Housing Bottom Near Or More Housing Doom Ahead? Popularity: 1% [?]

Watch this blog for loads-o-housing reports over the next couple weeks. We will get the newest info posted the second it becomes available…subscibe to our RSS and we will email the news as it breaks. Don’t forget to follow us on Twitter http://www.Twitter.com/timandjulie

Those seeking a home-price bottom should beware that price gauges can send false signals.

On Tuesday, the National Association of Realtors releases May home-resale data. Economists expect an annualized sales pace of 4.8 million units, down 33% from May 2005, near the bubble’s peak.

Wednesday brings Commerce Department data on May new-home sales, and economists see an annualized pace of 360,000 units, down 72% from May 2005.

Both reports will include pricing information, helpful for seeing how much pain homeowners have suffered and how much more banks will lose on their mortgage-backed securities.

Happy pricing news has been scarce. Median new-home prices fell 14.9% in April from a year ago, nearly matching the worst decline of the housing bust.

Things have been slightly more promising for existing homes, where median single-family home prices also fell 14.9% in April, an improvement over January’s record 16.7% decline.

Alas, that small uptick was merely “noise,” says NAR chief economist Lawrence Yun, who wants to see three more such months before declaring price stabilization. Even then, Mr. Yun warns, investors shouldn’t assume that home prices are rising broadly.

I am honestly glad to hear the NAR saying this…backs up various conversations we have been having with our inside lender contacts…who are concerned that todays ‘investors’ will be tomorrows foreclosures as they walk away from their newly bought ‘investments’ because they lost value. Recent history has proven that many homeowners will walk on their homes (investors included) when the home is upside down by 10-20%.

The trouble, notes Ivy Zelman, chief executive of housing research firm Zelman & Associates, is the NAR’s sample will increasingly include more-upscale homes as a glut of distressed, low-priced houses leaves the market.

Lately, as much as 50% of home resales have been foreclosures, and most have been lower-priced homes.

Now the foreclosure vortex is gripping higher-priced homes. A house that sold for $600,000 during the boom and $400,000 in foreclosure will be recorded by the NAR as a $400,000 sale, lifting the national median but suggesting no real improvement in housing.

We reported on this months ago…the Alt-A non-subprime borrowers are headed towards foreclosure at a HIGHER % rate compared to what we have seen thus far…

“It will be very difficult for investors watching the median existing-home price to realize it could be masking deflation at higher parts of the housing food chain,” says Ms. Zelman.

The Standard & Poor’s Case-Shiller price indexes, updates of which are due next week, have their own issues, but track repeat sales of the same house and might better reflect the true losses of banks, mortgage companies and homeowners.

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Where Have All The Foreclosures (and REOs) Gone? Popularity: 1% [?]

HREU Students (and Future students) have you noticed that the number of REOs for sale in your market has been falling….well, here is why…and…when to expect it all to change..

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Shocking Breaking News: 40 Month National Supply Of Homes For Sale! Popularity: 1% [?]

High End Homes Enter Housing Depression.

Breaking news from Diana Olick from CNBC….

I heard a startling statistic from the National Association of Realtors this morning…no not that home sales are actually increasing, but something about the high end of the market.

Chief economist Lawrence Yun said that the supply of existing homes for sale over $750,000 has reached a forty-month supply. Yep, that means it would take well over three years at the current place to sell off all of those homes.

The trouble is manifold: Jumbo loans are pricier and more difficult to get, job losses are mounting, and buyers in that price home are generally move-up buyers, so they have to sell their own homes first. I asked Mr. Yun if, given how hard it is to sell a home in that price range, he expects to see more foreclosures of high-end properties. He said absolutely.

Realtors: That alarming statistic from the NAR means huge opportunity for some agents….agents who know how to list and sell Short Sales! Watch the FREE Agent Short Sale Secrets video now and then download the Agent Short Sale Secrets book.

That’s going to mean a new phase of the current housing recession. So far we’ve seen the “correction” of a boom market that was driven by faulty, exotic loan products, investors looking to make a quick buck, and average Americans using their homes as ATMs. Now the losses are being driven by traditional economic factors and by sweeping price drops across the nation.

