Are mortgage lenders ready for the millennial mountain?
The company whose software processes almost a quarter of US mortgage applications says that a mountain of young American homebuyers is about to enter the market.
Ellie Mae has just launched its Millennial Tracker tool to provide insight into the next generation of US homebuyers and says that they are ready to move but mortgage lenders need to have the right products in place.
“The mortgage industry is poised to experience a monumental shift as more millennial homebuyers begin to enter the market,” said Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. “There are roughly 87 million would-be homebuyers in the millennial generation and 91 percent of them say they intend to own a home one day. Lenders must prepare today to meet their needs.”
The firm’s data shows that 31 per cent of closed mortgages in March by millennials showed women as the primary borrower. Those female borrowers had an average age of 30 and a FICO score of 724. Male buyers made up 66 per cent of primary borrowers on closed loans; their average age was 29 with a FICO score averaging 727.
Since 2014, Ellie Mae says that 60 per cent of mortgages made to millennial homebuyers were conventional with 37 per cent FHA. Loans of both types took just less than 1.5 months to close.
Rent growth is slowing says national report
The growth in rents across the US has begun to level off. That’s the finding of Apartment List’s May 2016 National Rent Report which reveals that San Francisco, New York, Houston, LA, Denver and Austin have seen declining rents.
However, some markets continue to buck the trend with renters paying significantly more in Dallas, Nashville, Charlotte, Atlanta, and Phoenix.
In the year to April, median rents increased nationally by 2.8 per cent to $1,300 for a 2-bedroom apartment. San Francisco continues to have the highest median rents, despite recent declines; a 2-bedroom apartment in the city costs $4,690. New York is in second place ($4,480) followed by Jersey City, NJ ($3,180), Washington DC ($3,000) and Boston ($2,900).
These are the top remodeling projects
Room additions saw the largest gain in remodeling projects in the past 3 years according to a report from the National Association of Homebuilders. As it begins a month focused on remodeling, the association has been looking at which projects have been most prolific in recent years.
“While bathroom and kitchen remodels remain the most common renovations, basements, whole house remodels and both large and small scale additions are returning to levels not seen since prior to the downturn,” said 2016 NAHB Remodelers Chair Tim Shigley.
Although adding rooms was up 12 per cent, there has also been a rise in whole house remodeling (10 per cent), finished basements (8 per cent) and bathroom additions (7 per cent).