June Marks 20 Months of Declines

June Marks 20 Months of Declines

Foreclosure Inventory: Completed foreclosures and distressed inventory continued their downfall in June, 

Data for last month showed 55,000 homes were lost to foreclosure, down 20 percent from June 2012. The decrease represents the 19th month-in-a-row completed foreclosures have ticked down. However, on a monthly basis, completed foreclosures inched up by 2.5 percent.
Since the financial crisis began in September 2008, about 4.5 million homes have been lost to foreclosure.
Rising Mortgage Rates Show Impact
Rising mortgage rates are beginning to impact the housing market, as pending home sales declined in June after reaching the highest level in more than six years

Brace Your Buyers for Higher Home Prices

Brace Your Buyers for Higher Home Prices

Home prices are rising across the country and the prices for new homes in particular may increase significantly in the near future. Economist predicts newly-built homes could see a 9 percent increase in price by the end of the year. 

“Here's what's happening: Land values are going up very fast right now in prime locations, what we call the ‘A’ locations,” Hunter explains. “In the best A (and B) markets, we expect prices to rise by 11 percent to 15 percent. Builders are desperate to buy lots, which in some cases are 30 percent to 50 percent higher than last year.”

Home Prices Up 10% To 13%
Homebuyers Locking In Affordability
Fully aware both home prices and mortgage interest rates are on the rise, home buyers are hedging their bets with fixed rate mortgages (FRMs) and sizable down payments to lock in affordable housing.

Fannie Mae Maintains Forecast for Faster Growth

Fannie Mae Maintains Forecast for Faster Growth

Despite Rising Rates: With July approaching its last week, economists at Fannie Mae are maintaining their forecast for greater economic growth in the second half of 2013.

In its latest Economic and Housing Outlook, Fannie Mae’s Economic and Strategic Research Group points to steady year-to-date job creation, high consumer confidence, and positive housing data as proof the economy is on a positive, though modest, growth path.

“We are keeping a very close eye on the effect of rising mortgage rates on the housing market and the economy, but our July forecast is little changed from last month,” said Doug Duncan, chief economist at Fannie Mae. “We continue to see growth in housing, partly due to an increase in existing home sales as buyers choose to act while rates remain near historic lows.”  Mortgage Rate Relief Coming?

Where cash is King 'Housing markets'

Home buyers who require financing for their home purchase can struggle to compete against buyers who have offers of all-cash.

Where are all-cash deals are the most prevalent? Cash deals represented 80 percent of home sales in June in Vermont; 58 percent in Nevada; 57 percent in Florida, and 51 percent in New York, according to RealtyTrac. Cash deals represent a very small percentage in Texas, Utah, and New Mexico. 

The markets with the most all-cash transactions tend to have a high number of foreclosures and depressed home prices, which attracts investors and private equity firms. The following 10 metros had 40 percent or more all-cash deals out of the total home sales in June. Watch our video to learn more BASEL III: How REALTORS® Won  Housing posts a win in getting costly capital requirements removed from Federal Reserve's 972-page BASEL III rule.

Short Sales Pick Up

Short Sales Pick Up As Investor Purchases Slow Over Last Year: With the exception of short sales, activity for distressed sales was relatively calm in June, according to data from RealtyTrac.

Last month, institutional investors, or non-lending entities that bought at least 10 properties in the last 12 months, accounted for 9 percent of residential sales. The share represents a slight increase from 8 percent in May, and a small decrease from 10 percent in June 2012.REO sales remained stable, accounting for 9 percent of sales, down from 10 percent in May and unchanged from a year ago.Meanwhile, short sales saw a significant increase over the last year, representing 14 percent of all sales in June, up from 8 percent a year ago. In May, short sales represented 15 percent of sales.Five More Markets Reach Full Recovery 

Report Shows Salt Lake City and Provo-Orem Highest Year-over-Year Increase:

Real Estate's New Big Buyers

Real Estate's New Big Buyers
Middle-Aged Women: Middle-aged women have become the fastest growing group of single female home owners, 
The number of 45- to 54-year-old single female home owners has soared 120 percent from 1982 to 2012. 

