This Week in Real Estate: July 25, 2016

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Housing starts and existing home sales lead the way in news for This Week in Real Estate. Despite affordability concerns the consistently low interest rates help first-time buyers grab a 33% share of existing home sales in June, the best performance by first-time buyers in four years. Below are a few highlights from the third week of July that influence our business:

* Housing Starts Bloom in June. Homebuilding rates accelerated in June, surpassing expert forecasts for the month. According to the Commerce Department, housing starts rose 4.8% from a month earlier to a seasonally adjusted annual rate of 1.189 million in June. However, while both permits and starts improved on a month-to-month basis, the total permits represented a decline of 15% compared to last June, and the total number of starts represented a decline of 1% compared to last year. Single-family permits in June were at a rate of 738,00; this is 1% above the revised May figure. Single-family housing starts in June were at a rate of 778,000; this is 4.4% above the revised May figure. Single-family completions in June were at a rate of 752,000; this is 3.7% above the revised May rate. “June data points on new construction show little change from what we have already observed during the spring and summer, and continues to indicate that builders are starting what they already permitted earlier this year but are not being bullish about demand for this fall and winter. We are continuing to see that new construction is failing to keep up with household formation, so the low vacancies in rentals and the dearth of homes for sale will continue to provide a solid foundation for rising rents and home prices,” said Realtor.com Chief Economist Jonathan Smoke.
Full Story…  http://rismedia.com/2016/07/19/housing-starts-bloom-in-june/?utm_source=newsletter&utm_medium=email&utm_campaign=eNews

* Mortgage Lending on Track For Best Year Since 2013. While a recent report from Fitch Ratings suggested that 2016 could be a rough year for mortgage servicers due to persistently low interest rates, those same interest rates could lead to a banner year for mortgage lenders. The Fitch report suggested that the current low interest rate environment will drive some homeowners to refinance, but another report from Equinox showed that it’s not just refinance applications that are trending up; actual first mortgage originations were up sharply in the first quarter – to a point that 2016 could be the best year for mortgage lending since 2013. According to Equifax’s report, the total dollar amount of first-mortgage originations during the first quarter of the year was $450.5 billion, which represented a year-over-year increase of 12.3%, and the highest amount for a first quarter total since 2013. Additionally, Equifax’s National Consumer Credit Trends Report showed that there were a total of 1.86 million new first mortgages in the first quarter, an increase of 10.3% over the same time period last year.
Full Story…  http://www.housingwire.com/articles/37539-mortgage-lending-on-track-for-best-year-since-2013?eid=322520585&bid=1467805

* Existing-Home Sales Ascend Again in June, First-Time Buyers Provide Spark. Existing home sales, as reported by the National Association of Realtors (NAR), increased 1.1% in June to the highest level since February 2007, as first-time buyers grabbed a 33% share, the best performance in four years. June existing sales are up 3% from the same month a year ago. June existing sales increased in the Midwest and West by 3.8% and 1.7% respectively. Year-over-year, the Northeast, Midwest and South increased 5.6%, 4.7% and 3.2% respectively, while the West decreased slightly.
Full Story…  http://www.realtor.org/news-releases/2016/07/existing-home-sales-ascend-again-in-june-first-time-buyers-provide-spark

* New Single-Family Housing Starts by Divisions. Using the public-use micro data files provided by Census Bureau’s Survey of Construction (SOC), NAHB Economics and Housing Policy group tabulated new single-family housing starts for the nine census divisions. There were more than 100k new single-family units started in 2015 in each of the South Atlantic and West South Central Divisions. The Mountain Division, the largest area among the nine Census divisions, started 85,448 new single-family units in 2015. The shares of new single-family housing starts in these three divisions accounted for 60% of the total new single-family housing starts in 2015. Additionally, there were 76,661 new single-family units started in the Pacific Division and 68,005 units in the East North Central Division. The Pacific Division shared 11% of the total new-single family housing starts in 2015.
Full Story…  http://eyeonhousing.org/2016/07/new-single-family-housing-starts-by-divisions/

Have a productive week!
Jason
 

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