In Case You Missed It: A Look at Recent National Housing Policy News

MBA Preliminary Analysis of 2016 HMDA Data

The 2016 Home Mortgage Disclosure Act data were released, along with a separate Federal Reserve analysis of the data. Here are some initial highlights:

In the newly released HMDA data for mortgage activity during calendar year 2016, there were 6,762 reporting institutions, a 2 percent decrease from 6,913 institutions in 2015. This was significantly lower than the peak of 8,886 institutions in the industry during 2006 and relative to that year, the number of HMDA reporters was down by 24 percent.  Both home purchase and refinance originations increased in 2016. Purchase originations saw a 14 percent increase, to $1 trillion in 2016 from $876 billion in 2015. Refinance volume increased 24 percent to $949 billion in 2016 from $768 billion in 2015, as 30 year fixed rates stayed below the 4 percent mark for most of 2016 (9 out of 12 months), averaging 17 basis points lower than in 2015.

Five Things that Might Surprise you About the Fastest-Growing Segment of the Housing Market

1. Single-family rental is the fastest-growing segment of the housing market.
2. Changing demographics and housing market conditions will continue to fuel the rental growth.
3. Institutional investors are tiny players in the single-family rental market.
4. The geographic focus of institutional investing in SFRs has shifted.
5. Future growth of institutional investors in SFRs is still up in the air.

Managing Mortgage Product Development Risk

The Mortgage Bankers Association's Research Institute for Housing America has released a new special report, Managing Mortgage Product Development Risk.

"Mortgage banking is a highly cyclical business, prone to expansion and contraction as market conditions change," Rossi said. "Mortgage product innovation is healthy for the industry and consumer so long as product risks and process quality are well understood." The paper noted intrinsic risks associated with mortgage products and processes amplified aggregate losses of mortgage originators, investors and servicers following the mortgage boom of 2004-2007. In many instances, product development acceded to market pressures as the economy expanded and regulatory oversight waned.

Freddie Mac’s Chief Diversity Officer on Diversity and Inclusion

In an effort to better represent underserved communities, as well as support ongoing diversity initiatives in the mortgage industry, Freddie Mac has announced the opening of a Borrower Help Center in McComb, Mississippi, according to a recent post by Dwight Robinson, SVP of Human Resources, Diversity and Inclusion, and Chief Diversity Officer at Freddie Mac. Robinson notes that this initiative isn’t new—it is the 14th center of its kind throughout the country; however, what makes this location unique is its locale. It is the first located in the lower Mississippi delta, serving a rural community with a median household income of $29,720. African-Americans also makeup 66 percent of the total population, and have a homeownership rate much lower than that of the regional average—50.0 percent—compared to 70.9 percent.

Distribution of Housing Types, Race and Ethnicity (Urban Areas and U.S.)

The diversity of urban housing markets can also be seen in their racial and ethnic make-up. Among the population of urban housing markets, 33 percent is Hispanic (compared to 17 percent of the nation as a whole), 17 percent is Black (compared to 12 percent of the nation as a whole), 10 percent is Asian (compared to 5 percent) and 3 percent is from other non-Hispanic, non-White racial and ethnic groups (compared to 3 percent). Only 38 percent of the population in urban housing markets identifies as non-Hispanic White.