Top Ten Reasons Why It Is Great to be an Appraiser!
10. Dazzle your friends with your knowledge of external obsolescence.
9. The wonderful world of rats, bats, and spiders.
7. See places in people’s houses that usually require a search warrant to access.
We all need some humor!! These made me laugh ;>
To see 7 more reasons, click here
For Covid Updates, go to my Covid Science blog at covidscienceblog.com
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To read more of this long blog post with many topics, click Read More Below!!
NOTE: Please scroll down to read the other topics in this long blog post on 2021 forecasts, cubic condo, FHA, mortgage origination stats, etc.
Good News: What Does the Housing Market’s Historic Pandemic Rebound Mean for 2021?
Good News: After hitting a low point in the spring, the housing market staged a dramatic comeback. The boost from loosening credit, along with rising house-buying power, equity and household formation, was strong enough to overcome the negative impact on housing market potential from the increase in tenure length so far in 2020.
Uncertainty for 2021: The trend in housing market potential will likely depend on the labor market’s recovery and how lenders adjust credit standards. Will the labor market continue to recover or weaken in the coming months as we battle the pandemic, and will any labor market weakness impact potential home buyers? If there is more uncertainty, will lenders tighten credit once more? The historic rebound in housing market potential will slow down if lenders won’t lend and consumers can’t spend.
Written by an economist, but well written and understandable. Worth reading, especially what to watch for any changes in the future. To read more, click here
My comments: I still can’t believe that housing sales are so strong, with increasing prices during tough economic times!! Can’t look at the past, as this has never occurred before.
Bad News: Millions of Americans Expect to Lose Their Homes as Covid Rages
Almost 18 million adults are behind on mortgage, rent payments
CDC suspension on evictions is slated to expire at end of 2020
Excerpt: Millions of Americans expect to face eviction by the end of this year, adding to the suffering inflicted by the coronavirus pandemic raging across the U.S.
About 5.8 million adults say they are somewhat to very likely to face eviction or foreclosure in the next two months, according to a survey completed Nov. 9 by the U.S. Census Bureau. That accounts for a third of the 17.8 million adults in households that are behind on rent or mortgage payments.
Short article at beginning of a longer Covid article. Video in the middle of the writeup is for commercial real estate. To read more, click here
My comment: A major factor is passing a Covid relief bill from Congress by the end of the year, especially unemployment extension, hopefully with an increase in unemployment benefits.
Why Housing Demand Will Likely Stay High for Years to Come
There are 5.7 million “missing” households since the Great Recession
- Household formation rates have been low since the Great Recession, and the 5.7 million “missing” households since that time are likely to boost housing demand for at least the next several years.
- Household formation rates rose in 2018 and 2019 to begin to chip away at this deficit as more home supply and a strong economy eased downward pressures from the previous decade. However, the current recession will likely reverse many of those gains.
- Building more homes is the clearest path to boosting household formation rates. New construction cratered during the Great Recession and remains low compared to historical standards.
To read more, click here
My comments: I recently watched a news segment on millennials living at home. For millennials, adults between the ages of 24 and 39, it is the highest it’s ever been since 1900 in the historical record. Wow!! Once the pandemic is finally over and people go back to work, there will be a huge pent-up demand for homes.
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New in the December Issue of the monthly Appraisal Today Newsletter
- 2020 year-end tax planning for appraisers. It’s not too late to save on your 2020 taxes! Donations, retirement account contributions, etc.
- Marketing with holiday gifts and cards – easy and Most Excellent Marketing Tool! I am sending out over 60 cards.
- How to reduce stress and be more productive – includeing tips on Covid stress – lots of ways: exercising, meditation, relaxation, firing stressful clients, etc.
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Cubic Condo in Cambridge, MA
Excerpt: The phrase “outside the box” is a tired corporate world cliché, but we can’t think of a better way to describe this intriguing Massachusetts condo.
“I’ve never seen anything like this. It’s basically three cubes on top of each other at different angles,” says the listing agent, Ed Greable. “When I first saw it, I thought, ‘Wow, this is different. This is going to be for somebody who likes something out of the ordinary.’”
Even though the residence stands alone, it is a condo. The owner doesn’t own the land it sits on, and it comes with monthly HOA fees of under $100 a month, which cover some insurance and snow removal.
The 1,206-square-foot condo in Cambridge, MA, is on the market for $869,900.
To read more and see lots of fotos click here
My comment: EZ to measure. Similar condo comps? A nightmare to appraise!!
