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San Diego home demand slips, inventory up

Posted on April 9, 2020 | Leave a comment

Demand for San Diego County homes has waned in recent weeks as the fallout from the coronavirus pandemic ripples through the real estate industry.

The number of pending sales in the county has dropped by 27 percent in two weeks, said data from Reports on Housing released late Tuesday.

Also, the average time on market for a home has increased from 46 to 66 days.

Besides anecdotal reports from real estate agents, the information from Reports on Housing is the first evidence that San Diego County is experiencing any downturn.

Analysts have been split so far on what it could mean for the expensive San Diego market. On one hand, it would seem a global pandemic where there is a concern about dying or losing employment would halt buyer interest. But, the San Diego market also has high demand with a very small pool of homes for sale.

For instance, the San Diego County market has seen the number of homes for sale increase by 210 in the last two weeks. However, that still makes it 5,018 listed compared to 6,751 at the same time last year.

San Diego is still a seller’s market, especially on the low end of prices, said Steven Thomas of Reports on Housing.

Homes under $750,000 still make up more than half the sales in San Diego County and stay on the market an average 48 days. But, the time it takes to sell increases as prices go up.

Homes from $750,000 to $1 million stay an average of 70 days; $1 million to $1.25 million, 99 days; $1.25 million to $1.5 million, 108 days; $1.5 million to $2 million, 163 days; and $2 million to $4 million, 299 days.

Home lenders brace for up to 15 million mortgage defaults

Posted on April 3, 2020 | Leave a comment

Mortgage lenders are preparing for the biggest wave of delinquencies in history. If the plan to buy time works, they may avert an even worse crisis: Mass foreclosures and mortgage market mayhem.

Borrowers who lost income from the coronavirus — already a skyrocketing number, with a record 10 million new jobless claims — can ask to skip payments for up to 180 days at a time on federally backed mortgages, and avoid penalties and a hit to their credit scores. But it’s not a payment holiday. Eventually, they’ll have to make it all up.

As many as 30% of Americans with home loans — about 15 million households — could stop paying if the U.S. economy remains closed through the summer or beyond, according to an estimate by Mark Zandi, chief economist for Moody’s Analytics.

“This is an unprecedented event,” said Susan Wachter, professor of real estate and finance at the Wharton School of the University of Pennsylvania. “The great financial crisis happened over a number of years. This is happening in a matter of months — a matter of weeks.”

“If a large percentage of the servicing book — let’s say 20%-30% of clients you take care of — don’t have the ability to make a payment for six months, most servicers will not have the capital needed to cover those payments,” Quicken Chief Executive Officer Jay Farner said in an interview.

As Mortgage rates yo-yo, what is means for San Diego real estate

Posted on March 31, 2020 | Leave a comment

Even with the coronavirus taking a wrench to the economy, many San Diego housing analysts have said low mortgage rates and demand will continue to drive the housing market.

But, what happens when mortgage rates go up?

In the past few weeks, rates for a 30-year, fixed-rate mortgage have fluctuated wildly — making monthly payments on an expensive San Diego County home go up or down by hundreds of dollars.

The rate was 3.37 percent Monday morning, said Mortgage News Daily, but was up to 4.15 percent two weeks ago.

For now, it appears unlikely that millions of sheltered Americans are going to be shopping much for homes. Also, many have lost jobs. Still, for those trying to purchase, navigating interest rates will take some work.

Tucker also said lenders don’t have as much incentive to try and fight for customers with lower rates when customers are calling them nonstop.

Mortgage rates usually follow the yields on mortgage-backed securities. These bonds typically track the yield on the U.S. 10-year Treasury.

Tucker said if the 10-year Treasury yield remains under 1 percent, the secondary market for mortgages stays healthy and the backlog of applications gets processed, it is possible mortgage rates will drop again to historic lows.

San Diego home demand slips, inventory up

Home lenders brace for up to 15 million mortgage defaults

As Mortgage rates yo-yo, what is means for San Diego real estate

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