IMBs post profits for the first time in two years

Happy Wednesday! Don't forget to relax your jaw. Today’s newsletter is 692 words, a 2.5-minute read.

1. IMBs post profits for the first time in two years

In the second quarter of 2024, independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks reported a pre-tax net profit of $693 per loan, a significant improvement from the $645 loss per loan in the first quarter, according to the Mortgage Bankers Association (MBA).

Approximately 78% of firms posted profits, up from 59% in the previous quarter. The average production volume rose to $492 million per company, with an increase in loan volume to 1,503 loans per company.

Despite a decrease in total production revenue, reduced production costs contributed to the overall profitability. The average loan balance for first mortgages increased to $356,993, up from $345,761 in the first quarter. (Link)

2. Mortgage applications fall as buyers stay cautious

Mortgage applications declined in the week ending August 16, despite slightly lower mortgage rates. The MBA's Market Composite Index, measuring application volume, dropped 10.1% from the previous week.

Purchase applications fell 5.2% to their lowest level since February, while refinance applications decreased by 15.2%, though still 90% higher than a year ago.

Potential buyers appear to be exercising caution, likely influenced by economic uncertainty and an increase in available housing inventory, which may be leading them to take a more selective approach despite the favorable mortgage rates.

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3. More Nuggets

🏘️ NAR: Houses don’t stay on market long in these hot ZIP codes. (Realtor.com)

🪩 The hottest club in town is… run by your credit-card company? (WSJ)

💸 Policy: What happens when you give people money to buy houses. (Axios)

📨 ABA raises concerns over proposal to ban medical debt from credit reports. (ABA)

⛈️ HUD offers disaster aid to South Dakota storm victims. (HUD)

🤝 Wells Fargo to sell most of Its CRE loan servicing business to Trimont. (Reuters)

4. Nykia Wright named NAR’s permanent CEO

Nykia Wright has been named the permanent CEO for the National Association of REALTORS® (NAR), the organization announced Monday.

Wright had served as interim CEO since November, when former CEO Bob Goldberg retired. Wright was previously the CEO of the Chicago Sun-Times.

5. Existing home sales rose 0.6% last month

Sales of existing homes rose 0.6% month over month in July, but fell 2% year over year—to a seasonally adjusted annual rate of 4,094,991. That’s the lowest July level in records dating back to 2012. This is according to a new report from Redfin.

Here are some other highlights from the report:

• The median sale price rose 4.1% year over year in July to $439,170. That’s just 0.7% below the all-time high of $442,389 set the prior month.

• Nearly 60,000 home-purchase agreements were canceled, equal to 16% of homes that went under contract—the highest percentage of any July.

• One silver lining: The supply of homes for sale rose a record 14%. That’s partly because listings are getting stale and piling up, but it means buyers have more options and room to negotiate.

☀️ You’re all caught up. See you on Friday!

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