Tag Archives: Home Prices

Market participants reacting to speculation that the Federal Reserve may taper its bond purchases later this year should refrain from acting too hastily, Freddie Mac says in its U.S. Economic and Housing Market Outlook for July. According to Freddie Mac's metrics, the 30-year fixed-rate mortgage has jumped a full percentage point since mid-May as "taper talk" rules the day. Rates are expected to gradually move higher, closing out 2013 in the range of 4.6 to 4.7 percent.

FNC's Residential Price Index (RPI) continued to show gains in May, though the company noted the pace of growth has started to slow to a more sustainable level. According to FNC, the index climbed 0.5 percent in May, striking a balance between April's 0.7 percent growth and March's 0.3 percent improvement. From December through May, FNC reported an average monthly price growth of 0.4 percent, which annual appreciation rates (4.0 percent in May compared to May 2012) similarly leveling out.

Responses to Fannie Mae's latest National Housing Survey indicate potential homebuyers may enter the purchase market sooner rather than later.

The number of underwater borrows dropped by nearly half from Q1 2012 to Q1 2013, Lender Processing Services (LPS) reported in its May Mortgage Monitor. As of the end of Q1, the total share of mortgages with loan-to-value (LTV) ratios of greater than 100 percent was down to 14.7 percent of all currently active loans. Even in the Western "sand states," where borrowers have struggled in recent years, LPS reported underwater loans were down as much as 53 percent year-over-year.

The newest Price Monitor report from Trulia shows asking prices are heating up along with the weather. The company reported a 10.7 percent year-over-year increase and a 1.5 percent month-over-month improvement. Trulia also tracked the 100 largest metro areas and revealed 99 markets experienced an increase in asking prices over the last year. According to Trulia's chief economist Jed Kolko, the increase in home prices and mortgage rates has added a significant cost to homeownership.

May was a strong month for home sales in Connecticut, the Warren Group reported. According to the group, sales in the state rose 2.9 percent year-over-year to 2,356. It was the highest number of transactions recorded for the month since May 2010 and the first time since January that sales volume increased on a yearly basis.

Homebuyer interest diminished somewhat in June, according to Redfin's Real-Time Demand Pulse. According to the brokerage, the number of customers taking tours fell 1.9 percent month-over-month in June, sinking even further than the 1.5 percent drop recorded last year. For the last week of the month, Redfin reported a 2.7 percent decline in tour requests from the prior week (compared to a 2.3 percent decline the same week in 2012). With closed sales typically peaking each year in June, Redfin expects continued monthly declines.

With headlines announcing rapid gains in home prices--some even detailing double-digit gains--Moody's Analytics says "there is little wonder that many fear a new housing bubble is developing despite the hard lessons of the Great Recession." However, Celia Chen, senior director of economic research at Moody's, dispenses these fears in her article, "Popping Housing Bubble Fears," published in the firm's most recent report. Even if prices do decline, Chen says the result would be "less damaging to the broader economy" than the market burst in 2008.

Forty-five of the top 50 metropolitan markets will experience yearly price increases during the second half of the year, according to Clear Capital's Home Data Index Market Report.

Home prices continue to see significant gains as inventory limits buyers, CoreLogic said in its latest Home Price Index (HPI) report. The index rose 12.2 percent (including distressed sales) year-over-year in May, once again marking the biggest annual increase since 2006. Excluding distressed sales, prices were up 11.6 percent over May 2012. Looking at the top 100 core-based statistical areas (CBSAs) measured by population, 97 showed year-over-year gains in May, CoreLogic reported--up from 94 in April.