The hottest Mortgages Substack posts right now

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Why is Debt-to-Income high?

Erdmann Housing Tracker • 84 implied HN points • 09 Mar 24
💰 Finance Mortgages Debt Housing Market
  1. The debt-to-income (DTI) ratio for households has generally declined since 2007, focusing more on new mortgage borrowers than all families.
  2. Debt payments have increased for older families since lending standards tightened in 2008, delaying when families take on mortgage debt.
  3. Higher rent inflation due to a lack of construction has pushed up mortgage costs in the early years, contributing to high DTIs.

Part 1: Current State of the Housing Market; Overview for mid-March 2024

CalculatedRisk Newsletter • 43 implied HN points • 13 Mar 24
💼 Business Real Estate Market Trends Inventory Mortgages
  1. The current housing market inventory is increasing year-over-year but remains below pre-pandemic levels.
  2. New listings for existing homes were up 11.3% year-over-year in February according to the Realtor.com report, showing a positive trend.
  3. Factors like the '3 D’s' (Death, Divorce, Disease), unemployment, and financial considerations affect homeowners' decisions to sell their homes, impacting market dynamics.

Q4 Update: Delinquencies, Foreclosures and REO

CalculatedRisk Newsletter • 33 implied HN points • 13 Mar 24
💰 Finance Real Estate Mortgages Equity Rates
  1. Most homeowners have substantial equity in their homes, which helps prevent a surge in foreclosures that could impact house prices.
  2. The distribution of interest rates on mortgages shows that a large percentage are under 4%, making it easier for homeowners to manage financially.
  3. Understanding key housing terms like forbearance, delinquency, foreclosure, and REO (Real Estate Owned) can help navigate discussions about property ownership.

ICE Mortgage Monitor: "First-Time Homebuyers Make Up Record 47% of GSE Purchase Loans"

CalculatedRisk Newsletter • 28 implied HN points • 04 Mar 24
💰 Finance Mortgages
  1. First-time homebuyers constituted a significant portion of GSE purchase loans in 2023, reaching a record 47%, the highest in at least a decade.
  2. Mortgage originations in 2023 hit a 30-year low, with a heavy focus on purchase transactions, while refinance lending showed potential for growth if rates decrease.
  3. In January, mortgage delinquencies dropped to 3.38%, the lowest level since October, indicating a positive trend below pre-pandemic levels.
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Credit Crunch Tsunami Hits Land

cryptoeconomy • 668 implied HN points • 22 Apr 23
💰 Finance Loans Mortgages
  1. Credit crunch is hitting various sectors like car loans, housing, and business loans.
  2. Banks are cutting off car loans due to difficulty in getting buyers approved, affecting dealers.
  3. Mortgages are in a critical state with plunging applications, high debt ratios, and increasing defaults.

Scholarship on the Mortgage Moral Panic

Erdmann Housing Tracker • 84 implied HN points • 03 Aug 23
💰 Finance Housing Market Regulations Mortgages Homeownership
  1. Regulatory changes post-Great Recession have made small dollar loans less available, leading to high denial rates
  2. Mortgage standards can create barriers, pushing buyers towards riskier agreements and impacting property prices
  3. Competition from all-cash buyers is high for small dollar homes, affecting mortgage approval rates and market dynamics

Why are homebuilder rate buydowns effective?

Erdmann Housing Tracker • 63 implied HN points • 08 Sep 23
💰 Finance Real Estate Mortgages Interest Rates Market Analysis
  1. Market prices aren't changing due to temporary factors, leading builders to use rate buydowns instead.
  2. Builders are using rate buydowns to close the gap between mortgage rates and other interest rates in the current market.
  3. The unique market conditions make rate buydowns a strategic tool for builders, influencing the mortgage market stability.

Housing affordability around the globe and what really helps

Klement on Investing • 2 implied HN points • 05 Mar 24
💰 Finance Housing Affordability Mortgages Government intervention Real Estate
  1. Data shows housing affordability has increased in most countries post the 2008 financial crisis due to low mortgage interest rates.
  2. National averages say the UK isn't as bad in housing affordability as perceived, with countries like Australia and France in a tougher spot.
  3. Analysis suggests government intervention, like offering housing benefits and building new homes, can notably improve housing affordability.

The Parable of Angelo Mozilo

Net Interest • 22 implied HN points • 21 Jul 23
💰 Finance Banking Mortgages Financial Crisis Insider trading
  1. Angelo Mozilo was a key figure in the mortgage industry, starting Countrywide Financial and seeing its rise and fall.
  2. Countrywide's shift towards subprime lending led to risky practices, with Mozilo's ambition for growth overriding concerns about risk.
  3. Despite the financial crisis fallout, Mozilo personally profited from insider trading but faced legal repercussions, highlighting the recurring issue of trading risk for growth in financial services.