While home prices are starting to show more signs of stabilizing, some states are already seeing prices start to climb. The states with the highest price appreciation in January, according to new data released by CoreLogic, are:
South Dakota: prices rose 5.7%
North Dakota: up 4%
West Virginia: up 4%
Montana: up 3.6%
Michigan: up 3%
Not all states fared as well for the month, however. According to CoreLogic’s report, overall home prices in January, which includes distressed sales, dropped 3.1 percent compared to a year earlier.
"Although home price declines are slowly improving and not far from the bottom, home prices are down to nearly the same levels as 10 years ago," said Mark Fleming, chief economist for CoreLogic.
The states that saw the biggest price depreciation in January was Illinois, where home prices were down 8.7 percent for the month.
Source: “Home Prices at Levels of 10 Years Ago: CoreLogic,” HousingWire (March 7, 2012)
Friday, March 9, 2012
Foreclosure Backlogs Starting to Clear, Report Says
Foreclosure starts rose 28 percent while foreclosure sales soared 29 percent in January compared to the previous month, according to the latest Lender Processing Services’ January Mortgage Monitor report.
The rise in foreclosures in January is a sign that foreclosure backlogs are beginning to clear, which is considered a positive, necessary step in the real estate market’s recovery, housing experts say. Lenders slowed processing foreclosures in 2010 when a robo-signing scandal surfaced, resulting in a backlog of foreclosures that prevented home prices from making a full recovery, experts say.
"It is a definite shift in that direction," an LPS spokeswoman said about the spike in foreclosures sales and starts in January. "We could be seeing the beginning of something, and we should most certainly be keeping our eyes on this over the next few months."
RealtyTrac, another company that tracks foreclosure data, reported that foreclosure filings in January rose 3 percent.
"We continue to see signs on a local and regional level that the frozen-up foreclosure process is beginning to thaw," Brandon Moore, CEO of RealtyTrac, had said about his company’s report.
According to LPS, the states with the highest number of seriously delinquent mortgages in January are: Nevada, Florida, Mississippi, Arizona, and Georgia.
Source: “Foreclosure Starts and Sales Spiked in January, Report Says,” AOL Real Estate (March 6, 2012) and “Repeat Foreclosures Hit an All-time High in January,” HousingWire (March 6, 2012)
The rise in foreclosures in January is a sign that foreclosure backlogs are beginning to clear, which is considered a positive, necessary step in the real estate market’s recovery, housing experts say. Lenders slowed processing foreclosures in 2010 when a robo-signing scandal surfaced, resulting in a backlog of foreclosures that prevented home prices from making a full recovery, experts say.
"It is a definite shift in that direction," an LPS spokeswoman said about the spike in foreclosures sales and starts in January. "We could be seeing the beginning of something, and we should most certainly be keeping our eyes on this over the next few months."
RealtyTrac, another company that tracks foreclosure data, reported that foreclosure filings in January rose 3 percent.
"We continue to see signs on a local and regional level that the frozen-up foreclosure process is beginning to thaw," Brandon Moore, CEO of RealtyTrac, had said about his company’s report.
According to LPS, the states with the highest number of seriously delinquent mortgages in January are: Nevada, Florida, Mississippi, Arizona, and Georgia.
Source: “Foreclosure Starts and Sales Spiked in January, Report Says,” AOL Real Estate (March 6, 2012) and “Repeat Foreclosures Hit an All-time High in January,” HousingWire (March 6, 2012)
Housing Affordability Soars to Record High
Low mortgage rates and falling home values have brought housing within reach to more families than ever before, according to the latest National Association of REALTORS® housing affordability index.
Housing affordability in January reached its highest level since NAR began tracking it in 1970. The index -- which tracks median home price, median family income, and the average mortgage rate -- reached 206.1 in January.
"This is the first time the housing affordability index has broken the 200 mark, meaning the typical family has roughly double the income needed to purchase a median-priced home," says Moe Veissi, 2012 NAR president. "For buyers who can qualify for a mortgage, now is a very good time to become a home owner."
