Here is a bit of trivia. A foreclosed home is likely to sell for much less than a similar one having a different cause for sale.

Harvard University and the Massachusetts Institute of Technology conducted a study and found;

• A sale brought on by the bankruptcy of the owner will sell for (on average) 3 percent below the price of a similar home not in a forced sale situation.
• An estate sale caused by the death of the homeowner will yield a price 5 to 7 percent below an unforced sale.
• A foreclosed home will sell for 27 percent less.

The number of California foreclosures is coming down. A couple of reasons; home prices are rising so the number of home owners “underwater” is slowly falling. This reduces the motivation for owners to walk away. Another reason is banks are working harder to approve short sales and loan modifications.

The first step in the foreclosure process is the issuance of a notice of default. Such notices fell nearly 44 percent in the second quarter from the same quarter a year ago, reaching a three year low.

Any good news, especially from a neighboring state, bodes well for us.

Resource: REALTOR®Mag

 

Mortgage applications rose for a second week out of the past ten. Applications were up 3.4 percent on a seasonally adjusted basis from the prior week. Lets hope these applications result in approved loans and buyers.

Resource: REALTOR®Mag

 

The Department of Commerce just announced the statistics for new single-family residences for June.

To put these numbers in perspective, June of 2006 saw 1.47 million homes started.

Inventory of completed homes has grown with San Diego showing a 33 percent increase over a year ago. Fannie May and Freddie Mac are placing more foreclosed homes on the market. The two companies held 164,000 homes at the end of March, up 80 percent from a year ago. Also, 7 million borrowers are 30 days or more delinquent. All of these factors contribute to fewer permits being issues and a lower number of starts.

Until we see the inventory come down and more buyers enter the market (and financing become more available) we will see the construction industry continue to suffer.

Read more at:

We report from time to time news on mortgage applications. Recently applications are down which means fewer buyers.

Is it any wonder the number of applications is falling when lenders tighten qualifications to an extreme level?

The New York Times has an article on how pregnancy can result in loan denial. And it isn’t just the lenders, Fannie and Freddie are getting into the act as well.

Resource: The New York Times

 

It is a bit of a dichotomy. There have been articles published about the economy causing families to move back together. Adult children move back home to avoid rent or mortgage payments. Grandparents move in with the kids for the same reason. By consolidating, grandparents are available for caring for young children, adult children are available to care for older parents.

Meanwhile a trend for smaller homes is developing. As reported by REALTOR®Mag, new homes are appearing that have two master suites, one at each end of the home. One for the parents and one for the grandparents.

Will these two trends collide?

Resource: REALTOR@reg;Mag & The Washington Post

 

REALTOR®Mag reports that CoreLogic’s monthly index of home prices shows May was the 4^th consecutive month of price increases when compared to the same month of 2009. May showed a 2.9 percent increase.

Caution was the keyword, however. The home buyer tax credit created a home sales spike in the Spring. The job market remains weak. And lending is still very tight. These factors contribute to a slowing of price increases. The four month trend could actually reverse.

Resource: REALTOR®Mag

 

Yes, new weekly mortgage applications are the lowest since December of 1996. On an unadjusted basis, new applications fell 12.7 percent from the prior week.

Updated rate information on Friday.

Resource: REALTOR@reg;Mag

 

This is becoming boring. 8 weeks now of declining mortgage applications. If you want more info, click on the REALTOR®Mag link.

Resource: REALTOR®Mag

 

 

Some home owners with extremely good credit are walking. Five percent of mortgage delinquencies are by owners with very high credit scores and roughly 28 percent of them are walking away from their underwater mortgage. This is especially the case in states that suffered the greatest decline in property values and in states with no recourse laws (Arizona).

Resource: REALTOR®Mag