said.

“The platform benefits lenders, real estate professionals, title agents, and homeowners, and has become even more crucial as the impacts of COVID-19 and record-low interest rates have created a huge tailwind behind home purchase and refinance,” he said.

States Title focuses on technology in its services, using data science to “create predictive title insurance based on an assigned risk score to indicate how safe a property is from liens or liabilities, helping to achieve faster title processing and more efficient underwriting.”

From 2018 to 2019, State Title grew transaction volume by 100x, according to the company.

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The stock market is a funny game. Not the kind of game that the rookie Game Stop investors are used to playing, but a real-life, action-packed, form of entertainment that toys with millions of Americans’ emotions and finances every day. You know what isn’t a game, and can also provide oh-so-sweet returns? Investing in real estate. 

The stock market is at an all-time high, finishing 2020 at record levels. But these gains are a temporary disguise, masking the true future of a volatile market.

In 2020, home prices soared by nearly 10% to levels not seen since 2014, all while inventory dropped significantly. The high demand created a competitive market, but also a successful investment environment for real estate enthusiasts.

Don’t Wait To Invest In Real Estate

Everyone should follow the idea of “Don’t wait to buy real estate, buy real estate and wait.” While, like the stock market, the waiting game for a real estate payoff can prove to be taxing, the reward is a very sweet victory. You may even get a few more hours of sleep along the way. 

Prior to 2020, properties typically appreciated at a little under 4% per year. However, even individuals that purchased homes in 2020 have seen an increase in home value after just one year of homeownership. According to CoreLogic, homeowners saw an 8% increase in home prices in 2020.

2021 is going to be another pivotal year for real estate, and it is estimated that the real estate market will see its highest level of activity ever, and home values are expected to continue to rise.

As numbers have surged during the pandemic, they are going to continue to grow for a different reason. The stock market. 

As the stock market adjusts to its new normal, the real estate market is growing stronger and stronger. And more importantly, it’s growing with stability. 

An investment in real estate is an investment in a tangible item. This tangible thing isn’t managed by an investment firm on Wall Street, or through an app – how stressful is that? Real estate is a physical investment that you can touch, feel and live in.

Not only is the investment tangible, but as home appreciation values continue to rise, real estate continues to prove a valuable investment as well. 

2021 Will See Continued Growth

These opportunities available in real estate are going to cause a tech disruption on the investment side. 2021 will see a plethora of offshoot companies and crowdfunding for real estate that hasn’t been seen before.

Real estate investments have generally been focused on the brokerage side, but it makes sense for individuals to pull their money together, buy a property, and have that value appreciate. 

Call your friends, go buy some properties. Then let the market do the rest of the work.

When investing in real estate, you don’t have to watch the value appreciate through a chart. You can drive-by your investment, disguised as a property, and check it out for yourself.

Another new dynamic to investing in real estate rather than the stock market is in the capitalization rate. Investors, in general, want to see a return on their investment at a 6 cap or higher, but because the security of real estate is so strong right now, I expect investors will buy at a lower cap rate. 

A real estate investment provides security. 2021 is the time to jump on that opportunity. 

This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

To contact the editor responsible for this story:
Sarah Wheeler at

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Even Norman Rockwell couldn’t put a rosier cast to New Hartford, Connecticut, in mid-autumn. On the far western outskirts of the Hartford metropolitan area, the town’s converted brick mill buildings are now occupied by restaurants that sell and serve locally grown produce and locally made artisanal cheese. A river – the Farmington – really does run through the town, shallow and sparkling, punctuated by occasional fly-fisherman. Bridges arch over the river from stands of yellow-leafed birches to groves of flaming maples.

It’s exactly the kind of place that’s attracting pandemic-panicked New Yorkers who, drawing a circle of two hours’ train travel from Manhattan, figure they can set up parallel lives in the country and city. 