An index of 100 means that median-income household has exactly enough income to qualify for the purchase of a median-priced existing single-family home, also accounting for a 20 percent down payment and 25 percent of gross income devoted to the mortgage principle and interest payments.
NAR projects that affordability will remain high for the remainder of the year.
"Housing inventory levels have declined to a point where conditions are becoming much more balanced in much of the country," Veissi said. "If access to credit improves, we could see a much more meaningful increase in home sales and broader stabilization in home prices with modest gains in areas with stronger job growth."
Source: National Association of REALTORS®
Housing affordability in January reached its highest level since NAR began tracking it in 1970. The index -- which tracks median home price, median family income, and the average mortgage rate -- reached 206.1 in January.
"This is the first time the housing affordability index has broken the 200 mark, meaning the typical family has roughly double the income needed to purchase a median-priced home," says Moe Veissi, 2012 NAR president. "For buyers who can qualify for a mortgage, now is a very good time to become a home owner."
An index of 100 means that median-income household has exactly enough income to qualify for the purchase of a median-priced existing single-family home, also accounting for a 20 percent down payment and 25 percent of gross income devoted to the mortgage principle and interest payments.
NAR projects that affordability will remain high for the remainder of the year.
"Housing inventory levels have declined to a point where conditions are becoming much more balanced in much of the country," Veissi said. "If access to credit improves, we could see a much more meaningful increase in home sales and broader stabilization in home prices with modest gains in areas with stronger job growth."
Source: National Association of REALTORS®
| -A A +A 'Rehab' Loans Surge in Popularity to Fix Up Properties
More borrowers are exploring financing options to cover the costs of rehabbing properties they buy. “Rehab” loans are surging in popularity, according to a New York Times article.
“We’re seeing an explosive growth in these loans,” says Ed Brehm with Prospect Mortgage, one of the country’s largest processors of 203(k) loans. The spike in demand is from the higher number of bank-owned properties as well as borrowers who can no longer get home equity loans, he says.
A survey in January from the National Association of REALTORS® found that 35 percent of the homes on the market are either short sales or foreclosures, and of those properties, 37 percent were considered “below” or “well below” average condition. The poor condition may have been from homes left abandoned or damaged from disgruntled home owners who were forced to leave.
The Federal Housing Administration’s 203(k) is particularly seeing an increase in interest among home purchasers. The loan covers the cost of buying the home but also for renovating it, and is paid back like a regular mortgage. The loan can be used for rehabbing the structure of the home to adding new floors and appliances.
Fannie Mae also offers rehab financial assistance as part of its HomePath lending program.
Source: “‘Rehab’ Loans to the Rescue,” The New York Times (March 1, 2012)
“We’re seeing an explosive growth in these loans,” says Ed Brehm with Prospect Mortgage, one of the country’s largest processors of 203(k) loans. The spike in demand is from the higher number of bank-owned properties as well as borrowers who can no longer get home equity loans, he says.
A survey in January from the National Association of REALTORS® found that 35 percent of the homes on the market are either short sales or foreclosures, and of those properties, 37 percent were considered “below” or “well below” average condition. The poor condition may have been from homes left abandoned or damaged from disgruntled home owners who were forced to leave.
The Federal Housing Administration’s 203(k) is particularly seeing an increase in interest among home purchasers. The loan covers the cost of buying the home but also for renovating it, and is paid back like a regular mortgage. The loan can be used for rehabbing the structure of the home to adding new floors and appliances.
Fannie Mae also offers rehab financial assistance as part of its HomePath lending program.
Source: “‘Rehab’ Loans to the Rescue,” The New York Times (March 1, 2012)
Home Prices Stabilize Despite Increase in REOs
An increase in distressed properties on the market is no longer chipping away at overall home prices, an “unusual and encouraging” sign, a new report suggests.
