Mortgage lending fell to a 17-year low of $1.1 trillion in 2014 as tightening credit standards limited growth in new loans. Housing sales dropped for the first time in four years, down 3% to 4.9 million. #-ad_banner-#There has also been a shortage of homes for sale, with 2 million houses on the market in November, up from a monthly average of 1.8 million in 2012 and 2013, but well under the 2.5 million monthly average between 2001 and 2006. Part of the reason for this is that buyers were underwater or barely breaking even on their current mortgages, so they… Read More
Mortgage lending fell to a 17-year low of $1.1 trillion in 2014 as tightening credit standards limited growth in new loans. Housing sales dropped for the first time in four years, down 3% to 4.9 million. #-ad_banner-#There has also been a shortage of homes for sale, with 2 million houses on the market in November, up from a monthly average of 1.8 million in 2012 and 2013, but well under the 2.5 million monthly average between 2001 and 2006. Part of the reason for this is that buyers were underwater or barely breaking even on their current mortgages, so they lacked the equity to sell their home and buy a new one. With news like this, you might not think it’s the best time to start buying into housing-related stocks. But you may have missed one headline that could mean a stronger housing market this year, especially for one segment in particular. Housing Boom 2.0 With 97% Loan-to-Value Option In December, Fannie Mae (OTC: FNMA) announced that it and Freddie Mac (OTC: FMCC) would begin offering a new lower-down- payment option. The 97% loan-to-value (LTV) program allows qualified first-time homebuyers to put as little as 3% down. The news… Read More