Seeking Alpha

Homebuilders and mortgage insurers cheer Watts' weekend move

  • Homebuilders and private mortgage insurers are partying thanks to incoming FHFA chief Mel Watts' weekend move to postpone an increase in fees which would have raised significantly raised mortgage costs for those with good, but not stellar credit and less than 20% to put down.
  • "This is a victory for the housing finance industry," says FBR's Edward Mills. "We believe that this is the first of a series of decisions by incoming Director Watt to preserve/expand mortgage credit availability ... We view this announcement as positive for housing generally, but specifically for private mortgage insurers, originators, and homebuilders."
  • Homebuilder ETFs: XHB +2%, ITB +2.8%.
  • Homebuilder names: Toll Brothers (TOL +3.9%), Putle (PHM +5%), Lennar (LEN +3.2%), KB Home (KBH +6.9%), Hovnanian (HOV +4.8%), D.R. Horton (DHI +2.8%), Standard Pacific (SPF +4%).
  • Mortgage insurers: Radian (RDN +4.1%), MGIC (MTG +1.1%), Genworth (GNW +1.6%), Old Republic (ORI +0.7%), NMI Holdings (NMIH +1.1%). Essent Group (ESNT -0.6%) is off a hair, but up 29% since its late-October IPO.
  • Not showing much reaction today, but potentially set up to disappoint if the GSEs do not allow any private oxygen in mortgage finance are Redwood Trust (RWT -0.2%) and PennyMac Financial (PFSI +1.2%).
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Comments (3)
  • wyostocks
    , contributor
    Comments (9005) | Send Message
     
    Back to the future. Barney must be smiling.
    23 Dec 2013, 02:29 PM Reply Like
  • rambler1
    , contributor
    Comments (627) | Send Message
     
    Idiotic liberals & everyone is entitled to everything attitude without regards to consequences. Amazing how little time has past since the problem occurred plus FNMA & FMCC still under conservatorship.
    23 Dec 2013, 02:45 PM Reply Like
  • bgold1955
    , contributor
    Comments (2242) | Send Message
     
    Hope your politics hasn't gotten in way of your investing in the last 5 years. It's been a heckuva ride! Yes, I know, glass is half empty.
    23 Dec 2013, 05:27 PM Reply Like
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