‘QRM’ rule could make access to credit easier for qualified buyers

September 2014 Data - Executive Summary
September 2014 Housing Market Podcast with MAR President Peter Ruffini

WALTHAM, Mass. – October 28, 2014 – The Massachusetts Association of REALTORS® (MAR) reported today that after 23 straight months of increases, the median price of a home in Massachusetts was flat compared to the same time last year. While prices experienced no change from the year before, closed sales continued their downward trend in September.

September Closed Sales:

Single-Family	September 2014	September 2013	%Change
Sales	4,224	4,367	-3.3%
Median Price	$325,000	$325,000	0.0%

• 8th straight month of single-family (SF) year-over-year sales decreases
• Prices flat after 23^rd straight months of SF median price increases

Condominium	September 2014	September 2013	%Change
Sales	1,697	1,789	-5.1%
Median Price	$305,000	$305,969	-0.3%

• 6th straight month of condominium (CC) year-over-year sales decreases
• First month of price decreases after 15^th straight month of increases

“Massachusetts is a high cost housing market and the trend throughout the year has been increasing prices, so seeing prices stabilize is good for the market and good for buyers,” said 2014 MAR President Peter Ruffini, regional vice president at Jack Conway & Co., in Norwell. “With continued low interest rates and increasing inventory in many market areas, conditions are good for an active market over the next several weeks.”

Inventory and Days on Market:

Single-Family	September 2014	September 2013	%Change
Inventory	23,355	25,121	-7.0%
Months of Supply	5.6	6.0	-6.7%
Days on Market	95	91	+4.4%
New Listings	7,295	7,024	+3.9%

• 31st straight month of year-over-year inventory decreases

Condominium	September 2014	September 2013	%Change
Inventory	5,366	6,864	-22.3%
Months of Supply	3.2	4.1	-22.0%
Days on Market	74	81	-8.6%
New Listings	2,466	2,555	-3.5%

• 47^th straight month of year-over-year inventory decreases

 “QRM” Rule Could Ease Access to Credit:

The recent release of the final Qualified Residential Mortgage (QRM) rule issued by the Federal Deposit Insurance Corporation should help qualified buyers in Massachusetts easier access to financing. The new rule, which came from the 2010 Dodd-Frank Act, provides a set of requirements a loan must meet to be considered a safe loan and eligible to be sold to investors. Early proposals would have required lenders to keep five percent of the loan on their books. As a result, lenders would have had to require large down payments from borrowers to cover that “risk-retention.” The final version of the law does not require the five percent hold-back.

“This is good news for home buyers in Massachusetts,” said Ruffini. “There are plenty of buyers who have good credit, good jobs, and low debt who would have a lot of trouble saving for a 20-30 percent down payment. The final version of this rule removes the onerous down payment requirements that the previous drafts of this rule would have required.”

While similar in name, the “QM” rule or “Qualified Mortgage” rule focuses on the ability-to-repay standards for safe and affordable loans, regardless of whether they are securitized for sale to investors. The changes are set to take effect in 12 months.

For more information on “QRM” and “QM”

QRM and risk retention.
http://www.realtor.org/topics/qualified-residential-mortgage-and-risk-retention/

QM:

http://www.realtor.org/topics/qualified-mortgage

About the Massachusetts Association of REALTORS®:

Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 20,000+ members.  The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.

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Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.