South Orange County Blog from Bob Phillips

What’s Ahead For Mortgage Rates This Week – June 30, 2014

Whats-Ahead-Mortgage-RatestLast week brought several economic and housing sector reports including Existing Home Sales, Case-Shiller and FHFA    home prices for April, as well as New Home Sales. Freddie Mac’s weekly mortgage rates survey and the weekly report on   new jobless claims were released on Thursday, and Consumer Sentiment for June rounded out the week on Friday.

Existing Home Sales Stronger than Expected!

Good news came from the National Association of REALTORS® Existing Home Sales report for May, which reported 4.89 million previously owned homes sold on a seasonally-adjusted annual basis. Analysts had projected a seasonally-adjusted annual figure of 4.75 million existing homes sold based on April’s reading of 4.65 million existing homes sold; April’s   reading was later adjusted to 4.66 million. May’s reading represented a monthly increase of 4.90 percent over April’s  reading and  was the second consecutive monthly increase in previously owned home sales.

The median sales price for existing homes sold in May was $213,400, which represented a 5.10 percent increase year-over-year.

May’s reading for existing home sales was the highest in seven months, and mortgage rates trended down during May, but strict lending standards were cited as a significant obstacle to first-time homebuyers.

Federal Reserve Chair Janet Yellen recently said in a press conference that mortgage lenders “need more clarity” as to their potential liability for failed mortgages. Mortgage lenders and loan servicing companies can be required to repurchase defaulted loans or to reimburse Fannie Mae and Freddie Mac for losses associated with mortgage defaults and foreclosures.

Case-Shiller, FHFA Report Slower Pace for Home Price Growth

The S&P Case-Shiller Home Price Index and FHFA’s House Price Index for April documented slowing rates of home price growth. Case-Shiller reported a 10.80 percent year-over-year growth in home prices for April, and FHFA reported a year-over-year gain of 5.90 percent rate of appreciation for home sales associated with mortgages owned by Fannie Mae and Freddie Mac.

Analysts noted that home price growth is leveling out after last year’s steep appreciation in home prices. While homeowners may disagree, economists say that a slower rate of home price growth can actually bode well for housing markets. More buyers can afford a home, which adds stability to housing markets. First-time buyers provide a foundation for home sales; if they cannot buy homes, then homeowners can’t sell existing homes and buy new homes. A slower but consistent rate of home price growth allows homeowners to build home equity, but won’t likely lead to housing “bubble.”

New Home Sales Blast Past Expectations, Mortgage Rates Fall

The U.S. Department of Commerce reported that new home sales for May reached a six-year high with a reading of 504,000 new homes sold on an annual basis. April’s reading exceeded expectations of 440,000 new homes sold as well as April’s adjusted reading of 425,000 new homes sold. The month-to-month increase in new home sales from April to May was the largest monthly increase in home sales in 22 years.

Although analysts caution that month-to-month seasonally-adjusted sales reports are volatile, this uptick in new home sales may help bolster builder confidence in housing markets. May prices for new homes also rose with the median home price at $282,000. This reading represents a year-over-year increase of 6.0 percent for new home prices.

The Northeast led regional results for new home sales with its reading of 54.50 percent; The West reported an increase of 34.00 percent. New home prices in the Southeast rose at an annual rate of 14.20 percent, and the Midwest region reported a 1.40 percent increase in new home prices. While analysts characterized the Northeast region’s May reading as exaggerated, overall results for new home prices indicate a comeback for new home prices.

Freddie Mac put some icing on the good news cake with its weekly mortgage rates report. Average rates for a 30-year fixed rate mortgage dropped to 4.14 percent with discount points lowered to 0.50 percent. The average rate for a 15-year fixed rate mortgage fell by eight basis points to 3.22 percent with discount points unchanged at 0.50 percent. The average rate for a 5/1 adjustable rate mortgage fell by two basis points to 2.98 percent with discount points lower at 0.40 percent.

