In the News

Retail sales rose 1.1% to $412.9 billion in September. This follows an upwardly revised 1.2% increase in August. Compared to September 2011, retail sales have increased 5.4%.

Consumer prices rose 0.6% in September, following an identical 0.6% increase in August. Compared to September 2011, consumer prices have risen 2%. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in September.

The National Association of Home Builders/Wells Fargo monthly housing market index rose one point in October to 41, the highest level since June 2006. This marks the sixth consecutive monthly gain. An index reading below 50 indicates negative sentiment about the housing market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending October 12 fell 4.2%. Refinancing applications decreased 5%. Purchase volume rose 1%.

The combined construction of new single-family homes and apartments in September rose 15% to a seasonally adjusted annual rate of 872,000 units. Single-family starts increased 11%. Volatile multifamily starts rose 25.1%. Compared to a year ago, housing starts were up 34.8% in September. Applications for new building permits, seen as an indicator of future activity, rose 11.6% to an annual rate of 894,000 units.

Existing home sales fell 1.7% in September to a seasonally adjusted annual rate of 4.75 million units from 4.83 million units in August. Compared to a year ago, existing home sales were up 11% in September. The inventory of unsold homes on the market fell 3.3% to 2.32 million in September, a 5.9-month supply at the current sales pace, down from a 6.1-month supply in August.

Initial claims for unemployment benefits for the week ending October 13 rose by 46,000 to 388,000. Continuing claims for the week ending October 6 fell by 29,000 to 3.25 million.

from Prospect Mortgage Economic Update

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August Existing-Home Sales and Prices Rise

WASHINGTON (September 19, 2012) – Existing-home sales continued to improve in August and the national median price rose on a year-over-year basis for the sixth straight month, according to the National Association of Realtors®.

Total existing-home sales 1 , which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 7.8 percent to a seasonally adjusted annual rate of 4.82 million in August from 4.47 million in July, and are 9.3 percent higher than the 4.41 million-unit level in August 2011.

Lawrence Yun , NAR chief economist, said favorable buying conditions get the credit. “The housing market is steadily recovering with consistent increases in both home sales and median prices. More buyers are taking advantage of excellent housing affordability conditions,” he said. “Inventories in many parts of the country are broadly balanced, favoring neither sellers nor buyers. However, the West and Florida markets are experiencing inventory shortages, which are placing pressure on prices.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 3.60 percent in August from a record low 3.55 percent in July; the rate was 4.27 percent in August 2011.

“The strengthening housing market is occurring even with difficult mortgage qualifying conditions, which is testament to the sizable stored-up housing demand that accumulated in the past five years,” Yun added.

The national median existing-home price2 for all housing types was $187,400 in August, up 9.5 percent from a year ago. The last time there were six back-to-back monthly price increases from a year earlier was from December 2005 to May 2006. The August increase was the strongest since January 2006 when the median price rose 10.2 percent from a year earlier.

Distressed homes3 – foreclosures and short sales sold at deep discounts – accounted for 22 percent of August sales (12 percent were foreclosures and 10 percent were short sales), down from 24 percent in July and 31 percent in August 2011. Foreclosures sold for an average discount of 19 percent below market value in August, while short sales were discounted 13 percent.

Total housing inventory at the end August rose 2.9 percent to 2.47 million existing homes available for sale, which represents a 6.1-month supply 4 at the current sales pace, down from a 6.4-month supply in July. Listed inventory is 18.2 percent below a year ago when there was an 8.2-month supply.

The median time on market was 70 days in August, consistent with 69 days in July but down 23.9 percent from 92 days in August 2011. Thirty-two percent of homes sold in August were on the market for less than a month, while 19 percent were on the market for six months or longer.

NAR President Moe Veissi , broker-owner of Veissi & Associates Inc., in Miami, said some buyers are involuntarily sidelined. “Total sales this year will be 8 to 10 percent above 2011, but some buyers are frustrated with mortgage availability. If most of the financially qualified buyers could obtain financing, home sales would be about 10 to 15 percent stronger, and the related economic activity would create several hundred thousand jobs over the period of a year.”

