As goes Goldman Sachs, so goes Wall Street. When a memo went out last year from CEO David Solomon telling staff that formal business attire was no longer an everyday requirement, it confirmed that casualwear had finally come to Wall Street.

And, when the venerated investment bank started slashing bonuses in the decade after the 2008 mortgage-bond meltdown, the financial services industries knew the golden age of multi-million-dollar bonuses that incentivized risk-taking was waning.

Now, Goldman Sachs is taking a stand against “bro culture” on startup boards. Speaking on Thursday at the World Economic Forum in Davos, Switzerland, Solomon said Goldman Sachs will refuse to take a company public unless it had at least one “diverse” board member.

The new rule goes into effect on July 1 in the United States and Europe, and the initial push for diversity will start with a focus on women, Solomon said. By 2021, the bank will look for two diverse board members, he said.

In a CNBC interview, Solomon said public offerings of U.S. companies with at least one female director over the past four years performed “significantly better” than those without.

“We might lose some business but in the long run this is the best advice for companies that want to drive premium returns for their shareholders,” Solomon said. “I look back at IPOs over the last four years and the performance of IPOs where there has been a woman on the board in the U.S. is significantly better than the performance of IPOs where there hasn’t been a woman on the board.”

Goldman Sachs has an 11-member board that includes four women.

“I really value the diverse perspectives that I’m getting that help me to run the company,” Solomon said.

Solomon didn’t cite proptech startup WeWorks, but it was the elephant – or the unicorn, to use the nickname for private companies valued at more than $1 billion – in the room. It went from an initial $47 billion valuation to bankruptcy in the second half of 2019.

Goldman was one of the investment banks slated to lead WeWork’s IPO, if it hadn’t been pulled because of questions about governance and valuation. WeWork’s initial IPO filing named a seven-member board that was all men.



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TransUnion recently reported that there will be a flood of first-time homebuyers in the market over the course of the next three years.

Now, it looks like that flood may be ready to start, but the news isn’t all good.

The latest Housing Trends Report for the National Association of Home Builders, which surveys prospective homebuyers for their sentiments on buying a home, revealed that the fourth quarter of 2019 saw the fifth consecutive year-over-year drop in the share of American adults who said they plan to buy a home in the next year.

According to the report, Q4’s report showed that only 11% of adults said they want to purchase a home in the coming year, down 2% from 2018’s 13%.

But, despite this number inching down, the report holds some positive news as well.

In fact, 63% of those who said they plan to buy a house are first-time homebuyers. This is much larger than a year earlier, when 53% of prospective homebuyers were first-timers.

Broken down by age group, it’s Millennials who are most likely to make a home purchase, with 19% of the overall share. Following not too far behind is Gen Z, with 13% and Gen X, with 12%, the report said.

Those prospective buyers in the two younger generations are, for the most part, first-time buyers.

Of the Gen Z prospective buyers, 88% would be first-time buyers, while 78% of Millennials would be first-time buyers. Interestingly, 57% of Gen X buyers would be first-timers and 20% of Boomers said they would be first-timers, too.

To no surprise, only 5% of Boomers said they have plans to purchase a home. Lately, there has been an “aging in place” trend, which may provide a reason for this small percentage.

Geographically, 12% of those surveyed were prospective homebuyers in the South and West, in front of the 10% in the Northeast and 9% in the Midwest.



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For many years, I have been adamant that following the Mortgage Bankers Association‘s purchase application data is critical for predicting what will happen in the housing market in the coming year. 

Logan Mohtashami
Logan Mohtashami,
Columnist

Housing market news can be over-hyped depending on the source, and this is especially true since the housing crash. Now it seems every soft print is thought to be a harbinger of another imminent collapse of the market.  

To help you navigate the sea of both positive and negative hyperbole that can make up the housing market commentary, last year, I started a weekly purchase application tracker on Twitter.

The context for this metric, however, is even more important than the nominal value.  Here are some guidelines on how to interpret this data line.

1. Seasonality: The second week of January to the first week of May is the period that makes up the bulk of the upfront housing demand.  

