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Housing Scorecard Details Progress, Examines San Francisco MSA

While the housing market made great strides toward recovery last year with improvements in foreclosures, home prices, and homeowner equity, the economy is “still healing” from the effects of the recent downturn, according to the latest Housing Scorecard from the Obama administration.

Released Friday, the January report found several improving indicators and particular strength in the San Francisco metro area, which has benefited from significant government support.

Citing recent RealtyTrac data, the Obama administration reported foreclosures declined 33 percent over the year in 2013 to their lowest level since 2005. At the same time, REO activity declined 31 percent.

Existing-home sales reached their highest level since 2006 with an annual gain of 9.1 percent in 2013, according to the January Scorecard. New home sales also improved, rising 16.4 percent over the year to their highest level in five years.

Underwater homeowners also felt some relief from rising prices, which brought national equity up $3.4 trillion over the first three quarters of the year, according to data from the Federal Reserve.

“With foreclosures down, home sales up, and equity continuing to grow, the housing market continues to make slow, but steadily improving progress,” said Kurt Usowski, deputy assistant secretary for economic affairs at HUD.

The January Housing Scorecard highlighted the impact made by the administration’s Making Home Affordable Program, which was enacted in 2009. In total, more than 1.9 million homeowners have received assistance through the program as of December. More than 1.3 million homeowners have received permanent loan modifications through the administration’s flagship Home Affordable Modification Program (HAMP).

The Federal Housing Administration has enacted another 2.1 million loss mitigation actions over the same time period. The administration also lays claim to another 4 million proprietary modifications, which it says it influenced by the creation of HAMP.

The San Francisco metropolitan statistical area (MSA) suffered uniquely during the recession and is now showing great improvement, according to the administration.

“As the housing market continues to improve nationwide, the San Francisco metropolitan area is also showing signs of significant improvement,” Usowski said.

The San Francisco metro is made up of two distinct areas—San Francisco and Oakland—each of which weathered the housing crisis differently. During the bubble, Oakland home prices increased at a rate 34 percent higher than the national average, while San Francisco’s home prices lagged the national rate by 11 percent. During the bust, Oakland’s home prices fell 45 percent, while San Francisco’s home prices declined 22 percent.

Through early 2010, San Francisco’s delinquency rate kept pace with the national rate. However, San Francisco’s delinquency rate has since improved at a faster pace. Serious delinquencies in the San Francisco MSA decreased 51 percent over the year in 2013, outpacing the national decline of 32 percent, according to data from Lender Processing Services.

The percentage of underwater homeowners in both San Francisco and Oakland have declined rapidly. In San Francisco, 2.5 percent of homeowners are underwater as of the third quarter of 2013, down from 9 percent in the third quarter of 2012. In Oakland, the rate dropped from 29.7 percent to 13.9 percent over the same time period.

San Francisco has been inundated with state and national aid to help it recover from the housing crisis.

“The Administration’s broad approach to stabilizing the housing market has been a real help to homeowners in the San Francisco metropolitan area,” the Obama administration said in its January report.

In addition to the 73,000 homeowners in the MSA who received assistance through the Making Home Affordable Program, the metro received $36 million from the Neighborhood Stabilization Program. The metro also benefited from the $1.98 billion California received from the Hardest Hit Fund. California also received $20 billion for refinancing, short sales, and loan modifications from the National Mortgage Servicing Settlement.

About Author: Krista Franks Brock

Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia.

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