Rising Mortgage Rates Stall New Home Sales, Single-Family Rents Hit Record High, Chicago Businessman Sentenced for Elderly Fraud

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Chicago Businessman Sentenced for Elderly Fraud

A Chicago businessman has been sentenced to more than 17 years in federal prison for a scheme that defrauded elderly homeowners. 68-year-old Mark Steven Diamond was convicted of bilking over 100 senior citizens in the Chicago area through a reverse mortgage and home repair scam. Diamond, along with accomplices, targeted elderly victims, convincing them to take out reverse mortgages to pay for non-existent home repairs. In many cases, the victims were misled into signing loan documents, thinking they were for repair work.

Diamond fraudulently pocketed the loan proceeds, leaving homeowners with debt and no repairs. U.S. District Judge Franklin U. Valderrama sentenced Diamond to 205 months in prison and ordered him to pay $2.7 million in restitution. The scheme caused significant harm to the vulnerable, and authorities say they will continue to fight such predatory practices.

Diamond’s co-schemers, including loan officers and a title agency owner, have also pleaded guilty and await sentencing.

A reverse mortgage is a loan that allows homeowners, typically seniors, to convert a portion of their home equity into cash, which is repaid when they sell the home, move out, or pass away.

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Single-Family Rents Hit Record High

Single-family home rents have hit a new record, surpassing apartment rents by 20%. According to Zillow, single-family rents have soared 41% above pre-pandemic levels, while multifamily rents are up 26%. This gap marks the largest difference ever recorded by Zillow.

The rise in single-family rents is driven by high mortgage rates, which are keeping many potential buyers on the sidelines and pushing them to rent instead. With millennials increasingly opting to rent larger homes, competition for detached properties remains fierce. Meanwhile, multifamily rents have stabilized, but property managers are offering concessions—such as free rent or parking—on 41% of listings, another record.

While for-sale housing inventory is slowly recovering, it’s still 25% below pre-pandemic levels, with some metros seeing more homes available. However, overall, demand for homes remains strong, and prices are expected to grow at a slower pace as more inventory becomes available.

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Rising Mortgage Rates Stall New Home Sales

New home sales slowed in December, as rising mortgage rates dampened buyer enthusiasm. According to Zonda’s chief economist Ali Wolf, the market is facing a “one-two punch” of increased competition and volatile interest rates, leading to uncertainty as we head into 2025. Since the Federal Reserve started raising rates in September, mortgage rates have climbed higher than expected, adding pressure to potential buyers.

Zonda’s New Home Pending Sales Index dropped 6.5% from November and is 21.8% lower than its peak. Prices for entry-level and move-up homes also declined, as builders adjusted pricing strategies. While high-end home prices rose by 0.4% year-over-year, entry-level homes saw a 1.2% dip.

Despite the slowdown, quick move-ins—homes ready to occupy within 90 days—rose 11% compared to last year, as buyers seek quicker solutions in a tight market. Builders are shifting toward more spec-heavy inventory to meet demand, but rising resale inventory in some areas is making these quick move-ins less desirable.

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