Mortgage Application Activity Boosted by Low Mortgage Rates

RealtyTimes.com, May 15th, 2013
Mortgage application activity continues to be boosted by low mortgage rates that remain stable and still within historic levels.
Full Story: http://realtytimes.com/rtpages/20130515_ratewatch.htm

Inventory Finally Shows Signs of Growth in April, Rises Monthly

By: Tory Barringer, DSNews.com, May 17th, 2013

While low inventory continues to curb home sales, April may have seen the first signs that the supply situation is turning around, RE/MAX says in its latest National Housing Report.

According to RE/MAX’s data, taken from a survey of multiple listings service (MLS) data from 52 U.S. metro areas, the months’ supply of homes for sale at the April’s sales pace was 3.6 months—the lowest supply since the National Housing Report began in August 2008. (RE/MAX considers a balanced supply to be 6 months).

However, the company observed a monthly increase in April in the overall number of homes for sale—the first since June 2010. In addition, the year-over-year percentage drop in inventory was 26.6 percent, the lowest annual drop in the last 12 months, perhaps marking a turning point for housing supply.

“Low inventories contribute to a limited growth in sales, preventing some buyers from closing on the home of their choice. But if inventories can rise to a more balanced level, the recovery should strengthen and experience even more home sales,” RE/MAX said in its report.

At the same time, closed transactions and prices continued to rise on both a monthly and yearly basis. April’s report shows an 8.1 percent increase in closed transactions over March and a 10.5 percent increase over April 2012. Agents reporting to RE/MAX are noting increased traffic and say they expect the summer selling season to be even stronger than last year’s.

Of the 52 areas surveyed in April, 41 reported higher sales volume than April 2012, and 25 reported double-digit gains, including Honolulu, Hawaii (53.2 percent); Burlington, Vermont (40.3 percent); Albuquerque, New Mexico (40.2 percent); Charlotte, North Carolina (39.4 percent); and Raleigh and Durham, North Carolina (38.1 percent).

Meanwhile, the median price for all homes sold in April was $177,200, a 4.7 percent monthly increase and a 10.7 percent yearly rise. April marks the 15th month in which the national median price has increased on an annual basis.

Of the 52 areas surveyed, only four posted year-over-year declines in median price: Los Angeles, California (-9.1 percent); Albuquerque, New Mexico (-6.3 percent); Cleveland, Ohio (-1.8 percent); and Providence, Rhode Island (-0.3 percent). Out of the remaining 42 metros, 21 reported double-digit price gains.

“April was exactly what we needed at this time in the housing recovery. Home sales and prices continued to rise, while we started to see improvement in the number of homes for sale,” said Margaret Kelly, CEO of RE/MAX. “It may take a few months, but as prices rise and more homeowners gain positive equity, we should see an increase in the inventory of homes for sale, resulting in a much better selection for potential homebuyers.”

The average days on market for all homes sold in April was 77, eight days fewer than March and 19 days fewer than April 2012, RE/MAX reported.

Mortgage Rates move higher for Second Consecutive Week

Realtytimes.com, May 17th, 2013
Mortgage rates followed U.S. Treasury bond yields higher this week on signs of stronger consumer spending.
Full Story: http://realtytimes.com/rtpages/20130517_interestratewatch.htm

Home Afrfordability Index Slips in Q1, but Remains Strong

By: Esther Cho, DSNews.com, May 16th, 2013

As interest rates stay low, housing affordability across the country remained strong in the first quarter but showed signs of weakening, according to data from the National Association of Home Builders (NAHB)/ Wells Fargo Housing Opportunity Index (HOI).

According to the index, 73.7 percent of new and existing-homes sold in the first quarter of this year were affordable to families earning the U.S. median income of $64,400. In the fourth quarter of last year, 74.9 percent of homes were considered to be affordable to median-income earners. A year ago, affordability was even stronger, at 77.5 percent.

Despite the decrease, NAHB Chairman Rick Judson noted the HOI has still stayed high over the past four years.

“The HOI has not slipped below 70 since the end of 2008,” he explained. “That said, from a builder’s perspective, it

should be noted that rising costs for building materials, lots and labor are making it somewhat more expensive to construct new homes in today’s market.”

