| | | House Prices Inch Higher but Show Signs of Deceleration |  | U.S. house prices rose 1.2 percent in the second quarter of 2016 according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI). House prices rose 5.6 percent from the second quarter of 2015 to the second quarter of 2016. FHFA's seasonally adjusted monthly index for June was up 0.2 percent from May. The HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac.
|  | "Although the appreciation rate for the second quarter was of similar magnitude to what we've been seeing for several years now, a close look at the month-over-month price changes during the quarter reveals a potentially significant market shift," says FHFA Supervisory Economist Andrew Leventis. "Our monthly price index indicates that in each of the three months of the quarter, the increase was only 0.2 percent. This is a much more modest pace of appreciation than we've seen in some time and most likely reflects accumulated pressures from significantly reduced home affordability."
While the HPI rose 5.6 percent from the second quarter of 2015 to the second quarter of 2016, prices of other goods and services were nearly unchanged. The inflation-adjusted price of homes rose approximately 5.7 percent over the last year.
Home prices rose in every state except Vermont between the second quarter of 2015 and the second quarter of 2016. The top five states in annual appreciation were: 1) Oregon 11.7 percent; 2) Washington 10.3 percent; 3) Colorado 10.2 percent; 4) Florida 10.0 percent; and 5) Nevada 9.6 percent.
For more information, visit www.fhfa.gov/hpi. | | | | Airbnb Hosts Hit a Refi Hitch | |  By Suzanne De Vita, RISMedia
Call it a bump in the refinance road.
Homeowners renting rooms through home-sharing platforms have encountered difficulty obtaining refinancing, subjected to higher interest rates and limited loan offerings, The Wall Street Journal reports.
The issue lies with hosts who rent rooms for a considerable amount of time in a given year-enough time for lenders to classify them as investors, despite maintaining the listing as their primary residence. Loans on investment properties are generally considered riskier, with terms to match.
Complications arise when the host believes the additional income earned from renting will prove favorable when applying to refinance, only to experience the opposite: one homeowner in the WSJ report, who earned $30,000 last year renting the cottage in his backyard, was denied a refi on a home equity line of credit because the bank he applied with prohibits them for "properties in which the homeowner is operating a business." Another homeowner in the report, who is permitted by his municipality to rent his primary residence for an unrestricted amount of time, was instructed to apply for a refi as if it were an investment property-and received a higher interest rate as a result.
The concern for lenders is two-fold: defaults on investment property loans are more common than defaults on those for primary residences, and higher default rates could prompt repurchase requests.
The refinance hitch is the latest in ongoing scrutiny of home-sharing platforms, especially Airbnb, one of the most well-known and used. (Airbnb maintains the scenarios in the WSJ report are "incredibly rare.") Critics have called on the Federal Trade Commission to investigate the "commercial" listing phenomenon. | | | | | | | |
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