Take a look at this underground mansion – 16,000 square feet! This is amazing!
This property can be yours for $1.7 million, but guess what, it’s bank owned!
Take a look at this underground mansion – 16,000 square feet! This is amazing!
This property can be yours for $1.7 million, but guess what, it’s bank owned!
Existing-Home Sales Slip
According to the National Association of Realtors® (NAR) overall existing-home sales slipped in June from the previous month though they “have stayed well above year-ago levels for the past two years.” At the same time median existing-home prices have shown double-digit year-over-year increases for seven straight months.
The NAR says total existing-home sales dipped 1.2 percent to a seasonally adjusted annual rate of 5.08 million units in June from a downwardly revised 5.14 million in May. However, sales were 15.2 percent higher than the 4.41 million-unit level in June 2012. Total existing-home sales include completed transactions for all single-family homes, townhomes, condominiums and co-ops.
Median national existing-home prices for all housing types was $214,200 in June, this was a year-over-year increase of 13.5 percent from June 2012. This marks 16 consecutive months of year-over-year price increases, this last time this occurred was between February 2005 and May 2006.
Sales of distressed homes, which includes foreclosures and short sales, accounted for 15 percent of total June sales; this was down from18 percent in May, and is the lowest share since monthly tracking began in October 2008. In June of 2012 distressed homes accounted for a 26 percent share of sales. The decline in sales of distressed homes, which typically sell at a reduced price, accounts for some of the price growth.
Regarding distressed sales, eight percent of June sales were foreclosures, while 7 percent were short sales. Foreclosures sold for an average discount of 16 percent below market value in June, and short sales were discounted 13 percent.
The NAR said First-time buyers accounted for 29 percent of purchases in June, compared with 28 percent in May. One year ago, in June 2012, first-time buyers accounted for 32 percent of overall sales. NAR Chief Economist, Lawrence Yun, said, “First-time buyers should be closer to 40 percent of the market, but they’re held back by the frictions of tight credit and very limited inventory in the lower price ranges in most of the U.S.”
New Home Sales Rise
According to the latest data from the Commerce Department, new-home sales jumped sharply in June rising by 8.3 percent on a month-over-month basis from May. The new-home sales increased to a seasonally adjusted annual rate of 497,000 units rising above the May figures of 459,000.
The June figures of 497,000 seasonally adjusted annual sales was also sharply above what economists had anticipated, they had expecting sales in the range of 481,000 seasonally adjusted annual sales. The June numbers were a whopping 38.1 percent higher than the same seasonally adjusted annual sales figures for June of 2012. Despite the great June sales figures they were still way below the peak figure of 1.4 million new-homes sold in 2005.
Data from the Commerce Department shows that through the end of June a total of 161,000 new-homes were available for sale, this equates to a 3.9 month supply of homes for sale at the current rate of sales, and is a slight contraction from the 4.1 months supply of new-homes available in May. A supply of six months is normally considered a healthy balance between supply and demand
Sales increased in the Northeast, South and West, while they decreased in the Midwest by 11.8 percent. Sales in the Southern region were at five year high. Economists said the strong sales pace, which is keeping supply low, should spur builders to break ground on new projects, which in-turn will help the economy by boosting growth in the gross domestic.
Additionally the Census Bureau reported that the median sales price for new homes sold in June was $249,700, about 5.3% below the May median sales price of $263,900. The average June sales price was $295,000, down about 4.1% from May when the average price was $307,800. The median sales price is where half all homes sold are above that price ($263,900), and half are below that price.
Many analysts believe that housing demand will continue in spite of the recent rise in mortgage interest rates, citing the fact that despite the rise in rates, they are still well below historic levels.
This year’s home-buying season looks nothing like last year’s. With mortgage rates and home prices rising, the best deals are long gone. Furthermore, there are fewer homes for sale now than one year ago. To what lengths will desperate house hunters go to snag the house of their dreams, and what are they most worried about? To get the answers to these questions, Trulia worked with Harris Interactive to conduct an online survey of 2,029 U.S. adults between June 24-26, 2013. Read More…
255 Metro Housing Markets Improving
The Improving Markets Index (IMI) put out monthly by the National Association of Home Builders (NAHB) reveals that a total of 255 metropolitan housing markets across the nation showed signs of improvement for July. This number was down slightly from 263 metro markets showing improvement in June. However, July’s numbers are more than triple the metro areas that saw improvement in July of 2012.
In order for a metropolitan area to make the list on the IMI it has to show gains in three areas of measure, and do so for at least six consecutive months. The IMI is designed to track the housing markets throughout the nation for signs of improvement in economic health. The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics, house price appreciation from Freddie Mac and single-family housing permit growth from the U.S. Census Bureau. Six new markets were added to the list in July, while 14 were dropped.
