News

The recent rebound in residential real estate investment and housing prices is proving the old adage, Real estate is local. While national indexes paint a picture of a recovering housing market, a closer look reveals quite a wide range of activity across the country. In general, those markets that fared worst during the housing downturn are the ones gaining the most from the recovery, according to CoreLogic's MarketPulse report released Tuesday.

Despite still sluggish new home sales, builder confidence improved in May for the first time since December, the National Association of Home Builders (NAHB) reported Wednesday. All three components of the HMI improved in May. The reading on current home sales increased four points to 48 from 44 (revised from the initially reported 45), the outlook for sales in the next six months rose to 53 from 52 (revised down from April's reading of 53), and the measure of buyer traffic rose to 33 from April's unrevised 30.

While home prices are rising today nearly as fast as they did during the peak bubble years of 2005 and 2006, Trulia reassures bubble-phobes that they can rest easy in its latest report. According to Trulia's findings, home prices are still 7 percent undervalued nationally, having come down from a peak of 39 percent overvalued in 2006. After the bubble burst, prices fell to being 15 percent undervalued at the end of 2011. With prices still undervalued relative to fundamentals, Trulia insists that today's rapid improvements still qualify as a rebound, not a new bubble.

Ally Financial Inc. announced an agreement that settles any existing and potential claims from Residential Capital--its bankrupt mortgage subsidiary--and ResCap creditors, according to an announcement Tuesday. The plan ""fully releases Ally from any claim,"" including representation and warranty claims, that could be brought on by ResCap and its third parties, but makes an exception for securities claims by the Federal Housing Finance Agency (FHFA) and the Federal Deposit Insurance Corporation (FDIC), a release stated.

Sales for single-family residences dropped in the first quarter of this year, marking the first decrease since the fourth quarter of 2010, The Warren Group reported. Single-family home sales in the state fell year-over-year by 3.5 percent to 4,067 in the first quarter. Although sales were down, prices were up. The median price for a single-family home in Connecticut rose by 9.3 percent to $235,000 in the first quarter, up from $215,000 a year ago.

In the first quarter of this year, mortgage originations increased, but total outstanding mortgage debt decreased, according to the Household Debt and Credit Report from the Federal Reserve Bank of New York. Delinquencies also improved over the quarter while foreclosure notices declined, according to the report. Total household debt--including mortgages, credit card debt, student loans, and auto loans--declined 1 percent to $11.23 trillion. The two main drivers of the quarterly decline were abating mortgage and credit card debt.

The national mortgage delinquency rate might be ""stubbornly high,"" according to TransUnion, but the delinquency rate would actually reflect normal levels seen 10 years ago if cure or foreclosure timelines were shortened. According to TransUnion, the first quarter national mortgage delinquency rate (60-plus delinquencies) was 4.56 percent, which is more than double the pre-crisis norm. However, when aging, 180-plus delinquencies were taken out of the equation, a new TransUnion analysis found the delinquency rate would actually be around 1 percent.

The available supply of foreclosures and short sales previously stunted the recovery for new home sales, according to CoreLogic's May MarketPulse report. Though, now that the supply of distressed homes and existing-homes for sale has fallen, there's more room for the new home sales market to expand. Citing data from the Census Bureau, CoreLogic reported new home sales have increased 19 percent from a year ago in March. Most new home sales are also concentrated in hard-hit suburban metro areas, which bring an economic stimulus to areas devastated by the housing recession.

Fannie Mae and Freddie Mac are offering the new Streamlined Modification Program to distressed borrowers before the effective date of July 1. As part of the program, Fannie Mae and Freddie Mac borrowers who are at least 90 days delinquent but no more than 720 days past due may be eligible for a modification that does not require the borrower to submit financial or hardship documentation.

Pisgah Community Bank (Asheville, North Carolina) and Sunrise Bank (Valdosta, Georgia) became the 11th and 12th federally insured banks to fail in the nation this year, FDIC announced.