Tag Archives: Home Prices

Sales of previously owned homes - which in recent months have been buoyed by a growing share of distressed REO and short sales - are expected to remain on an upward, albeit uneven, track through this year and next, according to economists at the National Association of Realtors' midyear meeting. Lawrence Yun says if the first-quarter sales pace holds, the year will close with 5.1 million completed transactions, 4 percent above last year. Frank Nothaft expects the increase to be at least that much, perhaps a bit higher.

Freddie Mac's economists see some positive signs for housing in terms of affordability and low mortgage rates, but extended unemployment dampens the forecast. The average duration of unemployment was just over 38 weeks in April. The GSE says the large number of workers unemployed for a long period remains the predominant force behind seriously delinquent mortgages. According to Freddie Mac, the economy needs to add over 250,000 new jobs per month, on a sustained basis, to reabsorb all the jobs lost since the recession.

One out of every 17 homes within Ohio's three largest cities has been reported as a foreclosure since the beginning of 2009. That's a rate equal to more than one home falling into foreclosure for every city block, according to the nonprofit community advocacy group National People's Action. After a 27-month long study, the organization found that since 2009, foreclosures have resulted in an estimated total loss of $1.6 billion in property values for homeowners in Cincinnati, Cleveland, and Columbus, and cost local governments in those cities nearly $30 million.

Integrated Asset Services (IAS) says the size and scope of home price declines are accelerating across the nation. The firm's IAS360 House Price Index declined another 2.6 percent over the first three months of 2011. At the end of March, the IAS360 was standing at a level not seen since the second quarter of 2003. The company says foreclosures are expected to rise to 1.2 million this year, adding to an already engorged housing supply and exerting further downward pressure on property values.

Data released by the National Association of Realtors Tuesday show that distressed properties - including bank-owned homes and pre-foreclosure short sales - made up 39 percent of the first quarter's existing-home sales. Overall, sales of previously owned homes rose to an annual rate of 5.14 million units during the first three months of this year. That pace is 8.3 percent higher than during the previous quarter and essentially flat compared to the same period last year.

Recent news has highlighted the severity of the renewed downturn in home prices, but Capital Economics says although condominiums will not escape altogether, over the next year or so condo prices are likely to fall by less than their single-family counterparts. The research firm notes that demand for condos is currently stronger than demand for single-family homes, due to cash buyers and investors seeking rental income. The condo market also boasts a lower delinquency rate, which suggests fewer foreclosed properties will support the supply of condos.

CoreLogic says its home price index has posted year-over-year declines for eight months in a row now. The company's latest reading shows home prices nationally fell 7.5 percent in March 2011 compared to March 2010 when distressed sales - including REO and short sale transactions - are factored into the equation. The data clearly demonstrates the extent to which pre- and post-foreclosure sales are weighing down overall market assessments. CoreLogic says if you take out the distressed factor, home prices are down just 0.96 percent from a year ago.

Fiserv, Inc. on Monday released an analysis of home price trends in more than 375 U.S. markets. While residential property values are continuing to fall on a year-over-year-basis in three-quarters of the metros, Fiserv sees signs of stabilization on the horizon. The company contends that the slide in prices has greatly improved home affordability. This dynamic, combined with growing economic strength, has prompted Fiserv's projection that average U.S. home prices will stabilize in the third quarter of this year.

Home values in the U.S. fell faster in the first quarter of 2011 than they have in any quarter since 2008, when the market experienced its worst performance, according to Zillow. The company's index of residential property values fell 3 percent during the first three months of this year when compared to the fourth quarter of 2010. As a result, negative equity hit a new high-water mark with 28.4 percent of homeowners with mortgages owing more on the loan than their home is worth.

Fannie Mae reported a net loss of $8.7 billion for the first three months of this year, which company executives say was primarily driven by a decline in home prices during the quarter. Fannie's first-quarter shortfall actually narrowed compared to a year earlier, when the company reported a loss of $13 billion. The GSE has requested another $8.5 billion in taxpayer funds from Treasury, bringing its total draws to nearly $100 billion. Fannie Mae acquired 53,549 single-family REO properties through foreclosure in the first quarter.