📉 Homebuying got more expensive In January

GM. This is Mortgage Nuggets, the newsletter that makes you want to “Read Mor News” like Chick-fil-A makes you want to “Eat Mor Chicken.”

Every Monday, Wednesday, and Friday morning.

1. Housing market posts $2.3 trillion drop

The US housing market experienced a 4.9% drop in the total value of homes, marking the largest decline in percentage terms since the 2008 financial crisis.

This was primarily due to the pandemic boom fizzling out and mortgage rates doubling, negatively impacting homebuyers.

Despite the decline, the total value of homes is still approximately $13 trillion higher than it was in February 2020. Some areas, like pandemic boomtowns in Florida, have held up well, with annual gains above 17%.

Meanwhile, cities like San Francisco and New York have witnessed the most significant drops in home values.

2. Mortgage rates rise for 3rd straight week

Investor reactions to economic data have led to a rise in mortgage rates for the third consecutive week, deepening concerns about home affordability.

According to Freddie Mac's Primary Mortgage Market Survey (PMMS), the 30-year fixed-rate mortgage increased 18 basis points to 6.5%, while the 15-year fixed rate surged to 5.76%.

Although inflation is slowing, the pace of deceleration still has economists expecting further hikes in the federal funds rate this year, sending mortgage averages upward.

3. Charted: Why the South has such low credit scores

Read Andrew Van Dam's fascinating piece for The Washington Post.

4. Homebuying got more expensive In January

The national median payment increased by 2.3% to $1,964 in January from $1,920 in December 2022, according to the MBA.

That move drove the MBA’s Purchase Applications Payment Index, which tracks how new monthly mortgage payments vary over time relative to income, higher by 0.9% to a reading of 160.9.

A month earlier, the PAPI came in at a mark of 159.5. Compared to January 2022, when it hit 132.7, the index is up 21.2%. An increase indicates worsening buyer affordability.

5. More Nuggets

The wild west: LA landlords train for potential attacks from tenants (TRD)

Wells Fargo Lays Off Hundreds (CNBC)

How homebuilders are luring buyers back (Axios)

CoreLogic Acquires Roostify (Press Release)

6. 1 fun thing: Zillow Rate Your Neighbor?

An idea that could go sideways a million different ways

☀️ Thanks for starting your Friday with me. See you on Monday!

p.s. If you like this newsletter, your friends may too. Forward it to a friend, and let them know they can subscribe here. Written by Ian Michael.