May 2016 - Rise and Fall

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54 | TH E M R EP O RT O R I G I NAT I O N S E R V I C I N G A NA LY T I C S S E C O N DA R Y M A R K E T ANALYTICS THE LATEST Hispanic Homeownership on the Rise, Despite National Stall Demographics are expected to drive new homeownership for next decade. T he Hispanic Wealth Project, in collabora- tion with the Na- tional Association of Hispanic Real Estate Profes- sionals (NAHREP), reported in its recent State of Hispanic Homeownership Report that Hispanics have attained measur- able homeownership gains for the fifth consecutive year. Despite the mostly stagnant homeownership report, the num- ber of Hispanic buyers entering the market has continued to grow over the last five years. The only homeownership rate to see a spike, Hispanics will likely be the pri- mary driver of new homeowners for the next decade and beyond. The homeownership rate increased marginally over the last two quarters, but was fairly unchanged year-over-year, espe - cially compared to the all-time high in 2004, the U.S. Census Bureau reported. This phenomenon has left many in the industry questioning if homeownership has bottomed out. According to the Bureau, home - ownership rate rose 0.1 percent to 63.8 percent in the fourth quarter of 2015, compared to 63.7 percent last quarter. Despite the rise however, the homeownership rate is 0.2 percent below the rate of 64 percent last year during the same period. Though the homeownership rate was up from a 48-year low in the second quarter of 2015, it is still below the peak of 69.2 percent in June 2004. The homeownership report from NAHREP showed that Hispanic-owner households grew by 245,000, accounting for 69 per - cent of the total net growth in U.S. homeownership. "Hispanics were the only major racial or ethnic group to raise their homeownership rate in 2015," the report stated. "For the first time in 10 years the Hispanic homeowner- ship rate spiked upward, while overall homeownership rates in the country continued a downward trend." "The Hispanic homeownership numbers were very encourag- ing, and all leading indicators strongly suggest that the trend will continue," NAHREP 2016 President Joseph Nery said. "Policy makers and the housing industry need to recognize that the face of home- ownership in America has changed and it is in everyone's interest to ensure that these new consum- ers have access to relevant lending products, affordable housing stock and culturally competent service providers in the coming years." The report showed that Hispanics also lead the nation in workforce participation and house - hold formation growth, meaning they will likely be the primary driver of new homeowners for the next decade and beyond. Hispanics accounted for 486,000 new household formations and rep - resented 37 percent of total house- hold formations in the country. "The State of Hispanic Homeownership Report highlights how important the Hispanic population has become in driving overall housing demand in the U.S., and how this influence will only continue to grow as their share of the population increases," said Chris Herbert, Managing Director Harvard Joint Center for Housing Studies. "Crafting housing policies that are attuned to meet - ing the needs of this important demographic group is essential to ensure they have access to decent and affordable housing." TRID Buyer Impact Emerges Many report unexpected costs, added time, and anxiety. A s a result of the implementation of the Consumer Financial Protection Bureau's (CFPB) TILA-RESPA Integrated Disclosure (TRID) rule, repeat homebuyers have seen both positive and negative effects when obtaining and closing a residential mortgage. According to the compliance guide issued by the CFPB, the rule merges four disclosures required under TILA and RESPA for closed-end credit transac- tions secured by real property into two forms. On the first, a Loan Estimate must be given or mailed to the consumer no more than three business days after receipt of the application. On the second, the consumer must be provided a Closing Disclosure at least three business days prior to the consummation of the loan. TRID was first introduced in 2010 from the Dodd-Frank Wall Street Reform Act, and was approved in 2013. Fifty-one percent of repeat homebuyers reported they expe - rienced unexpected costs, fees, or surprises in their most recent home buying experience, accord- ing to ClosingCorp's National TRID Impact on Homebuyers Survey. Conducted by Wilson Perkins Allen Opinion Research, the survey covered 1,000 adults nationwide who have purchased two or more homes, including one since October 3, 2015.

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