Purchase application numbers during these “heat months” should be viewed as the most crucial for the calendar year. By the end of February, we have a pretty good idea of how the year will shape up. 

2. The trend is your friend: The year over year comparison data is a more important predictor of future demand than the week to week data lines. 

While the week to week variations in the data can make for sexy headlines, they are not the most meaningful predictors of where the market is headed for the year. Trust only the year over year data.

3. Total mortgage application headlines need context: If you’re looking for direction just on spring season year over year demand trends, be mindful that the total application headline counts refinancing in it. 

You can have big swings on the year over year data on the entire mortgage application side and not have it mean much to the spring selling season. I have seen this mistake happen a lot because people forget about the refinancing aspect of the data.

Last year, we had a mini refinancing boom from buyers of homes in 2017, 2018 and 2019, as they had bought houses with higher rates. Now that a lot of them have refinanced, the whole headline year over year data – especially past April – may look bad, but it doesn’t mean home demand is falling. 

4.  Don’t assume: The percentage of growth or decline in purchase applications does not predict if sales will rise or fall by the same percentage. 

We can have 5-7% growth year over year, in purchase application data, and existing home sales can still be down for the year.

In the last two years, we have had slightly negative growth and an increase in inventory with positive purchase applications for the majority of the years.

We did have some negative prints during the heat months of 2019, something that hadn’t happened since 2014 when sales were down year over year. Remember this is a survey. The survey is suitable for trend direction, not exact sales.

The purchase application index in 2014 was at an all-time low when adjusted to the population. The index has been rising ever since. The best growth year was 2016 when we had over 25% growth year over year in the heat months. We didn’t have a 25% growth in sales that year.

Last year, due to the negative prints during the heat months, overall growth was only 3.7% year over year. The purchase application data from 2014-2020 doesn’t look anything like 2002-2005.  From this, we know that we don’t have an overheating housing cycle. Slow and steady wins this race.

MBAJan152019

For more on how the purchase application data is shaping the market in 2020, join me every Wednesday morning on Twitter.





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Homeowners may want to tap the breaks on those trendy white Carrara marble countertops if they’re looking to get a return on investment for home renovations.

That’s according to a recent report from NerdWallet, which pulls from Remodeling magazine’s 2019 Cost vs. Value report when stating, “An upscale kitchen renovation recoups just 59% of its cost in added value.”

Next on the list is one that’s more likely for the average home seller: DIY painting. The report cites data from Opendoor asserting that a low-quality paint job can result in the seller losing out on as much as $1,700. This may be bad news for the 47% of homeowners who stated at the beginning of last year that they were more likely to take on a project than hire it done. 

And while various HGTV shows may have homeowners ready to bust down some walls, the NerdWallet report advises against it in regard to an expanded master suite. If the renovation results in the loss of another bedroom, sellers could end up with their home listed at a lower price point. 

The last two items on the list may not be as surprising. Plush wall-to-wall carpeting and the addition of a swimming pool could end up costing homeowners. According to the report, carpet as the main flooring in a home drops its value by almost $4,000. A swimming pool, on the other hand, may deter buyers who are turned off by the potential maintenance. 

However, these warnings may be needless in 2020, as a recent report from Harvard University’s Joint Center for Housing Studies stated that U.S. homeowners are expected to spend less on renovations and repairs over the next year. 

That said, Arizona-based iBuyer Offerpad recently released a feature that allows homebuyers to customize their homes before moving in. Let’s just hope those homebuyers take a look at this list first.



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The 2019 multifamily and single-family market proved to be hot, and 2020 will only get hotter.

According to a new survey from TurboTenant, there were 31 cities from 20 states that were featured in the best place to buy a rental investment property report for 2020.

(Image courtesy of TurboTenant. Click to enlarge.)

New York and Ohio tied for the most cities represented, at three each, including Buffalo and Rochester, New York, as well as Akron and Columbia, Ohio. Seven states had double representation, including Iowa, Missouri, New Hampshire and Pennsylvania. Cities from Florida, Montana, North Carolina, South Carolina and Delaware also made the list.

