Hottest Housing Market Ever, Appraisal Gap Complicates Deals, Explosion of Appraisal Waivers, and Other News

Negotiating contract to buy house

March was the hottest month for housing since at least 2012. With home-sale prices hitting a record high, the appraisal gap has created friction among agents, lenders, and appraisers. Appraisal waivers have exploded during the COVID-19 pandemic. The President of The Appraisal Foundation discusses the foundation’s outlook for 2021. Sharp increases in interest rates have shifted the mortgage originations landscape very quickly. Read on for more appraisal news and insights.

March was the hottest month in housing history

“The housing market set a slew of records for prices, home-selling speed, and competition in March, making it the hottest month for housing since at least 2012,” according to this story from Redfin. However, “the latest weekly data for April suggests that we may already be seeing the beginning of some seasonal slowing in the market, so March might be the most intense month for the housing market this year.” Read the full article here.

The appraisal gap is complicating deals across the country

This recent HousingWire article reports, “The gap between appraisal and what buyers are willing to pay in one of the wildest real estate markets in modern history has created friction between agents, lenders and appraisers working under stressful conditions.” According to the article, “Some buyers are borrowing money from relatives and taking loans out against their retirement” to close the appraisal gap. Get insights into this issue from the perspective of the homebuyer, the real estate agent, the loan officer, and the appraiser by reading the full story here.

Want helpful tools for dealing with the appraisal gap? Check out our post, Pressure to Hit the Purchase Price: 5 Resources for Appraisers.

An explosion of appraisal waivers: Good or bad?

“Appraisal waivers have really exploded in recent years—especially during the pandemic,” writes Ryan Lundquist of the Sacramento Appraisal Blog. In this recent blog post, he takes a look at the actual number of appraisal waivers in recent years, noting “crazy growth” in the number of loans for which Fannie Mae and Freddie Mac do not require an appraisal. For more details and perspective on these numbers, read Lundquist’s full post here.

President of The Appraisal Foundation discusses outlook for 2021

In this Appraisal Buzz interview, David Bunton, President of The Appraisal Foundation (TAF), and Joan Trice, Founder of Allterra Group, LLC, provide insights into the outlook for TAF in 2021. They answer many questions, including, “What are some of the changes in store this year for The Appraisal Foundation?,” “How will these new outreach programs impact the valuation industry?,” and “What is new in USPAP and what can we expect to see in this update?” Watch the full interview on YouTube.

Swift shift in the mortgage originations landscape

Black Knight has launched a new monthly data report, the Originations Market Monitor, which leverages daily rate lock data from Optimal Blue to provide “an early and comprehensive look at mortgage origination trends.” According to this story from MReport, the March report revealed that “the refinance share of originations dipped beneath 50% for the first time in well over a year.”

“Recent—and sharp—upward movements in interest rates have shifted the mortgage originations landscape very quickly,” said Black Knight Secondary Marketing Technologies President Scott Happ. “The wave of refinancing activity of the last year and some months has suddenly given way to a purchase-heavy mix.”

McKissock is your appraisal wingman. Subscribe to our blog or follow us on Facebook and Twitter for regular appraisal news updates and insights into all facets of the industry.

Want to contribute to our blog? Apply here to reach thousands of readers on a weekly basis and establish yourself as a thought leader in appraisal.

Each year more than 100,000 professionals advance their career with McKissock Learning.

Hear what they have to say.

See More Reviews