Thursday’s Weekly Jobless Claims Report reading fell by 2000 new claims to a seasonally adjusted reading of 312,000 new claims filed. Analysts had expected a reading of 310,000 new jobless claims. 214,000 per month have been added to the economy from January to May 2014.

Positive economic developments were not lost on consumers. The Consumer Sentiment Index for June posted a reading of 82.5 against an expected reading of 81.9 and May’s reading of 81.2.

This Week’s News

Scheduled economic news includes Pending Home Sales, Construction Spending, the ADP Employment report, and the Non-farm Payrolls Report. The National Unemployment Rate report along with Freddie Mac’s PMMS and Weekly Jobless Claims round out the week. No news is scheduled for Friday’s Independence Day holiday.

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May Equity Home Sales Continue to Rise in California

An article from Colin Robins, from DSNews.com, dated June 25, 2014

Welcome2CaliforniaHigher home values have continued to fuel more equity home sales, making up more than 80 percent of all home sales for the past 11 consecutive months, according to the California Association of Realtors (CAR). The group noted that pending home sales receded slightly in May, as investors pulled out of the market due to higher home prices.

The group considers equity home sales as any non-distressed property sales.

CAR found that the share of equity home sales rose to 89.2 percent in May, up from 88.4 percent in April.  Since the beginning of the year, equity home sales have been steadily rising. The last time non-distressed property sales were sub-80 percent was in May 2013.

Distressed properties, as a share of total properties, continued to decline in May. CAR cited a decline in REO sales as the primary motivator behind the drop. The group commented, “The share of distressed property sales was down from 11.6 percent in April to 10.8 percent in May. Distressed sales continued to be down by more than 50 percent from a year ago, when the share was 22 percent.”

As a share of all distressed properties, short sales dropped to levels last seen in late 2007 at 5.6 percent. May’s figure was below April’s figure of 5.9 percent. May’s figure was down year-over-year from May 2013’s percentage of 14 percent. The share of REO sales fell in May to 4.7 percent, down from 5.3 percent in April and from 7.6 percent in May 2013.

The supply of available homes increased. CAR noted, “The Unsold Inventory Index for equity sales edged up from 3.6 months in April to 3.7 months in May, and from 2.3 months in April to 2.4 months in May for REO sales. The supply of short sales dipped from 4.4 months in May to 4.3 months in April.”

Pending home sales also drew back in California for the month of May, with the Pending Home Sales Index dropping 3.4 percent from a revised 114.1 in April to 110.1 in May. The group noted that an index of 100 is equal to the average level of contract activity during 2008. ( End of Colin’s article.)

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A Guide to Selecting a Home and Property That Will Suit Your Growing Family

A Guide to Selecting a Home and Property That Will Suit Your Growing FamilyBoth seasoned homeowners and first-time buyers know making the decision to purchase a new home is not one that is taken lightly. There are so many things to consider, from choosing a home with growth potential to finding a community to support a family’s interests and lifestyle.

While the decisions may seem endless, don’t be discouraged. Develop a strategic approach to buying a home with our definitive guide to selecting a home and property that will suit a growing family’s needs. Use this guide, to get started on the path to home ownership.

Look For Neighborhoods With Growth Potential

Choosing the right location is one of the most grappled with decisions when it comes to buying a home. While some home-buyers aspire to “keep up with the Joneses,” purchasing a home in the “trendy” neighborhood of the moment, savvy home-buyers know the best bargains can be found in “up-and-coming” locales.

Skip the higher property values and congestion and search for a home in an unincorporated area with growth potential. This might require driving a few extra blocks for that morning Starbucks coffee, but this will easily be overlooked once the community grows (and your home value with it).

Choose A Home With Income Potential

While the average buyer is interested in a single-family home, don’t discount homes with bonus apartments or mother-in-law suites. These types of home configurations can lead to significant income potential and can help to offset the cost of a monthly mortgage payment.

Income potential doesn’t just include garage apartments and mother-in-law suites; it encompasses open space as well. Build a duplex or a guesthouse on extra land for a significant return on investment. Or, take advantage of special land grants to grow crops or house bees on unused acreage.