To determine the top cities, the report compared the average rent with the monthly mortgage payment. The terms were set at 30 years, with a 20% down payment, and a 4.1% interest rate, which is the current national average. If positive numbers were reported in all categories, the location made the list.

Overall, the results found that the best places to invest in are in the Midwest and the East Coast.

In November, TurboTenant also showed that New York, Pennsylvania, Massachusetts, and New Hampshire were standouts, which is no big change from January’s report.

No. 1 on the list was Reading, Pennsylvania, which TurboTenant said has positive growth across the board. The number of leads per property in this town is its highest, at 271, with an average of eight days on the market. Home values here are increasing 11.1% year over year, with a median sale price of $140,000.

At the bottom of the list, No. 31, Auburn, Alabama actually is second place for the highest population growth and first place for employment growth. The median sale price of a home is $169,000, and the average two-bedroom rent is $919. Properties here spend an average of 14 days on the market.

Check out the rest of the list here.



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With a lack of new construction plaguing the housing market, many people are left to rely on the rental market, which saw record-low vacancies in 2019.

Add that up and that means it’s getting more expensive to live in the city, but that doesn’t mean there aren’t affordable options.

To that end, realtor.com found some cities that have affordable surrounding neighborhoods.

“I expect affordability to very much remain a main challenge for the housing market in 2020 for both buyers and renters, partly because there’s very limited new-housing supply,” says George Ratiu, senior economist for realtor.com, in a release.

Realtor.com uncovered the highest city to rent in is San Francisco, where a one-bedroom goes for $3,473. In the San Francisco metro, the Sunset District, located just about five miles outside of town, it was found to be the most affordable surrounding city, with one-bedroom rent going at $2,380.

Fellow California city Los Angeles was also ranked among the top of the list. With median one-bedroom rent at $2,199, the neighboring city of Windsor Hills had median one-bedroom rent at $1,657.

And the lowest? Median one-bedroom rent in Houston is at $1,035. Meanwhile in its most affordable neighborhood, in Mission Bend, located about 20 miles West of the Texas metro, the median one-bedroom rent is $700.

Another Texas metro, Dallas, also sits on the lower end of the list. There, the median one-bedroom rent is $1,180. In its most affordable neighborhood, Northwest Dallas, the median one-bedroom rent is $747.

“For young professionals looking for a place to rent, the major trade-offs center around location, proximity to public transit and amenities, as well as building features,” Ratiu said.

From New York to San Francisco, here are more affordable neighborhoods to live outside of the country’s largest cities:

Philadelphia, PA
Median one-bedroom rent: $1,495
Most affordable neighborhood: Somerton
Median one-bedroom rent in Somerton: $800

Atlanta, GA
Median one-bedroom rent: $1,425
Most affordable neighborhood: Dunwoody
Median one-bedroom rent in Dunwoody: $871

Chicago, IL
Median one-bedroom rent: $1,450
Most affordable neighborhood: Elmwood Park
Median one-bedroom rent: $1,150

Miami, FL
Median one-bedroom rent: $1,700
Most affordable neighborhood: Kendall West
Median one-bedroom rent in Kendall West: $1,251

New York, NY
Median one-bedroom rent: $2,960
Most affordable neighborhood: East Elmhurst
Median one-bedroom rent in East Elmhurst: $1,755

Washington, DC
Median one-bedroom rent: $2,200
Most affordable neighborhood: Chevy Chase
Median one-bedroom rent: $1,838

Boston, MA
Median one-bedroom rent: $2,500
Most affordable neighborhood: West Roxbury
Median one-bedroom rent in West Roxbury: $2,186



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The watchdog for Fannie Mae and Freddie Mac has been interviewing advisory firms to handle the public offerings of their shares and is likely to announce a name within the next few weeks, according to Jaret Seiberg, managing director of Cowen Washington Research Group.

“Our expectation is that FHFA in the coming few weeks will announce its financial adviser,” Seiberg said in a note to investors obtained by HousingWire. “We believe the agency in February will publish the proposed capital rules. We expect the enterprises to hire financial advisers this spring.”

