Nearly a decade after the peak of the American real estate bubble, there’s no shortage of fear that we’ll repeat the whole nightmare again. In the San Francisco Bay Area, the average home price is $1.45 million and the average income is $180,000 per year. While the real estate market has returned to normalcy by some measures, like yearly home-price appreciation and relatively high mortgage standards, in other ways it’s behaving very strangely. Some lenders are now starting to give out mortgages like dentists give out tooth brushes. Push a button on your i-phone and get a Rocket Mortgage.
The Mortgage Order Mills (MOMs) have seen their business dry up and their offices have a lot of empty desks. Ocwen (OCN) stock is at a two year low of about $2.50 … less than a mortgage drive-by inspection. Some of the MOMs are praying at the altar of Satan asking for another collapse in the housing market. Mortgage inspection fees and property preservation task fees are trending down while discount fees continue to trend up. The mortgage segment is the home of $3 mortgage inspections and 99% of the fraud in the industry. TracFone sales are on the rise as we enter the $15 grass cutting season. Even some of the largest national MOMs are now advertising on Craigslist. It’s getting harder to find anyone who will work for peanuts in the mortgage segment.