Market Studies

According to a report from Bankrate.com, the average closing cost across the United States rose 6 percent over the year to $2,402. Origination fees increased 8 percent to $1,730--accounting for the bulk of the increase in closing costs--while third-party fees rose 1 percent to $672. In terms of highest average closing costs, Hawaii took the top spot with an average of $2,919. It was joined in the top five by Alaska ($2,675), South Carolina ($2,658), California ($2,639), and New Mexico ($2,566).

Adding to concerns of a new housing bubble, lenders reported an increase in demand for non-traditional and sub-prime mortgage loans and that they’ve responded to that demand by easing standards, the Federal Reserve reported Monday in its quarterly Senior Loan Officer Opinion Survey. According to the survey, a net 3.1 percent of lenders responding said demand for ""non-traditional"" residential loans increased from the survey released three months ago and a net 25 percent of respondents said demand for loans from sub-prime borrowers was higher than it was in May.

Prices rose and inventory declined in July on an annual basis, according to the State of the Real Estate Market report released Monday by Movoto Real Estate. However, on a monthly basis, inventory increased and list price remained the same, signifying the market is reaching equilibrium, according to Movoto. Movoto also said the steady list price from June to July is to be expected based on historical data. ""[T]he fact that prices did not increase from June to July is seasonal,"" Movoto said.

In June, over 700,000 loans that were once current became newly delinquent, leading to a near 10 percent month-over-month spike in the national delinquency rate, according to a report from Lender Processing Services (LPS). Though, the sudden uptick in delinquencies is actually not surprising when looking at previous trends, LPS found. ""Over the last 18 years, similar changes occurred in June for all but four of those years,"" said Herb Blecher, SVP of LPS Applied Analytics. When examining the increase on a quarterly basis, Blecher also noted the rise was actually moderate compared to previous years.

""Beauty,"" Lew Wallace, the author of ""Ben Hur,"" once wrote, ""is altogether in the eye of the beholder."" So, it seems, is ""disappointment""-- at least when it comes to describing or characterizing the employment report for July, which showed 162,000 new payroll jobs and a drop in the unemployment to 7.4 percent. The disappointment came not from the unemployment rate--the lowest since September 2008--but from the creation of ""only"" 162,000 jobs. To be sure, the people who are ""disappointed"" are those forecasters who predicted more jobs would be created.

Even though both the United States and Europe experienced price declines starting in 2007, the increase in mortgages default rates over time was much more severe in the United States compared to Europe. For example, in the United States, prices fell 7.7 percent from 2007 to 2008, and default rates spiked 93.2. In Europe, prices fell 6.8 percent from 2008 to 2009, yet mortgage defaults increased by 11 percent. The report authors attributed the difference to two specific regulations used in Europe to prevent mortgage defaults.

Personal spending in June grew 0.5 percent, its fastest pace February while personal income rose 0.3 percent ,the Bureau of Economic Analysis reported Friday. Economists had expected income and spending each to grow 0.4 percent. By the numbers, income grew $45.4 billion, while spending was up $59.4 billion, the largest month-over-month increase since February when spending rose $75.7 billion.

The total balance for seriously delinquent first mortgages decreased to a five-year low as rising home prices reduce incentives to default, Equifax stated in its National Consumer Credit Trends Report. In June, the balance of loans 90 days or more past due or in foreclosure fell to $325 billion, down 27 percent from last year when the balance stood at $450 billion. Loans originated in 2010 or later represented about 7 percent of the balance for seriously delinquent mortgages.

The nation's economy added 162,000 jobs in July as the unemployment rate fell to 7.4.percent, the Bureau of Labor Statistics reported Friday. Economists had forecast payrolls would grow by 175,000 and that the unemployment rate would dip to 7.5 percent. Average weekly hours fell to 34.4, compared with forecasts of 34.5, and average hourly earnings fell two cents. Despite the increase in jobs, the report could have a major negative impact on the broader economy, as it showed more people with jobs but working fewer hours and for less money.

The CoreLogic Case-Shiller Home Price Indexes experienced a double-digit national price gain in Q1, a first since the housing bubble took place seven years ago. Prices increased an average of 10.2 percent from the first quarter of last year to the first quarter of this year across the 380 metro markets tracked. However, David Stiff, chief economist for CoreLogic Case-Shiller, does predict a slow-down in appreciation over the next year. From the first quarter of this year to the first quarter of next, the Case-Shiller Indexes predict a 6.5 percent price gain.