While the housing debate didn?t have a great impact on the 2016 presidential race, President-elect Donald Trump and the new sessions of Congress have decisions ahead of them that could significantly affect the mortgage industry.

When the new group takes office in January, here are five major mortgage questions that need answers:

1. Who Will Assume Federal Housing Roles?

The new administration will make appointments to a host of housing-related positions. They include the secretary of the Department of Housing and Urban Development, commissioner of the Federal Housing Authority, director of the Federal Housing Finance Agency, and president of Ginnie Mae.

2. Will Anything be Done About GSE Conservatorship?

A decision is upcoming on the future of government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. They are in the eighth year of conservatorship under the Federal Housing Finance Agency, and with reform talks stalling, the administration and Congress will be on the clock.

3. When Will the Fed Raise Rates?

Last December, the Federal Reserve raised the federal funds rate 25 points for the first time in over nine years. It has held steady since, but with the election finally over, is another hike looming? We may learn more after the Fed?s December meeting.

4. How Safe is the Mortgage Interest Deduction?

The mortgage interest tax deduction has been adamantly defended by the housing industry as a method of promoting homeownership. However, the Mortgage Bankers Association has recently indicated some willingness to re-examine it if it comes as a part of a comprehensive overhaul of the tax code. What will any changes made by Congress mean for the deduction?

5. Who Will be Named as the Ninth Justice?

As a result of a federal appeals court?s ruling that the current structure of the Consumer Financial Protection Bureau is unconstitutional, a new case with massive mortgage industry implications may be on the way to the Supreme Court. President Obama?s nominee for the open Justice slot, Merrick Garland, has been blocked by Senate Republicans, and the Trump Administration will likely get a chance to fill the opening.

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2016 has been a tumultuous year for the real estate sector, with the presidential election, Federal Reserve rate hike, and Brexit-spurred interest fluctuations all impacting the housing market in ways that are still playing out. As the new year looms, trends that will shape the industry’s coming months are at the forefront of everyone’s mind.

A Diversifying America

Over 50% of new home formulation is expected to happen in minority communities, according to a recent interview with Quicken Loans CEO Bill Emerson. The changing face of the mortgage industry’s clientele demands new and innovative ways of serving homebuyers. Lenders are seeking to attract more Millennial and minority borrowers with new cost-effective programs like Wells Fargo’s YourFirstMortgage, which provides first-time or low-to-moderate income (LMI) buyers incentivized rates and user-friendly features. Real estate professionals must follow suit. Adapting hiring and marketing practices to serve a wide, diverse constituency is a natural solution to expanding both customer base and profit margins.

Affordability Crisis?

Housing prices have seen a jump across the nation over the last year, but income rates have failed to follow suit. This is seen by many as the sign of an upcoming affordability dilemma: homeownership rates have strengthened but not fully recovered since the 2008 financial crisis, and a steady rise in the ticket price of both new and existing properties will hardly help. Whether the problem is due to supply or demand, real estate professionals will have to keep a close eye on housing metrics and associated data to guide their strategies going forward.

Data Security

Finally, with the Internet an ever-increasing factor in mortgage transactions, lenders and realtors alike must strengthen their cyber-security protocols. The news has been filled with data breaches over the last few years, with the infamous hack of healthcare provider Anthem’s internal records leaking the private information of nearly 80 million users. The medical industry is particularly susceptible to these attacks due to the large amount of sensitive data their systems house. The same holds true for realtors, who thanks to the TILA-RESPA Integrated Disclosure (TRID) rule must now follow an exacting set of standards for providing client information at closing. With the Social Security numbers, birth dates, credit scores and other data of their customers at stake, real estate offices should take top-to-bottom security measures in both their IT and human resource departments.

Demand for residential real estate was at near historic records throughout the summer of 2016. With buyers clamoring to snap up the available properties, prices predictable skyrocketed in many markets in the United States.