Yesterday Fitch ratings estimated that up to 75 percent of the modifications now being done through the administration’s Making Home Affordable program will re-default in six months to a year. I’m not talking about the old mods, which were largely repayment plans that could actually raise monthly payments. I’m talking about the new mods, which lower monthly payments to 31 percent of a person’s income. I couldn’t understand Fitch’s reasoning, so I called them.

Diane Pendley, managing director at Fitch, said the problem is not on that “front-end” ratio, but on the back end, which is all of the borrowers other debt (credit cards, car loans, student loans, etc.). She said that in talking with servicers, she’s hearing other debt is so high that most of today’s troubled borrowers cannot afford any loan payment at all, even at a very modest debt to income ratio. “Just getting the house payment done doesn’t mean their lifestyle is sustainable,” she said.

Another problem is that with home prices continuing to fall, more and more borrowers, who are essentially just renting their mortgages now because they will never see any home equity, are walking away. Even if the mortgage payment is low, the property taxes and home maintenance costs are padding that payment, and without an upside to the investment, there’s simply no reason to pay.

Suffice it to say, the foreclosure crisis, on the high and low ends, is not getting any better. It’s great that we’re seeing more sales action in the “distressed” market, but that’s not a real organic recovery. Now that the administration has managed to lower interest rates for conforming loans, they have to focus on jumbos, on jumbo rates and modifications. These are not all million-dollar homes of the rich and famous. In many markets, especially urban markets, a million-dollar home is a basic three bedroom, two bath on a postage stamp lot.

Agents, Read that again….DIANA IS 100% Correct! Here is the opportunity for you…learn how to mod your own loan now. Lower your own housepayment by $100s per month and $1000s per year….next, start your own loan mod business. Make money NOW from helping others SAVE money! Watch the FREE Agent Loan Mod Secrets video now!

Tomorrow we get the most recent data from the Mortgage Bankers Association on loan delinquencies. I’ll be watching the prime jumbos. You should be too.

Source: Diana Olick CNBC RealtyCheck@cnbc.com

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Strong Home Sales…Is The Housing Meltdown Ending? Popularity: 1% [?]

What to make of the increase in home sales?

Obviously, buyers…specifically lower end buyers…are buying. What are the buying? REOs and Short Sales. In other words, they are buying the homes they see and being the best overall values.

Will this trend continue? What do you think…read this article from Money.CNN.com and share your comments…

Is the housing meltdown ending?

Pending home sales rose in March for the second consecutive month and are up year over year. The Pending Home Sales Index from the National Association of Realtors showed a 3.2% gain to 84.6 from February, when it was 82. The index stands 1.6% higher than a year ago.

The consensus forecast of industry experts polled by Briefing.com had predicted no increase in the index.

It may still take a while before the market gains enough momentum to firmly state that the downturn has been reversed, according to Lawrence Yun, NAR’s chief economist. And, the upturn may have been boosted by the first-time homebuyers tax credit, a temporary measure that will lapse in December.

“We need several months of sustained growth to demonstrate a recovery in housing, which is necessary for the overall economy to turn around,” said Yun. “This increase could be the leading edge of first-time buyers responding to very favorable affordability conditions and an $8,000 tax credit, which increases buying power even more in areas where special programs allow buyers to use it as a down payment.”

The index is understood to be a forward indicator of home sales trends since it measures contracts signed, not completed sales. The up-tick may indicate that home prices have fallen low enough for buyers to get off the fence.

Feeling for the bottom

Yun is not calling a bottom yet, however, because the index is still at a relatively low level. Instead, he’s looking toward the summer selling season to determine what direction the market will take. Plus, he would like the number of homes on the market to drop to a more normal level of six to seven months of supply.

Realtors, learn how to easily list and sell short sales. Watch the FREE Agent Short Sale Secrets video and download the FREE Agent Short Sale Secrets Book NOW.

“If inventory goes down – it’s at just under 10 months now – to below eight months, that would mean we’re on the way to a sustainable recovery,” Yun said.

