Monthly Mortgage News & Market Update

Product Highlight of the Month- Cardinal Elite Down Payment Assistance

This may be one of the most impactful down payment assistance programs I’ve seen released in quite some time and it’s a proprietary down payment assistance program. Here are the highlights:

Compatible with FHA (but not Conventional or VA)
Up to 5% of the sales price that can go towards closing costs and down-payment.
It is a 10-year term where the rate is set at 2% above the first mortgage rate of the 1^st mortgage. (example, a $20,000 DPA would cost $225 per month)
No income cap, sales price cap debt to income ratio cap
Min FICO 600- Just need automated underwriting approval.
Do not need to be first-time home buyers.
Allows for not occupying co-borrowers.

Financial Markets- Stocks

The S&P 500 has continued to provide juicy gains, up nearly 8% for the year so far and up over 20% from the same time a year ago and up nearly 60% from 5 years ago. When it comes to your retirement account/401K, Like the rotisserie oven infomercial…“set it and forget it”.

Financial Markets- Bonds (Mortgage Rates)

The bond market, and mortgage-backed securities in particular, had another setback this past month. Hotter than expected jobs report and inflation reports fueled a bond market sell-off that started around the first of April and has struggled to recover the losses since. The 10-year US Treasury went from roughly 4.2% to over 4.6% in just 2 weeks. The average 30-year fixed rate mortgage pushed past 7% for the first time since December of 2023. Aside from the 4 months between August of 2023 and December of 2023, you would have to go back 24 years to find a higher average 30-year fixed-rate mortgage. The difference between the 10-year US Treasury and average 30-year fixed rate mortgage is now under 3%. Historically this difference hovered between 1.5 and 2%. After peaking at around 3.3%, the gap has started to narrow and is now 2.6% difference.

https://www.freddiemac.com/pmms

Southern Nevada Real Estate

With the 1^st quarter of 2024 in the books for Clark County home sales, the picture coming into focus appears to be a similar one as that from 2023. While January 2024 started out ahead of the pace compared to January 2023, February and March from a transactional standpoint underperformed the pace from February and March 2023. All told, year-to-date sales of condos, townhomes, and single-family residences totaled 7,770. Last year during the same timeframe there were 8,154 sales. Cash sales year to date are hovering around 32.5%.

Inventory inched up from a month-over-month basis, but down roughly 10% from March of 2023.

The median-priced home rose roughly 1% from February 2024 and is up roughly 9% from March 2023…but still 5% below its peak of nearly $485,000 reached in May of 2022. If you are a realtor and your sales volume is up from this time last year, pat yourself on the back. With the number of sales down 10% but home values up 10% the tide (in terms of total dollars) is flat and you should be proud of the start to the year!

If you are a loan officer and your loan volume is up from this time last year you can pat yourself on the back slightly harder because this year has more cash transactions and less available loan volume than the first 3 months of 2023.

Other than the seasonal bump in transactions we typically see headed into summer, it’s hard to envision any sort of material increase in sales without rates dropping to help the gridlock of home buyers staying put in their 3% mortgages.