Zillow now offering a 1% down payment loan

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Q3 GDP Tracking: Moving Up link

• BofA adjusted their 2Q GDP tracking estimate to 2.4% q/q saar and raised their 3Q estimate to 2.8% q/q saar.

• Goldman Sachs maintained their Q3 GDP tracking estimate at +2.6% with domestic final sales growth forecast at +2.7%.

• Atlanta Fed's GDPNow model predicts a 5.9% growth rate for Q3 2023, an increase from their previous 5.8% estimate.

Zillow is now offering homebuyers a 1% down payment option link

• Zillow introduces a 1% Down Payment program, initially available to eligible borrowers in Arizona, aiming to reduce the time needed for consumers to save for a down payment.

• A buyer looking to purchase a $275,000 home in Phoenix, Arizona, saving 5% of their income, would only need 11 months to save for the down payment with this program.

• The average 30-year fixed mortgage rate has risen above 7%, adding an extra $1,000 in monthly payments for a median US home priced at $416,000 compared to last year's rates of about 4%.

Warren Buffett Bets >$800M on Real Estate link

• Warren Buffett's Berkshire Hathaway disclosed a whopping $814 million investment across three major home builders, highlighting the industry's potential amidst a housing shortage.

• The primary focus was on D.R. Horton with Berkshire purchasing six million shares, making them one of the top 10 shareholders with 1.8% of its stock.

• Despite challenges faced by Berkshire's housing-related subsidiaries, the stock index for homebuilders has surged, outpacing the broader S&P 500 with D.R. Horton, Lennar, and NVR showing impressive growth rates this year.

Mortgage Rates might hit 8% per this data link

• The 30-year fixed mortgage rate is nearing 7.4%, drastically impacting housing affordability and causing a significant drop in homebuyer demand.

• Jerome Powell and the Fed indicate that the fight against inflation isn't over, suggesting that rates might remain high or even increase.

• Homebuyer demand has plummeted to its lowest since 1995 due to the combination of high property prices and 7-8% mortgage rates.

Pending home sales hit 2023 high after months of declines link

• Pending sales reached a 2023 peak of 387,000 in July, a significant recovery from the three-year low of 367,000 in March. However, they're still 15.7% lower year-over-year due to fluctuating mortgage rates.

• Average 30-year fixed mortgage rates hit 6.84% in July, a sharp increase from 5.41% in July 2022. Rates further soared to a 22-year high of 7.23% in August.

• Median home sale prices increased by 1.7% year-over-year to $421,872 in July, just 2.5% below the record high of $432,476 in May 2022.

Top 10 Zombie Homes ZIPS in Q3 2023 link

If you are wondering - “Zombie homes” are vacant, deteriorated small homes whose owners are behind on their mortgage payments.

• 1.3 million residential properties in the U.S. are vacant, equating to 1.3% or one in 79 homes.

• Foreclosures in Q3 2023 have risen by 16.6% from Q3 2022, with 8,782 properties identified as zombie foreclosures.

• The highest zombie foreclosure rates in U.S. zip codes include Fort Myers Beach, FL at 85.7% and Indian Wells, CA at 76.9%.

The Two Fastest-Growing Types Of Built-For-Rent, And The Metro Markets That Love Them link

• Horizontal apartment communities and townhome communities are the leading categories in the built-for-rent single-family space, with significant growth in unit completions.

• Phoenix and Dallas-Fort Worth dominate the townhome ranking, with Florida markets just beginning to embrace the BTR trend. Upcoming markets include Nashville, Huntsville, Orlando, Las Vegas, and Greeley, Colorado.

• Mortgage rates surpassing 7% are pushing more individuals towards renting, fueling demand for built-to-rent properties. However, securing financing remains a significant challenge for developers in this sector.

10-Year Treasury Rate Signals Caution for Commercial Real Estate link

• The 10-year U.S. Treasury rate hit 4.35% on August 21, its highest since 2007, and later settled at 4.24% on August 24. Predictions suggest it could soar to 4.75% or more, doubling the past decade's 2.24% average.

• A 100-basis-point surge in long-term interest rates could lead to a 60-basis-point increase in commercial real estate capitalization rates. This could result in a 25% drop in capital values, impacting investors and the banking sector.

• CBRE anticipates that post monetary tightening and once inflation aligns with the Fed's 2% target, the 10-year Treasury rate will average around 3.5% over the next five years, settling at 3.25% by 2027. This implies a 12.5% reduction in asset values.