FROM THE WARREN GROUP Est ab li s h e d 1 8 7 2
the
financial
www.bankerandtradesman.com
WEEK OF MONDAY, DECEMBER 25, 2017
services
and
real
estate
weekly
for
massachusetts
A Publication of The Warren Group COMMERCIAL INTERESTS
GOP Tax Bill Could Send High Prices Even Higher
HMDA DATA ANALYSIS
Tax Cut Deters People From Moving To High-Tax Areas And Homeowners From Trading Up BY SCOTT VAN VOORHIS BANKER & TRADESMAN COLUMNIST
F
orget about all those dire warnings that home values will take a hit thanks to the GOP’s tax bill. Instead, it’s time to start worrying about already high home prices getting even higher and more unsustainable than before. Sure, the sprawling tax scheme pares down some long-standing perks of homeownership, especially in blue states like Massachusetts, though less dramatically than first proposed. At one point, the National Association of Realtors predicted that homeowners in Massachusetts and other pricey states could see median home prices drop by tens of thousands of dollars. But some of the more obscure provisions tucked into the sprawling tax bill could have an even bigger impact, providing a perverse incentive that, in a market starved for listings, will keep many homeowners locked in Continued on Page 3
ONE Mortgages Succeed With Black And Latino Borrowers Rising Home Values In Boston And Beyond Threaten Product’s Effectiveness
A LOOK BACK, A LOOK AHEAD
Another Banner Year For The Real Estate Market Trajectory Expected To Continue Into 2018
T
BY JIM MORRISON BANKER & TRADESMAN STAFF
he numbers aren’t all in yet, but it seems safe to say 2017 was a good year for residential real estate in Massachusetts. Historically low inventory and interest rates translated to high prices and fast, strong sales numbers, pleasing most sellers and agents. Buyers, on the other hand, found high prices and stiff competition. For real estate agents and brokers, the biggest determining factors in the market this year was high demand and low inventory, said Anthony Lamacchia, broker/owner of Lamacchia Realty. “There are about 13,000 homes for sale in Massachusetts right now,” Lamacchia said. Continued on Page 8
BY BRAM BERKOWITZ | BANKER & TRADESMAN STAFF
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NE mortgages have done an outstanding job of helping black and Latino borrowers in Massachusetts purchase their first home, but it is also becoming less effective as area home values rise, according to recently released Data from the Massachusetts Housing Partnership of Home Mortgage Disclosure Act data. Available to first-time homebuyers who earn 100 percent or less of the area median income, the ONE mortgage can be used to purchase condominiums, single-, two- and three-family homes. The loans, originated by 42 banks and credit unions and backed by a loan loss reserve held by MHP, abide by Fannie Mae mortgage limits – $453,100 for a single-family house. Borrowers who qualify for a condo or single-family home need at least a 3 percent down payment, creating a high loan-to-value ratio that a financial institution would likely never agree to without mortgage insurance. MHP’s loan loss reserve fills this void, and
saves first-time homebuyers hundreds of dollars per month. The loan also comes with a generously discounted 30-year fixed interest rate. “It’s the most affordable and best program in the state for people who qualify,” said Jim Campen, a retired professor who analyzes HMDA loan data and creates an annual report for the Massachusetts Community & Banking Council called “Changing Patterns.” “I think it’s interesting that in Boston, the ONE program has done a particularly good job of reaching black borrowers.” According to the new ONE loan data in Massachusetts, black borrowers received 9.3 percent of the 1,653 loans issued in 2015 and 2016. Latino borrowers received 29 percent of all ONE loans issued. In Boston, black borrowers received 29.3 percent of the 209 ONE loans issued, whereas Latino borrowers received 20.6 percent. “This is the first year we were able to get Jim our
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Banking & Lending ������������������������������������������������� 10
Points ����������������������������������������������������������������������� 4
In Person ������������������������������������������������������������������ 7
CRE Insider ������������������������������������������������������������ B1
By The Numbers ������������������������������������������������������� 6
Residential ��������������������������������������������������������������� 8
Records Section ������������������������������������������������������ C1