Thursday’s report by NAR that homes are going under contract at the fastest pace since 2006 is the feature news of This Week in Real Estate. Below are a few of the highlights from the final week of May that influence our business:
* Pending Home Sales Reaches Nine-Year High. The NAR Pending Home Sales Index increased for the fourth straight month in April to a level 14% above April 2014. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts produced by the National Association of Realtors, increased 3.4% in April to 112.4, up from an upwardly revised 108.7 in March. The PHSI increased year-over-year for the eighth consecutive month and reached its highest level since May 2006.
Full story… http://eyeonhousing.org/2015/05/pending-existing-homes-sales-reaches-nine-year-high/
* Housing Bubble? Despite Rising Prices, Most Economists Still Say No. The S&P/Case-Shiller Home Price Index released on Tuesday was the latest report to show a relentless rise in housing prices, causing some economists to ask: Is another bubble forming? According to Tuesday’s data housing prices have been climbing for 35 consecutive months, but economists pointed to several reasons why that isn’t a concern, namely that while prices keep rising the rate of growth has slowed. In the first three months of this year home prices gained 0.8%, according to the S&P/Case-Shiller national index. That’s down from 2.8% in the first three months of 2013 and 1.2% during the same period of last year. “There is no bubble to be anxious about,” said David Blitzer, managing director and chairman of the Index Committee for S&P Dow Jones Indices. Price growth in most markets is “a lot softer” than it was a year ago, he noted. Economists also aren’t concerned about a price bubble because far fewer new homes are being built than a decade ago so there is little concern about oversupply. And most buyers are using cash or getting 30-year, fixed-rate mortgages that don’t carry the same risks as the subprime, adjustable-rate mortgages that many received during the boom.
Full story… http://blogs.wsj.com/developments/2015/05/26/housing-bubble-despite-rising-prices-most-economists-still-say-no/
* Fannie Mae: Mortgage Serious Delinquency Rate Declined in April, Lowest Since September 2008. Friday Fannie Mae reported that the single-family serious delinquency rate declined in April to 1.73% from 1.78% in March. The serious delinquency rate is down from 2.13% in April 2014, and this is the lowest level since September 2008. The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59%. Earlier this week Freddie Mac reported that the single family serious delinquency rate was declined in April to 1.66%. Freddie’s rate is down from 2.15% in April 2014, and is at the lowest level since November 2008. Freddie’s serious delinquency rate peaked in February 2010 at 4.20%.
Full story… http://www.calculatedriskblog.com/2015/05/fannie-mae-mortgage-serious-delinquency.html
* Buyers Purchasing Below Market Value in 59 Percent of U.S. Housing Markets, Sellers Getting More Than Market Value in 27 Percent of Markets. RealtyTrac released its April 2015 U.S. Home Sales Report on Thursday. RealtyTrac analyzed average sales prices and estimated market values at time of sale for single family homes and condos sold in April in 315 U.S. counties to identify the nation’s hottest seller’s markets, best buyer’s markets and those markets evenly balanced between buyers and sellers. “Nationwide, in April single family homes and condos sold for almost exactly 100% of their estimated full market value on average – indicating a good balance between supply from sellers and demand from buyers,” said Daren Blomquist, vice president at RealtyTrac. “At the local level, however, most markets tipped in favor or either sellers or buyers – although there were some Goldilocks markets exhibiting a ‘just right’ balance between buyers and sellers.” Out of 315 counties nationwide with a population of at least 100,000, there were 27% where homes on average sold for at least 101% of their estimated full market value, 59% where homes on average sold for less than 100% of their estimated full market value and 14% where homes on average sold for 100% of their estimated full market value. Nearly 29% of April single family home sales and condos were all cash. Full story… http://www.realtytrac.com/news/home-prices-and-sales/of-u-s-home-sales-report-april-2015/
Have a productive week!