The NAHB states that this is the sixth straight month in which at least 70 percent of all U.S. metropolitan statistical areas have “qualified” for the Improving Markets Index. NAHB Chairman Rick Judson says, “The relative stability of the IMI is representative of the broad recovery underway, which is much more extensive than what we were looking at one year ago.”
Adding to Judson’s comments, David Crowe, NAHB’s, Chief Economist states, “Despite slight ups and downs in recent IMI levels, an overwhelming majority of U.S. metros — including those located in almost every state — remain solidly on the path to recovery even as the pace of their improvement is slowed by ongoing challenges related to the availability of credit, labor, lots and certain building materials.” Crowe believes that the outlook for a continued housing expansion “remains very positive for the remainder of 2013.”
Housing Market Index Increases
According to the National Association of Home Builders (NAHB) their Housing Market Index (HMI) has gone up in July for the third straight month. The HMI shows builder confidence in the market for newly built, single-family homes which rose six points from 51to 57 for this month.
The NAHB has been conducting monthly surveys for 25 years. The Housing Market Index gauges homebuilder’s perceptions and expectations of the current housing market for single-family homes looking forward for the next six months.
There are three criteria that the HMI evaluates: The survey evaluates single-family home sales conditions and sales expectations for the next six months as being “good,” “fair,” or “poor.” Likewise the survey also asks builders to rate traffic of prospective buyers as being “high to very high,” “average,” or “low to very low.” The scores are then calculated in a seasonally adjusted index where any number over 50 indicates that builders have a positive expectation for the market, and view conditions as “good” rather than “poor.”
July saw increases in all three of the HMI components. According to the index the component gauging current sales conditions increased by five points up to 60 on the scale, this is the highest level since early in 2006. The component projecting sales expectations over the next six months jumped even more, rising seven points up to 67. The final component gauging traffic of prospective buyers rose five points to 45. As a group, these were the strongest readings for each component sine late 2005. Also all four regions (Northeast, South, Midwest & West) saw increases for the regional index.
NAHB Chairman Rick Judson says the, “report is particularly encouraging in that it shows improvement in builder confidence across every region as well as solid gains in current sales conditions, traffic of prospective buyers and sales expectations for the next six months.”
David Crowe, NAHB Chief Economist, adds that, “Builders are seeing more motivated buyers coming through their doors as the inventory of existing homes for sale continues to tighten.”
Foreclosure Update (part 2)
As a continuation from part one of this Foreclosure Update RealtyTrac’s (RT) Mid year 2013 U.S. Foreclosure Market Report™ states that judicial foreclosures rose from May to June only slightly on a month-over-month basis, but jumped substantially from June 2012.
The RT report states that judicial foreclosure were up less than 1 percent in June from the previous month, but jumped a substantial 34 percent from June of last year. They note that the judicial foreclosure states that saw significant increases in foreclosures were New Jersey (up 103 percent), Florida (up 100 percent), Maryland (up 94 percent), New York (up 66 percent) and Illinois (up 65 percent). The states with the highest foreclosure rates for the first six months of this year were Florida, Nevada, Illinois, Ohio and Georgia. (www.realtytrac.com)
Daren Blomquist, Vice President of RealtyTrac, states, “Halfway through 2013 it is becoming increasingly evident that while foreclosures are no longer a problem nationally they continue to be a thorn in the side of several state and local markets, particularly where a backlog of delayed distress has built up thanks to a lengthy foreclosure process,”
In referencing judicial states, he goes on by saying, “The increases in judicial foreclosure auctions demonstrate that these delayed foreclosure cases are now being moved more quickly through to foreclosure completion. Given the rising home prices in most of these markets, it is an opportune time for lenders to dispose of these distressed properties, either at the foreclosure auction to a third-party buyer, or by repossessing the property at the auction and subsequently selling it as a bank-owned home.”
RT’s report also reveals that the foreclosure process for U.S. properties foreclosed on in the second quarter of 2013 took an average of 526 days from the initial public foreclosure notice to the completed foreclosure, this was up 10 percent from 477 days in the first quarter.
See Also Part 1
Foreclosure Update (part 1)
The Mid year 2013 U.S. Foreclosure Market Report™ released by RealtyTrac® (RT) reveals that nationally properties with foreclosure filings, which include default notices, bank repossessions and scheduled auctions, for June was down 14 percent from the previous month and down 35 percent from one year ago. This was a six and a half year low, the lowest level since December 2006, and these figures were despite a 34 percent jump in judicial foreclosure auctions. (www.realtytrac.com)
Additional RT data shows that a total of 801,359 properties in the U.S. had foreclosure filings in the first half of 2013. This was a 19 percent drop from the previous six months and down 23 percent from the fist six months of 2012. The report also states that 0.61 percent of all U.S. housing units (one in 164) had at least one foreclosure filing in the first six months of this year.
