Market Studies

In the GSE's most recent U.S. Economic and Housing Market Outlook, Freddie Mac VP and chief economist Frank Nothaft looked at energy costs and their potential effects on the economic recovery. The U.S. Department of Energy reported that gas prices averaged $3.84 per gallon on September 3, up about $0.50 over the past two months. While rising energy costs can divert spending away from consumer goods, Nothaft said he isn't especially worried.

Though the Great Recession officially ended three years ago, low aggregate income is keeping Americans from climbing out of the income slump that resulted. While real average earnings (per person) trended downward or stayed flat during the previous four business cycles, Fannie Mae's Economic & Strategic Research group found that average earnings actually increased from pre-recession levels during the Great Recession.

About 600,000 borrowers rose above negative equity in the second quarter of 2012, CoreLogic reported Wednesday. According to the company's analysis, 10.8 million, or 22.3 percent, of residential properties with a mortgage remained underwater for the second quarter of 2012. Even though negative equity is said to be driving factor for default, 84.9 percent of underwater borrowers managed to stay current on their payments.

ForeclosureRadar released its Foreclosure Report for August on Monday, revealing that foreclosure starts fell dramatically during the month. The company's coverage area includes counties in California, Washington, Arizona, Nevada, and Oregon. In all states except Washington, foreclosure starts either fell drastically or stayed fairly flat month-over-month, with Oregon seeing an 80.6 percent drop in starts.

Eighteen percent of current loans remain underwater, according to LPS' July Mortgage Monitor report. In states where the percentage of current loans sitting underwater is extremely high, the share of new problem loans was also higher. For example, the state with the highest percentage of new problem loans was Nevada, where 54.7 percent of current loans are underwater, followed by Florida (33.1 percent), Arizona (28.4 percent), and Georgia (42.8 percent).

According to the GSE's August 2012 National Housing Survey, consumers maintain a cautious but improving view of homeownership and the housing market. The average home price change expectation is 1.6 percent, mostly consistent with July's results and down from a June high of 2.0 percent. Meanwhile, 11 percent of those surveyed say home prices will go down in the next year, holding steady at the lowest level since the survey began in 2010.

Home prices ticked up by 0.9 percent year-over-year, according to Lender Processing Services. The Florida-based analytics and technology provider revealed that prices also rose by 0.7 percent month-over-month. Home values climbed by $203,000 on average, reflecting a 0.7-percent uptick from $202,000 last year.

A mere 96,000 jobs were added in August, and the unemployment rate fell only because of a drop in the labor force, the Bureau of Labor Statistics reported Friday. Based on August's numbers, economists are anticipating another round of quantitative easing. Here are responses from economists on the latest employment report.

SunTrust is taking steps to improve its position in the market. The bank has continued to grow its mortgage banking division, which earned $258 million last quarter, according to FBR Capital Markets.

The nation's unemployment rate fell to 8.1 percent in August - the lowest level since April but the economy added just 96,000 jobs, the Bureau of Labor Statistics (BLS) reported Friday. According to BLS, 581,000 people left the labor force in August leading to the drop in the unemployment rate which nonetheless remained above the election-critical 8.0 percent. At the same time, July's job gains - originally reported at 163,000 - were reduced to 141,000 while June's job numbers dropped to 45,000 from 87,000.