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- Most overvalued and undervalued housing markets
Most overvalued and undervalued housing markets
Plus: NYCB sells mortgage servicing unit and TPO platform to Mr. Cooper for $1.4B
👏 Here it is: Friday. Today’s newsletter is 611 words, a 2.5-minute read.
Disclaimer: Average mortgage rates as of July 25, 2024. © MND's Daily Rate Index.
1. NYCB offloads mortgage servicing unit and TPO platform to Mr. Cooper for $1.4B in cash
New York Community Bank subsidiary Flagstar is selling its residential mortgage servicing business to nonbank mortgage firm Mr. Cooper for $1.4 billion, the bank announced Thursday.
The sale, which includes the bank’s mortgage servicing rights and third-party origination platform, is projected to close during the fourth quarter, the bank said.
The announcement came on the day the bank reported a loss of $323 million in its second-quarter earnings.
2. The economy grew at 2.8 percent rate in second quarter, blowing past expectations
The economy grew at an annual rate of 2.8 percent in the second quarter of 2024, according to new Commerce Department data released Thursday.
Economists expected it to grow by 1.9 percent, closer to the 1.4 percent growth posted in the first quarter of the year.
The strong report comes as the Federal Reserve is set to meet next week to consider changing interest rates, which it has held steady since last July.
“This is a perfect report for the Fed, growth during the first half of the year is not too hot, inflation continues to cool and the elusive soft landing scenario looks within reach”
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3. More Nuggets
🤔 What's the ideal mortgage rate? It depends on who you ask. (Bankrate)
🏘️ Who is driving rental demand? Hint: It’s not millennials anymore. (New York Times)
📉 New home sales fall to a seven-month low in June. (NAHB)
💸 Hackers have scammed real estate pros out of more than $446 million. (Real Deal)
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4. Mortgage applications decrease despite drop in rates
Mortgage demand declined last week despite lower mortgage rates, as refinancing continued to pace home loan activity. The MBA showed mortgage application volume declined 2.2% for the week ending July 19.
The 30-year, fixed mortgage rate was 6.82%, its lowest level since February, helping keep refinancing at its highest in nearly two years. Meanwhile, loans for home purchases continued to be subdued, down 4% from last week.
“Refinance applications were up, driven by conventional and FHA application activity, as some borrowers took the opportunity to act,” said Joel Kan, MBA's deputy chief economist. “Purchase applications decreased as ongoing affordability challenges persist with rates at their current levels and with home-price appreciation still strong in many markets.”
5. Most overvalued and undervalued housing markets
According to data from First American Financial Corp, If you're searching for a good deal on a home, the Midwest could be a good place to look.
California, on the other hand, is the epicenter of overvalued housing markets. But it's certainly not alone.
The data highlights that California cities like Los Angeles, San Jose, San Diego, and San Francisco have significantly overvalued homes, with prices far exceeding local buying power.
Conversely, Rust Belt cities like Detroit, Cleveland, and Pittsburgh show homes undervalued compared to local buying power, indicating potential for property appreciation.
☀️ You’re all caught up. See you on Monday!
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