By Dhara Singh

From Yahoo Money

Mortgage rates dropped to a new low for the 13th time this year, allowing a record number of homeowners to refinance, according to Freddie Mac, a government-sponsored agency that backs millions of mortgages.

The rate on the 30-year fixed mortgage fell to 2.72%, exceeding the previous low of 2.78% recorded the week of November 5. This is the lowest on records dating back to 1971 when the agency first began tracking rates. A year ago, the rate stood at 3.66%.

The new low would allow 19.4 million Americans to refinance their mortgages, a record high, according to exclusive data provided to Yahoo Money by Black Knight, a mortgage data and analytics firm. These homeowners could save a total of $5.98 billion on aggregate monthly payments.

“Investors had to weight the promising news of another vaccine contender against this week’s disappointing retail report and still-rising COVID cases, which drove the Freddie Mac interest rate for a 30-year loan down 12 basis points to another record low,” said Georgie Raitu, senior economist at Realtor.com, a real estate listing website.

‘Buyers and owners may see different rates’

Not everyone will be able to tap into the record low rates.

“Low mortgage rates are good for homebuyers as well as those looking to refinance,” said Danielle Hale, chief economist at Realtor.com. “But buyers and owners may see different rates offered depending on their credit characteristics, the type of home they are looking to buy or refinance, and whether they are doing a purchase or refinance itself.”

As unemployment increased during the pandemic, home loans backed by the Federal Housing Administration and often used by borrowers with blemished credit have increased their minimum credit score requirements — up to the mid-600s at some lenders — to protect from a higher risk of default.

Many banks also tightened lending standards in the third quarter for most types of mortgages, including for government- sponsored mortgages, which make up the majority of bank mortgage originations, according to a recent report from the Federal Reserve.

Rates Could Dip Lower.

Rates will likely decrease in upcoming weeks, experts said, but the rate is unlikely to reach as low as 2.5%. That is largely due to lenders being unable to keep up with a mortgage refinancing boom during the pandemic.

“Mortgage rates have traditionally been aligned with and mirrored the moves of the 10-year Treasury note,” Raitu said. “With Treasury yields having spent the better part of 2020 under 1%, we could have expected rates to have been in the 2.5% to 2.6% [range], but many lenders have responded to high unemployment and a large wave of refinances by tightening underwriting standards and keeping rates higher.”

The wave has already begun: Evictions surge as cities suspend moratoriums

by Akiko Fujita

Yahoo Finance

Legal aid groups and housing advocates are bracing for a surge in evictions, as local governments begin lifting moratoriums that deferred rent payments for millions of tenants who lost jobs to the pandemic.

In Michigan, where the state is set to lift the eviction moratorium next Wednesday, Ruthie Paulson has seen a 76% spike in calls to her 211 call center, which provides social services to those most in need. Nationally, the call volume has jumped 200%.

“A lot of the tenants are living in fear, day to day, not knowing if they’re going to receive a stimulus check, not knowing if they’re going to receive an unemployment check,” Paulson said. “They know that date is coming, when legally they know their landlord will be able to get a court order to officially evict them. They know they’re not going to be able to pay that money.”

States that have already lifted the moratorium have seen a dramatic spike in eviction cases. In Memphis, Shelby County courts faced a backlog of 9,000 eviction cases when hearings resumed last month. In Milwaukee, eviction filings spiked 15% since the city’s moratorium was lifted, according to data from the Eviction lab. Columbus, Ohio, converted the city’s convention center into a socially-distanced housing court to prepare for the impending wave of evictions and homelessness.

“In many ways, the wave has already begun. We need to work to stop it from becoming a tsunami and we’re running out of time,” said Diane Yentel, President of the National Low-Income Housing Coalition. “We’re seeing now a really frankly horrifying confluence of increasing evictions in states where new coronavirus cases are surging.”

20 million renters at risk of eviction

More than 20 million people, or one in five of the 110 million Americans who live in households that rent, are at risk of eviction by the end of September, according to the COVID-19 Eviction Defense Project. While economic stimulus payments and unemployment insurance have allowed tenants to remain in their homes throughout the pandemic, CEDP Co-Founder Zach Neumann says that is likely to change dramatically, with enhanced unemployment insurance set to expire at the end of the month.

Black and Latino families are at highest risk of eviction, according to Yentel.

Those seeking help aren’t limited to low-income families, but young professionals now out of work.

“You have a lot of folks who had strong incomes, in a lot of cases high five figure or low six figure

[salaries]

. They didn’t have a lot of savings, lost their jobs or were furloughed, and there was not any severance attached to that, but had rents that were in line with the salaries they were earning,” Neumann said. “The client pool economically looks a lot different than it has in the past.”

Eviction hearings conducted by Zoom

The threat of homelessness coincides with a troubling uptick in coronavirus cases across the South and West, leaving tenants especially vulnerable. In Tucson, where a surge in infections has filled hospitals to capacity, courts are processing over 52 eviction cases a day, 2 to 5 times the case load from the same period last year, according to Yentel. A disturbing spike in COVID-19 cases and hospitalizations prompted Texas Governor Greg Abbott to roll back the state’s reopening plans last month, but eviction hearings are moving forward on Zoom. That’s complicated the legal fight for tenants, who don’t have access to the technology.