While the fall season is typically a slower one for the real estate industry, the activity in the market over the past few months, and the latest demand and inventory data, seems to be pointing toward a hot autumn for home sales.

According to a September report released by realtor.com, property transactions in the ninth month of 2016 were four percent higher than they were in the same timeframe in 2015. Meanwhile, prices continue to reach new highs rather than rebound back to normal averages.

Digging deeper into the latest realtor.com report, we see that the expected median age of listings — a key metric that provides an accurate measurement of real estate inventory — is three days lower than it was in September 2015. At 77 days, the September 2016 median listing time is still about five days longer than it was in August 2016. The month-to-month drop simply shows that the typical fall slowdown is occurring, just not at a rate that bringing the market back down from some of its historic highs.

Overall inventory continues to be much lower than it was at this time last year. Fewer than 450,000 new listings entered the housing market last month.

The median home listing price was $250,000, which was almost 10 percent higher than it was in September 2015 and unchanged from the figure in August 2016. This shows that average time on the market may be slowing down as we head into fall, but home prices are staying steady at extremely high levels. The $250,000 marks an all-time high for September.

Why Are Prices and Demand Still So High?

According to the chief economist of realtor.com, the market isn?t slowing down as much as it usually does in the fall because there are still plenty of summer buyers waiting to reach their goals. Many of these market participants were temporarily blocked from buying properties by the fierce competition that played out in June, July, and August. They didn?t give up; they just put off buying a property until September or October, hoping that they would find fewer competitors.

Pent up demand is combining with near record low mortgage rates to continue to drive a hot real estate market well into the fall months.

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Affordable housing options in the U.S. are declining. ATTOM Data Solutions tracked 414 counties across the country and found that 24% of them were less affordable than their historic average in the 3rd quarter of 2016, up from the 22% mark in the 2nd quarter and 19% a year earlier. The 24% share was the highest since the 3rd quarter of 2009, when a staggering 47% of markets fell below their historic affordability averages.

Affordability Suffers

The affordability index is based on the share of average wages (from the U.S. Bureau of Labor Statistics) that is required to make monthly payments on a home at the median price as determined by publicly recorded sales deeds. That payment is made up of principle, interest on a 30-year fixed rate mortgage with a 3% down payment, and includes property taxes and insurance.

The improving affordability trend has reversed course following home price appreciation acceleration and wage stagnation. Nationwide, average weekly wages declined in the 1st quarter of 2016 after 13 consecutive quarters of year-over-year increases, according to Daren Blomquist, senior vice president at ATTOM. As a result 63% of markets saw worsening affordability.

A Silver Lining

There is a silver lining though, as some of the highest-priced markets, generally bastions of low affordability, actually improved in the index, mostly due to annual home price appreciation slowing to single-digit percentages. This is good news for prospective buyers who have been priced out of those expensive markets.

261 counties, or 63% of the field, suffered worsened affordability levels compared to a year ago. 368 counties, or 89%, saw annual growth in median home prices outpace annual growth in weekly wages.

Since the 1st quarter of 2012, when median home prices bottomed out nationwide, they have risen 60% while average weekly wages have only risen 6% over the same timeframe.

Recovering Counties

Across all 414 counties analyzed, earners must spend 36.3% of their income to buy the median-priced home, still a bit below the historic average of 38.8%, but above the 35.8% mark from a year ago. A few counties that rose well above the national average were Kings County, NY (Brooklyn) at 123.5%, Santa Cruz County, CA at 111.1%, Marin County, CA at 109.4%, New York County, NY (Manhattan) at 96.6%, and San Luis Obispo County, CA at 91.2%.

The ATTOM analysis used closings costs data from ClosingCorp that include title, settlement services, transfer taxes, appraisal, home inspection and recording fees. The report found that average closing costs for 2016 sales were $3,815, an average of 1.8% of the median sales price in each county and 8% of the annual wages in each county.