“Probable causes for this phenomenon include the large baby boomer population entering this age group over the last several decades and the prevalence of divorce leading to the creation of more female-headed households,”

 Short Sale Stigma Surfacing?

Fast Rise in Mortgage Rates Could Hurt

Fast Rise in Mortgage Rates Could Hurt

Fannie: The rise in mortgage rates over the last couple of months has been “significant” and could hamper the housing recovery, economists note in Fannie Mae’s Economic Strategic Report for July. 

However, home sales so far have been little affected by the spikes, they say. 

The 30-year fixed-rate mortgage has risen more than 110 basis points from the first week of May to the end of June. In early July, it started to ease somewhat. Still, the report says that despite the increases, rates are still near historical lows. It’s the sudden rise in such a short time that has been alarming, the economists note. 

 See where rates are today....

Home Sales Down, Inventory Up

Home Sales Down, Inventory Up

Existing-home sales declined in June, but have remained well above year-ago levels for the past two years. Also, the median price shows seven straight months of double-digit, year-over-year increases, according to the National Association of REALTORS®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dipped 1.2 percent to a seasonally adjusted annual rate of 5.08 million in June from a downwardly revised 5.14 million in May, but are 15.2 percent higher than the 4.41 million-unit level in June 2012.“Inventory conditions will continue to broadly favor sellers and contribute to above-normal price growth,” Yun predicted. The national median existing-home price for all housing types was $214,200 in June, up 13.5 percent from June 2012.  This marks 16 consecutive months of year-over-year price increases, which last occurred from February 2005 to May 2006. Watch the video to learn more...

SINGLE FAMILY HOME FLIPPING INCREASES 19%

SINGLE FAMILY HOME FLIPPING INCREASES 19%

IN FIRST HALF OF 2013 WHILE PROFITS SOAR: Single-family home flipping is on the rise as flippers see growing profits from their endeavors in most markets, according to a report released by RealtyTrac.

The volume of house flipping increased 19 percent from the first half of this year to the first half of last year, according to RealtyTrac.

At the same time, profits from flipping increased 246 percent.

Over the first half of this year, investors earned an average gross profit of $18,391 per home flipped, up from $5,321 in the first half of last year and a vast improvement from the first half of 2011 when flippers lost an average of $13,206 on flips. The $18,391 represents a 9 percent return on investment. No Need to Fear Rising Mortgage Rates

History shows us that we don’t need to fear the recent spikes in mortgage rates because they won’t have an impact on home prices, according to Fannie Mae researchers in a new report. 

Builders Haven't Felt This Upbeat Since 2006

Builders Haven't Felt This Upbeat Since 2006
Builders continue to feel more optimistic about the direction of the recovery for newly built single-family homes. Builder confidence rose six points in July to 57, according to the National Association of Home Builders/Wells Fargo Housing Market Index. 

Any number above 50 indicates more builders view conditions as good than poor. 

The index gauges builders’ perceptions on single-family home sales, sales expectations for the next six months, and buyer traffic. Watch video: Beware: Crack Down on Squatters

States are tightening up their adverse possession laws and making it tougher for squatters to make claims to properties they don’t own.

Conditions are ripe More Household

Conditions are ripe More Household
Formation to Buoy Demand: As job growth remains steady, conditions are ripening for household formations to grow stronger, according to a recent report on housing demand. 
Children are moving out of their parents’ homes, and college graduates are stepping out on their own, helping to fuel demand for housing.

The growth in household formation has caused an increase in demand over the last two years for all types of housing, including multifamily and single-family ownership and rentals, according to the report. Household formation hit bottom in 2009 and 2010, hovering in the mid-to-high 300,000 range. Analysts note in the report 

Inventories Rising Faster Than Usual

Inventories Rising Faster Than Usual

The number of homes for sale rose 4.3 percent in June to 1.9 million—the highest level in the past year. These gains are also higher than usual for this time of year, according to newly-released housing data from realtor.com®. 

