Mortgage demand has fallen 41%

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Mortgage demand has fallen 41% since Fed’s 50 bps cut link

• Mortgage demand saw a 10.8% drop for the week ending Nov. 1, extending a six-week decline driven by rising rates despite the recent Fed rate cut. Refinancing applications fell 19%, though they remain 48% higher than the same period last year.

• The average 30-year fixed mortgage rate rose to 6.81%, its highest since July, putting additional pressure on loan sizes. FHA loan rates climbed to 6.75%, while jumbo loan rates reached 6.98%.

• With expectations of increased government spending following Trump’s presidency win, the 10-year Treasury yield jumped, likely pushing mortgage rates up further. Market analysts suggest mortgage rates could hit 8% if current trends worsen.

Why South and Western metros haven’t cracked the hottest markets list in more than a year link

• Rising mortgage rates have priced many buyers out of traditionally hot Southern and Western markets, shifting demand toward the more affordable Midwest and Northeast. In October, the Midwest and Northeast made up all of Realtor.com's 20 hottest housing markets, with Rochester, NY, and Rockford, IL, as notable entries.

• Over the past two years, increasing inventory in Southern and Western markets has cooled demand, causing homes to stay on the market longer with fewer views per listing. By July 2023, no Western metros appeared in the top 20, and Kingsport, TN, was the last Southern market to rank, back in September 2023.

• To regain appeal, experts suggest that housing prices or mortgage rates in these regions would need to drop to attract renewed buyer interest. Currently, Huntington, WV, ranks highest for the South at No. 44, and Oxnard, CA, holds No. 85 for the West in the top 200.

Commercial/multifamily borrowing increased 59 percent in third-quarter 2024 link

• Commercial and multifamily mortgage originations jumped 59% year-over-year in Q3 2024, fueled by lower interest rates and increased economic activity. Borrowing also rose 44% from the previous quarter as interest rates on the Ten-year Treasury fell from 4.31% in June to 3.72% in September.

• Health care property loans saw the largest increase at 510% year-over-year, followed by hotels at 99%, retail at 82%, and multifamily properties at 56%. Office property originations, however, declined by 3%, signaling continued hesitation in that sector.

• Among investor types, CMBS loans surged by 260% year-over-year, while depository loans increased by 69%, and investor-driven loans rose by 62%. GSE-backed loans and life insurance company loans grew by 28% and 31%, respectively, reflecting diverse investment in commercial real estate.

The top 10 cities for American expats link

• Panama leads in expat satisfaction, with 82% reporting happiness due to affordability, proximity to the U.S., and welcoming locals. While health care ranks lower, expats enjoy robust social and financial ease with low monthly living requirements of around $1,000.

• Mexico ranks high with 89% expat happiness, favored for warm weather, beaches, and affordability; however, bureaucracy and banking challenges persist. Despite these, Mexico remains popular for its work-life balance, with 43% of expats fully satisfied.

• Indonesia appeals for low cost of living, friendly locals, and an average work week of 38.8 hours, enhancing work-life balance. Health care and air quality are downsides, though 84% report happiness, especially in Bali.

• These are the top 3. Click the link for the rest.

Active Adult Communities Trends link

• Active adult communities are establishing an average rental premium of 12% to 23% over multifamily, driven by demand for socialization and unique programming. This premium is achievable as occupancy rates stabilize, creating a distinct appeal over traditional multifamily options.

• Nearly 93% occupancy is reported in active adult rentals, with properties aged five to seven years reaching 95%-97% occupancy, primarily due to a growing cohort of renters aged 65-74. The demand is projected to grow as 2.2 million new renters enter the market over the next decade.

• Operators are increasingly focused on maintaining residents longer to avoid "acuity creep," where aging in place raises care needs. Avenue’s Viva Bene brand is addressing this by incorporating wellness programs to keep residents engaged and independent longer.

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Link to the listing

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Vidit

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