Buyers flock to Bay City, Michigan for ultra-low home prices

As work-from-home becomes more of a national norm, prospective homebuyers are seeking better home values in small towns that still offer a lot of amenities. One of those is Bay City, Michigan — a town of approximately 33,000 90 minutes outside of Lansing — that’s one of the 25 hottest MSAs in the country. With a median listing price of $92,000, Bay City is luring people from all over the country.

Per, homes are being sold at an average of $111,000 in Bay City, and the average listing price per square foot is only $75. Incredibly, that median listing price of $92,000 is up 15.8% compared to 2020. The Bay City Realtor Association reported that 222 homes have already been sold in 2021 – a 7.9% increase year-over-year.

Those prices are high for agents who sell exclusively in the mid-Michigan area, but for homebuyers looking to get out of a popular metro area — say, Detroit, which is two hours from Bay City — the deals are hard to beat.

“People come here and they see our prices, and their eyes become saucers,” said Barb Appold, a realtor for Berkshire Hathaway Home Services MI Real Estate. “I tell my clients, if you want a house, you’ve got to go in with an offer immediately and you’ve got to make it strong.

Appold noted that she had four offers in the first 24 hours when she put her daughter’s home on the market, and quickly set up 15 different showings the house before drawing the line.

“I had to stop showing it,” she said. “It was just crazy.”

In Bay City, once known as “the mecca for lumbermen,” the high availability of lumber and its proximity to the Sagniaw River made it an important hub for moving goods. Historians believe approximately 25 billion board-feet of lumber floated on the Saginaw River to the mills between 1851 and 1897. By the late 1800s, many in town were flush from the shipping business.

Eventually, homes matching the cash flow of the builders and investors were built, some to the tune of 6,000 square feet. Many of those nineteenth-century mansions are still in town today, and people are buying them for — you guessed it — a bargain.

“All of the mansions are still pretty well-maintained whenever they go on the market, so the ones in good shape are going for absolute steals – around $399,000 to $410,000,” Appold said. “I sold one around 6,500 square feet for $410,000.”

One of Appold’s other daughters – she has three – recently bought such a home with five bedrooms, four fireplaces, and maplewood floors for under $400,000.

“It’s easily a $1 million home anywhere else,” she said.

Other agents mentioned that investors are swarming, as well. Wade Eckenrod, an associate broker with RE/MAX in Bay City, said homes are getting sold “before the ink is dried” by investors who are willing to take on these homes sight-unseen.

“[Investors] look at our prices and laugh,” Eckenrod said. “They send us cash offers and they say ‘I don’t care what’s wrong with it – I’ll take it.’ And if I don’t find a buyer immediately when I list a property, I’m getting plenty of people making offers without even looking at the price or even doing an inspection.”

Builders are backed up, too.

Scott Doyen, of Scott Doyen Builders in Bay City, said getting materials hasn’t been an issue – but the cost, like in so much of the country, is forcing customers to scale back the size of the homes they order. Lumber prices, specifically, are sky-high right now, he said.

“A sheet of plywood was $5.97 a sheet one year ago, and now it’s $34 a sheet,” Doyen said. “Luckily, people are still wanting to build out here – they’re just building 2,500 square foot home instead of 3,000 square foot homes. That’s the only real difference, though. It’s crazy out here.”

Doyen added he gets three to five phone calls a day for people wanting to build, and he’s had to refer callers to otther builders in the area.

“I’m booked all the way until 2022,” he said.

Whether building a new home or snatching up an existing deal, there’s more than just affordable homes in Bay City. Beach and waterfront enthusiasts will enjoy the scenery along the Saginaw River, which multiple agents said offers some of the best scenery in the state, along with riverfront dining and activities. Bay City is also a short drive from the shores of Saginaw Bay, which feeds into Lake Huron.

“I think we’re one of the best-kept secrets,” Appold said. “We’ve got great restaurants, the waterfront, and we’ve got investors coming to town. It’s a great place to live.”

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What Biden’s infrastructure plan does for housing

President Joseph Biden’s $2 trillion infrastructure plan represents the most sweeping national investment in decades. The “American Rescue Plan,” unveiled Wednesday, includes $213 billion allocated for housing, with a focus on low- and middle-income homeowners and prospective homebuyers.

Specifically, the plan calls for the construction and rehabilitation of over 500,000 homes in low- and middle-income areas. According to Biden, two million affordable homes and commercial buildings would be built and renovated over the next decade as part of the initiative.

