Three metal keys with keychain and house shape pendant on grey laptop with black keyboard. Online house rental or purchasing concept.

Voice from the Industry: Leading the Digital Charge in Settlement

Republic Title’s Dennis Pospisil, Senior Vice President of Digital Settlement and Signing Services recently sat down with eOrignal to talk about digital trends from a settlement industry perspective. Check out the full conversation here:

eOriginal: Dennis, would you mind giving our readers an overview of your background?

Dennis: I originally received a degree in Information and Operations Management (or MIS), which focused on the intersection between technology and business. But my work history centers on real estate, having started my career as a real estate agent and then working across all aspects of a settlement company, eventually finding myself leading the charge for technology at Republic Title of Texas, Inc.

eOriginal: Why is Republic Title of Texas supporting the move toward digital mortgages? What is in it for you?

Dennis: At Republic, we take an “outside-in” approach, meaning that we first consider what is best for our customers, along with their wants and needs. We are starting to see the persona of the consumer change. Gone are the Baby Boomers and in are the Generation Xers and Millennials, who tend to be more comfortable with and have a preference for digital technologies.

Secondly, we consider decisions from a strategic company perspective, ensuring we meet the needs of the market. The market desires a digital buying experience, and frankly, closing is the last piece of the buying process that hasn’t gone digital. There is a lot of pent-up value waiting to be tapped just by digitizing that last element.

eOriginal: You’ve had a lot of experience with digital technologies. Would you mind talking about your early experiences with digital mortgages?

Dennis: I’ve done a number of hybrid closings on smaller platforms that died over the years. In those early days, the promise of digital closings sounded great from a settlement agent’s perspective, but the settlement community did not have the right technology to make it a convenient and positive experience for the consumer.

To paint a picture, consider what a closing with both electronically and wet-signed documents was like 10 years ago. The first part of the closing would go smoothly, but just when the borrower thinks they are finished, they would need to step into another room to complete the eSigning portion with a desktop computer and a large monitor. That’s not just inconvenient for the borrower, it’s also confusing.

But today, with mobile devices and tablets as well as existing wireless technologies, the supporting technology is in place to ensure a smooth digital closing experience.  We can offer concierge closing services that match the busy lives of today’s consumers.

eOriginal: You’ve used several digital solutions. What is some advice you can give to mortgage professionals and, more specifically, settlement agents about what to look for in a solution?

Dennis: I’d suggest they first consider what role the technology plays in their day-to-day activities. Is it an entire production system or is it an ancillary supporting system?

I’d also encourage mortgage professionals to consider the steps required to do basic operations in the product. Are there too many manual or redundant steps? Remember – these systems are supposed to make your lives easier.

Finally, I’ve been exposed to vendors in the past who didn’t have a vision for the future. They might have come out with the innovative and exciting capability that was in the news at the time, but they didn’t consider how those capabilities could provide value at scale, or how to augment and grow them in the future. I suggest others in the industry partner with providers that have a solid roadmap, a pulse on the market, and are seeking to find a different and better way.

eOriginal: What barriers do you see to settlement agents supporting digital mortgages?

Dennis: Many people subscribe to the “if it’s not broken, don’t fix it,” philosophy, but sometimes it is about making an existing way of doing things better. To continually be relevant in the market, you have to ask, “Can we make it better? If so, how?” I don’t see enough mortgage professionals focusing on those questions.

There are other barriers directly related to finances. For example, some settlement companies are not set up for high-speed internet, tablets, or laptops. And, finally, there are practical barriers unique to our industry, like legislation and the county clerks’ offices in the areas we serve. For example, we are still waiting on a “papering out” bill in Texas, but once that is in place, many of the existing hurdles to digital closings will begin to disappear.

eOriginal: One thing we hear about in the market is the potential for cost savings with digital. But we often hear about that in reference to lenders and other sectors of the mortgage ecosystem, not the settlement community. Are there potential cost savings for settlement agents? 

