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    SFRE Market Update

    Bi-weekly insights on the single-family real estate investment market.

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    Episodes

    • Mortgage rates fell to 6.01%, down eight basis points week-over-week and lowest since early January
    • Refinance applications jumped 7% weekly and are up 132% year-over-year, signaling active borrower response near 6%
    • Purchase applications dipped modestly while VA purchase activity rose
    • Refinance window open for DSCR and bridge loans originated at higher 2023–2024 rates
    • Single-family housing starts declined 6.9% year-over-year in 2025, reflecting continued construction pullback
    • Builder confidence slipped to 36, while share of builders cutting prices declined month-over-month
    • Acquisition, development, and construction loan rates fell to 7.61% in Q4, lowest since 2022
    • Builder financing costs improving even as sentiment softens, creating selective competition in builder-heavy markets
    • Housing inventory rising into spring with price reductions still elevated relative to historical norms
    • Single-family rent growth slowed to 2.7% year-over-year, with affordability improving to four-year highs
    • Rental yield compression tightening DSCR underwriting and limiting BRRRR refinance upside
    • Construction wage growth stabilizing alongside lower financing costs, improving cost structure for ground-up and heavy rehab projects
    • Mortgage rates fell to 6.01%, lowest level since early January and near three-year lows
    • Refinance applications jumped 7% week-over-week and are up 132% year-over-year, signaling active borrower response
    • Purchase applications declined modestly, though VA purchase activity rose
    • Current rate environment presents refinance opportunity for DSCR and bridge loans originated at higher 2023–2024 rates
    • Single-family housing starts declined 6.9% year-over-year in 2025, reflecting continued builder pullback
    • Builder confidence slipped again, though share of builders cutting prices declined month-over-month
    • Acquisition, development, and construction loan rates dropped to 7.61% in Q4, lowest since 2022
    • Builder financing costs improving even as sentiment remains soft, creating selective competition in builder-heavy markets
    • Housing inventory continues building into spring while price reductions remain elevated
    • Single-family rent growth slowed to 2.7% year-over-year, with rent affordability improving to four-year highs
    • Rental yield compression tightening DSCR underwriting and reducing margin for BRRRR refinance assumptions
    • Construction wage growth stabilizing alongside lower financing costs, improving cost structure for ground-up and heavy rehab projects
    • Federal Reserve Vice Chair Michelle Bowman signaled Basel capital rule changes that could bring banks back into mortgage origination and servicing
    • Bank mortgage share fell from ~60% in 2008 to 35% by 2023, while nonbanks gained dominance in investor lending
    • Proposed changes to mortgage servicing asset treatment and LTV-based capital rules could increase bank competition in DSCR and rental lending in late 2026
    • Mortgage rates holding near 6.04% with spreads compressing toward historical norms, helping stabilize borrowing costs
    • Refinance activity remains elevated year-over-year while purchase applications show steady but muted demand
    • Ten-year Treasury yield testing lower end of forecast range, limiting odds of meaningful near-term rate declines
    • Active housing inventory up 8% year-over-year but growth has cooled significantly from 30%+ earlier in cycle
    • New listings rebounding seasonally while price-cut percentage declines, signaling stabilizing seller pricing power
    • Slower inventory growth suggests incremental tightening before headline data reflects it
    • Beazer Homes reached 100% Zero Energy Ready Home standard across deliveries and expanding solar-powered communities
    • Builder competition increasingly centered on operating cost savings, not just purchase price or incentives
    • Energy-efficient upgrades becoming competitive necessity in Sun Belt and builder-heavy markets
    • Existing home sales fell 8.4% in January to 3.91M annualized, lowest pace in seven months
    • Inventory declined 0.8% to 1.22M homes, pushing months’ supply down to 3.7 from 4.2 in December
    • Median price rose nearly 1% year-over-year, marking 31 consecutive months of annual gains
    • Housing affordability index improved for the seventh straight month, signaling demand support beneath seasonal slowdown
    • Mortgage rates dipped slightly to 6.09%, first decline in three weeks but still range-bound near 6%
    • Purchase applications down modestly while refinance activity remains elevated year-over-year
    • Rate environment remains stable with no clear catalyst for meaningful near-term declines
    • Nearly 1 in 5 new homes saw price reductions, overtaking resale price cuts for first time in recent history
    • Builder-heavy markets including Texas, North Carolina, and South Carolina seeing elevated new construction discounting
    • Fix-and-flip operators should underwrite against discounted builder inventory as primary competition through first half of year
    • Foreclosure filings up 32% year-over-year but remain historically low relative to pre-pandemic norms
    • Distressed inventory pipeline building gradually, with meaningful supply unlikely to materialize until late 2026 or early 2027
    • Zillow and Redfin ordered to produce executive communications in $100M antitrust case over rental syndication agreement
    • FTC alleges payment reduced competition in multifamily rental listings, potentially reshaping rental distribution models
    • Platform risk may impact listing visibility, marketing costs, vacancy timelines, and syndication pricing for rental investors
    • National housing inventory up 10% year-over-year but growth has decelerated sharply from 30%+ last summer
    • Active listings near 695,000 nationally; new listings down 13.3% year-over-year, signaling fewer fresh sellers entering market
    • Pending sales rising as supply growth slows, suggesting gradual tightening conditions in resale market
    • Mortgage rates holding at 6.11% with no clear catalyst for near-term Fed rate cuts
    • Cost of capital remains anchored near current levels, increasing risk of waiting to refinance
    • Housing starts down 4.6% and permits down 3.1%, continuing builder pullback that began mid-2025
    • Builder competition likely elevated through Q1 and early Q2 before easing in second half as reduced pipeline works through