Following two years of declines, housing inventory is finally reversing course. More home owners are seeing rising prices and may be more apt to try to sell their homes. Where Housing Bargains May Still Lurk
In some states, a glut of foreclosures remain, and foreclosures tend to sell at discounts. Many of these properties will likely enter the market in the next six to 12 months

Administration Warns Delinquencies Remain High

Administration Warns Delinquencies Remain High

Despite Decreases: Foreclosures and mortgage delinquencies may be declining, but that doesn’t mean the industry should let its guard down. In the Obama Administration’s latest housingscorecard, which provides an overview of the housing market based on private and public sector data, officials continued to warn of a “fragile” recovery despite improvements.

Recently, Lender Processing Services reporteddelinquencies have fallen 43 percent from their 2010 peak, while RealtyTrac found foreclosure starts decreased 45 percent year-over-year in June.
“Foreclosure starts and completions are down significantly from one year ago; and since January 2012, rising home values have lifted 2.4 million homeowners back above water. That said, we remain cautious because although mortgage delinquencies are trending down, they still remain quite high compared to historic norms,” said Kurt Usowski, assistant secretary for economic affairs at HUD. Learn more ....

7 Best Midsize Cities for Job Growth

7 Best Midsize Cities for Job Growth

Provo-Orem, Utah comes in second on best Midsize Cities,

Economists often say where jobs pick up, the housing market will soon follow. Forbes recently ranked metro areas to find which midsize cities are posting some of the largest job gains. Forbes reviewed employment data from 2001 through January 2013 for its rankings. The midsize cities that topped its list:

Report Suggests Intentional Underbuilding 
A few years ago, during the housing bubble, homebuilding outpaced population growth. 

Younger Buyers More Likely to Consider Foreclosed

Younger Buyers More Likely to Consider Foreclosed

Younger homebuyers are far more open to the idea of buying a foreclosure compared to older buyers, a National Association of Realtors’ (NAR) survey on buyer and seller trends revealed.

Overall, 44 percent of surveyed buyers said they did not consider a home in foreclosure. When broken down by age group, however, only 31 percent of Millennials (32 and younger) said they did not consider purchasing a home in foreclosure compared to 65 percent for buyers aged 67 to 87.
The share of buyers who did not consider a foreclosure increased with age, the NAR found. For example, among Generation X buyers (aged 33 to 47), 43 percent did not consider a foreclosure, while 53 percent of those aged 58 to 66 were in the same category. Tax Reform CFA: Do No Harm

Will Rising Mortgage Rates Cool the Market?

Will Rising Mortgage Rates Cool the Market?

A big jump in mortgage rates over the past two months may start to cool the rapid rise of home prices in the second half of the year, The Wall Street Journal reports. 

Mortgage rates have shot up from lows of 3.59 percent in the beginning of May, to 4.58 percent during the last week of June, according to the Mortgage Bankers Association. Rates are at their highest levels in two years. 

“A rule of thumb holds that every one percentage point increase in interest rates reduces affordability by 10 percent, so the recent move in rates just made homes about 10 percent more expensive to buyers who need to finance their purchase,” The Wall Street Journal reports.Foreclosures Down 29% From Year Ago

47% of Bankers Expect Delinquencies to Decrease

47% of Bankers Expect Delinquencies to Decrease

More bank professionals expect mortgage delinquencies to decline over the second half of this year than to than to stay the same, according to an industry survey released Tuesday by FICO, a San Jose, California-based analytics software provider.

This is the first time in the quarterly survey’s history the number of professionals expecting mortgage delinquencies to decline outpaced those who expect it to remain the same.
Shadow Inventory Falls 34% from 2010 Peak serious delinquencies, or mortgages past due by 90 days or more, are trending downward,

Don't Let Credit Checks Derail Buyers

Don't Let Credit Checks Derail Buyers
uyers may want to purchase furniture to outfit their new home prior to closing. But if they’re not careful, they could cause delays in closing or even lose their home loan.
Since 2010, mortgage giant Fannie Mae has mandated that lenders recheck a borrower’s credit prior to closing on a mortgage. If anything new arises in the credit re-check, lenders may want to delay the closing to verify the borrower can still afford the mortgage. In some cases, the lenders may even cancel the mortgage prior to closing, which could mean a higher interest rate on a new loan. 
“We tell our clients about this upfront, and keep reminding them through the entire process not to go buy a new bed or a refrigerator,” says Michael Daversa, president and founder of Atlantic Residential Mortgage. “What you’re supposed to do is keep everything status quo.” July State of Market, Where Cost Per Square Foot

Delinquencies See Biggest Year-to-Date Drop

Delinquencies See Biggest Year-to-Date Drop
Since 2002: Delinquencies saw the steepest year-to-date drop since 2002 in May as new problem loan rates inched toward pre-crisis lows, according to Lender Processing Services’ (LPS) Mortgage Monitor report released Monday.
Since the end of last year, the delinquency rate has fallen by more than 15 percent to 6.08 percent in May.

