Dana Wade the New FHA Commissioner

The Senate announced the replacement of the Federal Housing Administration commissioner Brian Montgomery will be Dana Wade. President Trump nominated Dana Wade this February. Wade previously was the acting FHA commissioner from July 2017 to June 2018 and then became the program associate director for general government at the Office of Management and Budget from December 2018 to December 2019.

“I believe that FHA has a duty to support the nation’s housing markets and homeowners facing economic hardship,” Wade said during her Senate testimony in May. “While the virus will pass and the economy will eventually regain its previous strength, the road to recovery will require our sustained effort.”

Her top priorities as the FHA commissioner “would include protecting current FHA homeowners and fully deploying FHA’s loss mitigation toolkit for COVID-affected homeowners; ensuring that FHA has the necessary staffing and other resources, as well as continuing the innovative FHA IT Modernization effort; and vigilantly monitoring risk to taxpayers of losses stemming from COVID-19 and protecting FHA’s capital reserve to the maximum extent possible.”

Wade was praised for her Senate testimony. HUD Secretary Ben Carson congratulated her for her confirmation and shared that he believes she “has been a tremendous asset to the Department and the Administration throughout her years of service, and I have full confidence in her ability to successfully lead FHA.”

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June Sees A Rise In Pending Home Sales

Front elevation of this new construction home located in the Parks of Plaquemines. Custom large home built by a local contractor. Approximately 4 bedrooms and 3 baths with many custom features.Homebuyers are eager to purchase because of the record-low mortgage rates. The month of May brought the largest monthly gain ever recorded, and this month the rise in pending home sales is back up to pre-pandemic levels.

The National Association of Realtors (NAR) publishes The Pending Home Sales Index (PHSI) which is the leading indicator of housing activity. The PHSI measures housing contract activity and is based on signed real estate contracts for existing single-family homes, condos, and co-ops. The PHSI is issued around the 25th of each month.

According to the graph, the PHSI rose to 16.6% from 99.6 in May to 116.1 in June. The sales on a year-over-year basis were 6.3% higher than this time last year. This data is shown with existing-home sales, but the pending home sales index leads the existing-home index by a couple of months.

“It is quite surprising and remarkable that, in the midst of a global pandemic, contract activity for home purchases is higher compared to one year ago,” said Lawrence Yun, NAR’s chief economist. “Consumers are taking advantage of record-low mortgage rates resulting from the Federal Reserve’s maximum liquidity monetary policy.”

As far as the national regions, all four regions had a double-digit gain in month-over-month contract activity. The Northeast saw a 54.4% increase to 95.4, in the Midwest there was a 12.2% rise to 110.9, in the South it jumped 11.9% to an index of 140.3 and in the West, it jumped 11.7% to 99.6.

“The Northeast’s strong bounce back comes after a lengthier lockdown, while the South has consistently outperformed the rest of the country,” Yun said. “These remarkable rebounds speak to exceptionally high buyer demand.”

The housing market is making a strong recovery with record-low mortgage rates. The outlook for the U.S. economy is promising.

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NOMA’s Virtual Family Festival, August 22, 2020

Join in on the on-screen fun at home in New Orleans.

New Orleans, LA 70124

August 22, 2020
11am – 3pm

This is a free event.

Entertainment Line Up:
11am Reading with Alyssa My Big Curly Fro
12pm Hide and Speak with Cubs the Poet
1pm Tasting Stations with Southern Food & Beverage Museum
2:30pm Spontaneous Poetry with Cubs the Poet

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Builders Overwhelmed With Home Starts

Builders definitely have job security when it comes to homebuilding. The U.S. Housing Development and Commerce Department reported that housing starts rose 17.3 % to a seasonally adjusted rate of 1.19 million units. For single-family homes it increased 17.2% to a seasonally adjusted rate of 831,000 and multifamily homes rose 17.5% to a seasonally adjusted rate of 355,000.

Each region’s housing starts, both single-family and multi-family were broken down. Midwest was 0.2% higher than in the South and 20.9 % higher in the West. There was a decrease of 5.4% in the Northeast.

Housing starts are at 1.86 million which is up 2.1 % month-over-month, building permits are at 1.24 million with an increase of 17.3 % month-over-month and completions are at 1.22 million and has a 4.3% rise month-over-month. The breakdown for multi-family permits and single-family permits for each are as follows: housing starts for multi-family permits total 368,000 and single-family permits total 834,000, building permits for multi-family permits total 350,000 and multi-family permits total 831,000, and last are completions with 311,000 total multi-family permits and 830,000 single-family permits.

Dr. Lawrence Yun, Chief Economist, National Association of Realtors explains that homebuyers are racing into the market because of the low mortgage rates. He says the housing market is hot. Good news for the housing market but there is still a lack of inventory making it hard for buyers. Even though there is a gain in housing starts, it still is bare. Yun concludes that the U.S. needs at least 1.5 million housing starts.

“Fueled in part by record low mortgage rates, builders are seeing solid demand for housing despite the challenges of the virus and elevated unemployment. Demand is growing in lower density markets, including exurbs and small metros,” said Bill Bankfield, Vice President of Capital Markets, Quicken Loans.

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Builder Confidence Soars in July

Builder confidence has caught back up to the pre-pandemic level as of July. The housing market is in the lead to the U.S. economic recovery. According to the latest NAHB/Wells Fargo Housing Market Index (HMI) newly-built single-family homes rose from 14 points to 72 points in July.

The National Association of Home Builders started the NAHB/Wells Fargo HMI 30 years ago. It is a monthly survey that measures builder perceptions and asks respondents to rate market conditions for the sale of new homes at the present time and in the next six months as well as the traffic of prospective buyers of new homes.  A panel of builders is chosen each month to rate present single-family sales, and single-family sales for the next six months on a scale of good, fair, or poor. They also rate traffic of prospective buyers on a scale of high to very high, average, or low to very low.

The HMI can range between 0 and 100. July has seen good numbers with current sales conditions at an HMI of 79, sales expectations in the next six months rose to 75 points and the measure charting traffic of prospective buyers was at 58.

“Builders are seeing strong traffic and lots of interest in new construction as existing home inventory remains lean,” said NAHB Chairman Chuck Fowke. “Moreover, builders in the Northeast and the Midwest are benefiting from demand that was sidelined during lockdowns in the spring. Low interest rates are also fueling demand, and we expect housing to lead an overall economic recovery.”

“While the housing market is clearly rebounding, challenges exist,” said NAHB Chief Economist Robert Dietz. “Lumber prices are at a two-year high and builders are reporting rising costs for other building materials while lot and skilled labor availability issues persist. Nonetheless, the important story of the changing geography of housing demand is benefiting new construction. New home demand is improving in lower density markets, including small metro areas, rural markets and large metro exurbs, as people seek out larger homes and anticipate more flexibility for telework in the years ahead. Flight to the suburbs is real.”

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