MReport November 2020

TheMReport — News and strategies for the evolving mortgage marketplace.

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52 | M REPORT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Investment Properties Account for Highest Mortgage Fraud Risk Despite a Q3 decrease, experts warn, "we still see elevated levels of risk in purchase transactions." O verall, mortgage fraud risk in Q 3 declined; however, purchase ap- plications revealed a 6% risk increase since Q2. The one fraud type segment to increase since last year is occupancy fraud. This intel comes from the latest CoreLogic Mortgage Fraud Report. The CoreLogic Mortgage Application Fraud Risk Index showed a 26.3% year-over-year decrease in fraud risk at the end of the second quarter of 2020. "This marks the second year of substan- tial decreases in risk," the company reported. During Q2 2020, an estimated one in 164 mortgage applica- tions contained fraud indications, compared with the reported one in 123 mortgages the same period last year. Continued low mort- gage rates and a record volume of refinances pushed the overall fraud risk down. However, the purchase segment's risk increased by 6%, with investment properties driving the highest risk in both purchase and refinance populations. "The large drop in fraud risk in the past year was primarily driven by record-high refinanc- ing, which is traditionally lower risk transactions," said Bridget Berg, Principal of Fraud Solutions Strategy for CoreLogic. "However, we still see elevated levels of risk in purchase transactions, and we have not yet seen the long-term impacts of the COVID-19 pandem- ic, so it's imperative risk managers remain vigilant in searching out potential fraud." The researchers also shared the following highlights: Occupancy fraud risk was the only fraud type segment to experi- ence an increase year over year, jumping 25.8% between Q2 2019 and Q2 2020. New York, Nevada, and Florida were the top three states with the largest mortgage application fraud risk. Nevada moved into the top three for the first time since 2014, showing a risk increase of 8% year over year. Nevada was also the only state in the top five that showed increased risk when compared to 2019. States with the most significant year-over-year risk growth include New Hampshire, Wyoming, North Dakota, Nevada, and Rhode Island. Lower-populated states tend to show greater volatil- ity due to less lending activity. The Priciest American ZIP Codes in 2020 Just 11 states house the top 100 most expensive ZIP codes in the U.S. A lthough median home prices across the coun- try are at record-highs, there are plenty of American ZIP codes with homes listed at exceptionally high prices. RealtyHop has analyzed every real estate listing advertised in the U.S. so far this year, totaling over 3.2 million listings to discover the most expensive ZIP codes in 2020. By ranking each ZIP code by its median listing price, RealtyHop found that 41 of the most expen- sive ZIP codes in the nation have a median listing price of $2.5 mil- lion or more. Here are the top 10 most expensive cities in the country, ac- cording to median listing price: 1. 94027 Atherton, California ($8,650,000) 2. 33109 Fisher Island, Florida ($6,500,000) 3. 90210 Los Angeles ($5,649,500) 4. 11962 Sagaponack, New York ($5,362,500) 5. 94304 Palo Alto, California ($4,642,500) 6. 90077 Los Angeles ($4,495,000) 7. 11976 Water Mill, New York ($4,200,000) 8. 93108 Montecito, California ($3,997,500) 9. 10013 New York City ($3,995,000) 10. 92661 Newport Beach, California ($3,970,000) Among the top 10 ZIP codes, six are in California, three are in New York, and one is in Florida. The data also shows that only 11 states contain the 100 priciest places to live in the U.S. California and New York have the most expensive ZIP codes by far, as 88% of the top 100 priciest ZIP codes are found in these two states alone. California is home to 68 of those ZIP codes, while New York has 20 of the top 100. Los Angeles is the most exclusive city in the U.S by far., as the City of Angels contains 10 of the top 100 priciest ZIP codes. Unsurprisingly, New York City is also one of the most high-end cities, containing six of the country's 100 most expensive ZIP codes. New Jersey has 3 of the 100 ZIP codes on the list, and Connecticut, Illinois, Florida, Texas, Arizona, Colorado, Idaho, and Washington each have one.

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