Dennis: Yes, but I prefer to look beyond cost savings and consider revenue potential. Depending on the size of the operation, there are obvious hard cost savings in the form of paper, toner, and devices for printing. There are also softer savings like operational efficiency. At Republic Title of Texas, the efficiencies gained from adopting digital allow us to free our talented employees to drive growth for our business through new services and new markets. It allows us to access our business’s untapped potential.

eOriginal: We’ve talked about costs and revenue opportunities, but what about broader headaches? Can digital technology help there as well?

Dennis: Lost or misplaced files is certainly one headache that digital addresses. When you are using a digital system, your files and data are in one place, easily accessible. Another headache is in the talent management realm. There are talented people that settlement companies cannot hire because they don’t live near any of their brick-and-mortar locations. Supporting a digital process may open more avenues for finding top talent.

eOriginal: Do you feel the adoption and commitment toward digital mortgage is different now than in times past? If so, how?

Dennis: Thinking back to the early 2000s, we saw interest develop and then, just as quickly, disappear. The feeling is substantially different today. For one, we’ve seen many more digital closings this year than in years past. In fact, MERSCORP Holdings, Inc. recently announced that there were more eNotes registered in the first quarter of 2019 than in all of 2018. A second point to consider is that the ecosystem required to support and sustain the digital mortgage movement is taking shape, certainly much more than it did in those early years.

eOriginal: As we close, do you have any suggestions for settlement agencies considering support for digital mortgages?

Dennis: Be sure to approach moving to digital as a strategic initiative, rather than a one-off project. Think about your overall business strategy and then factor where digital can provide a sustainable impact. Be prepared to fully support and build on digital capabilities, rather than making a one-time investment in the latest technology. A commitment to digital requires more than just technology, it requires building a team of positive, digitally ready employees along with a strong ecosystem of digitally enabled partners.

Source: https://www.eoriginal.com/blog/a-voice-from-the-industry-leading-the-digital-charge-in-settlement/

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Tax Information For New Homeowners

As a new property owner, you are required to pay property taxes on this real estate. It is taxed each year by a variety of jurisdictions including the county, city and school district. As a new purchaser, you need to notify the taxing authorities of your ownership so that the tax rolls will reflect the change.  You may do this by contacting the appropriate tax appraisal district in your county from the following list:

Collin County Appraisal District – 469-742-9200 – www.collincad.org

Dallas County Appraisal District – 214-631-0520 – www.dallascad.org

Denton County Appraisal District – 940-349-3800 – www.dentoncad.com

Ellis County Appraisal District – 972-937-3552 – www.elliscad.org

Grayson County Appraisal District – 903-893-9673 – www.graysonappraisal.org

Hunt County Appraisal District – 903-454-3510 – www.hunt-cad.org

Johnson County Appraisal District – 817-648-3000 – www.johnsoncad.com

Kaufman County Appraisal District – 972-932-6081 – www.kaufman-cad.org

Parker County Appraisal District – 817-596-0077 – www.parkercad.org

Rockwall County Appraisal District – 972-771-2034 – www.rockwallcad.com

Tarrant County Appraisal District – 817-284-0024 – www.tad.org

Your property is assigned a single appraised value, which is sent to all taxing jurisdictions. The jurisdiction then applies the tax rate, as set by its governing body, to the appraised value.

In order to qualify for a residential homestead exemption you must provide the following to the Central Appraisal District when submitting your application:

  1. A copy of the applicant’s Texas drivers license or Texas identification certificate.

IMPORTANT NOTE: The property address on the exemption application must match the address listed on the applicant’s Texas driver’s /Texas identification certificate; otherwise the Chief Appraiser is prohibited from approving the exemption.