Biden is also calling on Congress to eliminate exclusionary zoning laws, which he says inflates housing and construction costs – an issue that has crippled homebuilders across the country for more than a year.

Biden wants homes upgraded through “block grants” – annual sums awarded by the federal government to a state or local body to help fund a specific problem – and through extending and expanding home and commercial efficiency tax credits.

Officials said extending and expanding the efficiency tax credits would be done through the Weatherization Assistance Program, the nation’s largest residential whole-house energy efficiency program.

How servicers can stay ahead of Biden’s potential regulatory changes

Among the unknowns servicers face in 2021 are changes that could affect lender-placed insurance (LPI). Servicers must have the flexibilities in place to keep up with the latest changes to remain compliant and efficient while still providing an optimal borrower experience.

Presented by: Proctor Loan Protector

Stakeholders in the housing industry praised the $213 billion initiative, but cautioned that it wouldn’t cure many existing ails.

“It’s a historic amount of money, but we have a historic-size problem, and even this amount of money is not going to solve the problem,” said David Dworkin, president of the National Housing Conference. “We have to keep in mind – when we talk about infrastructure, there’s not a great history of infrastructure investment succeeding without housing investment. They really need to go hand in hand to positively impact communities. So I think the housing component of the bill is very important.”

Dworkin added that home construction is “a highly effective jobs program” and “a leveraged economic stimulus” – besides creating construction jobs, a newly-built homes become an economic stimulus itself.

“People who move into new homes spend money on those homes that they wouldn’t otherwise spend,” Dworkin said. “In the first year alone in a new home people, are spending a ton of money on paint, furniture, barbeques – things that will stimulate the economy in a constructive way. Home building and new homes are a much more effective stimulus than cash, which usually just sits in saving accounts.”

“While a lack of inventory and rising prices continue to limit opportunities for homeownership – especially for younger Americans and minority populations – policies that support nationwide housing affordability are now more important than ever,” said Charlie Oppler, President of the National Association of Realtors.

In a statement, the White House said the infrastructure plan “will invest in America in a way we have not invested since we built the interstate highways and won the Space Race.”

Other elements of the American Rescue Plan include $621 billion toward transportation infrastructure, $400 billion for elderly and disabled care, $300 billion into drinking water and electric grid improvements, and $580 million invested into domestic manufacturing. Specifically, the White House is hopeful the investment into manufacturing will create more jobs in that field.

Sunia Zaterman, executive director of the Council of Large Public Housing Authorities, said the CLPHA will lobby Congress to ensure that the housing provisions of the infrastructure plan are “fully funded and remain central to the bill.”

“The centrality of public and affordable housing means its impact reaches beyond shelter – it is also critical to other key elements of the American jobs plan including expanding broadband, improving childcare, and increasing health care opportunities,” Zaterman said in a statement. “Public housing authorities are the most efficient delivery mechanism for these critical services because of their understanding of local needs, especially the needs of underserved communities of color.”

The plan could see months of roadblocks, especially considering the Biden Administration intends to fund the spending by raising the corporate tax rate from 21% to 28%, an effort sure to meet Republican resistance. Combined with measures designed to stop offshoring of profits, the White House said the tax hike would fund the entire plan within 15 years.

That tax hike would essentially roll back tax cuts from former President Donald Trump’s 2017 bill, which capped the amount of state and local taxes that could be deducted from federal income taxes at $10,000.

While Biden said he hopes to “win Republican support” for the bill, Democrats could attempt to pass the bill through budget reconciliation, an option that does not require any Republican support in a chamber split 50-50 by party (Vice President Kamala Harris being the tie-breaking vote). It would be similar to the passing of the American Rescue Plan, which Democrats passed without a Republican vote.

“The only opportunity for bipartisan support we see is the surface transportation component of the package, which might need to be split off from the rest because elements of it might not be able to pass through the reconciliation process,” said Alec Phillips, chief political economist with Goldman Sachs.

House Speaker Nancy Pelosi told the Democratic caucus she would like the pass the plan by July 4.

Affordable housing has long been a point of focus for Biden and his team, vowing prior to his election to introduce a tax credit for first-time homebuyers upwards of $15,000, reintroduce sharper regulatory teeth to agencies such as the Consumer Financial Protection Bureau, alter a spate of restrictive zoning laws to increase development, build millions of units of affordable housing, and cap payments for certain renters.