In fact, the report found that in the top 15 metro areas REOs dramatically increased in February, but those areas still showed average gains or mostly stable home prices compared to the previous month, a new report by Clear Capital shows. Distressed properties typically are known to put downward pressure on nearby home prices.
Alex Villacorta, director of research and analytics at Clear Capital, says improvements in the job market, an uptick in consumer confidence, and an increase in activity among investors making cash purchases may be helping to pull home prices up and “could be in play with the resiliency we’re seeing in prices against increasing REO this month.”
Overall, national home prices dropped 1.9 percent year-over-year, which is the smallest margin drop in 10 months, according to Clear Capital’s March housing report.
“Home prices across the nation saw light levels of depreciation in February, consistent with the trend we have seen over the last several months,” Villacorta noted. “However, the Northeast, Midwest, and West improved performance against last month’s quarterly declines in light of increases in REO saturation, which is unusual and encouraging.”
With the uptick in REO activity, however, “we’ll be keeping a very close eye on the effects of the attorneys general settlement with servicers, as it could dramatically change the flow of REO properties moving through the foreclosure process and significantly impact values in the near future," Villacorta said.
Source: Clear Capital and “Home Price Declines Resilient Against REO Saturation: Clear Capital,” HousingWire (March 5, 2012)
In fact, the report found that in the top 15 metro areas REOs dramatically increased in February, but those areas still showed average gains or mostly stable home prices compared to the previous month, a new report by Clear Capital shows. Distressed properties typically are known to put downward pressure on nearby home prices.
Alex Villacorta, director of research and analytics at Clear Capital, says improvements in the job market, an uptick in consumer confidence, and an increase in activity among investors making cash purchases may be helping to pull home prices up and “could be in play with the resiliency we’re seeing in prices against increasing REO this month.”
Overall, national home prices dropped 1.9 percent year-over-year, which is the smallest margin drop in 10 months, according to Clear Capital’s March housing report.
“Home prices across the nation saw light levels of depreciation in February, consistent with the trend we have seen over the last several months,” Villacorta noted. “However, the Northeast, Midwest, and West improved performance against last month’s quarterly declines in light of increases in REO saturation, which is unusual and encouraging.”
With the uptick in REO activity, however, “we’ll be keeping a very close eye on the effects of the attorneys general settlement with servicers, as it could dramatically change the flow of REO properties moving through the foreclosure process and significantly impact values in the near future," Villacorta said.
Source: Clear Capital and “Home Price Declines Resilient Against REO Saturation: Clear Capital,” HousingWire (March 5, 2012)
The Most Ethnically Diverse Metro?
Houston surpasses other metros in the country in one measure of ethnic diversity, a report from Rice University shows in analyzing census data from 1990, 2000, and 2010.
In Houston, the Latino population grew to one-fifth — or 20.8 percent — of the metro’s total population in 1990 and to 35.5 percent in 2010, according to the study. The Anglo population, on the other hand, decreased during that time frame, now making up 39.7 percent of Houston metro residents.
The report says that Latinos will eventually be the majority race in the area, overtaking Anglos.
“Houston is one of a handful of what is known as majority-minority cities, where Anglos represent less than 50 percent of the population,” Jennifer Bratter, co-author of the report, said in a statement.
Source: “Houston Surpasses New York and Los Angeles as the ‘Most Diverse in Nation,’” Huffington Post (March 2012)
In Houston, the Latino population grew to one-fifth — or 20.8 percent — of the metro’s total population in 1990 and to 35.5 percent in 2010, according to the study. The Anglo population, on the other hand, decreased during that time frame, now making up 39.7 percent of Houston metro residents.
The report says that Latinos will eventually be the majority race in the area, overtaking Anglos.
“Houston is one of a handful of what is known as majority-minority cities, where Anglos represent less than 50 percent of the population,” Jennifer Bratter, co-author of the report, said in a statement.
Source: “Houston Surpasses New York and Los Angeles as the ‘Most Diverse in Nation,’” Huffington Post (March 2012)
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