Impact of Labor Shortages on Housing Recovery

Lately, home prices have been increasing. Part of the reason for this is that there is a shortage of housing laborers. In a recent survey by the National Association of Home Builders, more than half of the builders reported that these labor shortages have lead to paying higher wages or bids in order to secure a project, thus the increase in home prices. This lack of laborers in all facets of residential construction has been impeding the housing and economic recovery. "The survey of our members shows that since June of 2012, residential construction firms are reporting an increasing number of shortages in all aspects of the industry - from carpenters, excavators, framers, roofers and plumbers, to bricklayers, HVAC, building maintenance managers and weatherization workers. The same holds...

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Expired Payroll Tax-Cut Barely Noticed by Workers

In January, the payroll tax cut expired, meaning that paychecks are now 2% less than they were before. Many economists predicted that consumer confidence and spending would suffer as a result, but it turns out that retail sales actually rose higher than expected, and consumer confidence rebounded. In fact, Bankrate.com surveyed workers and found that 48% of respondents didn't even notice that they were being paid less. 7% said that the loss has not had an affect on their finances. “It’s very encouraging. It means other things going on are helping,” said Mark Zandi, chief economist at Moody’s Analytics. "We are weathering the storm well, at least so far, better than I would have thought." However, Zandi also cautioned that the impact could take longer to become evident and that the results...

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News: Bailout Deal in Cyprus

If you have been watching the news, no doubt you've heard about the bailout crisis in Cyprus. Today it was reported that a solution to this problem may be possible. The European Union has set some guidelines for the bailout to which Cyprus must adhere. It is expected that they will reach an agreement today so that parliament can approve of specific measures that will fall within these guidelines. This news came a couple hours after the Cypriot finance minister left Moscow empty-handed due to Russia turning down their appeals for aid. This left the island without any other option than to make a bailout deal with the EU. An agreement must be reached before Tuesday or Cyprus will face the collapse of its financial system. Now Cyprus is left with a short deadline to find 5.8 billion euros which...

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Most Economists Agree: Recovery Gaining Momentum

Last week, nearly every article and report in the news claimed or suggested that the pace of the U.S. economic recovery is gaining momentum. Economic Forecasters are considering reassessing their previous thoughts as we see positive statistics like a rise in Retail Sales by 1.1%, and the Consumer Price Index's increase of 0.7%.  However, some argue that these were mostly due to higher gasoline prices and building material prices. Despite mostly positive claims, it appears as though the economy has felt the effects of the expiration of the 2% Social Security tax holiday, sequestration, and higher gas prices. These issues have fallen squarely on the shoulders of middle- and lower-income households who already have a limited amount of ways to cut spending in the short term. Aside...

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Two Nebraska Bills Amend Mortgage Requirements

As of March 7th, some new amendments to lender licensing rules were enacted thanks to two bills that were passed in Nebraska. They are intended to clarify the requirements for installment loan brokers, payday lenders, mortgage bankers, and mortgage loan originators. The first one is called the LB 279, (short for Legislative Bill.) It makes non-substantive clarifications to how a "loan broker" is defined. It also narrows down the exemption for accountants to certified public accountants only. Additionally, this bill gives the Nebraska Department of Banking and Finance authorization to share examination reports and other confidential information with the Consumer Financial Protection Bureau and any other relevant state regulators. The second bill is known as LB...

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Report: HUD Taking Steps to Enforce Fair Housing Act

Compared to previous administrations, the Obama Administration's efforts have proven to be more vigorous in enforcing state and local governments to comply with fair housing obligations through the Department of Housing & Urban Development (HUD). There was a recent report by three different national civil rights organizations that find Obama to be doing superior work toward improving housing conditions across the country. However, despite these high marks, the report also noted that there is plenty of "unfinished business" for HUD to attend to, including finalizing a regulation codifying its grantees' obligation to further fair housing. “This report indicates that HUD has, for the first time, taken significant actions to enforce the Fair Housing Act’s requirement that recipients of federal...

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Number of Mortgage Apps Increase

The Mortgage Bankers Association's (MBA) most recently Weekly Mortgage Applications Survey has compiled data for the week ending March 1, 2013.  According to this information, the number of mortgage applications filed has increased by 14.8% compared to a week earlier. The volume of mortgage loan applications is determined by the Market Composite Index. It tallied the current data on a seasonally adjusted basis. On an unadjusted basis, the Index increased 15% compared to last week. The number of refinance applications remains the same as last week, sitting at 77% of total applications. These statistics are good for the mortgage industry. The increase of applications proves that more and more people are continuing to leap into the world of homeownership. This hints that the...

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The Importance of the FHA

Here at Quest Loans, we specialize in FHA Loans. Many people don't realize that the Federal Housing Administration (FHA) has a very important role in the mortgage industry. When the private mortgage market collapsed, the FHA stepped up to help make mortgage insurance available to millions of qualified home buyers across the nation. 80 years ago, Congress actually designed the mortgage insurance fund to do just that. To prove how crucial the FHA is, the National Association of Realtors put together a testimony before the Senate Banking Committee praising the administration. According to NAR President Gary Thomas, without the FHA the housing downturn and economic recession would most likely have been far worse for the nation. “FHA continues to play a significant role in the housing market...

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FHFA's 2013 Conservatorship Scorecard for the GSEs

Edward J. Demarco, the Acting Director of the Federal Housing Finance Agency (FHFA), has recently released the 2013 Conservatorship Scorecard for Fannie Mae and Freddie Mac.  This "Scorecard" is literally rating their performances on things like "the quality, thoroughness, creativity, effectiveness, and timeliness of their work products." They are also graded on how well they cooperate and collaborate with FHFA, each other, and the industry. The three keywords that they must focus on are "Build, Contract, and Maintain." These were brought up in 2012 as the three goals of the FHFA's Strategic Plan for the GSEs. "Build" refers to their goal to "build a new securitization infrastructure platform for the secondary mortgage market." They must also "Contract the Enterprises dominant presence...

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30-Year Fixed-Rate Has Dropped!

According to Freddie Mac's recent Primary Mortgage Market Survey (PMMS), the average fixed-rate mortgage (FRM) for a 30-year term has been lowered! After not changing much in the past month, the rate has now clocked in at an average of 3.51 percent, which is down from 3.56 percent last week. This means good news for those seeking to purchase a home or refinance. This time last year, the 30-year FRM was averaging 3.90 percent. "Mortgage rates eased somewhat as the consumer price index in February held steady for the second month in a row," said Frank Nothaft, vice president and chief economist for Freddie Mac. "House price indicators, however, showed gains in 2012. The S&P/Case-Shiller national home price index rose 7.3 percent last year, reflecting the largest four-quarter growth since...

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