Market Studies

Veros, a provider of collateral valuation technology, enterprise risk management, and predictive analytics, recently released a white paper titled ""Interagency Appraisal & Evaluation Guidelines: Insights into Understanding and Integrating the New Guidance."" The white paper seeks to clarify the expanded language in the guidelines issued by federal regulators last December.

Despite a decline in California home sales last year, the number of homes sold in the Golden State for $1 million or more in 2010 rose for the first time since 2005, according to a study from San Diego-based DataQuick Information Systems. Million-dollar sales peaked in 2005 at 54,773 and then declined each year through 2009. In 2010, 22,529 homes sold for $1 million or more in California, a 21 percent increase from 18,621 in 2009. The most expensive confirmed purchase last year was a Bel Air residence for $50 million.

A survey of more than 1,000 banking professionals shows 79 percent of respondents anticipating their consumer lending businesses to grow or remain steady in 2011. Wolters Kluwer Financial Services conducted the survey in January, finding only 5 percent of respondents expecting a decline in consumer loan volume. Those surveyed said a soft economy, stricter compliance regulations, increased competition, and reduced loan demand could be hindrances to growth in lending.

The National Association of Realtors (NAR) reported that home sales increased in 49 states during the fourth quarter of 2010, with 78 markets experiencing gains from the fourth quarter of 2009. The national average of home sales rose 15.4 percent to an annual rate of 4.80 million in Q4 from 4.16 million in the third quarter. Distressed homes accounted for 34 percent of sales last quarter. Even with foreclosures continuing to enter the inventory pipeline, NAR says they've been selling well and housing supplies have trended down.

A study by George Washington University suggests the Federal Housing Administration (FHA) is carrying too much risk in insuring such a large percentage of large loans. In 2007 the FHA share of the home purchase market was at 6 percent. In 2009 that number came in at more than 56 percent. During that time, the size of the agency's loan limits more than doubled. The administration's plan for reforming the housing finance market indicates the government is planning to return FHA to its traditional role.

Although foreclosures and underwater homes continue to plague today's housing market, a survey conducted by Trulia.com found that 70 percent of Americans still view homeownership as being part of their American Dream. In fact, more than three out of four homeowners say their homes are the best investment they ever made. Conversely, only 20 percent feel trapped in their ""underwater"" homes, while 14 percent said they would walk away from their mortgage in a heartbeat if they could.

Mortgage interest rates rocketed higher this week. Reports from Freddie Mac and Bankrate recorded significant jumps across all home loan products. Both companies' surveys showed that the average rate on a 30-year fixed mortgage has hit its highest level since April 2010. Some industry experts argue that rising rates could be a positive for the housing market. While the ascension will likely slow refinancing activity, it could be the nudge prospective homebuyers need to get off the fence and lock in lower borrowing costs.

Data released this week by TransUnion says U.S. consumers are less of a credit risk than they have been in nearly two years. The company's proprietary Credit Risk Index decreased by 3.13 percent in the fourth quarter of 2010 when compared to a year earlier. Forty-nine states and the District of Columbia experienced declines in their credit risk indexes in Q4. The only state to see an increase was Wisconsin. TransUnion says while consumers' credit profiles have improved, consumer demand for credit has declined.

RealtyTrac has released its January foreclosure market report. The tracking company's analysis shows that foreclosure filings were reported on 261,333 U.S. properties in January. The tally represents a 1 percent increase from the previous month but a 17 percent decrease from January 2010. It marks the third consecutive month that filings have come in below 300,000, following 20 straight months where the total exceeded that threshold. REO activity was the only area where filings increased on a month-to-month basis.

According to statistics released by the Greater Las Vegas Association of Realtors (GLVAR), 51 percent of all existing homes sold in southern Nevada are now purchased with cash. GLVAR president, Paul Bell, said this represents a first for the area housing market. Bell says his organization has been checking with counterparts around the country and has yet to find another major metropolitan area where so many buyers are paying cash for homes.