Appraisal News and Business Tips

1-5-17 Newz .The Two Americas and Real Estate .McMansion Hell

FHA handbook 4000.1 quarterly update

No Changes to policies but it is always best to have the latest version when trying to figure out what FHA wants and underwriter/reviewer hassles.
The Federal Housing Administration (FHA) published the quarterly update to its Single Family Housing Policy Handbook 4000.1 (SF Handbook). This update incorporates previously published Mortgagee Letters into both the online and portable document format (PDF) SF Handbook.
http://www.allregs.com/tpl/public/fha_freesite.aspx  for Single Family Housing Policy Handbook 4000.1 December Update
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McMansion Hell!!
 Lots of interesting stuff. Go to the link below and look at some of the pull down links in the upper left for lots more info!!
This link is for one of the many pages – McMansion in Bentonville County, Arkansas
Cannot be described. Lots of photos with sometimes snarky comments. Just gotta see it  ;>

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The 10 Worst and Best Celebrity neighbors for 2016 – Just for Fun!
Excerpt: Zillow has once again taken the glittering pulse of celebrity neighbor-dom in its annual Celebrity Neighbor Survey, ranking the high-profilers us “normies” wouldn’t mind occasionally borrowing a cup of sugar from. The most sought-after, according to the survey, is the exiting First Family, who will remain residents of D.C. (get a glimpse of their new digs here!) in the new year. The least, on the other hand, is real-life (and now two-time) worst neighbor Justin Bieber, who racked up the most votes in the history of the survey.
Sorry, the voting has closed ;>
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Free appraiser webinar 1-18-17
Free Real Estate Appraiser Webinar Presented by the Network of State Appraisal Organizations (NSAO)
Get answers to your toughest questions, challenges, or concerns during this free webinar hosted by the Network of State Appraisal Organizations.
Join fellow appraisers from around the country for an Appraiser Question and Answer (Q&A) Webinar featuring representatives from The Appraisal Foundation (TAF) and the Appraisal Subcommittee (ASC).
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Is the New AMC business model broken?
New in the January 2017 issue of Appraisal Today
    Is the New AMC business model broken? Yes. I explain why.  Plus, analysis of turn times, fees, AMC changes since HVCC, etc. Also, of course, what this means for you. Free tip: Don’t let your accounts receivables build up. Too many AMCs trying to stay in business by getting low appraisal fees.
    Meet the New Boss – CU. Practical advice from a lender reviewer by Jared Mickel, SRA, RG. Jared sees and uses the CU interface that underwriters use. It is not available to AMCs or appraisers.
    New Year’s resolutions for 2017. Set goals for 2017 and how you will accomplish them! I have done mine. Personal – 2 hours a week volunteering at a local non-profit. Business – fewer commercial, more residential appraisals. I miss working in the field. Too much office time with commercial – writing long narratives. What are your goals for 2017?
    What’s up in technology – TracR by Wayne Pugh, MAI, CRE, FRICS, CCIM. Review of a very small Bluetooth device for finding your keys, wallet, phone, etc
To read the articles, plus 2+ years of previous issues, subscribe to the paid Appraisal Today!!!
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If you are a paid subscriber and did not get the January 2017 issue, emailed January 3, please send an email to info@appraisaltoday.com  and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it.
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The Two Americas and real estate prices
The recent presidential election dramatically demonstrated the “two Americas” economically. Below are several articles on how it is connected to different real estate markets.
Zillow research on variation in home prices by area
Excerpt: A wide chasm remains between negative equity in the lowest-valued homes and the highest-valued homes, however. According to Zillow, 16.9 percent of homes valued in the bottom third of the market had negative equity in Q3, while only 6.8 percent of homes in the top third were underwater-and this gap exists despite home values rising more quickly among homes in the bottom tier.
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NPR interview with Wall St. Journal reporter
Excerpt: We often hear people talk about two Americas. Now there is data showing that the same could be said of the housing market. Transcript (and recording) of an npr podcast with a Wall Street Journal reporter. 12/28/16

My Comment: I live in the Bay Area, where strong demand has caused prices in many areas to go well over the peak in 2005-2006, starting a few years ago. But, one of my brothers lives in Lake County, about 100 miles north of San Francisco and too far to drive to the Bay Area for jobs. Many residents are very low income. His house is still underwater, worth less than his HAMP loan. Prices there have come up some, but are still well below the peak prices. There is little work  so people have to commute to other cities, about an hour’s drive (or more) away. When kids graduate from high school, most leave.

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More on Appraisal Institute national vs. chapters – for those who care…
No-Confidence Petition to AI Board
Set up by Joe Milkes, copy of his Dec. 22 email:
“I just started the petition No-Confidence Petition to AI Board (at change.org) and wanted to see if you could help by adding your name and any comments. If you do not wish to sign the petition, you can still leave a comment.”
“My goal is to reach 1,000 signatures and more and I need more support. (Ed note: There were 28 signatures as of yesterday morning.)You can read more and sign the petition here:”
“Even if you do not want to sign the petition, feel free to leave your comments on the petition page.”
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Jonathan Miller has been posting lots of info. Here are a few links:
https://realestateindustrialcomplex.com  Miller’s blog about what is happening. You can post comments here.
Miller’s weekly Friday Housing Notes has comments in the Appraiserville section (scroll down the page)
My comments: Taking chapter’s money is nothing new. Chapters have worried about this for years. It definitely is threatening to larger chapters, such as Miller’s New York Chapter (when he was an AI SRA member).

Who cares about the AI? Not many residential appraisers. I quit writing about the professional appraisal associations awhile ago as they became less and less important to appraisers over time due to licensing.

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HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to www.mbaa.org 
Note: I publish a graph of this data every month in my printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.
Mortgage applications decreased 12 percent from two weeks earlier
WASHINGTON, D.C. (January 4, 2017) – , according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 30, 2016. The results included adjustments to account for the Christmas holiday.
The Market Composite Index, a measure of mortgage loan application volume, decreased 12 percent on a seasonally adjusted basis from two weeks earlier. On an unadjusted basis, the Index decreased 48 percent compared with two weeks ago. The Refinance Index decreased 22 percent from two weeks ago. The seasonally adjusted Purchase Index decreased 2 percent from two weeks earlier. The unadjusted Purchase Index decreased 41 percent compared with two weeks ago and was 1 percent lower than the same week one year ago.
While the index changes were calculated relative to two weeks prior, the following compositional and rate measures are presented relative to the previous week only.
The refinance share of mortgage activity increased to 52.2 percent of total applications from 51.8 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 5.4 percent of total applications.
The FHA share of total applications increased to 11.6 percent from 10.7 percent the week prior. The VA share of total applications decreased to 12.3 percent from 12.4 percent the week prior. The USDA share of total applications increased to 1.1 percent from 1.0 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.39 percent from 4.45 percent, with points increasing to 0.43 from 0.39 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.37 percent from 4.41 percent, with points increasing to 0.44 from 0.21 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 4.22 percent, with points decreasing to 0.34 from 0.44 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.64 percent from 3.70 percent, with points increasing to 0.38 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 3.28 percent from 3.41 percent, with points increasing to 0.42 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990.  Respondents include mortgage bankers, commercial banks and thrifts.  Base period and value for all indexes is March 16, 1990=100.

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