Naming the investment bank to start the underwriting process for the companies known as government-sponsored enterprises is the first major step in releasing them from conservatorship. Fannie Mae and Freddie Mac, the nation’s largest mortgage financiers, were seized by regulators in 2008, in the midst of the financial crisis.

For the record, while the process of selling shares to the public is referring to as an “initial public offering,” or IPO, it would be a second go-round for both companies. Fannie Mae began trading on the New York Stock Exchange in 1968, and Freddie Mac began trading on the same exchange in 1989.

The “offering” would be the 80% of Fannie Mae and Freddie Mac held by the federal government since 2008.

Prior to the government takeover in 2008, shares of the Fannie Mae and Freddie Mac traded above $68. After regulators seized them, they were kicked off the NYSE and their share prices tumbled to around 50 cents by the end of 2008. Today, they trade at around $3.

“Next step, in our view, is for FHFA to issue consent orders that will automatically remove each enterprise from conservatorship once they hit the minimum capital level that the capital rule requires,” Seiberg said. “The consent order, however, will maintain FHFA’s control over the enterprises until they are well-capitalized.”

The process of releasing the companies from conservatorship won’t be stopped by the election of a new president if the FHFA has consent orders in place, Seiberg said.

“There will be an election between the issuance of the consent orders and the enterprises becoming well-capitalized,” Seiberg said. “To us, it will be difficult for Democrats to stop this process even if they win in November. And if President Trump gets re-elected, then there should be no real risk of a disruption.”



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Last year, Plaid, a technology platform that connects various applications with users’ bank accounts and has a growing presence in the mortgage space, secured investments from Visa and Mastercard.

The fintech company did not reveal at the time how much the credit card companies were investing, but it turns out that Visa’s interest in Plaid was much more than just exploratory as the credit card giant is now set to buy Plaid.

Visa announced Monday that it reached an agreement to buy Plaid for a total purchase consideration of $5.3 billion.

That figure is exactly twice as much as Plaid’s reported valuation in late 2018 when it raised $250 million in its Series C funding round at a valuation of $2.65 billion.

Noted venture capitalist Mary Meeker led that funding round, with participation from Andreessen HorowitzIndex Ventures, Norwest Venture Partners, and Coatue Management, along with existing investors Goldman SachsNEA, and Spark Capital.

Plaid later brought on Visa and Mastercard as investors but now, Visa is set to buy the company flat-out.

“We are extremely excited about our acquisition of Plaid and how it enhances the growth trajectory of our business,” said Al Kelly, CEO and chairman of Visa. “Plaid is a leader in the fast-growing fintech world with best-in-class capabilities and talent. The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers.”

In the mortgage space, Plaid, a 2019 HW Tech100 winner, provides an asset verification program that can be used as part of Fannie Mae’s Day 1 Certainty program.

The company expanded last year when it acquired Quovo, another company that also connects applications to customers’ accounts, although Quovo’s business is focused more on investment and brokerage accounts. Plaid reportedly paid around $200 million for Quovo.

But that deal pales in comparison to Visa’s deal to acquire Plaid itself.

According to a release, Visa views the acquisition as an entry into new businesses and “complementary” to its existing businesses.

“First, Plaid’s fintech-centric business opens new market opportunities for Visa both in the U.S. and internationally,” the company said in a release. “Second, the combination of Visa and Plaid provides the opportunity to deliver enhanced payment capabilities and related value-added services to fintech developers. Finally, the acquisition will enable Visa to work more closely with fintechs through all stages of their development and drive growth in Visa’s core business.”

Plaid’s products allow consumers to share their financial information with thousands of apps and services, including Acorns, Betterment, Chime, Transferwise, and Venmo.

“This acquisition is the natural evolution of Visa’s 60-year journey from safely and securely connecting buyers and sellers to connecting consumers with digital financial services,” Kelly said. “The combination of Visa and Plaid will put us at the epicenter of the fintech world, expanding our total addressable market and accelerating our long-term revenue growth trajectory.”

The deal is already receiving positive reviews from several sizable financial services companies.

“We believe Visa’s acquisition of Plaid is an important development in giving consumers more security and control over how their financial data is used,” said Gordon Smith, co-president, JPMorgan Chase and CEO of consumer and community banking. “Protecting customer data and helping them share that information safely has long been a top priority for Chase. We look forward to partnering with Visa to continue building a great experience for our shared customers.”