In June foreclosure starts dropped 21 percent from May and were down 45 percent from June of 2012, this was the lowest level since December 2005 a seven and a half year low. There have been 409,491 foreclosure starts filed nationwide in the first six month of this year. During the same period in 2012 there were 1.1 million foreclosure starts. Foreclosure starts in June decreased in 38 states from the previous month.
The RT report shows that bank repossessions (REOs) in June decreased 9 percent from the previous month, and were down 35 percent from one year earlier. Through June, 248,538 bank repossessions have occurred nationally. This figure puts repos on an approximate pace of 500,000 through the end of this year, which would be down from the 671,000 in 2012.
There was a 34 percent decrease in bank repossessions for June from the same period a year ago. However, states with judicial foreclosure proceedings saw significant increases in these actions. <a href=”http://blog.prominentescrow.com/foreclosure-update-part-2/”>(see part 2)</a>
Existing-Home Sales UP
The latest data from the National Association of Realtors® (NAR), shows that total existing-home sales, which include single-family homes, townhomes, condominiums and co-ops, increased by 4.2% in May. Sales were based on a seasonally adjusted annual rate of 5.18 million units in May, up from April’s 4.97 million seasonal adjusted figures. May’s numbers are up 12.9% from a year ago which had a 4.59 million-unit pace in sales. June’s figures will be out later this month.
The NAR says that the median price in home sales continued recent double-digit increases, but it also continues 15 consecutive months of year-over-year price gains. NAR data reveals that existing-home sales are at the highest level since November 2009 when the market jumped to 5.44 million as buyers took advantage of tax stimulus. Existing-home sales have now stayed above year-ago levels for 23 months consecutive months.
In commenting on the recent sales figures NAR Chief Economist, Lawrence Yun, states, “the housing numbers are overwhelmingly positive. However, the number of available homes is unlikely to grow, despite a nice gain in May, unless new home construction ramps up quickly by an additional 50 percent…the home price growth is too fast, and only additional supply from new homebuilding can moderate future price growth.”
According to the NAR, total housing inventory available thru May rose 3.3 percent to 2.22 million existing homes on the market for sale, which represents a 5.1-month supply at the current sales pace. The 5.1-month supply is down from 5.2 months in April, and represents a listed inventory that is 10.1 percent below a year ago, when there was a 6.5-month supply.
In May median existing-home prices nationally for all types of homes was $208,000, which was a 15.4% increase from May 2012. This was the “strongest” price gain since October 2005, which saw a 16.6% increase, and this also reflected six consecutive months of double-digit price gains.
Reasons for interest rate increase
Over the past month and a half the mortgage market has seen a sharp rise in mortgage interest rates. Also, through May existing-home prices jumped 12.9% over the same period one year earlier (June home price figures will be available later this month). Will the increase in interest rates slow the resurging market, and what are the reasons for these rate increases?
On May 1rst of this year mortgage interest rates on a 30-year fixed-rate loan were 3.41%. As of July 11th the Mortgage Bankers Association (MBA) listed the same mortgage loan at 4.68%. This increase can price borrowers out of the market. A $200,000 loan at 3.41% will cost borrowers $888.07 per month on their mortgage. The same loan at 4.68% will rise to $1,034.87 per month.
In answering the first question, yes interest rate increases have had an impact. As of this writing the MBA states that loan applications for the purchase of new homes decreased by 15% in June, down from the previous month. The MBA also states that the Refinance Index decreased by 4% last week as the refinance share of mortgage activity dropped to 64% of total applications.
The sharp rise in interest rates was seen as a reaction to statements made by Federal Reserve Chairman Ben Bernanke in May. He hinted that the Federal Reserve might begin to reduce their purchase of Mortgage Backed Securities by sometime later this year. At the time of his statement the Fed had been purchasing $80 billion of these securities each month. This was telling lenders that they could originate the equivalent of nearly $1 trillion each year in new mortgage loans knowing that the Fed would purchase the loans. This assurance helped keep interest rates at all time lows. Historic lows were in fact seen late last year.
As noted above relative to the interest rate increases, the market had a strong reaction to Bernanke’s words. He immediately tried to back peddle on his statements in an attempt to sooth the negative reaction, but unfortunately the cat was out of the bag…rates continued up. Only time will tell if this is a temporary slowdown in the market due to the increased rates, or will this continue.