Think Long-Term When Choosing Schools

When choosing schools, think macro not micro. Remember to evaluate school districts at all levels: elementary, middle and high schools. Don’t choose a community based on the elementary school, if the middle and high schools are not as impressive.

A young child might be an elementary school student upon purchasing the home, but will matriculate through the school district during the course of a 30-year mortgage. Be sure to select a home in a community with a school district that can support youngsters at every level.

Let’s Get Together and Talk About Your Real Estate Goals

I’ve been selling homes in South Orange County since 1976 – over 37 years.  I have helped hundreds of people – just like you – achieve their property dreams.  It would be my honor to help you too.  Call or text me at (949) 887-5305, or shoot me an email at BobPhillipsRE@gmail.com, and let’s get started!

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Foreclosure Inventory Continues to Shrink in May

An article by Colin Robins, of DSNews.com  June 24, 2014

foreclosure-signBlack Knight Financial Services released its “First Look” at May Mortgage data, which found that foreclosure inventory declined to its lowest level since July 2008. As a percentage of total inventory, foreclosure pre-sale inventory is 1.91 percent, down 5.56 percent month-over month.

The percentage of total U.S. foreclosure pre-sale inventory is down 37.23 percent year-over-year.

Foreclosure starts, however, are creeping back upwards. Foreclosure starts totaled 86,300 for the month of May, an increase of 9.52 percent from April. Yearly, foreclosure starts remain down by 26.11 percent. Overall delinquency rates remained steady, down a mere 0.01 percent to 5.62 percent in May.

The number of properties that are 30 days or more past due but not yet in foreclosure totaled roughly 2.8 million, an 18,000 property increase from the previous month yet a decline of 204,000 from the previous year.

Properties 90 days or more past due totaled 1.1 million, down monthly and yearly by 18,000 and 166,000 respectively. Properties that are 30 days or more past due or in foreclosure totaled 3.8 million.

The top five states by non-current percentage include: Mississippi (13.75 percent); New Jersey (12.62 percent); Florida (11.28 percent); New York (10.91 percent); and Louisiana (10.66 percent)

The bottom five states by non-current percentage include: North Dakota (2.5 percent); South Dakota (3.61 percent); Colorado (3.82 percent); Montana (3.96 percent); and Alaska (4.06 percent). ( End of Colin’s article.)

From Bob Phillips, regarding just Orange County, California.  Here’s some local information on the subject from my good friend Steven Thomas, who produces a bi-weekly “Orange County Housing Report.”

Distressed BreakdownThe distressed inventory dropped to its lowest level since last August.

The distressed inventory, foreclosures and short sales combined, decreased by 7 homes and now totals 246. In 2014, the distressed inventory has not changed much, starting the year at 271. The long term trend is for it to remain at a very low level. Last month, they represented only 6% of all closed sales.

In the past two weeks, the number of active foreclosures increased by 3 homes and now totals 63. Less than 1% of the active inventory is a foreclosure. The expected market time for foreclosures is only 39 days. The short sale inventory decreased by 10 homes in the past two weeks and now totals 183. The expected market time is 38 days. Short sales represent 2.5% of the total active inventory.” ( End of Steven’s excerpt.)

Are YOU ( Or is someone you know.)  having trouble making your mortgage payments?

I have been assisting homeowners having difficulty with their mortgages for the past 5 years, and have both extensive training, ( As a CDPE, Certified Distressed Property Expert.)  and year’s of “in the trenches” experience.  If you, or someone you know, is having difficulty making their mortgage payments, give me a call or text at 949-887-5305, or shoot me an email at BobPhillipsRE@gmail.com.  I have solutions – let’s talk about them.

