Tag Archives: housing industry

Housing Market Update

This is a HUGE subject and I probably can’t do it justice in one blog entry. But here goes. Sales of new one-family houses in April 2009 were at a seasonally adjusted annual rate of 352,000, according to estimates released jointly last week by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 0.3 percent (±14.5%)* above the revised March rate of 351,000, but is 34.0 percent (±11.0%) below the April 2008 estimate of 533,000. The median sales price of new houses sold… Read More →

Housing report carries a mixed message

Today’s housing reports indicates that building permits in April 2009 decreased 3.3% from March and declined 50.2% from April 2008, to 494,000. Housing starts in March 2009 decreased 12.8% from the prior month and declined 54.2% from the prior year, to 458,000. On the surface this appears to be more bad news. But there is a silver lining. Behind the headlines (interestingly, the same was the case with retail sales), the numbers didn’t look as terrible. First, with record inventory why are people rooting for additional supply? Second,… Read More →

Mortgage rates fall again to 4.80%

According to data released today by Freddie Mac, 30-year mortgage rates fell this week to 4.80%, from 4.82% last week and 4.87% the previous week. Except for the 4.78% average during the first week of April, the 4.80% rate marks the lowest 30-year mortgage rate in history (see chart above), and is a full 4 percentage points below the 8.80% average rate since 1964. Along with falling home prices, the record-low mortgage rates are continuing to elevate housing affordability to record highs, which will help the real estate… Read More →

Have we hit a bottom in housing?

There have been some glimmers of light in the darkening economic picture, including retail sales for January and February and sales of both new and existing homes in February. It’s clear that ongoing market adjustments in key sectors are essential to eventual economic recovery and expansion. The policy blitz coming from the Administration, Congress, the Federal Reserve and foreign policymakers certainly are helping to move the train down the track toward the recovery tunnel — and the light at the other end should be in view soon. This… Read More →

Housing Affordability at Record High

OK, I am on vacation but blogging counts as relaxation, right? The National Association of Realtors (NAR) recently released its latest Housing Affordability Index (HAI), showing that housing affordability reached an all-time, historic record high of 166.8 in January (see chart above). A HAI of 166.8 would mean that the typical household earning the median family income of $59,821 in January would have 166.8% of the qualifying income to purchase a median-priced existing single-family house ($169,900) with a 20% down payment, which would be the highest level of… Read More →

Supply and demand do work

The current political stampede to stop mortgage foreclosures proceeds as if foreclosures are just something that strikes people like a bolt of lightning from the blue– and as if the people facing foreclosures are the only people that matter. What if the foreclosures are not stopped? Will millions of homes just sit empty? Or will new people move into those homes, now selling for lower prices– prices perhaps more within the means of the new occupants? The same politicians who have been talking about a need for “affordable… Read More →

Some good news on the housing front

Foreclosure filings dropped 9.6% from December, RealtyTrac reports, largely due to the combined mitigation efforts of banks and the government – but remain 18% higher than a year ago. In January, one in every 466 houses was the subject of a foreclosure filing. Yesterday, Foreclosures.com said completed foreclosures plunged by more than 25% in January from December, to 72,694 from 97,841. Preforeclosure filings – an indicator of future completed foreclosures – also fell 12%. “Efforts last year by government and industry to lay the groundwork for housing recovery… Read More →

Who do you believe?

From the WSJ: The good news is your home may be worth more than the rock-bottom price that your neighbors’ houses fetched. The bad news: No one but you might think so. The one point of widespread agreement in the real-estate industry is that there is no single accurate index of home prices. They are all over the map, cover different sets of homes and may exclude parts of the country or be unduly influenced by the mix of homes sold in a given month. No matter which… Read More →

Economy & Housing Roundup

From the National Association of Home Builders: A look at the latest carnage on Wall Street; long-term housing forecast is looking up. A must read! Click here.

The Link Between Foreclosures and House Prices

Rising foreclosures will not cause U.S. home values to plunge, despite widespread concerns to the contrary. That’s the conclusion of a new and first-of-its-kind study, The Foreclosure-House Price Nexus: Lessons from the 2007-2008 Housing Turmoil (NBER Working Paper No. 14294) by Charles Calomiris, Stanley Longhofer, and William Miles. Although the authors recognize that other factors not captured by their analysis could weigh on home prices, the effects of foreclosure shocks – which promise to grow over the next several months, and which have been a source of worry… Read More →