The Real Estate News Brief: Mortgage Payments in BITCOIN, Loan DISCOUNTS for the VACCINATED, & Patio Popularity

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In this Real Estate News Brief for the week ending August 28th, 2021... which lender will let you pay in Bitcoin, why a Covid-19 vaccine will get you a discount on closing costs, and the rising popularity of patios, for outdoor living.

Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review.

Economic News

We have economic news from this past week, but first, big news on the latest federal eviction moratorium. If you haven’t heard, the U.S. Supreme Court blocked that mandate after a new legal challenge by the Alabama Association of Realtors and a group of landlords. The plaintiffs argued that the CDC doesn’t have the authority to issue this kind of mandate. The justices agreed, saying the policy should’ve come from lawmakers, and not the CDC. (1) As Newsweek reports, progressive members of Congress are now considering legislation that would reinstate the moratorium, as the nation continues to deal with the pandemic. (2) So the battle continues.

Members of the Federal Reserve met virtually for their annual Jackson Hole Symposium, and discussed the need to pull in the reigns on its bond-buying policy. (3) After the meeting, Fed Chair Jerome Powell said a majority of Fed officials, including himself, believe that tapering should begin this year. He has been saying that the economy needs to make “substantial further progress” before the Fed would cut back on its stimulus policy, and he said for the first time in his speech, that that test has now been met. An announcement on “when” tapering might begin is expected in September.

Meantime, the inflation rate has now hit a 30-year high, according to the PCE Index. That stands for Personal Consumption Expenditure index. It’s the one that the Fed pays close attention to. It was up .04% in July and brings the annual rate of inflation to 4.2%. (4) That’s lower than the Consumer Price Index or CPI, which shows an annual rate of 5.4%. (5) Both are much higher than the Fed’s 2% inflation target.

A revised report on second quarter GDP shows the economy grew at an annualized rate of 6.6%. That’s up from 6.5%. (6)

The number of new weekly jobless claims rose for the first time in more than a month. The Labor Department says they were up 4,000 to about 353,000 for last week. Claims have been falling overall but have still not returned to pre-pandemic levels of about 220,000 per week. If you add all the people with ongoing claims, the total is about 12 million. That’s down from a high of 30 million toward the beginning of the pandemic. (7)

On to real estate: New home sales reversed a three-month decline, with a 1% increase for July. If that rate continued for an entire year, the sales total would hit 708,000. Currently, the median price for a home is $390,500. (8)

Existing home sales are also higher in July. The National Association of Realtors says they were up 2% to a seasonally-adjusted annual rate of 5.99 million homes. The increase in sales is being attributed to an increase in inventory. The median price for an existing home is now $359,900, or 17.9% more than it was a year ago. (9)

Mortgage Rates

Mortgage rates are still idling below the 3% level. Freddie Mac says the 30-year fixed-rate mortgage was up 1 basis point to 2.87%. The 15-year was also up just one basis point to 2.17%. (10)

In other news making headlines…

Paying Home Loans with Bitcoin

United Wholesale Mortgage made a big announcement about Bitcoin. It says that it will begin accepting cryptocurrency payments for home loans. UWM is the 2nd-largest lender in the U.S. The plan to accept crypto for payments is the first for the national mortgage industry. (11)

Lender Discount for the Vaccinated

What appears to be another industry first, is an announcement by Neat Loans to offer a discount to borrowers who are vaccinated against Covid-19. It would apply to $500 on closing costs for residential and refinancing loans.

The concern is that an unvaccinated person would be more likely to get sick and be out of work, making it difficult to keep up with mortgage payments. Borrowers who are unable to get the vaccine for health or religious reasons, would also qualify for the discount. (12)

Patio Popularity is Skyrocketing

New data shows that the popularity of patios jumped another notch higher in 2020. The National Association of Homebuilders reports that the share of new homes with patios rose to 61.4%. It’s the first time that number has ever been higher than 60%. At the beginning of the Great Recession, it got as low as 44.8%, but has been continually increasing since then, with a big jump in 2020. It rose from 59.6% to the current 61.4%. You’ll also find more homes with patios in warmer Western and Southern states. (13)

That’s it for today. Check the show notes for links. And please remember to hit the subscribe button, and leave a review!

You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal where you can view sample property pro formas and connect with our network of resources, including experienced investment counselors, property teams, lenders, 1031 exchange facilitators, attorneys, CPAs and more.

Thanks for listening. I'm Kathy Fettke.

Links:

1 - https://www.inman.com/2021/08/27/supreme-court-shoots-down-latest-eviction-moratorium/

2 - https://www.newsweek.com/whats-next-eviction-moratorium-progressives-eye-legislation-after-scotus-ruling-1623686

3 - https://www.marketwatch.com/story/fed-chair-powell-says-he-supports-starting-to-taper-bond-purchases-this-year-11630072826?mod=federal-reserve

4 - https://www.marketwatch.com/story/inflation-rate-hits-30-year-high-pce-shows-as-u-s-confronts-major-shortages-11630068319?mod=economic-report

5 - https://www.cnbc.com/2021/08/11/cpi-report-july-2021.html

​​6 - https://www.marketwatch.com/story/u-s-economy-grew-slightly-faster-6-6-pace-in-second-quarter-new-gdp-figures-show-11629982344?mod=economic-report

7 - https://www.marketwatch.com/story/jobless-claims-rise-for-first-time-in-five-weeks-to-353-000-but-still-near-pandemic-low-11629981525?mod=economic-report

8 - https://www.marketwatch.com/story/new-home-sales-rebound-despite-prices-hitting-record-high-11629814766?mod=economy-politics

9 - https://www.marketwatch.com/story/new-home-sales-rebound-despite-prices-hitting-record-high-11629814766?mod=economy-politics

10 - http://www.freddiemac.com/pmms/

11 - https://www.cnbc.com/2021/08/19/united-wholesale-mortgage-will-accept-bitcoin-other-cryptocurrency.html

12 - https://magazine.realtor/daily-news/2021/08/26/lender-offers-mortgage-discount-to-the-vaccinated

13 - https://eyeonhousing.org/2021/08/share-of-new-homes-with-patios-climbs-to-record-61-percent/

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