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The FHA Hawk Program for New Homebuyers is Coming: Here’s How It Affects Your Mortgage Insurance Premiums

Mortgage tipsThe FHA offers many new programs and incentives for new homebuyers to take advantage of so that they can be part of the effort to ease the credit crisis. If you are in the process of shopping for a mortgage prior to shopping for your new home, it can benefit you to learn about programs that you may qualify for that are being created by the Federal Housing Administration and piloted.

One such plan, which is has been approved as a four-year pilot program, is referred to as the FHA HAWK Program. Read on to learn how this program works and how it can affect mortgage insurance premiums.

What Is The HAWK Pilot Program?

The FHA HAWK program, which stands for Homeowners Armed With Knowledge, is designed to help first-time homebuyers make educated decisions when borrowing and buying a home. Individuals who are eligible to participate must qualify and meet the definition of first-time home buyer.

They will also be required to complete a housing counseling and education program that is available through HUD where they will learn financial information that can help them make smart home buying decisions.

Some of the topics covered in the educational program include: how to better manage finances, mortgage options, how to evaluate affordability, understanding your rights and the responsibilities that come with homeownership. Upon completion of the program, the applicant can submit their application for an FHA-insured mortgage and receive specific FHA mortgage insurance pricing incentives that will lower premiums.

What Type of Mortgage Insurance Incentive Will You Receive?

Once you participate in the program, the Federal Housing Administration will give all of the borrowers who qualify for the incentive a mortgage insurance premiums incentive by applying a 50 basis point reduction in the upfront premiums and a 10 point reduction in the annual premium starting at the time the loan originated.

As long as the borrower stays in good standing with their lender, they will receive these incentives and fee reductions for the life of the loan. This brings the upfront premiums down from 1.75 percent to a more manageable 1.25%. Add in the fact that you are saving on annual premiums that range between.45 and 1.55 percent, and you can see how beneficial this program can be over the period of 30 years. Finance experts predict that the average buyer will see a savings of $325 per year, which is a savings of $9800 over a 30 year loan term.

The FHA is piloting this new HAWK program in an effort to reduce delinquency of borrowers who borrow from FHA-insured lenders and to also reduce the costs of loan processing. By offering first-time homebuyers a discount to learn about the market, the FHA is trying to battle the ongoing credit crisis and in the same time service more educated buyers. If you would like to learn more about how you can reduce the mortgage insurance premiums that you pay initially and throughout the life of your loan, contact your trusted mortgage agent and discuss your options when it comes to the HAWK program.

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What’s Ahead For Mortgage Rates This Week – June 23, 2014

What’s Ahead For Mortgage Rates This Week June 23 2014Last week’s scheduled economic news included the National Association of Home Builders /Wells Fargo Housing Market Index, Housing Starts and Building Permits. The Fed’s Federal Open Market Committee (FOMC) issued its usual statement at the conclusion of its meeting, and Fed Chair Janet Yellen also gave a press conference.

Home Builder Confidence Improves, But Housing Starts Slow

NAHB released its Housing Market Index report, which reached its highest reading in five months. The index moved up from 45 to 49; a reading of 50 indicates that more builders are confident about housing market conditions than those who are not. David Crowe, NAHB chief economist, said that builder confidence is in line with consumer confidence; he noted that consumers are waiting for a stronger economic recovery before buying homes and that builders didn’t want to build more homes than markets would bear.

According to the latest figures from the Department of Commerce, May housing starts fell to 1.00 million from April’s reading of 1.07 million on a seasonally adjusted annual basis, and missed the consensus reading of 1.02 million. Building permits issued in May fell by 6.40 percent to 991,000 permits issued for single and multi-family construction. In recent months, permits for single family homes have fallen, while permits for multi-family units are increasing. This concerns economists as single-family homes generate sales of retail goods including furniture and home improvement supplies, while multi-family housing is often occupied by renters and yields fewer home related purchases.

Warmer weather was expected to add to the pace of housing starts, but this did not occur during May.

Fed Reduces Asset Purchases, Mortgage Rates

FOMC members reduced the Fed’s monthly asset purchases by $10 billion, for a monthly volume of $35 billion in Treasury securities and MBS. The meeting minutes noted FOMC concerns that inflation has not yet reached the committee’s benchmark of 2.00 percent inflation as a benchmark of economic recovery.

