Shadow Inventory Falls 34% from 2010 Peak

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I came across an interesting article that I thought might be of interest to you! 

"Fewer than 2 million homes remain in shadow inventory as of April, CoreLogic reported Tuesday.This puts shadow inventory at a supply of 5.3 months and represents an 18 percent year-over-year decrease. The data provider also reported shadow inventory is 34 percent lower than the 2010 peak of 3 million. For its estimate, CoreLogic counts unlisted properties that are seriously delinquent, in foreclosure, or held as REOs as shadow inventory.Currently, serious delinquencies make up the bulk of shadow inventory. Out of the total for shadow inventory, about 890,000 homes are seriously delinquent, while 761,000 are in some stage of foreclosure, and another 336,000 are REOs."

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Price Gains to Slow But Recovery Will Continue

With strong price gains continuing to make headlines, industry analysts are quick to assure us we are not in the midst of another bubble. The current pace of price appreciation will not endure much longer, they say. However, Capital Economics also assures us a deceleration in price gains does not mean an end to the housing recovery.

CoreLogic, Zillow, and other industry observers concur prices appreciation is set to slow, and Monday’s US Housing Market Update from Capital Economics reinforces this prediction. Furthermore, it is not the first time Capital Economics has expressed this view.

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Are Mortgage Rates Too Low to Threaten the Recovery?

The recent rise in mortgage rates is not enough to pose any real threat to the housing recovery, but that’s not to say the increase doesn’t come with any risk, according to a recent analysis from Capital Economics.

Freddie Mac’s most recent survey showed the 30-year fixed rate is almost back at 4 percent, while the Mortgage Banker Association reported the 30-year was up to 4.15 percent, the highest since March 2012.

To put things into perspective, Ed Stansfield, chief property economist at Capital Economics, noted that on a long-term view, rates are still “exceptionally low” as they return to levels seen in late 2011 and early 2012.

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Are Mortgage Rates Too Low to Threaten the Recovery?

Buying a House: Is Now the Time?

The real estate community is often criticized for always seeming to have a Pollyanna attitude about the housing market. Many believe that the industry’s current call ‘to buy now’ is nothing more than a scare tactic with the sole purpose of creating more commissions for the industry. Let’s take a look at whether or not that advice was good advice over the last year.

The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. According to the most recent Case-Shiller Home Pricing Index, home values have risen over 10% in the last year. If we look at Freddie Mac’sWeekly Primary Mortgage Market Survey®, the 30 year mortgage rate has increased from 3.67% to 3.91% during that same period.

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Buying a House: Is Now the Time?

Obama Administration Extends Making Home Affordable Program

U.S. Secretary of the Treasury Jack Lew announced today that Treasury is extending the Making Home Affordable Program for another two years. The new expiration date is now set for December 31, 2015.

The program offers help to homeowners through solutions including the Home Affordable Modification Program (HAMP), Home Affordable Foreclosure Alternatives (HAFA), and the Second Lien Modification Program.

As of March, an estimated 1.1 million struggling homeowners have received a permanent modification through HAMP.

The move aligns with the Federal Housing Finance Agency’s (FHFA) extension for the Home Affordable Refinance Program (HARP), which was first announced in April.

Developing story.

Obama Administration Extends Making Home Affordable Program

HomeVestors: Market Constraints Keep Housing from Another Bubble

Gains in home prices over the last year haven’t provided enough lift to offset the headwinds holding the recovery down—and that’s a good thing, says David Hicks, co-president of Dallas-based HomeVestors.

While reluctance from lenders, sellers, and appraisers has become something of a drag on sales and price improvements, Hicks asserts the market’s slow growth has kept the country away from another housing bubble.

“At the price point of the market we generally service, typically at or below the median price, securing a fair appraisal and financing are typically the major challenges our franchisees face when selling a property,” Hicks said. “Since we focus on ‘ugly houses’ that owners are anxious to sell, we’re not as affected by seller reluctance as is the general market. Everything our franchisees have for sale is selling quickly and in fact, the first quarter of the year was one of the best ever.”

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We Want Our Clients to Know the Facts Behind the Numbers!

While some might be rejoicing at the recent rising home prices and rising home sales seen across the nation, Fitch Ratings “still views these gains cautiously.” In fact, the agency predicts price gains will slow and perhaps even reverse over the next year.

Fitch expects a price “trough in the middle of 2014” but suggests inflation will keep prices from falling more than 3.5 percent.

“While rising prices and sales volumes suggest a recovery, they are not moving in sync with key economic indicators that would otherwise support a sustainable price level,” Fitch stated in its most recent quarterly report.

Fitch points to unemployment as one of these “key economic indicators.” Unemployment has declined from its high of 9.9 percent in 2010 to 7.7 percent.

However, the bulk of this decline is the result of fallout in labor force participation, not an improving employment situation, according to Fitch.

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We Want Our Clients to Know the Facts Behind the Numbers