The post What Biden’s infrastructure plan does for housing appeared first on HousingWire.

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Yellen's priorities at FSOC: Climate risk, hedge funds, bond market

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New SBA head at Regions wants to make PPP borrowers long-term clients

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CFPB reverses pandemic flexibilities, vowing enforcement

The Consumer Financial Protection Bureau announced Wednesday it is rescinding seven of its temporary policies put in place to protect consumers during the pandemic. The seven rescissions will be effective Thursday, April 1, with the government agency noting that it intends to exercise the full scope of its supervisory and enforcement authority provided under the Dodd-Frank Act.

In one of its key decisions, the CFPB said it will roll back its leniency on reporting Home Mortgage Disclosure Act data. In March 2020, the CFPB announced it would no longer require certain lenders to report quarterly information under HMDA, however, now the agency is instructing all financial institutions to do so beginning with their 2021 first-quarter data due by May 31.

The CFPB also said it is withdrawing its signature from several statements that allowed for flexibilities for lenders to work with consumers who were affected by the pandemic.

In its withdrawal from the Statement on Bureau Supervisory and Enforcement Response to COVID-19 Pandemic, the CFPB said, “it believes that companies should have had sufficient time to adapt to the pandemic and should now be able adequately to comply with the law and respond to enforcement actions or supervisory activities without the flexibility afforded under the statement.”

The CFPB also withdrew its signature from an interagency statement that allowed for leniency on loan modifications and reporting for financial institutions that was signed by the agency in April 2020, alongside the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration and the Office of the Comptroller of the Currency.

How servicers can stay ahead of Biden’s potential regulatory changes

Among the unknowns servicers face in 2021 are changes that could affect lender-placed insurance (LPI). Servicers must have the flexibilities in place to keep up with the latest changes to remain compliant and efficient while still providing an optimal borrower experience.

Presented by: Proctor Loan Protector

The statement provided clarification on the discrepancies for certain standards under section 4013 in the CARES Act (titled Temporary Relief from Troubled Debt Restructurings).

The above agencies also signed a statement outlining flexibilities on industry appraisal standards and then addressed appraisal regulations for Fannie and Freddie a week later. The CFPB said it will also be removing its signature from this letter. The flexible standards allowed for more appraisal options on certain qualifying primary residence loans, including desktop appraisals and exterior-only appraisals.

“As consumers seek temporary relief from lenders, the pandemic is impacting the operations of financial companies that are eager to help their customers during this unprecedented time,” former CFPB Director Kathleen Kraninger said at the time several of these policies were released. “Our actions today are temporary and targeted to support consumers by allowing financial companies to focus their resources on assisting consumers.”

The CFPB also rolled back leniency on reporting of certain information related to credit card and prepaid accounts under the Truth in Lending Act, Regulation Z, and Regulation E. These includes the annual submissions concerning agreements between credit card issuers and institutions of higher education; quarterly submission of consumer credit card agreements; collection of certain credit card price and availability information; and submission of prepaid account agreements and related information.

The bureau will also be enforcing the Fair Credit Reporting Act and Regulation V, which protects consumer privacy, after stating it intends to rescind flexibilities given to companies that report credit data. The information from these consumer reports are used to make many kinds of decisions, including whether a consumer can borrow money or how much he or she will pay in interest to finance a home or large purchase. How this will affect the reporting of delinquent loans, is yet to be delineated.

The CFPB also now intends to take enforcement action against land developers subject to the Interstate Land Sales Full Disclosure Act under Regulation J. Originally, flexibilities allowed for delays in filing annual reports of activity in an effort to “reduce administrative burden.” However, the bureau will not take any supervisory action against those who did not file between April 27, 2020 and April 30, 2021.

It’s final two rescissions included enforcement flexibilities on Regulation Z billing error timeframes and electronic credit card disclosures.

“Providing regulatory flexibility to companies should not come at the expense of consumers. Because many financial institutions have developed more robust remote capabilities and demonstrated improved operations, it is no longer prudent to maintain these flexibilities. The CFPB’s first priority, today and always, is protecting consumers from harm,” said CFPB Acting Director Dave Uejio.

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A neobank facilitates charitable giving directly through its app

Source: American Banker

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The post Institutional Memory and Appraiser Firms first appeared at Working RE Magazine.

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TDECU on the hunt for next chief executive

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CFPB ends Trump-era regulatory relief tied to pandemic

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Raisin’s first U.S. bank partner will offer build-your-own CDs

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