Tag Archives: Home Sales

With July approaching its last week, economists at Fannie Mae are maintaining their forecast for greater economic growth in the second half of 2013. In its latest Economic and Housing Outlook, Fannie Mae's Economic and Strategic Research Group points to steady year-to-date job creation, high consumer confidence, and positive housing data as proof the economy is on a positive, though modest, growth path.

Current homeowners are playing a bigger role as housing market participants amid a sharp slowdown in investor activity, according to data from the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. Last month, current homeowners represented 44.6 percent of the purchase market, up from 43.8 percent in May based on a three-month moving average. As rising home prices discourage investors, HousePulse found home purchases from investors slipped to 19.7 percent.

Existing-home sales fell 1.2 percent in June to an annual sales rate of 5.08 million as the price of a single-family home rose 13.5 percent from a year earlier--the strongest year-over-year gain since November 2005, the National Association of Realtors reported Monday. Economists surveyed by Bloomberg expected existing-home sales to jump to 5.27 million from May's originally reported sales pace of 5.18 million. The median price of an existing home rose $11,100 or 5.5 percent for the month to $214,200, the highest price since June 2008.

Distressed property sales have declined drastically in California over the last year, according to a recent report from PropertyRadar. In June, sales for distressed homes and condominiums plunged 46.5 percent year-over-year in June. On the other hand, non-distressed property sales shot up by 31.3 percent during the same time period. Government intervention is the main driving force behind the declines in distressed property sales, according to the report authored by Madeline Schnapp, director of economics research at the firm.

For several markets across the country, strong home price growth is also attached to a double-digit unemployment rate, leading Fitch Ratings to view the strong price appreciation as unsustainable. In a recent report, Fitch highlighted seven metro areas where high unemployment rates were in the backdrop of annual double-digit home price gains. The top two were Detroit and Las Vegas, while the remaining five were in California: Sacramento, Stockton, Los Angeles, Bakersfield, and Riverside.

At $193,750, the median price of a home in June sat 12.6 percent above the year-ago level and increased 5 percent from May. At $193,750, the median price of a home in June sat 12.6 percent above the year-ago level and increased 5 percent from May. Out of the 52 metros tracked, Albuquerque, New Mexico, was the only market to experience a yearly decrease after prices fell 4.2 percent. Home sales also stood higher compared to last year, increasing 4.1 percent in June. The improvement marks the 24th month of consecutive gains.

Citing improvements in manufacturing, tourism, commercial and residential real estate and in the financial sector, the Federal Reserve Wednesday said the nation's economy ""continued to increase at a modest to moderate pace"" from late May through early July. The assessment in the periodic Beige Book was tempered by ""mixed"" conditions in the agricultural sector and the absence of improvement in labor markets. ""Hiring,"" the Beige Book said, ""held steady or increased at a measured pace.""

With the sudden jump in mortgage rates, market spectators are wondering what the impact might be on the housing recovery. After analyzing previous instances when mortgage rates increased significantly, Mark Palim, VP of Fannie Mae's Economic and Strategic Research Group, determined history suggests rate increases won't stop the current recovery. Instead, a rapid rise in rates is ""more likely to contribute to a decrease in home purchase volume and an increase in the market share of adjustable-rate mortgages (ARMs),"" wrote Palim in a recent commentary.

Market participants reacting to speculation that the Federal Reserve may taper its bond purchases later this year should refrain from acting too hastily, Freddie Mac says in its U.S. Economic and Housing Market Outlook for July. According to Freddie Mac's metrics, the 30-year fixed-rate mortgage has jumped a full percentage point since mid-May as ""taper talk"" rules the day. Rates are expected to gradually move higher, closing out 2013 in the range of 4.6 to 4.7 percent.

Despite soaring builder confidence, new housing permits and starts fell in June, with new construction falling to the lowest level in 10 months, the Census Bureau and HUD reported Wednesday. The seasonally adjusted annual rate of new housing permits tumbled 7.5 percent--the largest month-over-month decline since January 2011--while starts fell 9.9 percent, the second-largest drop since February 2011. Builders completed homes at an annual adjusted pace of 755,000 in June, 6.3 percent more than May's 710,000.