Among the largest metros, or areas with a population of 500,000 or more, Ogden-Clearfield in Utah ranked as the most affordable metro for the third straight quarter. In Ogden-Clearfield, 93.7 percent of homes are affordable to median-income earners, according to the index.

Other large metros in the top five were Indianapolis (92.7 percent); Lakeland, Florida (92.1 percent); Youngtown, Ohio (91.9 percent); and Syracuse, New York (91.6 percent).

San Francisco-San Mateo-Redwood City kept its place as the least affordable large metro, where only 28.9 percent of median-income earners could afford a home. New York-White Plains-Wayne, New York-New Jersey followed closely behind at 29.7 percent.

Filling out the next three spots were three California metros: Santa Ana (35.8 percent), Los Angeles (39.9 percent), and San Jose (43.3 percent).

Among smaller metros, Mansfield, Ohio ranked as the most affordable metro, while another California metro, Santa Cruz-Watsonville, was the least affordable.

“The bottom line is that, for consumers who can qualify for a mortgage at today’s attractive rates, the majority of homes being sold remain within their grasp in markets nationwide,” added David Crowe, NAHB’s chief economist.

Average US Mortgage Rates Tick Higher

Associated Press, May 17th, 2013

Washington — Average US rates on fixed mortgages rose this week but remained near their historic lows.

Cheaper mortgages have helped the nation’s economy by spurring more home buying and refinancing.

Mortgage buyer Freddie Mac said the average rate for the 30-year loan increased to 3.51% from 3.42% last week.

That is still near the average of 3.31% reached in November, the lowest on records dating to 1971.

The average on the 15-year loan rose to 2.69%.  That is up from 2.61% last week, which was the lowest on records going back to 1991.

Low mortgage rates have helped to sustain the housing recovery that began last year.  Home sales and construction are up from a year ago, and prices are rising in most US markets.

Follow Len and Leslie Marma of Success! Real Estate on their facebook business page, “Marshfield Matters” …… click LIKE to receive real estate info and what’s happening in Marshfield. 

Mortgage Squeeze Loosens, Somewhat

Realtytimes.com, May 16th, 2013
Some 8 percent of banks loosened mortgage credit recently and mortgage credit conditions have either loosened or held steady for eight of the past nine quarters.
Full Story: http://realtytimes.com/rtpages/20130516_mtgsqueezeloosens.htm

New Home Sales Begin to Flourish as Distressed Inventory Declines

By: Esther Cho, DSNews.com, May 14th, 2013

The available supply of foreclosures and short sales previously stunted the recovery for new home sales, according to CoreLogic’s May MarketPulse report.

Though, now that the supply of distressed homes and existing-homes for sale has fallen, there’s more room for the new home sales market to expand.

According to CoreLogic, the number of seriously delinquent mortgages (90-plus delinquencies, including foreclosures and REOs), peaked at 3.7 million in January 2010, but has fallen by 1.2 million, or by 33 percent.

As delinquencies decline, new home sales are rebounding after hitting low points over recent years. Citing data from the Census Bureau, CoreLogic reported new home sales have increased 19 percent from a year ago in March.

Improvements in the new home sales market also benefits the economy in several ways since new homes require the acquisition and development of new land, the purchase of supplies, and the need for labor.

According to the report, every new home requires five full-time jobs for 12 months.

Most new home sales are also concentrated in hard-hit suburban metro areas, which bring an economic stimulus to areas devastated by the housing recession.

After observing year-over-year growth in new home sales growth for March, CoreLogic found a concentration of growth in the West. The data provider revealed six of the top 10 markets are located West, and the top three-Oakland, Bakersfield, and San Francisco—are in California.

Oakland and Bakersfield, in particular, have experienced a significant decrease in the supply of distressed homes for sale over the last year, with REO sales in March of this year dropping to about one-third the level seen last year, Corelogic reported.

The decline in distressed sales is not the only factor driving growth in new home sales. According to CoreLogic, San Francisco and Salt Lake City, which ranked No. 4 for its increase in new home sales, both experienced a rebound in new home sales due to economic improvements.

Over the last year in March, both markets have seen their employment bases grow by at least 3.5 percent, which is more than twice the national rate, CoreLogic stated.