Transcript00:00:00 Intro Music[Speaker] Kathy Fettke: In this Real Estate News Brief for the week ending July 24th, 2021… why refi’s are getting cheaper, what investors are doing with this hot market, and how homeowners are making money from their backyard swimming pools.Hi, I'm Kathy Fettke and this is the Real Estate News for Investors.Economic NewsWe begin with economic news from this past week, and a jump in the number of people applying for unemployment benefits. Initial jobless claims were up 51,000 to 419,000 in the last week. It’s the highest level in two months, but the increase is “not” due to the pandemic. As MarketWatch reports, claims were higher in auto manufacturing states like Michigan, Kentucky and Texas because plants are shut down during the summer for retooling. (1)Existing home sales rebounded in June. They had been heading lower for four months due to the tight inventory, but there’s been an increase in listings, and that’s boosting home sales. Inventory levels are currently at 2.6 months of supply. That’s up from 2.5 in May. It takes about 17 days, on average, for homes to sell. (2)Builders are also increasing their output. June housing starts hit their highest level since March. They were up 6.3% from May to June, and are up 29% year-over-year. Permits were down a bit however. They dipped 5% from May but are still 23% higher year-over-year. (3)That dip in permits may reflect a dip in home-builder confidence. The monthly index fell one point in July to a reading of 80. Anything over 50 is a positive sign of builder confidence. The National Association of Homebuilders says builder confidence has dropped somewhat because of a shortage of workers, construction materials and buildable lots. (4) Mortgage RatesMortgage rates dipped quite a bit this last week. Freddie Mac says the average 30-year fixed rate mortgage was down 10 basis points to 2.78%. The 15-year was also down 10 points to 2.12%. The report says that rates have dropped because of concerns about the Delta variant of the Covid virus, which is putting pressure on Treasury yields. And when Treasury yields drop, so do mortgage rates. (5)In other news making headlines…Bye-Bye to Dreaded Refinancing FeeA controversial fee added to refinancing loans during the pandemic has been eliminated, and that will lower the cost of most refi’s. The Federal Housing Finance Agency announced that, starting in August, lenders will not be required to pay an adverse market fee of 50 basis points to Fannie Mae and Freddie Mac. That fee has been, of course, passed on to borrowers. (6)The FHFA began charging that fee last year to cover higher costs and risks during the pandemic. Critics claim it was imposed to help raise capital during last year’s refinancing boom. The GSEs have done well throughout the pandemic. As Housingwire reports, Fannie Mae reported $5 billion in net income for the first quarter of this year while Freddie Mac reported $2.8 billion.Investors Pouring into the Rental MarketThe number of homes purchased by investors set a new record in the second quarter. A Redfin study shows that investors bought almost 68,000 U.S. homes worth a record $48.5 billion. That’s a 15.1% increase from the first quarter, and a 106.7% increase from the same quarter last year. (7)Redfin says that investors are buying about one in every six homes, and that multi-family properties are still the most popular. But it says single-family homes and condos are gaining ground. Redfin senior economist, Sheharyar Bokhari, says: “Investors see soaring home prices as an opportunity. With housing values consistently on the rise, solid returns are pretty much guaranteed -- especially when you’re an investor who has access to extremely cheap debt.”But it’s interesting to note that about 75% of the investor purchases were financed with all cash. That’s the highest level of all-cash investor home purchases since 2018. It’s also much higher than the national average of 30% for all buyers, althou