Builder Confidence Hits Highest Level Since 2007

The National Association of Home Builders Housing Market Index is a measure of builders’ perception of the market for newly built, single-family homes on a scale where any number above 50 indicates that more builders view sales conditions as good than poor. In August, builder confidence rose two points to 37, reaching its highest level since February 2007. Barry Rutenberg, chairman of the NAHB, said builders see current sales conditions, sales prospects for the next six months, and traffic of prospective buyers as better than they’ve been in more than five years. According to Rutenberg, the outlook appears to be brightening after the depths of the recession. The gains marked the fourth consecutive month of improvement for the index. Regionally, three-month moving averages show the Midwest up five points, and the South and West both gaining three points. More here.

Average Mortgage Rates Unchanged Last Week

The Mortgage Bankers Association’s Weekly Applications Survey covers more than 75 percent of all retail residential mortgage applications. Last week, the survey found average contract interest rates for 30-year fixed-rate mortgages unchanged from the previous week at 3.76 percent. The average 30-year rate on jumbo loans decreased to 4.03 percent. But despite mortgage rates near record lows, the Market Composite Index, which measures total mortgage application volume, was down 4.5 percent. The drop was due to a 5.0 percent decline in the Refinance Index and a 2.0 percent dip in the Purchase Index. Still, the refinance share of total mortgage activity remained at 81 percent for the week. More here and here.

Housing A Bright Spot Despite Slower Economic Growth

According to Fannie Mae’s Economic and Strategic Research Group, an uncertain job market and weakened consumer spending have slowed economic growth after a strong first quarter. But, despite the slowdown, the housing market continues to show improvement. Doug Duncan, Fannie Mae’s chief economist, said housing continues to be a bright spot as news from the housing market has been relatively upbeat, presenting a rare upside boost to the economy. Home sales are up 9.0 percent above last year and single-family housing starts are nearly 20 percent higher than the year before. Also, residential investment is expected to contribute to economic growth for the first time since 2005. These encouraging statistics combined with low mortgage rates and high affordability have led to a larger percentage of polled consumers who say they’d prefer to buy their next home in recent surveys. More here.

Prices Rising In A Growing Number Of Metropolitan Areas

New data released by the National Association of Realtors shows home prices improving and poised for further gains this year. During the second quarter, median existing single-family home prices rose in 100 of 147 metropolitan statistical areas compared to the same period one year earlier. Lawrence Yun, NAR’s chief economist, said it’s encouraging to see a growing number of metro areas with rising median prices. During the second quarter of 2011, for example, only 41 metros had improving values from the previous year. And the first quarter of this year saw only 74 cities with price gains. Also in the report, the national median existing single-family home price was $181,500, which is 7.3 percent higher than a year earlier and the strongest year-over-year increase since 2006. More here and here.

Improving Markets Index Includes 80 Cities In August

The National Association of Home Builders Improving Markets Index lists metropolitan areas that have shown improvement from their respective bottoms in employment, housing permits, and prices. In August, the list includes 80 cities across 32 states and the District of Columbia. David Crowe, NAHB’s chief economist, said the fact that there continues to be a strong core of metros on the list each month adds to growing evidence that the housing recovery has a solid foundation. The index now includes nearly one quarter of all U.S. metros. Five cities were added to the list in August, while 75 markets retained their spot and nine were removed from the index. The five new metropolitan areas were Miami and Palm Bay, Fla.; Hinesville, Ga.; Terre Haute, Ind.; and Lubbock, Texas. More here.

Buying Beats Renting In Majority Of Markets

An analysis of more than 200 metropolitan areas and 7,500 cities found that buying is a better deal than renting in a majority of U.S. markets. Conducted by Zillow, the analysis showed that, in more than 75 percent of metropolitan areas, a homeowner could expect to break even in fewer than three years. In some markets where home prices fell the most during the recession, including cities in Florida, Arizona, Pennsylvania, and Michigan, the breakeven point was less than one year. Stan Humphries, Zillow’s chief economist, said historic levels of affordability make buying a home a better decision than renting across most of the country, especially considering rent has risen more than 5.0 percent over the past year. More here and here.

Mortgage Rates Still Hovering Near All-Time Lows

According to the Mortgage Bankers Association’s Weekly Applications Survey, mortgage application volume slipped slightly last week though rates remain near record lows. The Market Composite Index, which measures total mortgage loan application volume, fell 1.8 percent from the week before due to a 2.0 percent drop in the Refinance Index and a 1.0 percent slide in purchase activity. Despite the dip, refinance volume remained at 81 percent of all mortgage activity for the week. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances rose to 3.76 percent from 3.75 percent the previous week. The average rate for jumbo loans also increased, rising to 4.04 percent from 4.01 percent one week earlier. More here and here.

Vacancy And Homeownership Reports Show Slight Improvement

The U.S. Census Bureau’s Second Quarter Residential Vacancy and Homeownership report shows little movement in either the vacancy rate for homeowner housing or the national homeownership rate. But, according to their estimates, the numbers are moving in the right direction. The homeowner vacancy rate was 2.1 percent, which is 0.4 percent lower than last year and 0.1 percent below the previous quarter. The vacancy rate has now fallen in each of the past six quarters. The homeownership rate, on the other hand, has been relatively flat and is now at 65.5 percent, up just 0.1 percent from the previous quarter and 0.4 percent lower than the same quarter last year. But Jed Kolko, Trulia’s chief economist, writes that U.S. Postal Service data offers a more accurate picture of the number of occupied housing units based on addresses that are or are not receiving mail. According to those numbers, the number of occupied homes rose by nearly 1,000,000 last year, a 5.0 percent drop in the number of vacant houses nationally. More here and here.

July Housing Scorecard Compiles Key Market Data

The most recent housing scorecard from the U.S. Department of Housing and Urban Development and the U.S. Department of the Treasury collects key housing market data and tracks the impact of the administration’s foreclosure prevention programs. In July, the scorecard shows important progress in both the inventory of homes on the market and the number of underwater mortgages. The number of borrowers who are underwater on their mortgage fell 5.8 percent from the previous quarter and is 0.9 percent below one year ago. But, though foreclosure activity was down in July, the report says there is an expectation that it will increase in coming months as processing delays are lifted. Also, housing inventory remains low. Experts consider a six-month supply of homes to be a balanced market. At the current sales pace, July’s estimates show a 6.6-month supply of existing homes and a 4.9-month supply of new homes currently on the market. Erika Poethig, HUD’s acting assistant secretary, says there has also been important progress in refinance activity. According to Poethig, July’s indicators show momentum not seen since before the housing crisis as refinances through the HAMP program have continued to surge. More here and here.

Midyear Foreclosure Report Finds Increasing Activity

RealtyTrac’s Midyear 2012 Metropolitan Foreclosure Market Report shows foreclosure activity increased in 125 of the nation’s 212 metro areas with a population over 200,000 during the first half of the year. But despite the increases, 129 of the included cities still saw year-over-year declines in foreclosure activity. Brandon Moore, RealtyTrac’s CEO, said increasing foreclosure starts in many local markets helped push total activity higher during the first half of the year. According to Moore, increasing foreclosure starts will be welcome news for prospective buyers and real-estate brokers in local markets where low inventory has caused slower sales activity. California had seven of the 10 highest foreclosure rates and 10 of the top 20 during the first half of this year. Florida, Georgia, Arizona, Nevada, and Colorado were also heavily represented among the top 20 foreclosure rates in the country. More here.