Anecdotal evidence indicates that trend may be happening. Realtors and other industry insiders are seeing rising open house attendance and multiple bids on some particularly desirable properties. Plus, pricing has become sharper, according to Sherry Chris, the CEO of Better Homes and Gardens Real Estate.

“Overpricing seems to be ending,” she said. “Properties are coming onto the market and selling quickly.”

And buyers are feeling a little more urgency, she added. In many markets, buyers have not felt any pressure to make an offer. “They said to themselves, ‘I don’t have to act immediately. It will still be on the market two weeks from now,’” she said.

Today, buyers are more likely to bid because they perceive the market as at or near its bottom. An April Gallup Poll reported that 71% of Americans thought it was a good time to buy a house.

They don’t, however, believe there will be price increases soon; three of four buyers think prices will stabilize or even decline in their areas over the next 12 months, according to Gallup.

Pat Newport, a real estate analyst for IHS Global Insight, is putting less emphasis on pending home sales than he once did for his housing market analyses. There has been a disconnect lately, he said, between the number of properties going into contract (pending home sales) and the number that actually close (existing home sales).

He speculates that this is because buyers are making offers and signing contracts but, because of financing problems, many deals are falling through.

Regional differences

The South saw the largest gain of any region, with pending home sales jumping 8.5%. Pending sales are 7.7% higher there compared with a year ago.

The Midwest gained 3.9% from February and 1.7% year-over-year. Northeast sales fell 5.7% and are off 24.1% compared with March 2008. The West dropped 1% for the month but are up 8.2% year-over-year.

Low home prices continued to help to drive sales, although NAR’s affordability index actually fell 2.3% from February, when it hit a historic high. This index is based on family income, home prices and mortgage rates.

“Compared to a year ago, the typical family can pay much less in mortgage costs for the same home, or buy a better home without necessarily increasing their monthly payment,” said NAR President Charles McMillan, in a prepared statement. “For buyers who’ve been on the sidelines and have good jobs, the market has never looked more favorable.

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Unexpected SPIKE In Home Sales….Housing Bottom Near? Popularity: 1% [?]

Realtors, looking for some good news?

Well, here it is………..

Sales of existing homes unexpectedly rose in February, recovering from a sharp drop in the previous month, according to an industry report released Monday.

The National Association of Realtors said that existing home sales rose last month to a seasonally adjusted annual rate of 4.72 million million units, up 5.1% from a rate of 4.49 million in January. February sales were down nearly 5% from year ago levels.

Economists surveyed by Briefing.com were expecting existing home sales to decline to 4.45 million.

The report said first-time buyers made up half of all purchases in February, and that sales of distressed properties accounted for about 45% of all transactions.

Sales were unexpectedly strong in the West, with activity increasing more than 30% over last year.

“February wasn’t too shabby for the existing-home market,” said Mike Larson, real estate analyst at Weiss Research. “The catch? The increase in sales activity is coming at the expense of pricing.”

The national median existing-home price was $165,400 in February, down 15.5% from last year, when the median price was $195,800.

Prices were depressed by the large number of foreclosed properties on the market, said NAR chief economist Lawrence Yun in a statement.

“Our analysis shows that distressed homes typically are selling for 20% less than the normal market price, and this naturally is drawing down the overall median price.”

Clearly, the Realtors that are gaining the most in this market are the agents who have learned how to become REO listing agents. Watch the FREE Agent REO Secrets video now to learn how you can become a REO Listing Agent. Watch the FREE Video Now

Meanwhile, the total number of existing homes on the market at the end of February rose 5.2% to 3.80 million units. At the current sales pace, it would take an estimated 9.7 months to sell down that inventory of properties.

The report also said the total number of homes for sale has steadily declined over the past six months from a record level last July.

Ian Shepherdson, chief U.S. economist at High Frequency Economics, said there’s a “good chance” the collapse in home sales that has been going on since September is “now over.” “Though a sustained recovery is still a long way off,” he added.

Source CNNMoney.com

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Home Sales INcrease…Have We Reached The Bottom? Popularity: 1% [?]

Sales of previously owned U.S. homes rose at their fastest pace in nearly six years in February, data showed on Monday, offering some hope to an economy battling a 15-month recession.