The minutes reflected FOMC’s position that it will maintain the target federal funds rate at between 0.00 and 0.25 percent for a considerable period after the asset purchases under the current quantitative easing program have ended. While analysts previously associated “considerable period” with a time frame of six months, Fed Chair Yellen stated during her press conference that there was no formula for determining the Fed’s actions; she emphasized that the Fed and FOMC would monitor a wide range of economic indicators, economic reports and developments in support of any decisions to change current monetary policy.

In response to a question about tight credit, Chair Yellen cited banks’ reluctance to lend to all but those with “pristine” credit scores as a factor contributing to slower recovery in the housing sector.

Mortgage Rates, Jobless Claims

Freddie Mac reported lower mortgage rates on Thursday. The reading for a 30-year fixed rate mortgage was 4.17 percent, a decline of three basis points. Discount points were also lower at 0.50 percent. The average rate for a 15-year fixed rate mortgage was lower by one basis point at 3.30 percent; discount points were unchanged at 0.50 percent. The average rate for a 5/1 adjustable rate mortgage fell to 3.00 percent from last week’s reading of 3.05 percent. Discount points were unchanged at 0.40 percent.

New jobless claims were higher than expected at 312,000; analysts had predicted a reading of 310,000 against the prior week’s reading of 318,000 new jobless claims.

No economic reports were released Friday.

What’s Ahead

This week’s economic calendar includes several housing-related reports. Existing home sales, the Case-Shiller Housing Market Index and New Home Sales will be released along with multiple consumer-related reports and weekly updates for mortgage rates and new jobless claims.

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9 out of 10 homebuyer assistance programs have funding

Down Payment Resource estimates 7 out of 10 homes for sale could qualify

From Inman News, June 13th 2014

piggy-bank-300x199An analysis of homebuyer assistance programs available through state and local housing finance agencies (HFAs)  and nonprofit groups around the nation found that 90 percent are funded, and that 70 percent of homes for sale could be eligible for one or more programs.

The analysis of 1,654 homebuyer assistance programs, by Down Payment Resource, found that Southern states had the greatest number of programs (598). But the 228 programs offered in the Northeast were the most likely to be funded — 96.5 percent had money to provide help to eligible buyers such as down payment and closing cost assistance, grants, tax credits, and affordable first mortgages with competitive or below-market interest rates.

A state-by-state breakdown shows California had the most programs — 283 — but that only 81.6 percent were  funded. Hawaii had 13 programs, but only six were funded.

Funding for homebuyer assistance programs comes from sources that include mortgage revenue bonds and mortgage-backed securities. During the depths of the housing downturn, the lack of liquidity in bond markets made it difficult or impossible for HFAs to issue bonds, and many scaled back their programs and raised rates. The federal government helped revive the programs by buying securities issued by Fannie Mae and Freddie Mac backed by new mortgage revenue bonds issued by the HFAs.

Down Payment Resource is a tool developed by Atlanta-based Workforce Resource that helps homebuyers and real estate agents providing services to them determine whether they, and homes they are interested in buying, qualify for down payment assistance and other homebuyer assistance programs.

The tool is available through the Down Payment Resource website, downpaymentresource.com, and about two dozen partner organizations, including 19 multiple listings services.

When MLSs integrate the Down Payment Resource tool with listings data, consumers shopping for homes on websites operated by the MLS and its member brokers and agents see a special icon next to for-sale listings that may qualify for assistance programs. Buyers are prompted to answer a few questions to see if they, themselves, are eligible for the available programs.

Three MLSs are launching Down Payment Resource tool this month, and all have a high percentage of listings that could be eligible for one more more assistance programs:

  • Corpus Christi, Texas-based Coastal Bend MLS (83 percent of listings eligible for one or more programs).
  • South Dakota-based Realtor Association of the Sioux Empire (75 percent of listings eligible).
  • Intermountain MLS (Eastern Oregon and Southern Idaho, with 87 percent of listings eligible).

