- In coming weeks, federal policy makers could roll out pilot programs to further test the concept of renting out single-family homes.
- There are two different types of programs that officials are likely to consider. Under the first, the Federal Housing Administration could sell properties in bulk to investors who agree to rent them out.
- A more likely option for Fannie Mae and Freddie Mac would be to set up pools of properties in which third-party investors would take a stake. Investors could be responsible for handling maintenance and day-to-day operation of the rental pool, with Fannie and Freddie sharing in some of the returns.
Read more about the pilot programs at http://blogs.wsj.com/developments/2012/01/12/six-questions-on-foreclosure-to-rental-programs/.
Lower home prices and interest rates led to an increase in home affordability in the third quarter, the CALIFORNIA ASSOCIATION OF REALTORS® reported.
Making sense of the story
- The percentage of California households that could afford to purchase a median priced home of $292,120 rose to 52 percent in the third quarter, up from 51 percent in the second quarter.
- C.A.R.’s HAI measures the percentage of all households that can afford to purchase a median-priced, single-family home in California. C.A.R. also reports affordability indices for regions and select counties within the state.
- Home buyers needed to earn a minimum annual income of $61,530 to qualify for the purchase of a $292,120 statewide median-priced, existing single-family home in the third quarter of 2011. The monthly payment, including taxes and insurance, would be $1,540, assuming a 20 percent down payment and an effective composite interest rate of 4.63 percent.
- Regionally, housing affordability rose in most counties in the San Francisco Bay Area but was down in Los Angeles County and Fresno County. At 77 percent, San Bernardino County was the most affordable, while San Mateo County was the least affordable, with only 25 percent of households able to purchase the county’s median-priced home.
Read the full story
http://www.latimes.com/business/realestate/la-fi-housing-affordability-20111111,0,6083426.story
The Federal Housing Finance Agency, along with Fannie Mae and Freddie Mac, on Monday announced changes to the Home Affordable Refinance Program (HARP) to help more borrowers.
The program will continue to be available to borrowers with loans sold to Fannie Mae and Freddie Mac on or before May 31, 2009, with current loan-to-value (LTV) ratios above 80 percent.
The new program enhancements address several other key aspects of HARP including:
Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers;
Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac;
Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac;
Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the Enterprises; and
Extending the end date for HARP until Dec. 31, 2013, for loans originally sold to the Enterprises on or before May 31, 2009.
Fannie and Freddie plan to issue guidance with operational details about the HARP changes to mortgage lenders and servicers by Nov. 15. Since industry participation in HARP is not mandatory, implementation schedules will vary as individual lenders, mortgage insurers and other market participants modify their processes.
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The Appraisal Institute has released a form intended to help real estate appraisers analyze values of energy-efficient home features.
The Appraisal Institute issued the form as an optional addendum to Fannie Mae Form 1004, the appraisal industry’s most widely used form for mortgage lending purposes. Used by Fannie Mae, Freddie Mac, and the Federal Housing Administration, Form 1004 is completed by appraisers to uphold safe and sound lending. Currently, the contributory value of a home’s green features is rarely part of the equation.
The Appraisal Institute’s addendum allows appraisers to identify and describe a home’s green features, from solar panels to energy-saving appliances. Form 1004 devotes limited attention to energy efficient features, so green data usually doesn’t appear in the appraisal report, or it is included in a lengthy narrative that often is ignored.
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Among the measures President Obama may unveil in his policy speech this week is a plan to make mortgage refinancing easier, so more households can benefit from ultralow mortgage rates.
Read the full story
http://online.wsj.com/article/SB10001424053111903648204576555013886591564.html?mod=WSJ_RealEstate_LeftTopNews