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The real estate industry is enjoying such a renaissance that it?s breaking financial barriers that haven?t been disturbed since the tech boom of the late 1990s. For the first time in nearly two decades, the S&P 500 got a new sector this year.

In September, the S&P Dow Jones Indices separated real estate companies from the rest of the financial sector to form an 11th stock group. The new grouping makes it easier for investors to follow the continued growth of one of the hottest segments of the economy.

Real estate hasn?t just been doing well over the past decade; it?s been one of the primary fuel sources in the sustained recovery of the overall economy. With interest rates at near record lows, property owning real estate investment trusts (REITs) that pay steady dividends have been one of the most attractive opportunities available to investors. An estimated $60 billion flowed into the real estate funds in the United States between 2001 and 2015.

Publicly traded REITs significantly grew in numbers over the past 15 years. Going back to 2001, almost 130 of them have gone public in America. Those offerings collectively raised more than $37 billion. Currently, there are approximately 240 REITs listed on Nasdaq or the New York Stock Exchange.

Now that it is separate from the insurers, banks, and other financial sector companies, the real estate industry accounts for about 3 percent of the S&P 500?s market capitalization. This drops the financial grouping down to 13 percent from 16 percent.

According to a member of the index-designation committee responsible for the decision to split, the real estate industry is primed for even more growth due to the latest developments. Real estate used to be buried in financials, Sebastien Lieblich told the Wall Street Journal. Now it?s been elevated to special status, he noted, making it easier for investors to put their money in those stocks.

The Latest Sign of a Strong Market

Before the S&P made the move to elevate real estate, a rival indexing firm already had done the same. Based on the performance of the real estate stocks and the general health of the property market in the United States, MCSI Inc. made the change to remove the real estate sector from financials and place it in its own grouping.

The developments in the stock world are just further proof of the strength of U.S. housing right now. New home construction is booming, the value of existing homes is on the rise, and low interest rates have more and more people thinking this is the time to buy.

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In a rapidly changing and highly regulated industry like lending, there are always going to be plenty of topics up for debate. The SAFE Mortgage Licensing Act happens to be one of the interesting issues getting a lot of attention right now.

The bill is up for discussion in the Senate after easily passing approval in the House. Its wide popularity has many predicting that it will become law sooner rather than later.

If you need to catch up on the finer points of this relatively new legislation, we?ve got you covered.

Why Mortgage Loan Originator (MLO) Licensing Matters

Loan officers used to change jobs less frequently than they do now. Job loyalty and security were both higher, making it quite rare for MLOs to leave one state and go to another in search of new employment. In today?s faster-paced, more connected world, seeing someone cross state lines for a better is commonplace.

The SAFE Mortgage Licensing Act is attempting to catch the law up with the new realities of employment in the lending industry. The bill would provide recently relocated loan officers a 120-day grace period in licensing. It would apply if the professional moved from one state to another or from a bank/credit union to an independent lender.

There?s no debate about the fact that MLO licensing is important. Consumers and the industry alike want to ensure that a loan officer can?t escape justice by slipping over state lines. However, many feel a regulatory update is long overdue.

What About Consumer Protection?

SAFE?s authors attempted to account for the protection of borrowers as much as the convenience of MLOs. The new piece of legislation made headlines with its inclusion of minimum standards related to the licensing and registration of loan officers, but some consumer protection groups are asking if the standards go far enough.

The NMLS (Nationwide Multistate Licensing System) is currently in charge of setting federal guidelines for the pre-licensing and education of mortgage originators. Despite the existence of that agency, there is still a great deal of variety in the licensing requirements from one state to another.

Because of the inability of NMLS to set even and consistent requirements nationwide, it looks like the minimum federal standards promised by SAFE Act do provide at least a step in the right direction for the protection of consumers. The new guidelines are expected to do more to guarantee MLOs possess consistent and comprehensive expertise upon achieving licensing.

For now, SAFE appears to be a positive step for all parties — borrowers, institutions and loan officers themselves.

