Friday, July 31, 2015

GDP Substantially Improves in ‘Advance’ Q2 Estimate Team Thayer News

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The GDP growth rate in the first quarter, which was reported to be an annual rate of minus 0.2 percent in the BEA's third and final estimate released in late June, was revised upwardly and reported on Thursday to be 0.6 percent.
"These results are in line with years past when we have had a very weak first quarters followed by more normal second quarters," said Mark Fleming, Chief Economist with First American. "The quarter-over-quarter jump isn't a signal of rebounding, but is simply a return to more normal rates of growth. The 2.3 percent rate for the second quarter is probably in line with where we will land at the end of the year—2.3 percent for 2015."
The Q2 increase in real GDP reflected "positive contributions from personal consumption expenditures (PCE), exports, state and local government spending, and residential fixed investment that were partly offset by negative contributions from federal government spending, private inventory investment, and nonresidential fixed investment," according to the BEA report. Meanwhile, imports, which are a subtraction when GDP is calculated, increased in Q2.
"The good news in this release comes from two basic observations," said Robert Denk, Assistant VP for Forecasting and Analysis at the National Association of Home Builders (NAHB), on the NAHB's Eye on Housing blog. "First, economic activity rebounded in the second quarter after a weather-induced (less than previously estimated) pause in the first quarter, with PCE growth offsetting a slowdown in investment. And second, while revised lower in 2012 and 2013, PCE was revised higher in 2014, and is accelerating so far in 2015, showing a stronger growth trajectory over the last several years."
Also on Thursday, the BEA released annual revisions of real GDP growth for each year dating back to 2012. The BEA found that real GDP increased at the average annual rate of 2.0 percent from 2011 to 2014, revised downwardly from previously published reports of 2.3 percent real GDP growth for that period. From Q2 2011 to Q1 2015, real GDP growth was revised to an annual rate of 2.0 percent, down from the previously reported rate of 2.2 percent for that period, according to the BEA.
Real GDP growth for 2012 was revised downwardly by 0.1 percent down to 2.2 percent; for 2013, it was revised downwardly by 0.7 percentage points down to 1.5 percent; and for 2014, it was unchanged at 2.4 percent. The primary cause for the downward revisions was PCEs and government spending.
The advance Q2 estimate is based on source data that are incomplete and subject to further revision, according to the BEA. The BEA will release the second estimate for Q2, based on more complete data, on August 27.
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Justin Lee Thayer is Lane counties expert in market analysis for real estate investors. Call Justin @ 541-543-7287
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Servicers’ Attention to Small Amount of At-Risk Borrowers Negatively Impacts Satisfaction Team Thayer News

ChecklistThe J.D. Power 2015 U.S. Primary Mortgage Servicer Satisfaction study released Thursday found that servicers are spending too much time and resources focusing on at-risk customers, negatively impacting satisfaction for the majority of their customers.
"While servicers must be prepared to work within the confines of industry regulations, they must also effectively satisfy customers whose expectations regarding technology and personal service are rapidly changing," the survey said. "To meet these challenges and remain competitive, mortgage servicers need to understand and implement key best practices that have the greatest potential to reduce or prevent problems, contain costs, and create positive customer experiences that improve brand perceptions and minimize oversight risk."
At-risk customers, those that J.D. Power defines currently behind in their mortgage payments or concerned about keeping current during the next year, represent only 15 percent of the survey respondent pool. This small group has been the center of regulatory and other government agencies such as the Consumer Financial Protection Bureau (CFPB), Fannie Mae, and Freddie Mac. The survey determined that among mortgage service customers who are highly satisfied, 14 percent are at-risk customers and 86 percent are customers who are current with their payment.
“A lot of time and resources have been spent on the live representative interaction to help distressed borrowers. While improvement is needed, the majority of mortgage customers haven’t seen a lot of meaningful changes in their experience,” said Craig Martin, director of the mortgage practice at J.D. Power. “Mortgage servicers must ensure that all customers’ concerns receive the appropriate attention in customer experience management decisions. For example, the typical mortgage servicing customer prefers to interact online, so a high-quality self-service website experience should be a priority, but it is often an afterthought.”
The study is based on responses from 5,922 customers from March 2015 through April 2015 who have had a mortgage on their primary residence for at least one year. It gauged customer satisfaction with the servicing experience among the largest U.S. mortgage servicers through six key factors: onboarding, billing and payment, escrow account administration, fees, interaction, and communications.
According to J.D. Power, on a 1,000-point scale, Quicken Loans, Inc. ranked the highest in terms of customer satisfaction among all primary mortgage servicers for the second consecutive year with a score of 834, performing well in all six key categories. Citizens ranks second with a score of 768, followed by Capital One at 742. Overall customer satisfaction with mortgage servicers is 718.
"ŸProviding an outstanding mortgage servicing experience can generate high levels of advocacy and loyalty," the survey noted.
The study finds that 85 percent of highly satisfied customers with satisfaction scores of 900 or higher say they “definitely will” recommend their mortgage servicer to others. In addition, 74 percent say they “definitely will” reuse their servicing provider for their next home purchase.
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Wednesday, July 29, 2015

