Industry Briefs Oct. 27, 2020
Stewart Acquires Pro Teck Valuation Intelligence
Stewart Appraisals Management Inc., Houston, announced its acquisition of Pro-Teck Services Ltd., DBA Pro Teck Valuation Intelligence.
The acquisition is intended to strengthen and expand Stewart’s scale in appraisal and valuation platforms. Pro Teck provides property valuation services, including its proprietary technology Valuation Intelligence, a cloud-based fulfillment platform that provides residential real estate values and market information, as well as a SaaS platform to enable lenders to directly manage the appraisal process in-house.
In June, Stewart acquired United States Appraisals, a move that strengthened its offerings in mortgage originations. Berkery Noyes served as exclusive financial advisor to Pro Teck Valuation Intelligence.
First American, ServiceMac LLC Announce Agreement for Acquisition
First American Financial Corp., Santa Ana, Calif., a provider of title insurance, settlement services and risk for real estate transactions, and ServiceMac LLC, a mortgage subservicing company, announced an agreement for First American’s acquisition of ServiceMac.
As a part of the transaction, First American has acquired a minority interest in ServiceMac’s parent company. That interest will convert into equity of ServiceMac at the closing of the acquisition, which is expected to occur by the end of 2021, subject to regulatory approvals and the satisfaction of customary closing conditions.
First American said ServiceMac’s mortgage subservicing business complements First American’s existing capabilities and will enhance First American’s ability to provide lenders and servicers with mortgage, settlement, post-closing services and servicing-related products and services. ServiceMac will have enhanced access to First American’s property and homeownership data and mortgage products. ServiceMac’s management team, including President and CEO Bob Caruso, will continue to lead the company’s operations.
CFPB Releases ANPR on Consumer Access to Financial Records
The Consumer Financial Protection Bureau issued an advance notice of proposed rulemaking requesting information related to consumer access to financial records. The Bureau is asking the public how it might most efficiently and effectively develop regulations to implement Section 1033 of the Dodd-Frank Act, which provides for consumer rights to access financial records.
The Bureau’s ANPR seeks comments and information on costs and benefits of consumer data access; competitive incentives; standard-setting; access scope; consumer control and privacy; and data security and accuracy. The ANPR can be found at https://files.consumerfinance.gov/f/documents/cfpb_section-1033-dodd-frank_advance-notice-proposed-rulemaking_2020-10.pdf.
Fitch Ratings: Use of Mortgage Insurance-Linked Notes is Growing
Firth Ratings, New York, said from their first introduction in 2015, mortgage insurance-linked notes have grown to become a significant source of reinsurance capacity for U.S. mortgage insurers. At year-end 2019, there were $6.7 billion of outstanding MILN, which represents a 117% increase over the past four years.
Fitch said despite pandemic-related rising delinquency rates, the U.S. mortgage insurance industry successfully marketed new MILN, though at increased pricing. Overall, Fitch views this as a positive for the USMI industry and a demonstration of the resiliency of the MILN asset class.
Rent Cafe: Gen Z Gaining as Largest Renting Population
A new survey from Rentcafe.com said millennials may be the largest renting generation, but Gen Z-ers are definitely gaining momentum. The survey said 85% of the youngest cohort on the market is already renting.
The survey of 2,500 users on rentcafe.com and focused on Gen Z-ers’ responses found more than any other cohort, 62% of Gen Z renters believe apartment technology is extremely or very important—so much so that they are willing to sacrifice space for digital features.
Their most sought-after amenity is high-speed internet (27%), which came in higher than all other features, including parking, gym, or laundry. Moreover, smart locks and thermostats, as well as energy-efficient appliances, ranked higher than an extra bedroom.
More than any other age group, 39% of Gen Z renters start their apartment search on Google, with property ratings and reviews as their top research tools. However, when it comes to deciding on an apartment to rent, 72% prefer in-person tours.
Pavaso Integrates with Ellie Mae Digital Lending Platform
Pavaso, Plano, Texas, announced its eClosing platform is now integrated with the Ellie Mae® Digital Lending Platform. The integration allows lenders to access Pavaso’s innovative eClosing technology directly through the Digital Lending Platform to drive quality and efficiency in the closing process.
