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Foreclosure Filings Down 19 Percent In One Year

Wednesday, February 22nd, 2012

Foreclosures Per Capita January 2012 

Fore­clo­sure fil­ings fell 19 per­cent last month ver­sus one year ago, says foreclosure-tracking firm Real­ty­Trac. It’s yet one more sig­nal that the U.S. hous­ing mar­ket may have already climbed off its bottom.

Accord­ing to Real­ty­Trac, a “fore­clo­sure fil­ing” is any one of the fol­low­ing foreclosure-related events : (1) A default notice on a home; (2) A sched­uled auc­tion for a home; or, (3) A bank repos­ses­sion of a home.

In look­ing at the Jan­u­ary 2012 figures :

  • Default Notices were down 22% from Jan­u­ary 2011
  • Sched­uled Auc­tions were down 19% from Jan­u­ary 2011
  • Bank Repos­ses­sions were down 15% from Jan­u­ary 2011

On a monthly basis, how­ever, the num­bers weren’t so promising.

Default notices and sched­uled auc­tions were mostly unchanged, but bank repos­ses­sions rose 8 per­cent. The rise in bank repos­ses­sions is likely because 2010’s robo-signing con­tro­versy has been rec­ti­fied at the state and lender level.

This trend toward more bank-owned homes is expected to con­tinue through 2012.

As in most months, January’s fore­clo­sure activ­ity was geo­graph­i­cally con­cen­trated. Nevada led the nation in Fore­clo­sures Per Capita, fol­lowed closely by California. 13 states fared worse than the national aver­age of 1 fore­clo­sure per 624 house­holds. 37 fared better.

The dif­fer­ence in fore­clo­sure fre­quency among the two group­ings was stark :

  • Top 13 Fore­clo­sure States : 1 fore­clo­sure per 435 house­holds, on average
  • Bot­tom 37 Fore­clo­sure States : 1 fore­clo­sure per 5,101 house­holds, on average

North Dakota had January’s low­est fore­clo­sure rate nation­wide. Just 1 in 63,500 homes was in some form of fore­clo­sure in North Dakota last month.

As a first-time or sea­soned buyer , fore­closed homes can be entic­ing. They’re plen­ti­ful and cheap. However, just because a fore­closed home can be bought for a “steal”, that doesn’t mean it’s worth buy­ing. The process of buy­ing a fore­closed homes is dif­fer­ent from the process of buy­ing a non–fore­closed home.

The contract-and-negotiation process may be dif­fer­ent with a fore­closed prop­erty, and fore­closed homes are often sold “as-is”. This means the home you buy at auc­tion could be run-down and defec­tive to the point where it’s uninhabitable.

If you plan to buy a fore­closed home, there­fore, have a real estate pro­fes­sional on your side. The inter­net can teach you much about how the hous­ing mar­ket works, but when it comes to writ­ing con­tracts, you’ll want an expe­ri­enced agent on your side.

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Housing Starts Stay Strong; Building Permits Rise.

Friday, February 17th, 2012

Single-family housing starts

The hous­ing mar­ket has car­ried for­ward its year-end momentum. 

Accord­ing to the Cen­sus Bureau, on a seasonally-adjusted, annu­al­ized basis, January’s Single-Family Hous­ing Starts crossed the half-million unit marker for the sec­ond straight month.

This hasn’t hap­pened in close to 2 years and is the lat­est in a series of strong data that sug­gests the belea­guered hous­ing mar­ket has turned a corner.  

Although single-family starts slipped 1 per­cent from Decem­ber, January’s annu­al­ized 508,000 fig­ure rep­re­sents a 16% spike from Jan­u­ary 2011 and is the second-highest read­ing since April 2010 — the last month of 2010’s fed­eral home buyer tax credit program.

A “hous­ing start” is a new home on which con­struc­tion has started.

The strength of January’s Hous­ing Starts data sur­prised Wall Street ana­lysts and is par­tially respon­si­ble for Thursday’s unex­pected mort­gage rate spike. 

In hind­sight, though, we should have seen this coming.

Ear­lier in the week, the National Asso­ci­a­tion of Home­builders announced that home­builder con­fi­dence had climbed to its high­est point since 2007 amid builder reports of ris­ing sales vol­ume and the most foot traf­fic from buy­ers in more than 4 years.

In addi­tion, builders expect to sell more homes in 2012 than in 2011.

Builders are build­ing and buy­ers are buying.

Mean­while, as another sign of hous­ing mar­ket strength, the Cen­sus Bureau reports that, in Jan­u­ary, Build­ing Per­mits moved to a multi-year high as well. Per­mits issued for single-family homes in Jan­u­ary rose 1 per­cent from Decem­ber, a sta­tis­tic that sug­gests hous­ing will con­tinue its run through the spring sea­son, at least.

86 per­cent of homes break ground within one month of per­mit issuance.

It’s a good time to be a home buyer. Mort­gage rates and home prices are low. Hous­ing mar­ket momen­tum, how­ever, is build­ing. If you’re on the fence about whether to buy a home , ask your real estate agent for addi­tional mar­ket information.

The cost of home-ownership may never be as low as it is today.

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Homebuilder Confidence Returns To Pre-Recession Levels

Thursday, February 16th, 2012

NAHB HMI index 2010-2012

New con­struc­tion buy­ers , look out. The nation’s home builders are pre­dict­ing a strong 2012 for new home sales. It may mean higher home prices as the spring buy­ing sea­son approaches.

For the sixth straight month, the National Asso­ci­a­tion of Home­builders reports that home­builder con­fi­dence is on the rise. The Hous­ing Mar­ket Index climbed four points to 29 in Feb­ru­ary, the index’s high­est read­ing since May 2007.

The Hous­ing Mar­ket Index is now up 8 points in 8 weeks. The last time that hap­pened was June 2003, a month dur­ing which the U.S. econ­omy was regain­ing its foot­ing, much like this month. It’s note­wor­thy that June 2003 marked the start of a 4-year bull run in the stock mar­ket that took equi­ties up 54%.

The NAHB’s Hous­ing Mar­ket Index itself is actu­ally a com­pos­ite read­ing. It’s the end-result of three sep­a­rate sur­veys sent to home builders monthly.

The association’s ques­tions are basic :

  1. How are mar­ket con­di­tions for the sale of new homes today?
  2. How are mar­ket con­di­tions for the sale of new homes in 6 months?
  3. How is prospec­tive buyer foot traffic?

In Feb­ru­ary, builders reported marked improve­ment across all three areas. Builders report that cur­rent home sales climbed 5 points; that sales expec­ta­tions for the next 6 months climbed 5 points; and that buyer foot traf­fic climbed 1 point.

Most notable of all of the sta­tis­tics, though, is that the nation’s home builders report that there are now twice as many buy­ers set­ting foot inside model units as com­pared to just 6 months ago.

This data is sup­ported by the monthly New Home Sales report which shows ris­ing sales and a shrink­ing new home inventory.

Because of this, today’s new home buy­ers  should expect fewer con­ces­sions from builders at the time of con­tract includ­ing fewer price breaks on a home and fewer free upgrades. Builders are opti­mistic for the future and, there­fore, may be less will­ing to “make a deal”.  

This spring may mark the best time of year to buy a new home. 60 days for­ward, it may be too late.

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