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Have you submitted your feedback on the proposed changes that the Consumer Financial Protection Bureau released this summer? The comment period is quickly drawing to a close.

With the countdown to the October 18, 2016, deadline well under way, it?s a good time to recap why the comment period is so important, what?s already changed, and what lenders need to know going forward.

TRID Challenges and Comments

The TILA-RESPA Integrated Disclosures rule went into effect on October 3, 2015. Soon after, mortgage and real estate industry professionals began compiling their grievances. Regulations regarding the sharing of closing disclosure forms probably received the most ire.

To their credit, the Consumer Financial Protection Bureau listened to the pleas of professionals across the nation and opened the discussion for proposed rule changes. By July of 2016, a 300-page proposal containing the phrase ?seeks comment? more than 150 times was released. Thus began the comment period allowing anyone to review the rule changes and submit suggestions on where the CFPB went too far or not far enough.

Initial Reaction

Lenders and real estate firms reacted positively to the CFPB?s efforts to clarify confusing language, make selective amendments, and open the forum for discussion. Many saw a couple of key changes as clear victories for the affected industries.

In a Housing Wire article, a cross section of mortgage professionals mostly agreed that the CFPB took a big step in the right direction. They were impressed by the Bureau?s willingness to address issues in the original wording of the rule and their enthusiasm for courting public feedback to fuel future changes.

Changes in Progress

Notably, in their 300-word proposal released in July, the CFPB sided with the National Association regarding closing disclosure (CD) forms. NAR argued that sharing between lender and real estate agent was common practice before TRID and nothing had happened to justify the new restrictions that went into effect on October 3, 2015.

The CD issue appears to be on its way to resolution, but widespread participation in the comment period is one way to ensure that happens.

What Lenders Need to Know

Lenders interested in offering their perspective on dealing with TRID over the past year, or on the recently proposed changes, the comment period only lasts until October 18, 2016.

If you would like to know more about the latest TILA-RESPA Integrated Disclosures proposal or how you can submit your feedback to the CFPB, you should visit the Federal Register website.

Newly built home sales rose in July to the highest they?ve in almost a decade, signaling continued momentum in the U.S. housing market.

Momentum Building in the Housing Market

July?s seasonally adjusted annual rate of 654,000 new single-family home sales was a 12.4% increase over June, marking the highest level since October 2007, according to the Commerce Department.

Ralph McLaughlin, an economist at real estate website Truila, noted that the increase in new home sales displays continued strong demand in the current low-interest rate, low unemployment environment.

The Wall Street Journal surveyed a group of economists who had predicted home sales to slide in July down to 580,000. June sales were revised from an initially estimated pace of 592,000 down to 582,000.

When compared to the first seven months of 2015, new home sales also rose 12.4% through the first seven months of 2016.

Strong Fundamentals Support the Housing Market

Recovering income growth, steady job creation, and historically low mortgage interest rates have supported purchases of both new and existing homes, and the housing market has been a bright spot in the economy so far this year.

At the end of July, the average rate for a 30-year fixed rate mortgage was 3.48%, down a half percentage point from 12 months prior, according to Freddie Mac.

While new home sales account for roughly a tenth of total U.S. homebuying activity, June?s sales of previously owned homes are also close to a decade-long high, according to the National Association of Retailers.

The National Association of Realtors? numbers show sales of previously owned homes rose to their strongest pace in nearly a decade in June.

More Room to Grow

Sales of new homes in July were up 31.3% over July 2015, bringing the figure back to the level recorded when the recession began. The pace, however, remains well behind the peak level of 1.39 million in July 2005. July 2016 was the first month with a rate over 600,000 since early 2008. Pre-recession, the last time the rate was so low was 1991.

At the end of July, there was a 4.3-month supply of newly built homes, the smallest supply in three years. The median sale price for new homes sold in the month was $294,600, down slightly from July 2015?s median of $296,000.

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