The COVID-19 crowds that are now seeking fresh air and socially distanced living are looking beyond what is considered more traditional second-home destinations to small towns that have struggled to catch the updraft of the broadband revolution. As city dwellers scatter, enough of them are landing in the semi-rural spots to potentially realign the very definition of economic development, land use and the consequent cascade of broad band investment, municipal services, taxation and local spending priorities. 

“The economy is moving faster than the population,” said Mark Lautman, an economic development consultant who has helped local organizations in New Mexico and elsewhere forge partnerships that serve residents and employers.

In the past, economic development was defined by incentives for buildings and infrastructure with the aim of winning and keeping employers with substantial numbers of workers. 

The COVID-19 pandemic has accelerated a longer-term trend of separating talent from location. Economic development leaders are just starting to realize the profound implications of a distributed workforce on their local economies, workforce development, housing and real estate markets, he said. 

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Out of necessity, the pandemic spurred numerous changes in the mortgage process, including appraisals. But what part of that will stick after we’re back to a more normal environment? We’re exploring that topic at our Spring Summit on March 4 and asked Brian Zitin, co-founder and CEO of Reggora, to share his expertise on the panel titled, The Brave New World of Valuations.

Reggora is a venture-backed startup that provides software to speed up the appraisal process for mortgage lenders and real estate appraisers. Prior to Reggora, Zitin co-founded a real estate brokerage called Sonder Partners, which was based on a proprietary algorithm that helped to efficiently target and sell investment properties in the Greater Boston area.

His time with Sonder Partners exposed Zitin to the inefficiencies in the modern appraisal process, which led to the start of Reggora. Zitin has also spent time at both a boutique private equity company and a large commercial real estate investment firm.

At the Spring Summit, Zitin will be joined by Tony Reese, chief appraiser at RPM Appraisal Services, and William Fall, CEO of The William Fall Group, to talk about what the appraisal process will look like as we come out of the pandemic period.

Other topics on the agenda include:

  • What mortgage tech is solving now
  • Servicing challenges in a pandemic period
  • Operational strategies in the current market
  • eClosing/RON update
  • A new regulatory regime

The summit also features sessions on lessons from local markets, an economic update and more.

As with all HousingWire events, we’re bringing together some of the brightest and most successful people in mortgage, real estate, compliance, security, technology and regulation to offer their insights on what’s happening right now and what’s coming next.

Speakers joining Zitin include UWM CEO Mat IshbiaFigure  Technologies CEO and co-founder Mike Cagney , CoreLogic’s  Selma HeppBlend CEO Nima Ghamsari, Mortgage Champions CEO Dale Vermillion, Lead Analyst Logan Mohtashami, top Century 21 Realtor Xio Sandoval and many more.

The 2021 Spring Summit is designed for our HW+ premium members, who get access to all HousingWire virtual events, long-form digital content published weekly, an exclusive Slack community and more. Sign up for HW+ membership and register for the summit here, or get event-only access for your company or team here.

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The total number of mortgages in forbearance declined six basis points to 5.29% in the week ending Feb. 7, according to the latest estimate from the Mortgage Bankers Association.

The trade group said 2.6 million homeowners are currently in forbearance plans.

“The share of loans in forbearance declined to the lowest level since April 5th of last year, due to decreases in both the GSE and Ginnie Mae portfolios,” said MBA Vice President and Chief Economist Mike Fratantoni.

According to the MBA, Fannie Mae and Freddie Mac loans in forbearance decreased six basis points to 3.01%. Ginnie Mae loans decreased 12 basis points to 7.34%, while the share for portfolio loans and private-label securities (PLS) remained unchanged relative from the prior week, at 9.14%.

The percentage of loans in forbearance for nonbank servicers decreased 4 basis points to 5.69%, while the percentage of loans in forbearance for depository servicers decreased 10 basis points to 5.26%.

From forbearance to post-forbearance: How to make the process effective

To accommodate the large volume of loans still in forbearance, mortgage servicers must have functional, flexible and effective forbearance processes in place. Here are some actionable steps to create that process.