PayPal President and CEO Dan Schulman, meanwhile, stated: “We have strong relationships with both Visa and Plaid. The combination of Plaid’s capabilities with the security and scale of Visa’s global network will provide us with exciting opportunities to enhance our products.”

As for Plaid, the company said that the deal will allow the company to grow.

“Plaid’s mission is to make money easier for everyone, and we are excited for this opportunity to continue delivering on that promise at a global scale,” said Zach Perret, CEO and co-founder of Plaid. “Visa is trusted by billions of consumers, businesses and financial institutions as a key part of the financial ecosystem, and together Visa and Plaid can support the rapid growth of digital financial services.”

According to a release, Visa will use cash on hand and debt issuance “at the appropriate time” to fund this deal. The companies expect the deal to close in the next three to six months.



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The last 365 days proved that as much as the industry tries to predict the real estate market, nothing beats proactively preparing for any type of lending environment. The best example of this was also one of the biggest mortgage industry trends of 2019: the drop in interest rates.

By the end of 2018, there was an overwhelming amount of negative housing data points that didn’t bode well for a strong start to last year. A majority of the forecasts for 2019 predicted that interest rates would rise, causing would-be buyers to continue renting, along with rising home prices and tight inventory making affordability sound impossible. 

The reversal of these predictions spawned a refi boom, and when the top industry voices were asked to share which trends not only took the industry by storm last year but were expected to carry into 2020, the trend that was on the forefront of everyone’s mind was the year’s record-low interest rates, averaging around 3.9% in 2019 according to Freddie Mac.

In his video for HousingWire, United Wholesale Mortgage President and CEO Mat Ishbia quickly stated at the beginning, “Looking at 2019, it was an unexpected year for most. The rate rally was the big news.” He also noted that it was a great year for most people in the industry that helped a lot of consumers across America.

The pleasant surprise of low interest rates is the most obvious trend of last year, but to proactively prepare for 2020 and beyond, lenders need to pay attention to the other hot trends brewing.

HousingWire asked five voices in the industry to share what they uniquely saw happening in 2019 and what top mortgages trends people in the industry should watch for heading into the new year.

MOVEMENT MORTGAGE CEO CASEY CRAWFORD

In 2017, Movement Mortgage not only purchased First State Bank in Danville, Va., but they also gained a piece of history. Movement Mortgage CEO Casey Crawford shared the deep roots that the bank has in America’s history, saying, “[First State Bank] is a 100-year-old institution founded in Southern Virginia that was serving the black community during the Jim Crow South.”

He explained that during this period, the bank opened up credit options for the community when they were explicitly being discriminated against and denied access to credit products. Last year, the Movement Mortgage team decided to look back and see how black homeownership has changed over the years.

They were shocked to find that today, the country is seeing the widest rate of disparity between black and white homeownership in 100 years. He continued to expand upon this long-standing problem in America, adding that the good news is there are 1.7 million qualified black Millennials who are ready to purchase homes.

The trend that will carry into 2020: Lenders need to educate this community about homeownership opportunities to help bridge the wealth gap that exists in the United States today.

THE KNOWLEDGE COOP VICE PRESIDENT OF TRAINING AND DEVELOPMENT NATHAN KNOTTINGHAM

“Wire fraud” is a topic that should’ve come across the industry’s desk more than a handful of times last year. It’s a growing and pressing issue that people shouldn’t become numb to.

Nathan Knottingham, vice president of training and development with The Knowledge Coop, gave his unique take on how cyber security seized the industry’s attention in 2019, and is something his company has heavily focused on the last few years.

2019 brought an increase in deep fake accounts and security threats, and Knottingham stressed the importance of understanding and guarding against the dark web. “This one needs to be a continued priority going forward,” he said. “And hopefully, the heightened awareness will keep all people in the industry on alert and help the IT professionals do their job to keep organizations safe.”

The trend that will carry into 2020: The industry needs to stay vigilant in protecting consumer information as hackers become more sophisticated. 