Rob Chrane, president and CEO of Down Payment Resource, said buyers taking advantage of down payment assistance and other programs are able to apply savings to moving expenses, emergencies and retirement. Most assistance programs also require homeownership counseling, which has been shown to decrease the risk of default and foreclosure.

Although many programs are reserved for first-time homebuyers, anyone who has not owned a home in the last three years will typically qualify as a first-time homebuyer.

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Dos And Donts Of Buying Fixer-Upper Real Estate

fixer-upper-3A fixer-upper is real estate in need of serious repairs. These properties are often called “handyman specials.” If you have the skill or the money to complete the repairs, you can often find great deals. Here are some dos and don’ts of buying fixer-upper real estate.

DO Get A Home Inspection

Fixer-upper homes need repairs. Some of these repairs, like broken floor tile, are easy to see. Others, like water  damage in the attic, can be easily hidden. The only way to know for sure what you’re buying is to have the property inspected by a professional home inspector.

DO Pay Attention To The Home’s Market Value

You don’t want to buy a house and spend your hard-earned money for repairs only to find out the home is worth less than what you paid for it. Have your agent complete a comparative market analysis so you know what the fixed up home will probably be worth.

DO Have An Estimate For Repairs

There’s no point buying a fixer if you can’t afford both the cost of the home and the repairs. Get an estimate from at least three contractors before you buy. Knowing the cost of repairs beforehand will help you make the best decision.

DON’T Think About Potential Profit

You’ve probably heard countless stories about people who bought fixers and sold them for outrageous profits. However, the reality is that most distressed homes are sold for a small profit or no profit.

DON’T Buy A Home Just Because The Price Is Low

When you buy a fixer-upper, you have to consider more than just the asking price. Add together the cost of repairs, insurance, and what you can realistically expect to make from the sale. This will tell you if the home really is a good investment for you.

DON’T Buy If You Don’t Have The Money

No matter how good a deal you find on a fixer, they aren’t worth it if they will stretch your budget too far. The last thing you want to deal with is damage to your credit score and the risk of foreclosure in the event you can’t pay for the home.

Not ALL fixed up houses are going to be flipped or resold

Many fixed up houses become the eventual home of the owner, and were purchased with that in mind, while a large number of them become rental properties, for the owner, so, as you can see there are plenty of options, or reasons for buying a fixer.

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FOMC Statement: Quantitative Easing Tapered by $10 Billion

FOMC Statement Quantitative Easing Tapered by 10 BillionThe Federal Open Market Committee (FOMC) determined that current economic conditions warranted another $10 billion reduction in the Fed’s asset purchases.

Citing improvements in economic indicators including labor markets and national unemployment, committee members said that further tapering of its quantitative easing (QE) asset purchases was warranted. The Fed will now purchase a total of $35 billion monthly in treasury securities and mortgage-backed securities.

While continued reductions in the Fed’s asset purchases could contribute to rising mortgage rates, the FOMC statement said that the Fed’s “sizeable and still increasing” holdings of long-term securities is expected to hold down long term interest rates including mortgage rates.

The FOMC statement included its standard caveat that reductions to QE purchases are not on a preset course and that committee members will continue close analysis of financial and economic news and conditions as part of decisions to change the volume of QE asset purchases.

Committee Monitoring Unemployment, Inflation

Unemployment remains “elevated” according to the FOMC statement. Committee members said that they will continue to monitor unemployment readings, but committee members expect that overall improvement in economic conditions will continue to justify the current target rate for federal funds at between 0.00 and 0.25 percent.

The FOMC statement notes that this “highly accommodative” policy will likely remain in effect for a considerable period after the QE asset purchases conclude.

Committee members continue to monitor the inflation rate, which remains below the FOMC target rate of 2.00 percent. Noting that inflation persistently below the Fed’s target rate could hamper economic growth, the FOMC said that it expects inflation to move toward its target rate within the medium term.