House Committee Examines Dodd-Frank’s Impact Team Thayer

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The hearing, titled "Dodd-Frank Five Years Later: Are We More Prosperous?", included witnesses Phil Gramm, Senior Partner with U.S. Policy Metrics and former U.S. Senator; R. Bradley Miller, Of Counsel with Grais & Ellsworth and a former member of Congress; and Peter Wallison, Arthur F. Burns Fellow in Financial Policy Studies, American Enterprise Institute. A recurring theme at the hearing was that Dodd-Frank represented overregulation which has stifled economic recovery rather than accelerated it as was intended.rank Act on American prosperity, freedom, and financial stability five years after the controversial law was enacted took place in the House Financial Services Committee on Tuesday.
"By any measure we are today experiencing the weakest recovery of a post-war era," Gramm said. "Had this recovery simply matched the strength of the average of the other ten recoveries since World War II, 14.4 million more Americans would be working today and the average income of every man, woman and child in the country would be $6,042 higher. The incomes of the poor, middle income workers, women and minorities have fallen even during the recovery, an unprecedented event. All this economic carnage has occurred despite a doubling of the Federal debt and an 2 expansion of the Federal Reserve Bank balance sheet and the monetary base at rates never before witnessed."
Wallison presented a chart that compared recovery from the financial crisis of 2008 with that of previous crises and noted that from 2009 until the passage of Dodd-Frank in July 2010, economic recovery was on the same pace as previous recoveries. He contended that recovery began to slow down when Dodd-Frank was signed into law.
"I believe that all the new regulation added by the Dodd-Frank Act in 2010 is the primary reason for the slow growth this country has experienced since 2010. Later in this testimony, I will show that the new regulations imposed on banks—particularly small banks—has created a bifurcated economy," Wallison said. "Large firms in the real economy, which can access the capital markets for financing, have been growing roughly in line with previous recoveries, but smaller firms that rely on banks for financing are growing far more slowly. Since most of the growth in the US economy, and especially in employment, comes from small firms, the economy is underperforming and will continue to underperform until the treatment of banks under DoddFrank Act is substantially modified or repealed."
Gramm, a Republican former Senator from Texas, also said he believes that Dodd-Frank gave regulators too much power.
"Much of our slow growth is not just a product of mounting regulatory burden but of legislative and executive actions that have empowered regulators to set rules rather than implement rules set by Congress," he said. "Dodd-Frank has undermined a vital condition required to put money and America back to work—legal and regulatory certainty."
In his opening statement at Tuesday's hearing, Committee Chairman Jeb Hensarling (R-Texas) asserted that the massive 2,300-page law "launched a salvo of consequences that have crippled growth," and that Dodd-Frank had hit Main Street when it was intended to reform Wall Street. As Gramm pointed out, the effects of the "failed recovery" were manifested in the banking system; the FDIC said that 1,341 banks have failed since 2010 while only two new banks have been chartered in the last five years – compared to about 2,500 banks chartered in the quarter century prior to the financial crisis.
"It has had pernicious effects on small businesses and community financial institutions which are the lifeblood of the Main Street economy. Community banks and credit unions supply the bulk of small business and agricultural loans, but the combined weight of Dodd-Frank’s 400 regulations is dragging them down," Hensarling said. "We are losing on average one community financial institution a day."
Miller, the Democratic former North Carolina Congressman, admitted there was more work to be done was far as creating an economy that allows Americans to grow and prosper. But he stood in defense of Dodd-Frank at Tuesday's hearing.
"Dodd-Frank was a compromise and reformers did not get all we wanted, but it was probably all that was possible at the time, given the industry’s continued enormous clout in Washington, even while the industry stood in complete disrepute among the American people," Miller said. "We are better off, and more prosperous, than we would be without it."
The first hearing in the series, "Dodd-Frank Five Years Later: Are We More Stable?" took place in the Committee on July 9. The date of the third hearing in the series, titled "Dodd-Frank Five Years Later: Are We More Free?" will be announced later, according to the Committee.