LUND MORTGAGE TEAM OWNER/BROKER LISA LUND

With the recent refinance boom in 2019 serving as a great example, it benefits lenders to be proactive rather than reactive to what’s happening in the market. Owner/broker of Lund Mortgage Team Lisa Lund stressed, “Although 2019 was record-breaking for most of us, we have to remember it doesn’t last forever.”

A small victory lap after a great year is fine, but this doesn’t mean lenders can rest on their laurels. Lund asked, “What’s your business plan for 2020 or even 2024?”

In her video, she emphasized the importance of reinvesting back in yourself or in your company, adding “If you do that, you’re going to ensure a lifetime of success, not just while we’re all riding this crazy refinance boom.”

The trend that will carry into 2020: Companies need to make sure they are always working on ways to improve and evolve with changes in the market.

THRIVE MORTGAGE DIRECTOR OF EDUCATION AND ENGAGEMENT JAMES DUNCAN

Technology and innovation are two words that showed up in many articles and discussions over the last few years, and this isn’t likely to change moving forward. However, the focus of these technology conversations will, as Thrive Mortgage Director of Education and Engagement James Duncan shared in his video.

The rapid pace of new technology has been advancing faster than many lenders could keep up with. “They just knew that there were inefficiencies in the process and the workflow that needed to be addressed and fixed,” Duncan said.

This trend started to shift as more lenders started asking better questions and the right questions in 2019, leaving this next year to really put this technology to the test. Duncan explained that the leaders who pull away from the pack aren’t going to be the ones who simply adopted new technology, but the ones whose focus was on adopting technology to enhance the borrower’s experience and to improve the level of service and advice that they provide to the client.

The trend that will carry into 2020: Lenders need to focus on the impact technology has on the borrower experience.

UNITED WHOLESALE MORTGAGE PRESIDENT AND CEO MAT ISHBIA

In a landmark ruling for the mortgage industry, as of Nov. 24, 2019, originators could officially move from a bank to a nonbank or to a new state and keep originating new mortgages without having to wait for a new license.

The transitional authority ruling eliminated the required period that originators had to wait for a new license before they could begin originating at their new job, which was a welcome change after a long push from the mortgage industry for new regulation.

United Wholesale Mortgage President and CEO Mat Ishbia pointed to the change as one of the biggest trends of the year, saying, “This has already started to impact the mortgage broker channel, and we’re seeing even more of it coming because of compliance support and technology support, along with some of the things that weren’t available in the broker channel in 2014, 2015 or 2016.”

The trend that will carry into 2020: The transitional authority rule will have a big impact in helping originators move jobs.

On top of all these trends, the industry is also moving ahead with a new commitment to community and collaboration. These five industry voices are just the start of a new era, one where lenders are collectively making the industry a better place. As more trailblazers join this movement, HousingWire is here to spotlight the trends that are helping move markets forward.



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There are two pretty obvious things that underlie the mortgage industry’s recruiting efforts. First, the competition is intense. The unemployment rate is at a record low and mortgage companies are competing with some of the biggest brands in the world for the best people. In addition, most people — even those who ended up in the industry — don’t grow up dreaming about getting into mortgage finance.

Despite these obstacles, lenders, servicers and other companies in the mortgage ecosystem are fighting the good fight to attract and retain top talent. HousingWire created engage.talent to support those efforts, gathering experts to share the best tools and strategies to succeed at filling some of the most important roles in mortgage.

The goal of engage.talent in Dallas on Feb. 6 is to bring more collaboration and knowledge sharing into the recruiting and retention conversation.

Companies in HousingWire’s Talent Leadership Council are committed to attracting, developing and retaining top talent. It’s going to take leaders, like those on the Talent Leadership Council, to not only help the industry compete in the battle for talent, but transform mortgage finance into a field that top people choose to comes to first.

Joining the Talent Leadership Council allows you to bring your team to engage.talent to learn together from some of the best recruiters and coaches in the business. It’s an investment in the future success of your company as you learn what’s working right now in talent acquisition. To learn more about the Talent Leadership Council, go here, and to register for engage.talent, go here.



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