The Mortgage Corner
It may not seem like much in such a depressed real estate market, but builder confidence in the market for newly built, single-family homes gained five points in May from a downwardly revised reading in the previous month to reach a level of 29 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. This is the index’s strongest reading since May of 2007. And that will give a boost to several other industries, including construction and finance.
Graph: Calculated Risk
“Builders in many markets are reporting that buyer traffic and sales have picked back up after a pause this April,” said Barry Rutenberg, chairman of the National Association of Home Builders (NAHB). “It seems we have resumed the gradual upward trend in confidence that started at the beginning of this year, as stabilizing prices and excellent affordability encourage more people to pursue a new-home purchase.”
More good news is that mortgage delinquencies continue to decline, reports the Mortgage Bankers Association. “The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 7.40 percent of all loans outstanding as of the end of the first quarter of 2012, a decrease of 18 basis points from the fourth quarter of 2011, and a decrease of 92 basis points from one year ago”, according to the MBA’s National Delinquency Survey. “The non-seasonally adjusted delinquency rate decreased 121 basis points to 6.94 percent this quarter from 8.15 percent last quarter.”
And Realtors in some markets are reporting multiple offers, reports Calculated Risk.
Jon Lansner at the Orange Country, California Register: O.C. homes draw multiple-offer ‘avalanche’ (an excerpt from Steve Thomas' report) “Below $500,000 range is NUTS. Homes priced at or near their market value are generating an avalanche of multiple offers. A home in this range is placed on the market and, within moments, cars filled with buyers are touring the home. ...Upon writing an offer, buyers quickly find that they are one of many, sometimes over ten, offers on the home. Suddenly ... In the end, the seller factors the highest price with the largest down payment. I know, you are thinking, “What about the appraisal?” In many instances, shrewd sellers and Realtors are leveraging the competition to drop the appraisal contingency and require the buyer to make up the difference between the appraisal price and the purchase price, IF there is an appraisal problem. ... Supply has dropped to levels not seen since June 2005. ... The expected market time for all of Orange County is 1.5 months, or six weeks.”
So, “While home building still has quite a way to go toward a fully healthy market, the fact that the HMI has returned to trend is an excellent sign that firming home values, improving employment and low mortgage rates are drawing consumers back,” said NAHB Chief Economist David Crowe. “The pace of this emerging recovery could be stronger were it not for the significant impediments that the market continues to face with regard to builder and consumer access to credit, inaccurate appraisals, and more recently, rising materials prices.”
Harlan Green © 2012
2 comments:
The main goals of mortgages brokers is to help people and finding for the best loans and much easiest way. Vancouver mortgage broker
To respond to your question, my platform is Google's gmail, so you know. Editor
Post a Comment