What Sun Tzu says about the cause of failure Team Thayer

What Sun Tzu says about the cause of failure
Here is the list of common fears from one survey in 1977 asked to 3000 Americans:
The 14 Worst Human Fears

1) Speaking before a group 
2) Heights
3) Insects and bugs
4) Financial Problems
5) Deep water
6) Sickness
7) Death
8) Flying
9) Loneliness
10) Dogs
11) Driving/riding in a car
12) Darkness
13) Elevators
14) Escalators

Failure is a part of life, the goal is to minimize those failures. 
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Justin Lee Thayer is Lane counties expert in market analysis for real estate investors. Call Justin @ 541-543-7287
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Tuesday, July 28, 2015

HUD Claims a Year of Progress Since Castro Became The New Secretary Team Thayer News

home-protectionWhile much has been written and said in the last two weeks on the fifth anniversary of the passing of Dodd-Frank into law, HUD is celebrating an anniversary of its own on Tuesday.
July 28 marks exactly one year since former San Antonio mayor Julián Castro was sworn in as HUD secretary, succeeding Shaun Donovan. In addition to celebrating Castro's one-year anniversary as HUD secretary, HUD will commemorate the 50th anniversary of its founding on September 9.
During his first year as the nation's top housing official, Castro has made several policy changes with the intent of increasing opportunity for more Americans to obtain affordable, sustainable housing. Several of those changes are outlined in an announcement from HUD on Monday titled "Year of Progress: Delivering on the Promise of Opportunity."
"We recognize housing as a platform for Americans who are striving to improve their lives and break the cycle of poverty for the next generation," HUD stated in the release. "As needs for our services have increased, HUD will continue to invest in initiatives that have demonstrated outcomes in helping the people we serve."
One of the major changes Castro enacted occurred just one week into the new calendar year. On January 8, Castro announced that the Federal Housing Administration (FHA) would be lowering the annual premiums for first-time buyers by half a percentage point, down to 0.85 percent. The Agency estimates the move will save more than two million borrowers an average of about $900 annually on mortgage premiums and will allow about 250,000 new homebuyers to enter the market during that time.
"I applaud FHA's initiative to lower the mortgage insurance premium by 50 bps," said Laurie Goodman, center director of the Housing Finance Policy Center at the Urban Institute. "This was a courageous move, as the MMI Fund had not reached its 2 percent minimum."
Indeed, the MMI fund stood at 0.41 percent last November, less than a quarter of the 2 percent required by law, which caused the lowering of the annual premiums to draw some criticism.
"Since FHA's financial future is still uncertain, now is not the time to reduce premiums. It has nowhere near the level of reserves to withstand even a minor recession," Edward Pinto, co-director and chief risk officer of the American Enterprise Institute's International Center on Housing Risk, told DS News in a recent interview. "Given FHA's current high risk practices, it would be imprudent to not stay the course; it should not lower premiums."
Another step HUD took toward providing Americans with access to affordable housing was the Affirmatively Furthering Fair Housing (AFFH) rule, which was announced on July 8. This rule creates a streamlined fair housing planning process that helps communities analyze their choices for fair housing and establish goals and priorities to address barriers to fair housing. The rule was widely praised as a way to help the 1968 Fair Housing Act meet its obligation to help state and local governments improve their housing policies and achieve more meaningful outcomes that allow all Americans to live where they want to.