**TAX EXEMPTIONS
On January 1, value ownership, legal description of the property and exemption status of the taxpayer is determined. Several forms of tax relief are available which may reduce the taxable value of your property. Applying for exemptions is the taxpayer’s responsibility. Some exemptions require a new application each year.  Contact your appraisal district to learn more about the following exemptions and how to file for them:

• General Homestead Exemption
• Over 65 Exemption
• Disabled Individual Exemption
• Disabled Veteran Exemption
• Agriculture Land Exemption

TO RECEIVE YOUR EXEMPTION(S), YOU MUST OWN THE PROPERTY AND BE LIVING IN THE PROPERTY AS OF JANUARY 1ST. YOUR APPLICATION MUST BE APPLIED FOR ON OR BEFORE APRIL 30TH TO RECEIVE THE TAX BENEFITS FOR THIS YEAR, THIS IS A FREE SERVICE.

Remember, tax statements are generally mailed in October of each year. The taxes are payable on or after October 31st, however, you may elect to pay them as late as January 31st without penalty. Taxes become delinquent February 1st and on this date penalties and interest do accrue. If you receive
a Tax Statement and your mortgage company is escrowing funds for taxes from your monthly payments, forward the statement to your mortgage company so that they can pay the taxes.

If the Central Appraisal District sends correspondence regarding your exemption, make sure to respond.

Republic Title of Texas, Inc. makes no express or implied warranty respecting the information presented and assumes no responsibility for errors or omissions.

Click here for a printable version.

December Stats Are In!

The December 2019 DFW are real estate statistics are in and we’ve got the numbers! Take a look at our stats infographics, separated by county, with MLS area stats on each county report as well! These infographics and video are perfect for social sharing so feel free to post them!

To see past month’s reports, please visit our resources section here.

For the full report from the Texas A&M Real Estate Research Center, click here. For NTREIS County reports click here.

Renting vs. Buying – Is this your year?

New year, new house?  Could this be the year you finally buy a house and get out of renting for good? There is a lot to consider with this decision so we’ve put together a list of the advantages of buying and some reasons to keep renting in the event buying is not in your best interest at the moment.  Take a look and think it over!  If you have any questions on buying vs. renting, there’s no better person to talk to than a Realtor.  They are your industry experts and can get you going on the path towards buying.

Advantages of Buying

  • Ample inventory of new and existing homes means more choices and competitive home prices for potential home buyers.
  • Interest rates are generally low right now, making it a great time to buy.
  • When you buy a house, you will know that the mortgage rate for the next 5 to 30 years is going to be the same every month. Rent may continue to increase each year.
  • With each payment, you will build equity and increase the amount of total home ownership.
  • There may be down payment programs available in your area that can help you purchase your first home.

You Should Consider Buying If

  • You want to build wealth.  Investing into real estate is the fastest way to add zeros to the end of your net worth.
  • You want to settle down, build community and know you will be in the same city or town for at least 2 years.

You Should Keep Renting If

  • You need flexibility and don’t want to commit to staying in the same location for the foreseeable future.
  • You have limited income or are unsure about your current job.  Renting allows you the flexibility to downsize your living space.

If you are thinking about buying a home, reach out to a REALTOR® to get started.

Click here for a printable version.

house graphic republic title

Texas Housing Insight

Here is a great post from Texas A&M Real Estate Center regarding home sales for November.

Texas housing sales stabilized in November after reaching a record high the previous month. Steady employment growth and low mortgage interest rates continued to support housing demand, as exemplified by rising mortgage applications and a downtick in the average days on market. As home builders continued to concentrate their efforts to provide more affordable homes, inventory for homes priced less than $300,000 expanded for the first time since February. Additional supply at the lower end of the market pushed Austin sales to record-breaking levels while also supporting an increase in San Antonio’s sales volume. On the other hand, November home purchases in Houston and North Texas fell due to low inventories in the same price range. Although home-price appreciation has moderated over the past few years, housing affordability remains the primary challenge to the Texas housing market.

Supply*

The Texas Residential Construction Cycle (Coincident) Index, which measures current construction activity, ticked up with industry wage improvements. The Residential Construction Leading Index rose to its highest level since the Great Recession as housing starts increased, suggesting higher levels of construction in the coming months.