Designed to improve the real estate closing experience, Pavaso supports all real estate closing options, delivering traditional, hybrid and fully paperless eClosings with both in-person eNotary and remote online notarization platforms (where permitted by law). Lenders using Ellie Mae’s Encompass can create and add documents to orders on the Pavaso platform.
Zillow: Deepening Inventory Shortage Slows Home Sales Even Further
Zillow, Seattle, said the housing market’s recent record of superlatives marches on. The company’s Weekly Housing Report said prices soared to new heights and inventory reached record lows — down nearly 50% annually in some major metros. The lack of available homes and an overdue seasonal slowdown may finally be pulling pending sales down after a “scorching hot” few months.
The report said newly pending sales are up 19.6% over last year, but have fallen 4.9% since last month and 1.7% since last week. Low inventory and an overdue seasonal slowdown may finally be dragging down sales, though sales volume remains close to what would be expected during a typical spring shopping season.
Demand for the few homes available is still incredibly strong, as homes typically stayed on the market for 12 days before going pending, 16 days faster than this time last year and one day faster than most weeks in August and September. Cincinnati has the shortest median time on market at 4 days.
Zillow research shows entry-level and mid-market homes priced between $186,000-$344,000 are selling at the fastest pace among all price tiers.
Redfin: Home Prices Post Another 15% Gain
Redfin, Seattle, said the median home sale price increased 15% year over year to $320,625—the highest on record, for the week ending October 18. The report said home prices were up 16% from the same week a year earlier. Home prices continue to buck their typical seasonal pattern.
Since the four-week period ending July 5, home prices have increased 6.8%. Over that same period in 2018 and 2019, prices declined an average of 4.4%. The median asking price of new listings was up 14.2% from a year earlier. Pending home sales climbed 32% year over year even as the number of sales continued a typical seasonal decline. New listings of homes for sale were up 8% from a year earlier. Active listings (the number of homes listed for sale at any point during the period) fell 29% from 2019 to a record low.
“It’s remarkable how this late in the year the market remains highly competitive,” said Redfin chief economist Daryl Fairweather. “There are still plenty of homebuyers lying in wait for new listings to hit the market. And when homebuyers see their perfect house listed amid the ongoing shortage of homes for sale, they are willing to pay asking price or even more just to make sure the deal goes through before another buyer swoops in. The election may slow down homebuying activity in the coming weeks as buyers and sellers get anxious about the outcome, but once the dust settles, it’s likely that there will still be a lot of pent-up demand that will heat things right back up.”
Black Knight: Forbearance Volumes See ‘Modest’ Decline
Black Knight, Jacksonville, Fla., said forbearance volumes saw a modest decline this week, falling by 11,000 from the week prior. Weekly declines of 14,000 among GSE loans and 2,000 among portfolio-held and privately securitized loans were partially offset by a 5,000 increase in forbearance plans among FHA/VA loans
Black Knight said as of Oct. 20, nearly 3 million borrowers remain in active COVID-19 forbearance plans, representing 5.6% of first lien mortgages Despite the limited improvement this week, overall forbearance volumes are down 623,000 (-17%) month-over-month, driven by the strong improvement seen in early October. More than 80% of remaining forbearance plans have had their terms extended.
Heartland Properties Joins Forces with Adwerx
Heartland Properties, Council Bluffs, Iowa, a local real estate firm serving the Council Bluffs and Omaha areas since 1988, launches the Adwerx Enterprise Automation Platform. The firm is now automating online ads for newly listed properties within their office, plus custom retargeting campaigns for every agent, and agents have the ability to run local, personalized streaming TV commercials.
The Adwerx Enterprise Automation Platform delivers each client a fully integrated, results-oriented digital marketing platform. Adwerx delivers personalized, omnichannel brand marketing and automation at enterprise scale. Adwerx customers are able to deliver customized ads programmatically across streaming TV, popular websites, Facebook and Instagram and mobile apps, while driving growth through digital marketing automation.