"The Affirmatively Furthering Fair Housing provision of the Fair Housing Act was intended to help remedy years of government-supported segregation and inequality, not by forcing diversity, but by empowering and encouraging states and localities to partner with the federal government to address the effects of these harmful policies," House Financial Services Committee Ranking Member Maxine Waters (D-California) said.
Other HUD achievements in the last year include funding rental assistance vouchers for 2.4 million low-income households, providing an opportunity for families who are seeking to become homeowners; investing $250 million through the Choice Neighborhoods Program to transform high poverty areas; and investing $4 million to expand the HUD-Veterans Affairs Supportive Housing (HUD-VASH) Program to help approximately 650 Native Americans who are currently homeless or at risk of being homeless.
Still, there is more work for HUD and FHA to do as Castro approaches his second year as HUD secretary, particularly in the area of relaxing the standards on loan level certifications for lenders.
"The FHA needs to focus more on access to credit by giving lenders the comfort they need to eliminate their overlays," Goodman said. "This means changing the loan level certifications lenders sign. FHA currently requires lenders to certify that the information it has provided to FHA is true, complete, and accurate. This has resulted in FHA seeking indemnification for small, inadvertent errors and has served as a basis for the False Claims Act, under which lenders are liable for treble damages."
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Justin Lee Thayer is Lane counties expert in market analysis for real estate investors. Call Justin @ 541-543-7287
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Fannie Mae Announces BIg News for Single-Family Loans Team Thayer Real Estate

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Fannie Mae is now providing an enhanced single-family loan performance dataset in order to offer greater transparency in advance of the Enterprise moving to an actual loss framework for the Connecticut Avenue Series (CAS) risk sharing transactions, according to an announcement from Fannie Mae on Wednesday.
Features of the enhanced dataset include information on credit performance up to, and including, property disposition. The credit information the new dataset provides includes event dates, the costs incurred by the credit event, and recovery proceeds that Fannie Mae receives. Fannie Mae estimates it could move to the actual loss framework  for the CAS transactions as soon as the fourth quarter this year.
"Proactively providing this research data is an important step to prepare the market for our move to an actual loss structure for CAS deals later this year and supports market participants in further modeling the credit risk of Fannie Mae’s Single-Family book of business," said Laurel Davis, vice president for credit risk transfer at Fannie Mae. "We are providing access to this data now in order to give the market sufficient lead time to become comfortable with the information.  Our hope is that by allowing broad access to the data, we can increase the transparency and liquidity of our credit risk offerings."
The information in the enhanced dataset is provided to help investors better understand the credit performance of loans that Fannie Mae owns or guarantees as the development of the Enterprise's risk sharing program continues.
Last week, Fannie Mae announced a $1.56 billion credit risk sharing transaction under the CAS series, putting the Enterprise over the milestone of $10 billion in notes issued through CAS since the program began in October 2013. In less than two years, the Fannie Mae has transferred risk to private investors on single-family mortgage loans with an unpaid principal balance (UPB) of more than $390 billion.
For information on Fannie Mae's approach to credit risk transfer or any of the CAS risk sharing
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FHFA Home Price Index 2015 Team Thayer Real Estate News

