TheMReport

48 | 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 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 The American Dream Lives On Despite changing demographics, it seems homeownership is still very much a part of the American Dream. H omeownership has long been considered the cornerstone of the American Dream, and ValueInsured polled over 5,000 Americans in the last two years for its Modern Homebuyer Survey to assess the state of that dream—and what Americans should do to keep it alive. Millennials (70 percent) are in line with the rest of Americans (71 percent) in their desire to keep the American Dream alive. Both groups also acknowledge—at 69 percent and 68 percent, respec - tively—that the American Dream isn't something stagnant; it is ever- changing and must remain fluid in order to survive. And while 76 percent of millennials identify their own personal American Dream as being different from their parents, 65 percent still believe that home - ownership defines their version. Location of respondents didn't seem to diminish this desire, either. Eighty percent of urban dwellers said owning a home is important to their American Dream, compared to 76 percent of suburbanites and 76 percent of respondents living in a rural area. The survey also found that "the association of homeowner - ship with the American Dream [seems] to transcend socioeco- nomic borders." Seventy-six percent of Americans with a college education desire to own a home, compared to 74 percent of Americans without an education. Similarly, 84 percent of Americans with a pre-tax income over $100,000 want to own a home, as do 71 percent of those with a pre- tax income under $50,000. Even Americans that rent (71 percent) or live rent-free (61 percent) say that they would someday like to own a home of their own. Credit-Reporting Changes Open New Doors The nation's top credit reporting agencies will soon drop tax liens and civil judgments, giving many consumers a boost in credit score. T here's good news for those looking to get a mortgage in the near future: One in five U.S. consumers could see their credit score increase this fall. In a recent Realty Check article, Diana Olick said millions of bor - rowers could qualify for a home loan. However, the changes will add more risk to the mortgage market. Equifax, TransUnion, and Experian announced they would drop tax liens and civil judgments from some consumers' profiles if information such as the person's name, address, and either date of birth or Social Security Number were missing. According to a report by CBS Money Watch, journalist Kathy Kristof said credit bureaus would also be barred form including medical debt collections if the debt isn't at least six months old or if the medical debt was eventually paid by insurance. Civil judgments, public liens, and certain medical debts, which weren't always ac - curately reflected on credit reports, were targeted for a number of reasons. Medical debts, unlike that of credit charges, are unplanned, and doctors and hospitals have no standard formula for when they send unpaid debts to collection. Some consumers were reported to be extremely late when they may have only been a month or two behind, but others didn't get reported for years. Court judgments and liens were rarely updated, causing consumers to suffer long after they were paid and liens were released. Unfortunately, according to Thomas Brown, SVP of Financial Services at LexisNexis, this could add significant risk to the mort - gage market. "If you look at someone that has a tax lien or a civil judgment, they can be anywhere from two to more than five times more risky just because of the presence of that information. That's very, very significant," Brown told Olick. "It doesn't really do a consumer well to be extended credit that they can't afford, they can't reasonably service." Tim Rood, Chairman of The Collingwood Group, a busi - ness advisory firm, said this is a welcomed and needed change for millennials and first-time home - buyers that clearly will benefit the mortgage and housing industries. "Small increases in consumers' credit scores can push them into a higher credit category, from 'fair' to 'good,'" Rood said. "Some lend - ers only lend to certain categories of consumers, so being included in the 'good' category could mean the difference for qualifying for mortgage loans." Prices Aren't as Bad as They Seem New data shows that prices are up—but compared to historical peaks, they're not as high as they could be. A ccording to Harvard's State of the Nation's Housing, when home prices are adjusted for inflation, they are still 9 to 16 per - cent below their peak, depending on the measure used. There has been uneven price growth over the U.S., with home prices just slightly above their mid-2000s heights in the Midwest, Pacific Northwest, and Texas. These areas account for 48 percent of all markets. In real dollars, prices reached their peaks in only 15 percent of all markets. Prices were above their peak in 10 percent of Metropolitan Statistical Areas and Metropolitan Divisions and topped their peak in 17 percent of the smaller micro areas. In one-third of all markets, real prices were still 20 percent below their peak. This was seen in the places where the housing crisis hit hardest: Florida, large parts of the Southwest and Northeast, and parts of the Midwest. The report said this uneven growth has led to increasing differences amongst housing costs with the 200 inflation-adjusted median home values in the 10 most-expensive metros being $350,000. This is, on average, three times higher than the median value of homes in the 10 least- expensive metros. When taking a look at the increase between January 2000 and December 2016, real home values in the top 10 rose 64 percent to about $574,000 while the least expensive were about $113,000. This is a rise of 64 percent and 3 percent, respectively.

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