Here are some of noteworthy updates this week from Housing Wire regarding Housing Market, Mortgage and more .
NAR lends support to First Time Homebuyer Pandemic Savings Act
National Association of Realtors announced their support of Rep. Sean Maloney’s (D-NY) First Time Homebuyer Pandemic Savings Act, on Wednesday July 22. The bill would allow for up to $25,000 of coronavirus-related retirement distributions to be tax exempt and penalty free if put toward the down payment of a first home. With the act potentially sitting under the umbrella of coronavirus-related distribution, the bill would not be subject to the early-distribution penalty of 10% and could be repaid over three years.
Low inventory means higher prices for California’s housing market
California Association of Realtors (C.A.R) reported that the California Housing Market rebounded in June with the largest month-to-month sales increase in nearly 40 years, and California’s median home price hit its own record high of $626,170. As a response to the pent-up demand from the delay of home-buying season, median home prices in the Central Valley rose 7.4% from last year, CAR said. Home prices in Southern California also rose 3.3% from the year prior.
Mortgage rates rise on job-market concerns
The average rate for a 30-year fixed mortgage is 3.01% this week, up from 2.98%.Mortgage interest rates rose from a record low this week, increasing above the 3% threshold, as a resurgence in COVID-19 infections in the U.S. caused lenders to worry about the jobs market. According to Sam Khater, Freddie Mac’s chief economist. “The concern is that the pause in economic activity will cause unemployment to remain elevated, which will lead to longer-term labor market distress,” said Keith Gumbinger, vice president at HSH.com, a mortgage data firm. “The higher rate may also reflect that lenders are overwhelmed by applications to refinance mortgages and don’t want to worsen the flood of new borrowers”, however, “rates are going to go lower as we go forward because of the slow economy, and we probably will see risk premiums easing going forward,” Gumbinger.
1.4 million homes have accessory dwelling units, Freddie Mac says
Guest home, granny flats and mother-in-law suites are more commonly used terms for accessory dwelling units in the U.S., which have grown in demand exponentially since the 1950s.
According to research from Freddie Mac, there are 1.4 million single-family properties with ADUs. They were identified using a national-level dataset of 600 million Multiple Listing Service transactions dating back to the late 1990s, the report said.
California, Florida, Texas and Georgia account for half of the 1.4 million ADUs in the U.S. According to Freddie Mac. “shadow housing,” or ADUs that aren’t legally accounted for, aren’t included in the report.