FHFA
House prices inched up 0.4 percent in May, on a seasonally adjusted basis from the previous month, according to the Federal Housing Finance Agency’s monthly House Price Index. The previous month was revised up from 0.3 percent percent change in April to instead reflect a 0.4 percent change.
Then index is based on home sales price information from mortgages sold to or guaranteed by Fannie Mae and Freddie Mac.
From May 2014 to May 2015, house prices were up 5.7 percent. For comparison, the U.S. index is 1.8 percent below its March 2007 peak and is roughly the same as the April 2006 index level. 
For the nine census divisions, seasonally adjusted monthly price changes from April 2015 to May 2015 ranged from -0.6 percent in the East South Central division to 1.1 percent in the East North Central division. In addition, the 12-month changes were all positive, ranging from +0.9 percent in the Middle Atlantic division to +8.4 percent in the Pacific division.
National Association of Realtors’ existing-home sales, which also came out on Wednesday, reported that the median existing-home price for all housing types reached an all-time high in June.
The FHFA house price index compares homes sales on a monthly basis, while the NAR existing-home sales report compares year-over-year home price levels. 
COTW-7-24-15
With home prices continuing to climb, baseline jumbo-mortgage thresholds may be raised for the first time in a decade. Jumbo mortgages for single-family residences exceed $417,000 in most parts of the country and $625,500 in high-price markets. But with home prices climbing back to pre-recession peaks in some markets like Honolulu, baseline jumbo thresholds may be raised for the first time in a decade.
The agency that sets these limits, the Federal Housing Finance Agency (FHFA), in May requested public input on its house price index. This index includes sale-price information on government-backed mortgages as well as real-estate sales compiled by research firm CoreLogic from hundreds of U.S. counties. Distressed sales are included but not appraisal values from refinances.
The deadline for input is July 27, and the FHFA will decide this fall whether to change the baseline limit starting Jan. 1.
In the early 1970s, the baseline limit for conventional loans was just $33,000. That was the maximum amount a homeowner could borrow to qualify for a “conforming” mortgage—one financed by Fannie Mae or Freddie Mac. The $33,000 limit rose steadily over the years to keep up with home prices. Hawaii, Alaska, Guam and the Virgin Islands got higher loan limits because of the high cost of living.
The Housing and Economic Recovery Act of 2008 established the current formula, which is based on median home-sale prices reported in a monthly FHFA survey. However, there is some wiggle room in high-cost areas, where conforming loans can exceed the baseline by up to 150%.
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Monday, July 27, 2015

