Posted To: MND NewsWire

Black Knight has taken what will probably prove to be only their first in-depth analysis of the potential effects of the COVID-19 pandemic on the economy and specifically on the U.S. housing and mortgage markets. The paper looks at the current state of the market, key drivers of the pandemic on the housing and mortgage industries and models some possible outcomes. We are extremely pleased that they have used mortgage rate information from MortgageNewsDaily for some of their calculations. Because it is their business, Black Knight, also makes a lot of recommendations as to how technology can mitigate some of the most dramatic impacts. The company notes that the situation at present is incredibly fluid and dynamic, "and underlying facts and assumptions in this report may need to be revisited...(read more)

4/3/2020 12:49:40 PM

Posted To: MND NewsWire

Home building might be the answer to more than just the housing shortage according to some information provided by Paul Emrath, economist for the National Association of Home Builders (NAHB). He maintains that it can also be a significant factor in rebuilding the economy once the COVID-19 crisis ends. Emrath has updated NAHB's 2014 estimates of the economic impact that residential construction has on the U.S. economy, especially via the number of jobs it creates. Nationally he estimates that building an average single-family home creates 2.90 full-time equivalent (FTE) jobs. Full-time equivalency is enough work to keep one person employed for a full year. This work generates $189,000 in wages and salaries and $110,957 in taxes. Although the majority of these jobs (FTE of 1.71) are in construction...(read more)

4/3/2020 8:26:46 AM

Posted To: Pipeline Press

While in captivity it is important to focus on the friends you’ll see when you’re released . Your borrower doesn’t want the fuss and muss of typing up their own forbearance letter so they don’t have to make payments on their federally backed mortgage? Don’t worry: someone has created a form letter . The press focuses on the bad news, like NYC hospitals reportedly implementing ‘Do Not Resuscitate’ policies for coronavirus patients, or the political finger pointing that will be debated for decades. There is good news, however, like Spain and Italy seeing a slowdown phase of new cases. Strides are being made in finding people immune , or quick finger-*** blood tests to determine whether we’ve ever had COVID-19. Treatments and preventative vaccines...(read more)

4/3/2020 8:16:51 AM

Posted To: MND NewsWire

The Department of Housing and Urban Development (HUD) has announced how it will be allocating its initial portion of funds from the massive Coronavirus Aid, Relief, and Economic Security (CARES) Act passed by Congress last week. Over $3 billion will be awarded through the Department's Community Development Block Grant, Emergency Solutions Grant, and Housing Opportunities for Persons with AIDS programs. HUD Secretary Ben Carson said use of the existing grant formulas will allow funds to be awarded quickly. They will be accompanied by new guidance that cuts red tape so grantees can quickly help their communities. Two billion of the funds will go to states, communities, and non-profit organizations for the following: Construction of medical facilities for testing and treatment. Acquisition of...(read more)

4/3/2020 8:04:06 AM

Posted To: MBS Commentary

Many people have "expert sources" they rely on for insight to potential market movers. I understand this quite well. On the one hand , I used to believe that such experts knew more than my 13yr old about what might happen next in the market. On the other hand , I often fend off questions from my MBS Live family members that seem to suggest that I am an expert source on rates. If we're talking about what IS happening and what HAS happened in rates, sure. But if we're talking about the FUTURE, there are no gurus . Current market movement is providing a profound reminder about just how true this "no gurus" thesis is. I recently updated one of our knowledge base entries with the following snippet warning on the dangers of thinking you know anything that other people...(read more)

4/2/2020 9:41:54 AM

Posted To: Pipeline Press

Yesterday I decided to put thoughts of SRP values plummeting, and EPO & EPD penalties being enforced, out of my mind and get some exercise. My cat Myrtle had a mix of curiosity and disdain while watching me do my the 90-second yoga class on YouTube, which is about all my body can handle. “Come into the moment! Feel the energy flow from your ‘sit bones’ into the earth. Feel your heartbeat throughout your spine!” After the 90 seconds Myrtle lost interest and had begun to lick “herself” with ease, and I was ready to go back to staring at my computer for 14 hours day like I am now. I figure if I add 10 seconds a day, by the time we’re released from captivity I’ll be up to doing… seven hours of yoga per day. Namaste! Speaking of animals...(read more)

4/2/2020 8:30:57 AM

Posted To: MND NewsWire

Nationwide outlays for construction slipped slightly in February. The Census Bureau said public and private sources spent at a seasonally adjusted annual rate of $1.367 trillion on all forms of construction, down 1.3 percent from the rate in January. This was 6.0 percent more than was expended in February 2019. The total spent during the month on a non-adjusted basis was $96.999 billion, up slightly from the $96.462 billion spent in January. For the year-to-date (YTD) spending totals $193.460 billion, an increase of 8.2 percent from the first two months of 2019. Privately funded projects were funded at a seasonally adjusted annual rate of $1.026 trillion, down from $1.039 trillion in January, a 1.2 percent decline. That spending rate, however, is 5.6 percent higher than the rate in February...(read more)

4/1/2020 10:46:22 AM

Posted To: MBS Commentary

This morning's ADP Employment showed a loss of 27k jobs. Forecasts called for a loss of 150k jobs compared to last month's report that was strongly positive at +183k. Normally, when ADP or NFP job counts beat their forecast by more than 100k jobs, it's enough to prompt at least a little bit of bond market weakness (i.e. higher rates), even in the recent era where jobs counts weren't that big of a deal. And it's a big deal for me to say ADP/NFP are not a big deal because they have historically been very big deals. In fact, there is no bigger deal in the economic data world than NFP (the non-farm payrolls component of the big jobs report). If it hasn't been a big deal for the past however many years, it's because the labor market has been so stable and strong . Almost...(read more)

4/1/2020 8:43:48 AM

Posted To: Pipeline Press

“I hadn’t planned on giving up quite this much for lent.” So true. It is a different world than only a month ago. Of course rates are going to stay at these levels for a long time. But rate sheet prices are disconnected from MBS prices, which are disconnected from Treasury prices. Those of you who have subscribed to my commentary for more than a year know that I truly relish producing my April 1 edition. The April Fool’s Day Commentary has fooled many a senior executive and regulator, and the stories have brought many chuckles to readers. And although I inject some humor into my daily commentary, and will continue to do so, I didn’t have the heart to produce a totally farcical commentary this year, especially after spending 34 minutes of my “work at home”...(read more)

4/1/2020 8:19:41 AM

Posted To: MND NewsWire

In an earlier article , (before more pressing issues shelved the topic) we summarized highlights from a recent New York Times Magazine article about the ownership of a large share of the nation's single-family rental stock by institutional investors. Part 1 recapped how private equity funds moved to purchase distressed single-family homes during the housing crises, turning it into rental stock. Their property management has been uneven, and tenants are suffering from significant financial abuses. The author, Francesca Mari, who tells much of the story through the eyes of Chad who is now renting the home he used to own, says the extent of the financial repercussions from Wall Street's investment are not limited to the rapid rent increases and unfettered fees we pointed to in the first article...(read more)

4/1/2020 7:54:30 AM