New Home Sales Fall Unexpectedly In October. Median Prices Plummet

The U.S. Census Bureau and the Department of Housing and Urban Development have jointly released NEW RESIDENTIAL SALES for October 2010.

The survey is primarily based on a sample of houses selected from building permits. Since a "sale" is defined as a deposit taken or sales agreement signed, this can occur prior to a permit being issued. Changes in sales price data reflect changes in the distribution of houses by region, size, etc., as well as changes in the prices of houses with identical characteristics. It takes four months to establish a trend of new home purchases.

Despite the expectation that the absence of a Homebuyer Tax Credit would lead to slow sales, analysts expected home sales to rise to 310,000 in October, which would have constituted a marginal increase from Septembers rate of 308,000.

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Low rates, don't miss out

Long-term mortgage rates fell to the lowest level of the year this week, after falling for five consecutive weeks. Freddie Mac's weekly rate report puts the average 30-year fixed-rate mortgage at 4.93 percent in the week ending May 13, down from 5 percent last week.

Source: Washington Business Journal, Jeff Clabaugh,(05/17/2010)

Sign of improvement

TransUnion's quarterly analysis of trends in the mortgage industry found that national mortgage loan delinquency rate (the ratio of borrowers 60 or more days past due) decreased in the first quarter of 2010 after steady increases for 12 consecutive quarters. The delinquency rate dropped to 6.77 percent -- a level slightly lower than in the fourth quarter of last year.

This statistic, which is traditionally seen as a precursor to foreclosure, reflects a decrease of 1.74 percent from the previous quarter's 6.89 percent average. Year over year, mortgage borrower delinquency is still up approximately 30 percent (from 5.22 percent.)

Highest mortgage borrower delinquency rates in the first quarter of 2010 continued to be highest in Nevada (15.98 percent) and Florida (14.65 percent), while the lowest mortgage delinquency rates continued to be found in North Dakota (1.76 percent), South Dakota (2.44 percent) and Nebraska (2.68 percent). Seventeen states showed increases in delinquency from the previous quarter with Alaska (+11.3 percent), New Hampshire (+6.3 percent) and Hawaii (+4.8 percent) leading the pack.

The average national mortgage debt per borrower decreased (0.47 percent) to $192,774 from the previous quarter's $193,690.

REAL Trends, Inc.

Final weeks of homebuyer credit can be tough times

As the final weeks of the homebuyer tax credit tick away, many sellers are playing a game of "chicken" with buyers by refusing to negotiate on price and seeking other concessions, knowing that buyers may not have time to find another home in time to make the tax credit deadline, according to reports from real estate professionals across the country in the popular real estate site, Active Rain. Some sellers are asking buyers to compromise home inspections or raise prices after credit-driven buyers turn out for open houses. Real estate agents around the country report a sudden shift in the climate between buyers and sellers. Some real estate agents report that sellers, who experience a higher number of showings, may decide to hold out for a higher price and others say sellers are trying to reduce the period for a home inspection so that they can find another buyer before the credit expires if the deal falls through.

Source: RealEstateEconomyWatch.com, Steve Cook

Info on March's market

First-time homebuyers drove the housing market in March, posting a record high share, according to the latest Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market Conditions.

The survey found that a huge 48.2% of March's home purchase transactions were attributable to first-time homebuyers. This eclipsed the previous peak of 46.9% reached last October when the expected November expiration of the original homebuyer tax credit sent purchases by first-time homebuyers soaring.

The surge in first-time homebuyer activity in March came at the same time the volume of distressed properties in the housing market climbed to over 50%, according to the Campbell/Inside Mortgage Finance survey. This was far above the low of 37.3% recorded in November, when a combination of government-mandated loan modification efforts and foreclosure moratoriums significantly reduced the inventory of distressed properties in the housing market.

Source: from REAL Trends

Mortgage Delinquency

The number of mortgages delinquent at the end of February 2010 is 21.3% higher than the same time last year despite government-led modification efforts, according to the latest monthly report from Lender Processing Services. Both delinquent and foreclosure inventories remain bloated as high volumes of problem loans remain held up in pipeline due to loss mitigation efforts and foreclosure moratoria, LPS found in the report.

Delinquencies recorded a seasonal decline from 10.25% a month earlier, but the national delinquency rate remains high at 10.2%, based on LPS's study of 40 million loans nationwide. LPS also found that foreclosure inventory reached another record high. February's foreclosure rate of 3.31% represented a 51% increase over 2009.

More than 7.9 million first-lien mortgages are in non-current or real estate owned (REO) status, LPS said. The percentage of problem loans as well as new problem loans remains at a five-year high. More than 1.1 million loans that started 2010 in current status were at least 30 days delinquent or in foreclosure by the end of February.

Source: Housingwire.com, Diana Golobay, (04/12/2010)

Treasury Official Says Administration is Working on Principal Reduction Plan

The Obama administration is actively working on a plan to help both jobless workers and those who owe more than their homes are worth and details of the plan are coming "very very soon," a top Treasury official said on Thursday.

http://www.mortgagenewsdaily.com/03252010_principal_reduction.asp