Freddie Mac’s Portfolio Expands by $4.5 Billion by Team Thayer Real Estate News

www.teamthayer.comFreddie Mac's total mortgage portfolio expanded at an annualized rate of 2.8 percent in June, marking the fifth consecutive month and the 10th time in the last 12 months the portfolio has grown, according to Freddie Mac's June 2015 Monthly Volume Summary released on Wednesday.
The serious delinquency rate on Freddie Mac-backed single-family residential mortgage loans fell by another 5 basis points from May to June, down to 1.53 percent–virtually the same as the 1.52 percent serious delinquency rate reported for Freddie Mac-guaranteed loans in November 2008 at the start of the financial crisis. Freddie Mac's serious delinquency rate was less than half of the nationwide rate reported by CoreLogic for May, which was 3.5 percent.
The number of homeowners who received permanent loan modifications totaled 4,895 for June, a slight increase from 5,490 in May. With 30,312 modifications for the first half of 2015, Freddie Mac is averaging 5,052 modifications per month. This figure represented a decline of about 500 mods per month from 2014's monthly average of 5,596. Freddie Mac tweeted on Friday, "We helped nearly 4,900 families avoid foreclosure last month and over 30,000 in the first half of 2015."
The expansion of Freddie Mac's portfolio represented an increase of about $4.51 billion, up to nearly $1.923 trillion. It was the portfolio's largest expansion since December 2014, when it grew by $7.1 billion at an annualized rate of 4.5 percent. The 2.8 percent expansion rate is the second-highest during the last 12 months, second only to December's 4.5 percent. At the beginning of that 12-month period, in July of 2014, the portfolio's value was $1.895 trillion.
Though the portfolio has seen expansion in 10 of the last 12 months, June was only the 17th time in the last 66 months that the portfolio has grown dating back to January 2010.
"Driven by low mortgage rates and surging home sales, conventional mortgage activity is up substantially from one year ago," Freddie Mac Chief Deputy Economist Len Kiefer said. "According to our latest estimates, conventional mortgage origination volume is up $139 Billion (+30 percent) in the first half of 2015 compared to the first half of 2014. We expect interest rates to rise gradually and refinance volume to slow substantially in the second half of 2015, more than offsetting increased purchase mortgage activity. As a whole, we expect mortgage origination volume in 2015 to be up $100 billion (8 percent) compared to 2014."
Single-family refinance loan purchase and guarantee volume totaled $20.3 billion in June, up slightly from $20.1 billion in May. The percentage of single-family refinance loan purchase and guarantee volume that comprised the total single-family mortgage portfolio fell from 61 percent in May to 56 percent in June. The percentage of Freddie Mac's total single-family refinance volume was 9 percent in June, down from 10 percent in May.
The aggregate unpaid principal balance (UPB) of the Freddie Mac's mortgage-related investments portfolio declined by about $7 billion from May to June after declining about $9.8 billion from April to May. Freddie Mac's mortgage-related securities and other guarantee commitments saw an annualized rate increase of about 5.3 percent in June.
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Bill to Limit Compensation for Fannie Mae Freddie Mac Executives Team Thayer Real Estate News

www.teamthayer.com Eugene OregonThe House Financial Services Committee has announced that proposed legislation to cap the salaries of CEOs at Fannie Mae and Freddie Machas advanced to the markup phase, which will take place in the Committee on Tuesday, July 28.
H.R. 2243, also known as the Equity in Government Compensation Act of 2015, was introduced by U.S. Rep. Ed Royce (R-California) in May shortly after Federal Housing Finance Agency (FHFA) director Mel Watt directed the GSEs to submit a proposed executive compensation for the CEO position that could be as high as $7.26 million a year, the 25th percentile of the market.
Early in July, Fannie Mae and Freddie Mac announced that their respective CEOs, Timothy Mayopoulos and Donald Layton, would receive a raise from their current annual salaries of $600,000 (the cap set by Watt's predecessor, Edward DeMarco) up to $4 million. The announcement of the substantial raise for the GSE's top executives drew the ire of many lawmakers, including Royce, who said it is "unconscionable" that the GSEs would elevate the pay of their CEOs to that level while taxpayers are still on the hook. The GSEs have been under the FHFA's conservatorship since September 2008, when they received a $187.5 billion taxpayer-funded bailout.
Similar legislation was introduced by former Rep. Spencer Bachus (R-Alabama) in January 2012 and passed the House Financial Services Committee on a bipartisan vote of 52-4. One of the four who voted against the legislation was Mel Watt, then a member of the Committee.
"Congress needs to put a stop to the planned multi-million dollar paydays at Fannie Mae and Freddie Mac," Royce said upon the announcement that his bill was scheduled for markup. "Holding compensation packages at taxpayer-backed organizations to responsible limits is in the interest of the public trust. I thank Chairman Hensarling for advancing this legislation and look forward to building the bipartisan backing it previously garnered."
Watt said in a statement earlier this month that the purpose of the pay raises was to "promote CEO retention, allow reliable succession planning, and ensure the continuity, efficiency and stability" at Fannie Mae and Freddie Mac.
Royce's bill would suspend the compensation packages for Fannie Mae and Freddie Mac executives and would limit the salaries to the highest level paid at the FHFA, which the Congressional Budget Office estimated in 2011 to be $255,000 per year. It would also place non-executive GSE employees on the General Schedule (GS) pay scale, where the most they could earn annually would be $132,122.
Other government agencies have weighed in on the pay rate for the top executives at the GSEs. The Department of Treasury released a statement earlier this month saying, "Treasury does not support FHFA’s new approach to CEO compensation at Fannie Mae and Freddie Mac and urged the agency to reject any increase. Treasury has consistently recommended that existing limits on compensation continue." White House press secretary Josh Earnest stated, "I think it is entirely legitimate for the executives at those institutions to be subject to compensation limits."
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Fannie Mae Revises Economic Growth Estimate for Q2 Team Thayer Real Estate News

