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» VISIT US ONLINE @ DSNEWS.COM 25 RISING HOME PRICES FREEZING OUT SOME INVESTORS Real estate investors carried housing and distressed markets through the Great Recession, but their success could spur the rental boom and higher home prices at the expense of critical home buyer groups, a new report has found. Clear Capital and ATTOM Data Solutions released their findings in a joint white paper in late February. e report documented shifting trends in investor activity and demographics in Dallas, Nashville, and Seattle over the course of nearly a decade. According to the authors, real estate investors from the financial crisis onward have included those with a lot of cash handy, institutional entities like banks, and, more recently, smaller-time players in attendance at distressed-property auctions. ree cities reviewed in the report provide windows on those changes, which were Dallas, Seattle, and Nashville. Because the Dallas real estate market weathered the financial crisis relatively better than other cities, fewer investors were attracted to flip properties, but those in the rental market have seen a boom in the years since. In Dallas, as in some other cities, median home prices have ticked up to nearly $189,525 on average, according to the report. Lower home prices in Nashville attracted buyers over the course of the crisis and recovery, leaving distressed properties to account for a smaller share of the market for institutional investors over the last decade, the report found. Seattle was different in that it was highly disadvantageous in the early years of the crisis but rebounded in the later years, with median home prices peaking at $375,000 in that city in the third quarter last year. All of this points to an investor surge possibly withdrawing in more numbers from some real estate markets, even as rental investors flip more distressed properties. In the meantime, increasing home prices may be scaring away home buyer groups like millennials and first-time buyers, the authors found. "A housing recovery that is highly dependent on real estate investors is a bit of a double-edged sword," Daren Blomquist, SVP at ATTOM Data Solutions, said in a related statement. "Rapidly rising home values have been good for homeowner equity but also have caused an affordability crunch for the first-time home buyers the housing market typically relies on for sustained, long-term growth," Blomquist added. CFPB MORTGAGE COMPLAINTS HOLD STEADY e volume of mortgage-related complaints received by the Consumer Financial Protection Bureau (CFPB) is holding steady, according to the CFPB's most recent Monthly Complaint Report, which showed a 0 percent change between November 2015–January 2016 and November 2016–January 2017. Seeing the most increase in complaints over that same period were student loan products, which experienced a 388-percent jump. Consumer loans, bank accounts/ services, credit cards, and credit reporting rounded out the top five. Payday loans saw the biggest decrease, dropping 26 percent since January 2016. But just because mortgage complaints didn't see a huge jump doesn't mean they're not complained about; they remain one of the top complained-about financial products month after month. In January 2017, for example, there were 4,195 mortgage-related complaints—almost four times as many as consumer loan products and nearly twice as many as credit cards. e most mortgage-related complaints were reported for Wells Fargo, Bank of America, JPMorgan Chase, Citibank, and Capital One. Wells Fargo also saw the biggest increase in overall complaints (63 percent), followed by Equifax, TransUnion, and Experian. Reacting to the report, Tom Goyda, Senior-Level Communications Strategist and Manager for Wells Fargo, told DS News: "What [the CFPB] is not showing are complaints that come in month by month. ey show a three-month rolling average. e February report actually shows September, October, and November 2016 averages. It's a lagging indicator. If you look on a month-by- month basis, since September, the complaints against Wells Fargo have been going down." Overall, complaints increased the most in Georgia (59 percent), South Dakota (43 percent), Mississippi (34 percent), Missouri (32 percent), and Louisiana (31 percent). e biggest declines were in Delaware (-8 percent), New Hampshire (-8 percent), and Hawaii (-4 percent). As of the February report, the CFPB has handled more than 1.1 million complaints. More than 264,000 of those have been mortgage related. e top states for mortgage- related complaints have been California (45,239 to date), Florida (28,663), New York (16,668), Texas (12,997), and New Jersey (11,895). 2.6 million borrowers are behind on mortgage payments— the lowest number since August 2006, according to Black Knight Financial Services' January 2017 mortgage data. KNOW THIS

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