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14 | M R EP O RT COVER STORY Even with the rising prices, single-family homes continued to sell quickly, with many proper- ties receiving multiple offers, at or above the asking price, sometimes within a week of going on the market, Jingst added. "Homes were selling very, very quickly." Ongoing affordability issues combined with the increasing ability to perform many jobs remotely to push many consum- ers out of city centers and into secondary and tertiary markets. "They're not as worried about the commute into the city," Koss said. Home sales volumes fell early in the fourth quarter, which Todd Sheinin, COO, Homespire Mortgage, attributed to lack of inventory and a modest increase in interest rates, pushing the listed price of some available homes beyond the financial reach of some prospective buyers. Refinancing activity also began dropping off near the end of the year. This resulted in layoffs of some underwriters by a few lenders late in the year, Butler noted. Another contributing factor, ac- cording to Koss, was prospective sellers seeing sales prices com- manded by other sellers earlier in the year and then trying to push their asking prices beyond what buyers could or would afford to pay. While the industry felt the strain of needing more underwrit- ers, those same pressures also hit the sector when it comes to ap- praisers. Clarke pointed out that the number of real estate apprais- ers has been declining for years, and the volume of originations and refis meant increased demand for their services. That's even despite the GSEs having relaxed the rules for mortgages requir- ing physical appraisals, meaning more can be done via automated systems. "It's a supply and demand issue," Clarke said. "There is far too much demand for appraisers and far too little supply." The underwriting and appraisal professions are both suffering from an aging workforce, with fewer new professionals than retiring ones, Butler said. The Flood Insurance Factor F EMA'S National Flood Insurance Program (NFIP) began using "risk-informed" rates beginning October 1. According to FEMA, the new rates are de- signed to better reflect a property's flood risk. As such, those in areas where flood insurance is required may wind up paying higher rates upon policy renewal. New poli- cies will also reflect those higher rates. Those in lower-risk areas will pay lower rates. "The NFIP's new rating meth- odology is long overdue, since it hasn't been updated in more than 40 years," said David Maurstad, an NFIP senior executive, upon the unveiling of the new rates. "Now is the right time to modernize how risk is identified, priced, and communicated." The legacy pricing system in- creased rates annually. According to FEMA, nearly one-quarter (23%) of homeowners in flood zones will see their rates decrease as a result of the new rules. Tech Takeaways L enders, particularly com- munity financial institutions and other smaller organizations, turned increasingly to technol- ogy in order to handle the crush of mortgage and home equity demand, Jingst said. "Three to five years ago, most financial institu- tions looked at fintechs as com- petitors. Now, they're realizing there are technology companies out here who want to work with them, to help them leverage tech- nology to help their borrowers move quickly to take advantage of the low rates." "The only way we were able to keep up with the crush of volume was with our [proprietary] tech- nology," Koss said. The biggest advancement in the technology, driven primarily by the COVID-19 pandemic, was the RULES & REGS: THE TRENDS THAT SHOULD BE ON YOUR RADAR AFFORDABILITY: Several experts said they expect a bigger affordable housing push in the new year. "It's a big issue now, and it's going to continue to be a big issue," Seehausen said. "I think the CFPB is going to be very focused on giving guidance and getting more active in reviewing fair lending." Several of the experts we spoke with said they expect the CFPB to step up its inspections and to be more vigilant about rules violations than it was under the previous administration. "We're hoping for more clarity," Koss said. "We're hoping that as long as you know the rules of the game and can plan for it, then it's an equal playing field. Some people like to play more in the gray areas than others." Young people, many of them saddled with college debt, are particularly hard-pressed to find affordable single-family homes. For the first-time homeowner, gathering the funds for a down payment has always been a struggle. With increasing acceleration of home prices, the prospective homeowner must be even more diligent about saving before purchase. "You've got to be smart about it; you don't want to be house-rich and cash-poor," Sheinin said. "Buying a home requires that the buyer be that much sharper and it's more important to have a real sharp lender that they're working with to make sure they're ready to go when the opportunity is there." The affordability issue is driven primarily by lack of new starter homes being built, an issue that has existed for several years. With building materials increasing in price—though the cost of lumber has fallen from where it was earlier in the year—builders get little, if any profit, from lower- priced homes, so they focus on pricier residences. The lack of starter homes goes beyond just the profitability equation, Koss noted. Municipalities could offer tax breaks to encour- age the building of smaller, more affordable homes. However, adding more smaller homes means increasing population density, and thus generating more people in need of services for for schools, sewers, etc. Neither local govern- ments or current municipal residents want that, Koss said. PRIVACY: "There's a push to get all 50 states to agree to a common set of rules and guidelines. The same is true for data privacy," Seehausen said. California tends to have the strictest data privacy rules. The different rules in different states make managing compliance a challenge. "California tends to set the stage for a lot of regulations that then move east," he continued. So, he expects more states to come in line with the stricter privacy guidelines in force in California. OTHER REGULATIONS: While the national moratoria are over, some local governments were just ending some of the eviction restric- tions as the new year began. The industry is pushing to get more control over remote online notary practices, Seehausen added.