FHA Loan Limits Move Up To A Floor of $356,362
Excerpts: The Department of Housing and Urban Development (HUD) has published its 2021 Forward Mortgage Limits for FHA loans. The FHA limits are based on the Federal Housing Finance Agency’s (FHFA’s) conforming limits for Fannie Mae and Freddie Mac loans; however, they are individualized by locality and cover a much wider range.
HUD sets a floor for the lowest cost areas and a ceiling for high cost areas. Limits fall within those two ranges. The agency determines whether an area is considered high cost or low cost by the median sales price of homes at the county level. Where a property is inside a Metropolitan Statistical Area (MSA) the county within the MSA with the highest median price determines the outcome for the entire MSA.
To read more, click here
To download a list of all counties and MSAs with the limits for all types of property click here
COVID-19 Recent posts covidscienceblog.com
Face Masks and Covid Risks in Homes
- n95 masks. how to use. Facial hair and masks (plus link to 36 images of facial hair types). How to check if n95 and surgical masks have FDA Emergency Use Approval. You cannot tell by reading about them on Amazon.
- Surgical vs. n95 vs. cloth analysis.
- Links to my 10 most relevant blog posts
To read the blog post, click here
New Mayo Clinic Research: How Face Masks Reduce Risk
- Two videos (air going out of and into the masks) plus speaker talking about the research). Chart with effects of different distances.
- Links to my 9 most relevant blog posts
- Uses surgical and cloth masks but applies overall to n95 masks (effect on actual distances for n95 would be different).
To read the blog post, click here
Fauci: Herd Immunity. Vaccines. Testing. 34 minute video
Some of the topics:
- Herd immunity example using an African wildebeest (antelope) herd. Understandable by everyone.
- Vaccines. Excellent analysis from approval to the future. Fauci has been doing vaccine research for decades.
- Very good explanation of the PCR vs. antigen Covid tests
- Post-Covid syndrome (long haulers) – after the virus is gone. It can last for months with many problems.
Note: I watch a lot of Fauci interviews but only write about those that have a good interviewer who lets Fauci talk and has some good questions. This one is very good.
To watch the video and read more text, click here
Coronavirus Vaccines terms and explanations – 2 minute video (not on my Covid blog)
Covers the basics. Well done by Webmd.
To watch the video, click here
Future planned posts on my Covid Blog: Coming soon are risk from crowding in homes and Covid related questions to ask before going to the property. Writing my two very long coronavirus monthly newsletters did not work very well. Some of what I wrote about changed the day it they out! I can change blog posts any time, including the date it was changed.
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 paid monthly 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 firstname.lastname@example.org . Or call 800-839-0227, MTW 7AM to noon, Pacific time.
Mortgage applications decreased 0.6 percent from one week earlier
WASHINGTON, D.C. (December 2, 2020) – Mortgage applications decreased 0.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 27, 2020. This week’s results include an adjustment for the Thanksgiving holiday.
The Market Composite Index, a measure of mortgage loan application volume, decreased 0.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 32 percent compared with the previous week. The Refinance Index decreased 5 percent from the previous week and was 102 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 28 percent compared with the previous week and was 28 percent higher than the same week one year ago.
“After adjusting for the Thanksgiving holiday, mortgage applications were mixed, with a jump in purchase applications and a decline in refinances. Purchase activity continued to show impressive year-over-year gains, with both the conventional and government segments of the market posting another week of growth,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Purchase loan amounts continue to be significantly higher than their average over the past decade and hit $375,000 last week, the largest since the inception of MBA’s survey in 1990. Housing demand remains strong, and despite extremely tight inventory and rising prices, home sales are running at their strongest pace in over a decade.”
Added Kan, “The sustained period of low mortgage rates continues to spark borrower demand, and the mortgage industry is poised for its strongest year in originations since 2003. The ongoing refinance wave has been beneficial to homeowners looking to lower their monthly payments during these challenging economic times brought forth by the pandemic.”
The refinance share of mortgage activity decreased to 69.5 percent of total applications from 71.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 1.8 percent of total applications.
The FHA share of total applications decreased to 9.1 percent from 10.0 percent the week prior. The VA share of total applications increased to 11.9 percent from 11.8 percent the week prior. The USDA share of total applications remained unchanged from 0.4 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) remained unchanged at 2.92 percent, with points decreasing to 0.31 from 0.35 (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 $510,400) increased to 3.19 percent from 3.18 percent, with points increasing to 0.30 from 0.27 (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 increased to 3.00 percent from 2.99 percent, with points increasing to 0.34 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 2.53 percent from 2.51 percent, with points decreasing to 0.27 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.
The average contract interest rate for 5/1 ARMs remained unchanged at 2.63 percent, with points increasing to 0.47 from 0.44 (including the origination fee) for 80 percent LTV loans. The effective rate increased 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.
Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501