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35 » VISIT US ONLINE @ DSNEWS.COM WHERE TO GET THE MOST BANG FOR YOUR INVESTMENT BUCK A recent report from HomeUnion compares the investment property values in 10 of the most sought-after markets for investors to best determine what a total of $400,000 will buy a single-family rental (SFR) investor in these popular markets: Jacksonville, Dallas, Atlanta, Charlotte and Austin; versus what a real estate investor can acquire for the same price in the markets of Denver, Washington, D.C., Seattle, New York and Oakland, which are frequently coveted by investors. e report uses leverage at 25 percent, which shows that the markets of Jacksonville, Dallas, Atlanta, Charlotte, and Austin are more affordable, offer renters and investors significantly more square footage, and provide investors with the ability to earn much higher monthly rental returns. "Our study confirms that investors' dollars go much further in the South and one of the biggest metros in Texas than they do in Oakland, New York, Seattle, Washington, D.C., and Denver," says Steve Hovland, Director of Research for HomeUnion. "Not only do investors get more for their money, they can buy a larger home or homes in a nicer neighborhood, allowing for the potential to capture higher rental income in the Austin, Charlotte, Atlanta, Jacksonville, and Dallas markets." Comparing the data side by side, a $400,000 investment in the metro areas of Jacksonville, Dallas, Atlanta, Charlotte, and Austin allowed for a purchase of two rental assets compared to the same investment in Denver, Washington, D.C., Seattle, New York and Oakland which only was sufficient for one investment property. Looking at the monthly rent collected from an investment property in the 10 metro areas, there is an average of $2,996 received in the metros of Jacksonville, Dallas, Atlanta, Charlotte, and Austin. is is almost $1,000 more than the monthly rent average for Denver, Washington, D.C., Seattle, New York and Oakland, $2,020. HomeUnion does, however, note that in August, leveraged investment home prices rose 12 percent on a year-over-year basis, reaching a median price of $261,900. "As prices continue to soar for investment housing, and inventory remains low in many major metro areas, it has become increasingly difficult to find sound, profitable investments," adds Hovland. "To assist our clients, we've done a deep dive into our data on more than 110 million homes nationwide to reveal just how far $100,000 down will go across the United States." FANNIE MAE MAKES FIRST- EVER FRONT-END CIRT For the past three years, Fannie Mae has transferred a substantial portion of credit risk to mortgage insurance affiliates. But until now, all of those transactions have been of the back-end variety. In late October, Fannie Mae announced that it secured commitments for its first-ever front- end Credit Insurance Risk Transfer (CIRT) transaction to be executed with affiliates of mortgage insurance companies. When the transaction is complete, it will be the first CIRT transaction Fannie Mae has done on a "flow" basis, which means the transfer occurred before Fannie Mae acquired the covered loans, also known as a front-end transaction. e insurance coverage becomes effective upon Fannie Mae's acquisitions of the loans. With this transaction, a portion of credit risk on pools of single family loans totaling $3.7 billion in UPB will shift to a group of approved mortgage insurance affiliates. e covered pool contains 30-year fixed-rate loans with LTVs between 80 and 97 percent, according to Fannie Mae. e loan pool is expected to be filled over a six-month period, beginning with deliveries in the fourth quarter of 2016. "is innovative pilot transaction represents another milestone for Fannie Mae's risk transfer initiative. Front-end CIRT expands the options that Fannie Mae can use for transferring mortgage credit risk away from taxpayers, while tapping a diverse source of capital and risk-sharing partners," said Rob Schaefer, Fannie Mae's vice president for Credit Enhancement Strategy & Management. "rough our partnership with several approved mortgage insurers and their affiliates, we are able to bring to market a new structure that leverages the enhancements that were pioneered in our existing CIRT program, including a streamlined operational process, improved certainty of coverage, and enhanced counterparty protections." Fannie Mae plans to continue offering traditional CIRT transactions to cover existing loans in its portfolio. Fannie Mae has transferred a portion of the credit risk on more than three-quarters of a trillion dollars in single-family mortgages through various programs, including CIRT, Connecticut Avenue Securities (CAS), and other forms of risk transfer, allowing private capital to gain more exposure to the U.S. housing market.

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