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“Similar to the trend in recent months, the first week of February
showed a faster pace of exits from forbearance compared to recent weeks, while new forbearance requests were unchanged,” Fratantoni said.

“MBA expects the rollout of the vaccines to boost economic growth through the course of the year, leading to a stronger job market and a greater ability for more struggling homeowners to get back on their feet. We do believe that additional support is needed until they have regained their jobs and incomes.”

According to the MBA, 16.07% of total loans in forbearance are in the initial stage while 81.42% are in a forbearance extension. Just over 2.5% are forbearance re-entries.

The MBA’s survey found that of the cumulative exits between June 1, 2020, and Feb. 7, 28.2% of borrowers continued to make their monthly payments during the forbearance period. Of those exiting forbearance, 25.5% resulted in a loan deferral/partial claim, and 15.4% resulted in reinstatements, in which past-due amounts are paid back upon exit.

About 14% of exits represented borrowers who did not make all of their monthly payments and exited forbearance without a loss mitigation plan in place. The survey found that 7.7% of exits resulted in loan modifications, and 7.5% of exits resulted in loans paid off through either a refinance or by selling the home.

On the day that the MBA released its latest survey, the Biden administration extended forbearance and eviction moratoriums an additional three months, through June 30, 2021. Homeowners with FHA loans will now be able to receive up to six months of additional mortgage payment deferrals if they entered before June 30, 2020. The Biden administration’s FHA also gave homeowners more time to request a pause or reduction in mortgage payments through the CARES Act.

However, the measures made Tuesday don’t apply to borrowers with loans backed by Fannie Mae and Freddie Mac. Those borrowers can request forbearance for up to 15 months if they apply by the end of February.

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Real estate data powerhouse CoStar Group has made an offer to acquire Corelogic for $95.76 a share, roughly 20% higher than the accepted offer Stone Point Capital and Insight Partners made earlier this month.

By bidding over $95 a share, CoStar’s offer would value CoreLogic at $6.9 billion. In a letter to CoreLogic’s board, CEO Andy Florance said he was “stunned” to read that Stone Point and Insight’s offer had been accepted.

“We do not believe the pending transaction maximizes value for CoreLogic stockholders and we continue to believe in the strong strategic rationale for the combination of our two companies,” Florance said in the letter. “The fact that CoreLogic stock continues to trade well above the pending transaction price is a clear indication that the shareholders agree with us.”

CoreLogic had been battling with investors who jointly own or have an economic interest equivalent to approximately 15% of CoreLogic’s outstanding common stock since the summer. In a July letter sent to CoreLogic’s board of directorsCannae Holdings and Senator Investment Group proposed buying the firm in an all-cash offer for $66 a share.

The investors dropped their takeover bid on Nov. 2 after CoreLogic confirmed it was exploring multiple offers to sell at or above $80 per share. Cannae and Senator still exerted pressure on shareholders to fully replace the board with their own nominees.

compromise was reached on Nov. 24 following a proxy vote was held that replaced three of the 12 directors on CoreLogic’s board with that of the investment groups’ nominees.

Funds managed by Stone Point Capital and Insight Partners agreed to buy CoreLogic earlier this month in a deal with an equity value of about $6 billion. That came after CoStar made an offer worth $86 a share, according to Bloomberg calculations.

Under the terms of CoStar’s latest proposal, CoreLogic shareholders would receive 0.1019 shares of CoStar in exchange for each share of CoreLogic stock, representing a value of $95.76, Bloomberg reported.

If CoStar were to close the deal, it would represent the largest acquisition the Washington, D.C.-based firm has completed to date. CoStar has already spent billions acquiring other firms in recent years, including a $250 million buyout of Homesnap in November and a $190 million deal for Ten-X Commercial in March. Because of anti-trust issues, the firm often has to walk a tight rope with acquisitions. Its deal to acquire RentPath fell apart late last year after the Federal Trade Commission filed an antitrust complaint.