FOMC Releases Forecasts for Key Indicators

FOMC released a table of its forecasts for certain economic sectors. Highlights include a projected reading of 6.00 to 6.10 percent for national unemployment for 2014, and the rate of inflation for personal consumer expenses at between 1.50 and 1.70 percent for 2014. According to its projections, the Fed’s target inflation rate of 2.00 percent is likely to be reached in 2015 or 2016.

Fed Chair Yellen Gives Press Conference

A major theme of Fed Chair Janet Yellen’s press conference was that there is no set formula for Fed decisions concerning interest rates, inflation and tapering its volume of asset purchases. She cited geopolitical risks including conflicts in Europe and developing civil crisis in Iraq as examples of influences on U.S. financial markets, energy supplies and prices.

Ms. Yellen said that while consumer spending has increased, the Fed wants to see wage growth exceed inflation so that consumers would see an actual increase in their incomes. She also cited the Fed’s target inflation rate of 2.00 percent as important to continued economic recovery.

A wide range of opinions among FOMC members about federal interest rates was mentioned by Ms. Yellen as an example of overall uncertainty about the economy and developing economic trends. She cautioned investors to be mindful of this uncertainty.

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May Housing Scorecard Shows Progress in Equity and Home Sales

An article by Colin Robins, of DSNews.com, dated June 13th, 2014:

Perfect-10May Housing Scorecard Shows Progress in Equity and Home Sales

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury released the May edition of the Obama Administration’s Housing Scorecard on Friday. The government report showed progress, noting growth in key indicators such as increasing equity and a rebound in the sale of new and existing homes.

According to the Federal Reserve, homeowner equity was up nearly $795 billion in Q1 2014, totaling more than $10.8 trillion. May’s figure was the highest level since the second quarter of 2007. Equity has continued to rise since the beginning of 2012, up 73 percent (nearly $4.6 trillion) through the first quarter of 2014.

“May’s Housing Scorecard shows that the housing market recovery is picking up after the harsh winter months,” said HUD assistant secretary, Katherine O’Regan. “More homeowners have positive equity, foreclosures continue their downward trend, and sales of new and existing homes are rebounding. While these are all good signs, it’s clear that we must remain committed to helping homeowners as they recover from the worst housing recession since the Great Depression.”

HUD cited figures from CoreLogic, which found that the number of underwater borrowers dropped 48 percent, lifting more than 5.8 million homeowners above water from 2012 to the first quarter of 2014. Despite first quarter gains of 300,000 homeowners who returned to positions of positive equity, approximately 12.7 percent of residential properties with a mortgage are still underwater.

HUD also celebrated new home sales, which were up 6.4 percent to 433,000 in April. Foreclosure starts continued on a downward slope, down 10 percent from the previous month and down 32 percent year-over-year. Foreclosures are the lowest they have been since December 2005.

Existing-home sales rose for the first this year. HUD cited a National Association of Realtors report that found existing home sales sold at a seasonally adjusted annual rate (SAAR) of 4.65 million in April, up 1.3 percent from March. However, existing-home sales are still 6.8 percent below the 4.99 million pace seen a year earlier.

“The standards set by the Making Home Affordable program have significantly changed the mortgage servicing industry,” said Treasury Acting Assistant Secretary Tim Bowler. “Treasury is committed to holding servicers accountable to these standards, and as a result has seen continued improvement by the largest servicers.”

HUD noted that foreclosure mitigation programs continue to provide relief for distressed homeowners—more than 8.3 million mortgage modification and other homeowner assistance actions were completed between April 2009 and April 2014.

HUD commented, “More than 2.0 million homeowner assistance actions have taken place through the Making Home Affordable Program, including nearly 1.4 million permanent modifications through the Home Affordable Modification Program (HAMP), while the Federal Housing Administration (FHA) has offered 2.3 million loss mitigation and early delinquency interventions through April.” ( End of Colin’s article.)

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