“Though they are still approximately 1.4 times what they were, on average, during the 1995 to
2005 period, delinquencies have come down significantly from their January 2010 peak,”

First-Time Buyers Have Smaller Budget,Interest in Foreclosures

Are Rising Prices Tempting More Home Owners?

Are Rising Prices Tempting More Home Owners?
With rising home prices, more home owners are finding they can sell without fear that their mortgage is worth more than their house. 
The number of sellers coming onto the market is serving as a relief to home buyers who were becoming increasingly frustrated at the lack of inventory and increase.

From January to March, about 19.8 percent of homes nationwide with a mortgage are considered “underwater” -- that’s a drop from 23.7 percent a year earlier.  Are Short Sales Becoming a Thing of the Past?

Asking Home Prices Show Impressive Gain in June

Asking Home Prices Show Impressive Gain in June

Rents Pick Up: Asking home prices took off in June, soaring 10.7 percent year-over-year, Trulia reported Wednesday.

Month-over-month, asking prices inched up by 1.5 percent and rose 4.1 percent on a quarterly basis. Trulia also tracked the 100 largest metro areas and revealed 99 markets experienced an increase in asking prices over the last year.

Rents rose at a slower pace of 2.8 percent year-over-year, though it was still the biggest increase since January. In Houston, New York, and Philadelphia, rents picked up at a faster pace than asking prices. Read more ....

Above-Normal Price Growth, Strong Metro Area Gains

Above-Normal Price Growth, Strong Metro Area Gains

Report Projects:  Forty-five of the top 50 metropolitan markets will experience yearly price increases during the second half of the year, according to Clear Capital’s Home Data Index Market Report released Tuesday.

This widespread forecast of price increases “speaks to this move toward a more balanced, broad-based recovery,” said Alex Villacorta, VP of research and analytics at Clear Capital. 

Timing the Market Right Some Buyers Still Lingering: Home prices and mortgage rates are rising

Cash Offers Make Home Buying Competitive

Cash Offers Make Home Buying Competitive

All-cash offers accounted for 33 percent of home sales, according to the National Association of REALTORS®' May 2013 REALTORS® Confidence Index. The majority of those all-cash offers are coming from investors and international home buyers. 

All-cash offers can represent stiff competition for traditional buyers. For example, first-time home buyers, who are already facing low inventories and rising home prices, view all-cash offers as one of their biggest competitions in the market today. 

Millennials' ball-and-chain:Student loan debt 

First-time buyers losing out as home sales rise,

First-time buyers losing out as home sales rise,

First-time home buyers accounted for 28 percent of existing-home purchases in May—down from 34 percent a year prior, according to the National Association of REALTORS®. Traditionally, first-time home buyers account for four of 10 home buyers, so their dwindling numbers are alarming some housing analysts and economists. 

As home prices rise, first-time home buyers may increasingly get left on the sidelines. Home prices have posted double-digit gains in the last year in many markets, and average mortgage rates are ticking up above 4 percent. Some first-time home buyers may have already missed the prime conditions to jump into home ownership.

U.S. home prices have risen for 14 straight months, but one set of buyers has been increasingly on the sidelines: first-time home buyers. 

Rising Rates soared to a two-year high last week.

Housing Market 61% 'Back to Normal'

Housing Market 61% 'Back to Normal'
The housing market made it to 61 percent “back to normal” in May, according to the latest Housing Barometer from Trulia.

May’s percentage is the first time the recovery has passed 60 percent since the crash. April’s barometer was 54 percent. A year ago, the barometer was at only 35 percent.
The monthly report measures three key housing market indicators.
Forecast Points to Steady Price Growth