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The years 2020-2024 will have the best housing demographics ever recorded in U.S. history, with the lowest mortgage rates recorded in history. When you have these two titans acting in unison, it can potentially accelerate real home prices in an unhealthy way. 

In 2020, the year of COVID-19, existing home sales ended at a respectable 5,640,000. That is roughly only 130,000 higher than the levels we saw in 2017. But sales should have ended the year more in the range of 5,710,000-5,840,000 if we stayed true to the trend line we had established by February 2020, before the COVID crash. We were and still are playing catch up to the lost demand during the COVID-19 shutdown period.

Purchase applications give a right direction trend 30-90 days ahead, and they are now averaging 12.8% year-over-year growth from last year. This is a tad better than I expected. 

So far this year, the weekly Mortgage Bankers Association purchase application data compared to last year looks like this: +3%; +10%; +15%; +16%; +16%; +17%. That is still growing a bit better than the peak rate of growth I was looking for at 11% before March 18 arrived, and all economic data went haywire crazy on year-over-year comps.

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Online retail lender loanDepot raised just $54 million by offering 3.9 million shares at $14 on Thursday, far below the range of $19 to $21 it initially had sought. The downsized offering follows a theme that’s afflicted almost all of the nonbank mortgage originators that have gone public in the last year.

LoanDepot, the second-largest retail-focused IMB in the country, had initially planned to raise about $362.5 million by selling 17 million shares at $21 in an IPO. Instead, with the $54 million raised, its proceeds came in at 82% less than bookrunners had projected earlier this week.

All of this occurs against the backdrop of record origination volumes and record profits at the California-based lender, which is the fifth-largest overall retail lender in the country, according to Inside Mortgage Finance.

In its S-1, loanDepot said it originated $79.4 billion in loans for the 12 months that ended Sept. 30, 2020. And according to Inside Mortgage Finance, loanDepot originated about $100.7 billion in mortgages throughout 2020.

The company generated $1.47 billion in net income in the nine months through Sept. 30, blowing away any prior record many times over.

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“We’ve created a company that is built to serve customers throughout the entire loan transaction, from the onset of the purchase or refinance decision through loan closing and servicing,” its CEO and founder Anthony Hsieh said in the prospectus.

In its prospectus, loanDepot spoke of its partner business, which includes third-party-originations via mortgage brokers and real estate agents, as well as joint-ventures with builders and other referral partners. But it noted that its retail strategy is more developed. LoanDepot originated 72% of the company’s loans in 2019 via its 2,000-member strong retail channel, and 28% through its partner network.

LoanDepot has demonstrated it can harvest leads through its “mello” technology platform and close with a direct-to-consumer approach, but such a strategy has limitations when interest rates rise and the purchase market is more viable.

As of early Thursday afternoon, investors seem to have responded well to loanDepot’s downsizing approach. The stock was trading at $16.80 as of 12:34 p.m. EST and had even hit a high of $17.77 earlier in the day.

LoanDepot is traded on the New York Stock Exchange under the ticker symbol LDI. Its bookrunners include Goldman Sachs, BofA Securities, Credit Suisse, Morgan Stanley, Barclays, Citi, Jefferies and UBS Investment Bank acted as lead managers on the deal.

Backed by private equity firm Parthenon Capital Partners, loanDepot first announced plans to go public in September 2015, but canceled the IPO hours before pricing due to what the company called adverse “market conditions.” At the time, LoanDepot had sought a valuation of $2.4 billion to $2.6 billion. In 2017, the company revived plans for an IPO but didn’t take the plunge.

Its entrance into the public markets follows that of several rivals, including Rocket Companies (Hsieh said in the fall that loanDepot was the Lyft to Rocket’s Uber) as well as wholesale-only lenders United Wholesale Mortgage and Homepoint.

It’s unclear if Apollo Global-owned AmeriHome and Lone Star Holdings-owned Caliber Home Loans will go public after their respective financial backers postponed their planned IPOs in October due to adverse market conditions.

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