Single-family construction permits fell for the first time in five months, but the year-to-date (YTD) count increased 1.5 percent compared with January-through-November levels in 2018. Texas led the nation with 9,128 nonseasonally adjusted permits, accounting for 16 percent of the U.S. total, but ranked seventh in per capita issuance. On the metropolitan level, Houston topped the list for the 13th straight month with 2,883 permits, followed by DFW with a post-recessionary record 2,789. Issuance remained strong in Central Texas with 1,259 and 736 permits in Austin and San Antonio, respectively. Texas’ monthly multifamily permits stepped back from a YTD record in October but maintained a strong upward trend.

Total Texas housing starts accelerated to a one-and-a-half year high, increasing 6.1 percent amid a rebound in the multifamily sector. Single-family private construction values fell 8.7 percent after data revisions pushed October values upward. November levels, however, were in line with the yearlong average. Houston and San Antonio registered monthly losses but maintained positive momentum. Austin and DFW construction values increased after dropping in October.

Strong construction activity balanced solid sales volumes. Texas’ months of inventory (MOI) remained at 3.6 months for the fifth consecutive month. A total MOI around six months is considered a balanced housing market. The MOI for homes priced less than $300,000, which comprised two-thirds of sales, ticked above 2.8 as the supply of active listings increased for the third straight month. Inventory for luxury homes (those priced more than $500,000), however, remained elevated at 8.3 months. This disparity exemplifies the shortage of affordable housing, although efforts have been made to more closely match demand and supply.

Inventory continued to decrease in Austin and Dallas, sliding below 2.2 months in the former and posting 3.1 months in the latter. The Fort Worth and Houston MOIs steadied at 2.5 and 3.9 months, respectively. Meanwhile in San Antonio, a recent influx of new listings pushed the MOI to 3.7 months with a notable increase in the $200,000-$300,000 price cohort.

Demand

Total housing sales flattened in November after adjusting for seasonality. The upward trend, however, persisted amid low interest rates and ongoing strength in the job market. Activity for homes priced above $200,000 slowed after reaching record-breaking levels the previous month but increased more than 10 percent compared with 2018 on a YTD basis.

Central Texas sales volumes continued to grow, particularly in Austin, where transactions climbed 3.2 percent for the fifth straight month. Most of the monthly improvement occurred in the $200,000-$300,000 price range after weakness in the first half of the year. San Antonio sales rose 1 percent, largely due to a surge in closings for homes priced below $200,000. Houston and Fort Worth, however, lost traction in the $200,000-$300,000 bracket, pulling total sales down 1.3 and 1.1 percent, respectively. Dallas sales activity declined 3.4 percent with decreases across all price cohorts.

Texas’ average days on market (DOM) stabilized at 59 days, indicating healthy demand. The DOM in Houston and San Antonio steadied at 56 and 59 days, respectively. In Austin, the DOM recorded a monthly increase to 57 days but shed two days from a year ago. North Texas demand remained strong compared to the rest of the state with DOMs of 51 and 45 days in Dallas and Fort Worth, respectively.

Speculations of a U.S.-China trade truce and continued strength in the national economic data slowed the downward slide in interest rates. Long-term rates were above those for short-term instruments for the second straight month following a four-month yield curve inversion, signaling increased confidence. Concerns of a recession lessened as current economic fundamentals at the state and national level remain healthy and stable. The ten-year U.S. Treasury bond yield rose above 1.8 percent, while the Federal Home Loan Mortgage Corporation’s 30-year fixed-rate stabilized at 3.7 percent. After falling the previous month, mortgage applications for home purchases climbed nearly 30 percent YTD. Refinance mortgage application activity accelerated as rates remained relatively low, almost tripling since year end.

