Weekly News (January 26, 2022)

Interest Rate (4th Week)

(By Fairway Home Loan )

   Prime Rate:3.0% / Ref IR: 0.00- 0.25% .

• 3% Down payment for 1st home buyer is available.
• 5% Down payment 2-4 units FHA program available
• 15% Down payment 2 families -conventional program available.
• Potential home buyer — Have a pre-approval first before the shop.  Now we have 48hour underwriting turn-around times for regular loans.
• Self employed borrower – Need to prepare 3 month business bank statements and the YTD Profit and Loss Statement. YTD income can’t decline more than 30% compared to last year.
• 2022 Conventional loan limit:

Conforming SFR : $647,200.00/ Conforming high balance: $970,800.00

Confirming 2 Family: $828,700/ Conforming High Balance: $1,243,050

NJ Home Owners eligible for Max $35,000 Support

( Korea Times 1/25 )

• NJ Home owner assistance program starts 2/8/2022 through web site njerma.com for those who are under the hardship due to the Covid-19 and whose income is under 150% of AMI. Bergen County’s AMI with 4 family household is $164,100.
• The application document includes 1) ID card issued by the State 2) Latest month income proof  3) 2 month bank statement  4) Tax report since 2019  5)Mortgage statement, etc.
• If the owner lives for 3 years, the received fund will be granted and, therefore, the owner does not need to pay back.

PFAS chemicals found on 34 NJ water systems

( Record 1/26 )

• Dozens of NJ water systems that serve a combined 500,000 residents exceeded new stringent standards last year for PFAS, a family of chemicals that have been linked to cancer and other ailments, environmental officials said Tuesday.
• Higher levels were found in 34 community water systems, including several in Bergen County that now face millions of dollars in expenses to buy filtering systems. The largest water provider that exceeded the standard was the Middlesex Water Company, which serves 233,000 people.
• State officials are still formulating a statewide cleanup plan, but a lot of that hinges on lawsuit filed by the Murphy Admin against DuPont, 3M and other companies that used PFAS chemicals, so called “forever chemicals”, for decades in manufacturing everyday products such as nonstick pans, polishes, waxes, paints and cleaning products.

Gateway Project’s Federal Fund Approval is clearer

( Korea Daily 1/24 )

• FTA has decided the Gateway Project’s fund priority as medium-high from medium-low which was classified under Trump administration. Among the total budget of $12.3B, Federal support will be 5.5B.
• The main portion of the project will be constructing 2 new tunnels under the Hudson River between Weehawken and NYC and repairing existing tunnels which were built in 1910, costing $10.1B and $2.2B respectively.

Home Sales Hit 15-Year High in 2021

( WSJ 1/21 )

• S. home sales surged to a 15-year high in 2021, powered by low borrowing rates and an intense buyer demand that are expected to keep the market hot during the first months of 2022. Existing home sales rose 8.5% from a year earlier to 6.12M, the NAR said Thursday
• But recent rapid rise in interest rates has some housing economists forecasting that the market frenzy will subside in the second of the year.
• The median existing-home price in 2021 rose to a record $346,900, up 16.9% from 2020, NAR said.

Average $20,000 added to home construction cost

( Korea Daily 1/22)

• According to NAHB, 1000 bd sf costs $1000 which is up 167% since August 2020. Consequently, additional construction cost for single family house is about $18,600 and additional cost for a condo unit is about $7,300 which might cause $67 apartment rent increase

• Main reasons for increase of lumber price are 1) supply-chain disruption 2) Tariff for Canadian lumber 3) wild-fire in Canada.

Commercial Properties Saw Record Sales in 2021

( WSJ  1/26 )

• Investors set a record for U.S. commercial-property sales last year, betting that the pandemic is reordering how people live, work and play. Real-estate buyers loaded up on warehouses, which serve as fulfillment centers for the e-commerce boom. They bought apartment buildings to capitalize on record high rents. They paid up for resorts and vacation-oriented hotels that benefited from the resurgence in travel to leisure destinations.
• Overall commercial-property sales totaled a record $809B in 2021, which was nearly double 2020’s total, and it exceeded the previous record of about $600B in 2019. This change is not fleeting. Real-estate investors said they don’t see 2022 sales slowing down much, if at all, from the last year’s record pace.
• The most popular commercial property type last year was rental apartments, whose owners have been able to keep raising rents during the pandemic in part because for-sale housing is too pricy for many to afford. Multifamily sales totaled $335.3B, up 128% from 2020. According to real Capital. Industrial property was in second place with $166.1B, up 56% from 2020.
• Office buildings had sales of $132.2B, well short of the category’s record year.

Experian Offers DIY Credit Reports

( WSJ  1/26 )

• Experian, one of largest credit report firms in the U.S. this week will start allowing consumers who don’t have credit reports to create them from scratch. The company said about 28M adults in the U.S. don’t have credit reports with major credit-reporting firms and as a result don’t have credit scores. That, in turn, means they can’t get financing from banks and other mainstream lenders, limiting borrowing options to payday and other high-cost loans.
• With Experian’s new program, called “Go”, the process in many cases will involve consumers linking recurring non-debt bills to their newly created credit reports. The process is aimed at converting consumers from being invisible to banks to having a credit record and an increased chance of loan approval.
• Experian began piloting Go with roughly 15,000 people in October. On average, people who add nondebt accounts to their newly created credit reports Go from no FICO score to a 665 which is generally the threshold around which lenders consumer consumers to have decent to good credit.