Tenant rights vary from state to county to city, adding to the confusion. In some jurisdictions, failure to dial into a hearing by video call paves the way for landlords to move forward with an eviction.

“With a Zoom hearing you never have the opportunity to access a lawyer, to speak to someone who can give you advice to explain how the process goes. So the odds of not having your full rights under the law or not having representation, go down even further,” said Neumann, who offers legal aid to tenants in Colorado. “Even before COVID it was an extreme problem — 98% of landlords in Colorado went to court with an attorney and 2% of tenants did. We expect to see that 2% go down to an even lower number, which obviously affects outcomes across the system.”

Housing advocates say the pandemic has exacerbated an affordable housing crisis the country faced even before COVID-19. Yentel says 8 million households, or roughly 25 million people, were paying at least half of their income towards rent each month.

“When you have such limited income to begin with and you’re paying so much of it for your home, you’re always one financial emergency away from not being able to pay the rent and facing eviction, and in worst cases homelessness,” Yentel said.

Sen. Elizabeth Warren (D-Mass.) has introduced legislation to extend the 120-day rent moratorium in the CARES Act to March 2021. Though the initial provision, set to expire on July 25, only covers federally assisted housing, or roughly 30% of renters nationwide, Warren’s proposal extends the proposal to include most tenants.

But with Congress on recess until July 20, any action may be too late for tenants living in cities where the moratorium has already been lifted.

“We’re running out of time,” Yentel said. “The stakes couldn’t be higher right now, and every day of inaction is putting more low income people at risk of losing their homes.”

America’s housing market is showing the first signs of trouble because of the coronavirus pandemic.

By Jacob Passy, Market Watch

March started out as a strong month for the U.S. housing market — but by the second half of the month, the first indications that the coronavirus pandemic would weigh on home-selling activity began to emerge, according to a new report from Realtor.com.

In the weeks ending March 21 and March 28, the number of newly-listed properties fell by 13.1% and 34% respectively when compared with the same period a year ago, Realtor.com found. This is an indication that home sellers may be holding off on listing their properties right now.

The pace of home-price growth also slowed notably in the latter half of the month, according to the report. Home list prices were only up 3.3% year-over-year for the week ending March 21, and 2.5% for the following week. This represented the slowest pace of listing price growth since Realtor.com started tracking this data in 2013.

“Our inventory and listing data can provide some early insight into how housing markets may be impacted by COVID-19, but the situation and reactions to it are still rapidly evolving,” Realtor.com chief economist Danielle Hale wrote in the report.

“The U.S. housing market had a good start to the year. Despite still-limited homes for sale, buyers were buying and builders were building,” she wrote. “The pandemic and virus-fighting measures appear to be disrupting that initial momentum as both buyers and sellers adopt a more cautious posture.”

Real-estate firms have taken steps to brace for the impact of the coronavirus pandemic. So-called iBuyers including Zillow US:ZG and Redfin US:RDFN that purchase homes from sellers and then sell them for a profit had wound down their home-buying operations in anticipation of an economic downturn. Real-estate brokers, incuding Redfin and Re/Max US:RMAX , had also shifted toward virtual home tours as open houses became verboten in the wake of social-distancing recommendations.

And other recent reports have shown additional signs of a slowdown in the housing market. LendingTree US:TREE released an analysis of Google US:GOOG search data analyzing the popularity of the search term “homes for sale” across the country’s 50 largest metro areas. Searches for “homes for sale” have fallen across all 50 cities in the study from their peak levels in 2020 thus far.

LendingTree estimated that these Google searches could drop some 63% compared with last year if the impact of the COVID-19 outbreak remains substantial for the next two months. A drop in web searches could presage a decline in home sales.

Another sign that home sales will slump this spring: Mortgage applications. The volume of mortgage applications for loans used to purchase homes was down 24% compared with a year ago for the week ending March 27, according to data from the Mortgage Bankers Association. That’s in spite of mortgage rates being near historic lows. Comparatively, the volume of refinance applications was 168% higher than a year ago.

Before the coronavirus pandemic flared up, the U.S. housing market was on relatively solid footing. While the number of homes for sale remained low — constraining sales activity to an extent — demand among buyers was still quite high. Low mortgage rates had fueled an early start to the spring home-buying season, with homes selling four days faster in March when compared with 2019 levels, Realtor.com found.

The jump in jobless claims has stoked concerns of a repeat of the Great Recession and the foreclosure crisis that preceded it. But housing economists argue that this is unlikely to be the case.

“While housing led the recession in 2008-2009, this time it may be poised to bring us out of it,” Mark Fleming, chief economist for title insurance company First American Financial Corporation US:FAF , wrote in a report this week.

Unlike in the 2000s, the housing market in the U.S. is not overbuilt, Fleming argued, making it less likely that a large swath of vacant properties will crater the home values for homeowners. Rising home values and stricter lending standards have also meant that homeowners are sitting on historically high amounts of home equity.

“The housing market will not go unscathed, as consumer confidence and a strong labor market are essential in the decision to purchase a home,” Fleming wrote. “Yet, this time, housing is a casualty of a public health crisis turned economic, not the cause of an economic crisis.”