Prices

The Texas median home price flattened at $245,300, while annual home-price appreciation decelerated to 4.2 percent. The median price for new homes flattened; however, resale transactions, which comprise the majority of home sales, recorded the fastest median price growth rate this year of 5.5 percent year over year (YOY), exceeding the national existing-home price appreciation of 5.4 percent YOY.

On the metropolitan level, median home prices fell. Austin’s median price dropped $14,600 from an all-time high in October to $314,400. San Antonio’s metric shed $6,300, falling to $229,500 as homes priced less than $200,000 comprised more than a third of total sales for the first time since May. The median price in North Texas was $293,600 and $251,800 in Dallas and Fort Worth, respectively. Houston’s price decreased for the second straight month to $245,100.

The Texas Repeat Sales Home Price Index indicated more moderate home price appreciation of 3.7 percent. The Dallas and Houston indices slowed pace, increasing only 2.1 and 2.0 percent YOY, respectively. San Antonio’s index increased 4.1 percent YOY but decelerated from growth as high as 6.6 percent in January. On the other hand, Austin’s and Fort Worth’s indexes accelerated 5.5 and 4.3 percent YOY, respectively. Rising home prices without substantial wage growth decreases overall housing affordability, which remains the primary challenge to the Texas home market.

Click here for the full report.

Source – James P. Gaines, Luis B. Torres, Wesley Miller, and Paige Silva (January 10, 2020) https://www.recenter.tamu.edu/articles/technical-report/Texas-Housing-In…

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North Texas home sales set record in 2019

In December, 9,056 houses changed hands, the highest total on record for the final month of any year. 

North Texas’ housing market ended 2019 on a high note, and the jump in sales during the final month was enough to push the year’s home purchases to an all-time high.

Last month’s preowned home sales were up 15% compared with December 2018.

Area real estate agents sold more than 108,000 single-family homes for the year — 3% more than in 2018, according to preliminary data from the Real Estate Center at Texas A&M University and North Texas Real Estate Information Systems.

“Dallas-Fort Worth winds up with record sales again,” said James Gaines, chief economist for the Real Estate Center. “The Dallas side of the Metroplex was actually a little better than Fort Worth.”

In December, 9,056 houses changed hands, the highest total on record for the final month of any year.

Lower mortgage rates in the second half of 2019 boosted homebuying in the D-FW area and across the country after a slowdown in purchases early last year.

“One of the things that helped was that the fourth quarter of 2018 was a down quarter because interest rates went up, oil prices were down and things slowed down,” Gaines said. “October, November and December numbers looked extraordinarily good on a year-over-year basis.

“The fourth quarter was enough that it made up for some of the slowdown that started earlier in the year.”

Along with the higher sales in December, median single-family home prices in the area were up 5% year over year to $270,000. For all of 2019, North Texas home prices were 3% ahead of those in 2018, according to the Real Estate Center.

At the end of the year, 20,535 houses were listed with real estate agents in the more than two dozen North Texas counties included in the survey. That’s a 4% decline in inventory from the end of 2018.

There are indications that January will be another strong month for North Texas home purchases.

The number of pending sales — properties under contract but not yet closed — is up 18% from a year ago.

Gaines said he doesn’t expect the big home sales gains to continue through the new year.

“We won’t see those percentage rates going forward,” he said. “I don’t think we are going to see those double-digit rates of increase.”

Home prices in North Texas have risen more than 60% in the past 10 years.

 

Looking ahead, Gaines said it’s unrealistic to expect the same kinds of home market growth moving forward.

“The decade of the 20-teens was an exceptional decade for Texas and D-FW in particular,” he said. “As we look forward to the decade of the 2020s, it would be unrealistic to expect us to duplicate that rate of growth.

“It’s not that we won’t grow. It’s just not going to be a very high rate of prosperity.”

More homes were sold in December than ever before in North Texas for the last month of any year.
More homes were sold in December than ever before in North Texas for the last month of any year.(Real Estate Center at Texas A&M)

Source: Dallas Morning News – Steve Brown
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