New home sales decline in November
Sales of newly built, single-family homes declined 11.3 percent in November to a seasonally adjusted annual rate of 355,000 units, according to a report released by the U.S. Commerce Dept.
Foreclosures will keep rising through 2010
Home foreclosures are likely to keep climbing through all of next year despite stabilizing housing prices in some areas, a major lender group said Thursday as it reported that the level of delinquencies and repossessed homes had jumped to a record.
One in seven U.S. home loans was past due or in foreclosure as of Sept. 30, putting that quarterly delinquency measure at its highest level since 1972, when the Mortgage Bankers Assn. began reporting it. At the beginning of this year, 1 in 10 loans was past due or in foreclosure.
The continued surge in delinquencies suggests that a recovery in the housing market could be stalled by the worsening job picture as well as by further fallout from the easy-money lending that prevailed during the boom years.
One in seven U.S. home loans was past due or in foreclosure as of Sept. 30, putting that quarterly delinquency measure at its highest level since 1972, when the Mortgage Bankers Assn. began reporting it. At the beginning of this year, 1 in 10 loans was past due or in foreclosure.
The continued surge in delinquencies suggests that a recovery in the housing market could be stalled by the worsening job picture as well as by further fallout from the easy-money lending that prevailed during the boom years.
Changes in FHA Financing
Spot approvals extended and only 1 appraisal now needed for Jumbo loans!
FHA came out with a few announcements last week that will help the housing market in the near term. Spot approvals were supposed to be ending on December 7th, but have been extended yet again until February 1st 2010. I actually would not be surprised if they extended this until the end of 2010. They also eased the guidelines for condo project eligibility until December 31st 2010 in regards to owner occupancy rates, pre sale requirements and FHA concentration requirements for each condo project…this essentially will make it easier for a buyer to qualify to buy a condo so this good news. FHA also took away the need for a 2nd appraisal on all jumbo loans over $417k, needing two appraisals done before was both more costly and time consuming for buyers and sellers.
FHA came out with a few announcements last week that will help the housing market in the near term. Spot approvals were supposed to be ending on December 7th, but have been extended yet again until February 1st 2010. I actually would not be surprised if they extended this until the end of 2010. They also eased the guidelines for condo project eligibility until December 31st 2010 in regards to owner occupancy rates, pre sale requirements and FHA concentration requirements for each condo project…this essentially will make it easier for a buyer to qualify to buy a condo so this good news. FHA also took away the need for a 2nd appraisal on all jumbo loans over $417k, needing two appraisals done before was both more costly and time consuming for buyers and sellers.
One-Fourth of Borrowers Are Underwater
More than 23 percent of people with mortgages owe more on their properties than they are worth, according to a report released Tuesday by research firm First American CoreLogic.
Another 2.3 million homeowners are within 5 percent of being underwater, bringing the total of those who are upside down or close to it to about 28 percent.
About 5.3 million U.S. households have mortgages that are at least 20 percent higher than their home's value, the First American report says. Borrowers owing more than 120 percent of their home's value are the most likely to default, First American calculates.
The majority of underwater mortgages are in the following states:
Nevada: 65 percent of home owners are underwater
Arizona: 48 percent
Florida: 45 percent
Michigan: 37 percent
California: 35 percent
The report also notes that most U.S. homeowners have home equity, and nearly 24 million owner-occupied homes don't have any mortgage at all, according to the U.S. Census Bureau.
Another 2.3 million homeowners are within 5 percent of being underwater, bringing the total of those who are upside down or close to it to about 28 percent.
About 5.3 million U.S. households have mortgages that are at least 20 percent higher than their home's value, the First American report says. Borrowers owing more than 120 percent of their home's value are the most likely to default, First American calculates.
The majority of underwater mortgages are in the following states:
Nevada: 65 percent of home owners are underwater
Arizona: 48 percent
Florida: 45 percent
Michigan: 37 percent
California: 35 percent
The report also notes that most U.S. homeowners have home equity, and nearly 24 million owner-occupied homes don't have any mortgage at all, according to the U.S. Census Bureau.
House Vote Approves Extension
More good news for consumers and the housing market recovery. The U.S. House of Representatives voted 403 to 12 to extend the home buyer tax credit, expanding the parameters to include existing homeowners and not just first-time buyers.
As it now stands, the federal tax credit will be extended through April 30, 2010, with a 60-day extension if a binding contract is in place prior to the deadline. First-time home buyers will continue to be eligible for a tax credit of up to $8,000, while existing homeowners will be eligible for a reduced credit of up to $6,500. To qualify for the $6,500 credit, existing homeowners must have lived in their current residences for at least five years. The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000 in both instances.
Under additional provisions included in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The legislation maintains the provision that home buyers do not have to repay the credit provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.
As it now stands, the federal tax credit will be extended through April 30, 2010, with a 60-day extension if a binding contract is in place prior to the deadline. First-time home buyers will continue to be eligible for a tax credit of up to $8,000, while existing homeowners will be eligible for a reduced credit of up to $6,500. To qualify for the $6,500 credit, existing homeowners must have lived in their current residences for at least five years. The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000 in both instances.
Under additional provisions included in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The legislation maintains the provision that home buyers do not have to repay the credit provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.
Tax Credit passes through Senate
The Senate just voted 98-0 to pass the Home Buyer Tax Credit (as part of the Unemployment Insurance Bill). It is now in the House of Representatives for a vote. We expect the bill to be placed on a fast track for passage on Thursday. The Bill could reach the President for final approval as early as Friday, November 6th.
Congress Extends Higher Loan Limits
The FHA, Fannie and Freddie Loan Limits at the $729,750 level were extended through December 31, 2010. It is expected to be signed by President Obama quickly. This was important victory for market stability across the board. One extension down, one more to go!
Tax Credit Update
There is progress on the homebuyer tax credit in the Senate. Despite media reports, negotiations are still ongoing and nothing is final. Leadership is still working to find a way to bring credit to Senate floor and pass it. So progress is always good news, but this is not real news just yet. We will keep you posted.
First Time Home Buyer Tax Credit
UPDATE: The tax credit agreement of yesterday has changed. Senate is still negotiating terms of the credit and how to proceed. A new agreement on extending & expanding the tax credit has been introduced as a separate bill. The voting procedure on this bill is undecided. It could be voted upon separately from the UI bill, or not. Timing is still up in the air. We are still very much in the mix so stay tuned!
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