    • Camden Property Trust exiting California, reallocating ~$1.5B into Sun Belt markets citing regulatory costs and operating friction
    • Institutional capital shifting toward lower-regulation states, reinforcing divergence in long-term risk and return profiles across markets
    • Mortgage rates edged up to 6.11%, marking a second week holding just above 6% after briefly dipping below in early January
    • Post–Warsh nomination volatility appears to have closed the near-term window for sub-6% mortgage rates
    • Housing starts fell 4.6% in October, with single-family starts down 5.4%, signaling a builder pullback that began mid-2025
    • Declining starts point to reduced new-supply competition later in the year, but near-term builder pressure remains through Q1 and early Q2
    • Building permits also declined, reinforcing a slower construction pipeline heading into spring and summer
    • Inflation reaccelerated in December, with CPI up 0.4% month-over-month and shelter costs rising 5.2% year-over-year
    • Firmer inflation reduces the likelihood of near-term Fed rate cuts, keeping borrowing costs elevated for DSCR, bridge, and flip loans
    • Floating on expected rate cuts is becoming increasingly risky as markets reprice the Fed outlook
    • Champion Homes posted strong earnings, highlighting growing demand for affordable manufactured and modular housing
    • Manufactured homes priced near $185K plus land now directly compete with entry-level stick-built resale inventory
    • Entry-level flips in rural and exurban markets face rising competition from new manufactured housing alternatives
    • Mortgage rates held near 6.1%, but on-the-ground buyer behavior is becoming the more important signal than macro headlines
    • Pending home sales climbed for a fourth straight week, pointing to sustained demand rather than a seasonal bounce
    • Rising pending sales suggest stronger closed transaction volume through February and March
    • Active listing growth has slowed sharply, signaling the seller surge from last summer has largely cleared
    • Buyer demand is firming faster than new supply is rebuilding, quietly tightening market conditions
    • Early tightening shows up first in off-market competition and falling lead response rates before headline data shifts
    • Down payment assistance programs expanded to 2,619 nationwide, broadening the pool of qualified retail buyers
    • Majority of DPA programs now support buyers with incomes above $100K or no income limits at all
    • Entry-level flips benefit from expanded DPA access, reducing price concessions and days on market
    • Long-term rental investors should monitor entry-level rent growth assumptions as homeownership access expands
    • Kevin Warsh named next Fed Chair, triggering a bond market selloff and pushing mortgage rates back above 6%
    • Markets view Warsh as more hawkish than Powell, increasing uncertainty around the pace and depth of future rate cuts
    • Mortgage rates that briefly touched 5.99% have reversed, making floating riskier for DSCR, bridge, and flip borrowers
    • PennyMac earnings show origination volumes rising while servicing profits fall, highlighting intense lender competition
    • Excess lender capacity is keeping pricing tight, giving borrowers negotiating leverage when shopping rate quotes
    • Existing-home sales jumped 5.1% in December to the strongest pace in nearly three years, driven by late-year rate relief
    • Inventory tightened sharply to 3.3 months of supply, creating near-term acquisition pressure before spring listings arrive
    • M/I Homes doubling down on spec inventory, prioritizing sales pace over margins through aggressive incentives
    • Builder impairments and price declines in Austin and San Antonio signal elevated risk in spec-heavy, entry-level markets
    • Builder rate buydowns and incentives continue to compress resale comps in construction-heavy metros
    • Mortgage rates moved back above 6%, with spreads compressing toward pre-pandemic norms and limiting further downside without lower Treasury yields
    • Brief sub-6% rates confirmed how narrow the current refi and acquisition window remains for DSCR and bridge borrowers
    • Builder sentiment stuck near decade lows, with widespread price cuts and incentives continuing to pressure resale comps
    • Aggressive builder pricing in markets like Phoenix, Austin, and Charlotte caps flip exit pricing unless properties are meaningfully differentiated
    • Material and labor cost inflation persists, particularly in metals, reinforcing the need for conservative rehab and construction budgets
    • Active listings rose modestly week-over-week, but year-over-year inventory growth has slowed sharply from mid-2025 peaks
    • Pending sales climbed steadily throughout January, signaling improving buyer engagement heading into February and March closings
    • Acquisition competition expected to intensify as spring listing season approaches and buyer demand stabilizes
    • Down payment assistance programs expanded to 2,619 nationwide, materially increasing the pool of qualified entry-level buyers
    • DPA availability supports exit liquidity for sub-$350K flips but could gradually shift marginal renters into ownership
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    • Executive order limits federally backed financing for large institutional buyers of single-family homes, reshaping exit liquidity in select markets
    • Purpose-built build-to-rent communities receive a carve-out, preserving financing pathways for dedicated rental developments
    • Threshold for “large institutional” buyers to be defined within 30 days, potentially below the traditional 1,000-unit mark
    • Reduced institutional participation could slow rental supply growth in Sun Belt markets like Atlanta, Charlotte, and Tampa
    • Mortgage rates rebounded above 6.2%, closing the brief sub-6% window as bond volatility and inflation concerns resurfaced
    • Mortgage spreads have largely normalized, meaning further rate relief now depends on Treasury yields falling
    • Builder sentiment dropped back to 37, with price cuts and incentives remaining widespread to move inventory
    • Aggressive builder pricing continues to pressure resale comps in construction-heavy metros such as Phoenix, Austin, and Charlotte
    • DSCR lenders expanding flexibility as competition increases, including acceptance of crypto assets for reserve requirements
    • Crypto-based reserves face strict caps and haircuts, signaling innovation but continued underwriting conservatism
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