Average Mortgage Rates Set Another New Survey Low

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell to yet another new survey low last week. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to 3.91 percent from 3.93 percent the week before. Despite the drop, mortgage loan demand was relatively flat. The Refinance Index dropped 1.5 percent from the previous week and the Purchase Index slipped 0.6 percent. The Market Composite Index, which measures total mortgage loan application volume, fell 1.3 percent from the week before. The refinance share of all mortgage activity was unchanged at 76.6 percent. More here and here.

Housing Recovery, Economic Data Trending In The Right Direction

According to Freddie Mac’s most recent U.S. Economic and Housing Market Outlook, first-quarter economic data contains many encouraging signs for the general economy and housing market. Early estimates say the economy grew at 2.2 percent during the first quarter, which is slower than the previous quarter but an improvement over three of the past four quarters. Residential fixed investment, which reflects new housing construction and remodeling expenses, has grown in each of the past four quarters. Also, home prices have bottomed in many markets and, along with the lowest mortgage rates in more than 60 years, contribute to extraordinary affordability conditions for buyers. Frank Nothaft, Freddie Mac’s vice president and chief economist, said the first-quarter data is not uniformly positive but shows the macroeconomy and housing recovery are headed in the right direction. More here and here.

Index Shows Yearly, Quarterly, And Monthly Gains In Home Prices

The Federal Housing Finance Agency’s home price index posted its first year-over-year improvement since 2007 in a report that also included quarterly and monthly gains. According to the index, which is calculated using sales price data from Fannie Mae and Freddie Mac mortgages, home values rose 0.5 percent from the first quarter of 2011 to the first quarter of this year. Prices also showed a quarterly increase of 0.6 percent and a 1.8 percent jump between March and April. Andrew Leventis, FHFA’s principal economist, said increased affordability and decreasing inventory are positively impacting home prices and the data is consistent with other housing market indicators showing stronger prices in the first quarter. More here and here.

New Home Sales Increase 3.3 Percent In April

The U.S. Department of Housing and Urban Development and the U.S. Department of Commerce released their New Residential Sales report for April. According to the report, sales of new single-family homes rose 3.3 percent over March’s revised rate and are 9.9 percent above year-before levels. The gains put new-home sales at a seasonally adjusted annual rate of 343,000, up from March’s revised rate of 332,000. The median sales price of new homes sold in April was $235,700; the average was $282,600. At the current sales pace, there was a 5.1-month supply of new homes available for sale at the end of the month. More here and here.

Mortgage Rates Hit Another New Low, Refi Activity Rises

According to the Mortgage Bankers Association’s Weekly Applications Survey, refinance activity spiked 5.6 percent last week, as average mortgage rates hit another new low. The Increase in refinance application demand pushed total mortgage loan application volume up 3.8 percent over the previous week. It was the third straight week of gains in the Refinance Index and brought the refinance share of total mortgage activity up to 76.6 percent from 74.9 percent the week before. Michael Fratantoni, MBA’s vice president of research and economics, said mortgage rates dipped to new survey lows and spurred borrowers back into the refinance market. The average contract interest rate for 30-year fixed-rate mortgages fell to 3.93 percent from 3.96 percent the previous week. More here and here.

April Existing Home Sales Up 10 Percent From Last Year

The National Association of Realtors’ existing-home sales report for April shows a 3.4 percent rise in sales of previously owned homes. Total existing-home sales, which include single-family homes, townhomes, condominiums, and co-ops, rose to a seasonally adjusted annual rate of 4.62 million, up from March’s 4.47 million. The improvement put sales 10 percent higher than the level seen in April 2011. Lawrence Yun, NAR’s chief economist, said it’s no longer just investors taking advantage of affordability levels and the return of regular home buyers is helping home sales and prices. The national median existing-home price surged to $177,400 in April, a 10.1 percent increase over last year. Also, there were 2.54 million homes available for sale at the end of April, which is a 6.6-month supply at the current sales pace. More here and here.

Warm Winter Weather And The Spring Sales Season

An unusually warm winter may be influencing the pace of spring home sales, according to a new outlook from Fannie Mae’s Economic & Strategic Research Group. The housing market got off to a fast start at the beginning of the year but monthly data suggests some loss of momentum nearing the end of the first quarter. This slowing,however, is primarily due to an unseasonably warm winter pulling sales activity from the spring, when the sales season typically begins. Doug Duncan, Fannie Mae’s chief economist, said he still expects home sales to rise more than seven percent this year, noting improvements in consumers’ outlook on prices and selling a home in the current market as evidence that housing will continue to build on its recent gains. Fannie Mae’s forecast calls for the economy to grow by 2.3 percent in 2012, though they call for some economic sluggishness before things begin to firm in the second half of the year. More here and here.

Housing Affordability Conditions Reach Record High

The National Association of Realtors’ Housing Affordability Index measures the relationship between median home price, family income, and average mortgage rate to determine how affordable it is to buy a home in the current housing market. During the first quarter of 2012, the index reached a record high of 205.9. According to the report, a household earning approximately $61,000 could afford a $325,500 home. Moe Veissi, NAR’s president, said there has never been better housing affordability conditions or market opportunities as there are today for potential home buyers. A component index tracking affordability conditions for first-time buyers hit a record high as well. Based on affordability factors, a typical first-time buyer making 65 percent of the median family income could afford a home costing $182,500. More here.

Housing Starts Up 30 Percent From Last Year

According to estimates from the U.S. Census Bureau and the Department of Housing and Urban Development, privately-owned housing starts in April were at a seasonally adjusted annual rate of 717,000. That’s 2.6 percent above March’s revised number and 29.9 percent above April 2011. Single-family housing starts were also up in April, rising 2.3 percent from the month before. And though total building permits fell after rising 4.5 percent in March, single-family authorizations were at a rate of 475,000, which is a 1.9 percent increase over March’s revised figure of 466,000. More here.

Refinance Activity Surges 13 Percent As Rates Fall

According to the Mortgage Bankers Association’s Weekly Applications Survey, the Market Composite Index, which measures total mortgage loan application volume, was up 9.2 percent last week due to a 13.0 percent surge in the Refinance Index. The seasonally adjusted Purchase Index, however, fell 2.4 percent from the previous week. Michael Fratantoni, MBA’s vice president of research and economics, said the increase in refinance activity was due to a spike in the conventional sector and not because of rising government loan demand. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to another new low, dropping to 3.96 percent from 4.01 percent the week before. More here.