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Stronger-than-expected economic activity for the second quarter will drive accelerated economic growth for the second half of 2015, according to the July 2015 Economic Outlook released Thursday byFannie Mae's Economic & Strategic Research (ESR) Group.
The U.S. economy contracted at an annualized rate of 0.2 percent in the third and final Q1 estimate from the Bureau of Economic Analysis released in late June. Improved conditions in Q2 were driven by increases in consumer spending and residential and nonresidential investments, combined with a waning drag from net exports, according to Fannie Mae. In the July Economic Outlook, Fannie Mae expects the economy to pick up to an annualized rate of 2.8 percent in Q2, which is 0.4 percentage points higher than the June estimate.
Despite volatile economic conditions overseas that could pose headwinds to the U.S. economy, the ESR Group's estimate for full-year economic growth in July is an annualized rate of 2.1 percent, up from June's forecast of 1.9 percent, according to Fannie Mae.
"Our second-half outlook is little changed overall, but we have upgraded our full-year outlook due to the upward revision to first-quarter GDP and our more optimistic view for the second quarter," Fannie Mae Chief Economist Doug Duncan said. "We believe consumer spending will be the largest contributor to growth for the remainder of the year, particularly as consumers’ confidence, household net worth, and income growth prospects have continued to strengthen amid an improving jobs market. On the downside, the drop in oil prices will likely continue to weigh on nonresidential investment in structures, and on balance we expect net exports to be a drag on growth this year, due in large part to the debt crisis in Greece and deteriorating economic conditions in China."
Duncan said Fannie Mae's housing outlook is largely unchanged in the July forecast, with leading housing indicators such as housing starts, mortgage rates, single-family home sales, existing home sales, and single-family mortgage originations pointing to "continued improvement" into the summer.
"We expect to see strong sales, lean inventories, and rising confidence through the rest of the year, which should support increased home building activity and give an added boost to economic growth," Duncan said. "Although a lack of skilled labor may hurt construction activity, our forecast calls for housing starts to average 1.12 million units. We expect existing and new home sales to climb by approximately 5 and 25 percent, respectively, and total mortgage originations to rise approximately 24 percent to $1.46 trillion, with a refinance share of 47 percent."

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Wednesday, July 22, 2015

Should Your Realtor Hire A Professional Photographer? Team Thayer Real Estate Springfield Oregon

