According to the Federal Housing Finance Agency, home prices rose 0.7 percent in February compared to January, and a whopping 7.1 percent compared to February 2012, representing the largest gain in over six years and meeting economists’ expectations. Inventory levels remain tight, and while home values are on the rise and multi-bid situations are becoming common, existing-home sales fell 0.6 percent, according to the National Association of Realtors (NAR).
Meanwhile, new home sales rose 1.5 percent between February and March after a devastating 7.6 percent drop the month prior, according to the U.S. Commerce Department. The median sales price is up 3.0 percent from March 2012, rising to $247,000, and sales performed best in the Northeast (up 20.6 percent for the month) and the South (up 19.4 percent), which made up for the dip in sales in the Midwest and West.
The report indicates that new home sales have risen 18.5 percent for the year and inventory levels remain at record lows, despite rising 2.0 percent for the month. Supply levels have hit 4.4 months, which will likely drive up new home prices as any supply below six months is considered an imbalance between supply and demand.
Mortgage Delinquency Rates Dropping
Lender Processing Services, Inc. (LPS) reports that the mortgage delinquency rate continued to decline, falling 3.13 percent for the month to 6.59 percent. Florida, New Jersey, Mississippi, Nevada and New York had the highest percentage of delinquent loans.
The foreclosure inventory fell below five million total properties for the first time in five years. The number of properties over 30 days past due but not in foreclosure is at 3,308,000, and fully 1,466,000 properties are over 90 days delinquent but not in foreclosure, while 1,689,000 properties are in the foreclosure pre-sale inventory.
Summarizing the State of Housing
Trulia’s March 2013 Housing Barometer measures housing starts, existing-home sales and delinquencies, and reported that combining the three, the housing recovery is now 56 percent back to normal, up from 33 percent just one year ago. The Barometer has now improved in eight of the last nine months.
The company notes that construction starts jumped to their highest level since June 2008, up 47 percent from the year prior, and multi-unit construction accounted for 38 percent of new starts, which is far above the typical multi-unit share of 20 percent. Additionally, they look to existing-home sales, which fell slightly for the month, but noted that non-distressed sales rose 23 percent for the year, “a key marker for recovery.”
Contrary to some economists’ position, Trulia’s Chief Economist Jed Kolko says the restrictively tight inventory levels could finally be easing, as seasonally adjusted inventory rose for the second month in a row.
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