The National Association of Realtors (NAR) said sales rebounded 5.1 percent in February to a 4.72 million-unit annual rate, notching their largest gain since July 2003, but about 45 percent of these were foreclosure or short-sale transactions.

Clearly, the agents who are making the money in this market are the agents who know how to list and sell Shortsales…and REO Listing Agents. 45% of all transactions last month were Shortsales and REO sales. Agents learn how to easily list and sell shortsales. Watch the FREE Agent Shortsale Secrets video now. Next, watch the Agent REO Secrets video to learn how to become a REO Listing Agent.

This was above market expectations for a drop to a 4.45 million-unit pace after January’s 4.49 million rate. Compared to the same period last year, February sales were down 4.6 percent, the NAR said.

U.S. stocks, already rallying after the U.S. government released details of a plan to clean out toxic assets from banks’ balance sheets, extended gains on the housing data.

The housing market is at the core of the economic and financial meltdown and stabilizing it is seen as a key ingredient for the recovery from a recession that started in December 2007.

“Because entry level buyers are shopping for bargains, distressed sales accounted for 40-45 percent of transactions in February,” said NAR chief economist Lawrence Yun. “Distressed homes typically are selling for 20 percent less than the normal market price, and this naturally is drawing down the median price.”

Agents, stop fighting with all the best priced buyer-baited REO listings. Be the agent with those listings. Watch the FREE Agent REO Secrets video now

Sales were up in all four regions, with the West outperforming. In California, the median listing price rose for the first time in three years.

Government data last week showed a rebound in U.S. housing starts and new building permits in February.

“It suggests that the drop in prices and mortgages rates and an increase in affordability are having an impact in the market,” said Alan Gayle, senior investment strategist at Ridgeworth Investments in Richmond, Virginia.

“Stabilization in the housing market is critical for the economy to start, and this is a good report.”

There is hope that the government’s $272 billion package to stem the tide of foreclosures, together with aggressive efforts by the Federal Reserve to keep interest rates down could lay the foundation for the housing market’s recovery.

NAR’s Yun said the government’s stimulus package could add 1 million sales this year, but depressed levels of consumer confidence and rising unemployment could derail this projection.

The median national home price declined 15.5 percent in February from a year ago to $165,400, the second biggest decline on record.

The inventory of existing homes for sale rose 5.2 percent to 3.80 million from the 3.61 million overstock reported in January. That represented 9.7 months’ supply at the current sales pace, unchanged from January.

Analysts said reducing this stock of unsold homes was critical for the housing market’s recovery.

“An overhang of inventory will continue to plague the market, putting downward pressure on prices and construction activity for some time to come,” said Adam York, an economist at Wachovia in Charlotte, North Carolina.

“The housing market will remain stressed until more reasonable inventory levels are restored.”

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Pending Home Sales Decrease | Continued Home Value Loss | Realtor Coaching and Training Popularity: 1% [?]

Realtor(R) Coaching students….read this info and share with your sellers. All HREU Coaching clients need to be aggressively lowering their listings prices. Clearly, the market will not be improving anytime soon. The bank owned homes will continue to flood the market with very competitively priced homes.

NEW YORK (CNNMoney.com) — Despite a meltdown in financial markets, a credit freeze and soaring unemployment, housing markets fared better than expected in October.

The number of homes under contract to be sold fell by just 1% year over year according to a report out today from the National Association of Realtors (NAR), and were down 0.7% from September. Analysts surveyed by Briefing.com had expected pending sales to slip by 3.6% year over year, and by 3% from September.

The condition of the housing market varies considerably around the country, according to NAR.

Many of the one-time bubble markets in Florida and California are now showing substantial sale gains from their depressed levels over the past couple of years. Sharp price declines in these markets have attracted bargain hunting buyers.

“Despite the turmoil in the economy, the overall level of pending home sales has been remarkably stable over the past year, holding in a generally narrow range (of about 5 million in annualized sales),” said Lawrence Yun, chief economist for NAR.

“We did see a spike in August when mortgage conditions temporarily improved, which underscores two things – there is a pent-up demand, and access to safe, affordable mortgages will bring more buyers into the market,” he said.

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