The Weigh In on Dodd-Frank’s Progress to date Team Thayer Real Estate News

writing-on-paper1Tuesday, July 21, 2015 marks the fifth anniversary of the Dodd-Frank Wall Street Reform and Consumer Protection Act. As Dodd-Frank turns five, congress members and industry leaders examine just how effective the reform act has been within the government agencies to which it was applied.
These agencies include: U.S. Commodity Futures Trading Commission (CFTC), U.S. Securities and Exchange Commission (SEC), Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), and the Consumer Financial Protection Bureau (CFPB).
Rep. Jeb Hensarling (R-Texas), chairman of the House Financial Services Committee, delivered a speech today at the American Enterprise Institute (AEI), discussing the where the U.S. stands with Dodd-Frank and what reforms need to be enacted for more economic growth.
The Dodd-Frank Act was enacted by Congress in the wake of the financial crisis. Congress believed that the crisis was caused by insufficient regulation of the private financial sector, particularly Wall Street, Hensarling noted. In reality, the government’s housing policies were to blame. Its goal is to ultimately prevent another financial crisis and avert huge economic costs this would place on the economy. This reform is thought to be the largest and most restrictive regulation within the financial services industry since the New Deal.
“Its proponents, including the president, promised that it would lift our economy into ‘too-big-to-fail’ and promote financial stability,” Hensarling said in his speech. “Yet, five years later, the evidence continues to mount that our society is now less stable, less prosperous, and less free. It is clear now that the financial crisis did not result from deregulation, but instead from dumb regulation.”
Hensarling titled his speech, “The Unhappy Results of the Dodd-Frank Act,” highlighting that this reform act has not provided the anticipated results for the economy or consumers and that “Dodd Frank is the absolute epitome of Washington greed.”
“Washington not only failed to prevent the financial crisis, in many ways it led us into it,” Hensarling said. “If you had to point to a root cause of the financial crisis, this was it: government housing policies. Additionally, the Federal Reserve certainly did its indispensable part by maintaining a highly accommodative monetary policy that dramatically lowered interest rates and kept them low for a very long time and inflated a housing bubble.”
Democratic staff on the Financial Services Committee, led by Ranking Member Maxine Waters (D-California), also placed their highly opposite opinion of the Dodd-Frank Act thus far in a new report released Tuesday.
Their report determined that while the Dodd-Frank Act has been successful in the face of constant Republican attack, more must be done to ensure all Americans can benefit from our nation's recovery.
“Five years and nearly 13 million jobs later, the Dodd-Frank Wall Street Reform Act has put our nation on a path to economic recovery. Today, our financial system is safer, more accountable, and more transparent,” said Congresswoman Waters. “The financial crisis represented the worst financial disaster in a generation. And in the face of relentless Republican attempts to roll back these critical reforms, Democrats remain committed to fighting to protect American consumers from the worst actors in our financial system.”
According to the report, and in spite of these attempts to undercut the law, Dodd-Frank has empowered regulators with vital tools to prevent a future crisis. The report also provides a roadmap for regulators and Congress to “bridge the recovery gap” while also addressing small financial institution concerns.
“Congress and regulators should work together to bridge the recovery gap,” the report noted. “While the economy has rebounded significantly since the enactment of Dodd-Frank, some groups and communities have yet to fully benefit from the recovery. The wealth gap—the difference in wealth between high, middle and low-income households or between white and minority households— is currently at its widest level in 30 years. Middle, lower-class, and minority families have seen their wealth stagnate. The recovery gap also includes small financial institutions. While bank failures have greatly slowed since Dodd-Frank, and the law and Democrats have provided numerous exemptions and exceptions for smaller financial institutions which have helped them to stabilize, small financial institutions could benefit from additional regulatory relief, as provided for in HR 2642, which all Committee Democrats have cosponsored. As Congress intended for Dodd-Frank to help struggling communities, bridging the recovery gap for these persons and institutions should be the next phase of reform.”
National Association of Federal Credit Unions (NAFCU) President and CEO Dan Berger also issued a statement today regarding the five-year anniversary of the Dodd-Frank Act and its impact on credit unions.
“Since the implementation of the Dodd-Frank Act, we have lost 1,250 federally insured credit unions – over 17 percent of the industry–since the second quarter of 2010 due to the overwhelming regulatory burden,” Berger said. “Credit unions – not-for-profit, member-owned financial institutions–have been widely recognized for not having caused the financial crisis and for their prudent business model, but they are bearing the heavy burden of regulations imposed on them in response to Dodd-Frank and there appears to be no end in sight.”
“As credit unions disappear, consumers suffer the most,” Berger added. “Credit unions offer financial services with low fees, competitive interest rates and exceptional service.”

  

Justin Lee Thayer is Lane counties expert in market analysis for real estate investors. Call Justin @ 541-543-7287
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