First-time buyers accounted for 31 percent of purchasers in August, down from 34 percent in July; they were 32 percent in August 2011.

All-cash sales were unchanged at 27 percent of transactions in August; they were 29 percent in August 2011. Investors, who account for most cash sales, purchased 18 percent of homes in August, up from 16 percent in July; they were 22 percent in August 2011.

Single-family home sales rose 8.0 percent to a seasonally adjusted annual rate of 4.30 million in August from 3.98 million in July, and are 10.0 percent above the 3.91 million-unit pace in August 2011. The median existing single-family home price was $188,700 in August, up 10.2 percent from a year ago.

Existing condominium and co-op sales increased 6.1 percent to a seasonally adjusted annual rate of 520,000 in August from 490,000 in July, and are 4.0 percent above the 500,000-unit level a year ago. The median existing condo price was $176,700 in August, which is 3.3 percent higher than August 2011.

Regionally, existing-home sales in the Northeast rose 8.6 percent to an annual pace of 630,000 in August and are also 8.6 percent above August 2011. The median price in the Northeast was $245,200, up 0.6 percent from a year ago.

Existing-home sales in the Midwest increased 7.7 percent in August to a level of 1.12 million and are 17.9 percent higher than a year ago. The median price in the Midwest was $152,400, up 7.8 percent from August 2011.

In the South, existing-home sales rose 7.3 percent to an annual pace of 1.90 million in August and are 11.1 percent above August 2011. The median price in the region was $160,100, up 6.5 percent from a year ago.

Existing-home sales in the West increased 8.3 percent to an annual level of 1.17 million in August but are unchanged from a year ago. With ongoing inventory shortages, the median price in the West was $242,000, which is 16.3 percent higher than August 2011.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

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Last Week in the News

Retail sales fell 1.5% for the week ending August 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.1%.

Existing home sales rose 2.3% in July to a seasonally adjusted annual rate of 4.47 million units from 4.37 million units in June. Compared to a year ago, existing home sales were up 10.4% in July. The inventory of unsold homes on the market increased 1.3% to 2.4 million in July, a 6.4-month supply at the current sales pace, down from a 6.5-month supply in June.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 17 fell 7.4%. Refinancing applications decreased 9%. Purchase volume rose 0.9%.

New home sales rose 3.6% in July to a seasonally adjusted annual rate of 372,000 units from an upwardly revised rate of 359,000 units in June. The initial June reading was 350,000. On a year-over-year basis, new home sales are up 25.3% compared with July 2011. At the current sales pace, there’s a 4.6-month supply of new homes on the market.

Orders for durable goods — items expected to last three or more years — rose $9.4 billion or 4.2% to $230.7 billion in July. This increase follows a 1.6% increase in June. Excluding volatile transportation-related goods, July orders posted a monthly decrease of 0.4%.

Initial claims for unemployment benefits for the week ending August 18 rose by 4,000 to 372,000 from an upwardly revised 368,000 the prior week. Continuing claims for the week ending August 11 also rose by 4,000 to 3.317 million.

from Prospect Mortgage Economic Update

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Last Week in the News

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — rose 0.7% in February, following a revised 0.2% increase in January. The February reading was the highest level since June 2008.

Initial claims for unemployment benefits for the week ending March 17 fell by 5,000 to 348,000, the lowest reading since February 2008. Continuing claims for the week ending March 10 fell by 9,000 to 3.35 million.

The combined construction of new single-family homes and apartments in February fell 1.1% to a seasonally adjusted annual rate of 698,000 units, after an upwardly revised gain of 3.7% in January. The January figure was revised from 699,000 units to 706,000 units. Compared to a year ago, housing starts are up 34.7%. Applications for new building permits, seen as an indicator of future activity, rose 5.1% to an annual rate of 717,000 units.

Existing home sales fell 0.9% in February to a seasonally adjusted annual rate of 4.59 million units from an upwardly revised 4.63 million units in January. The inventory of unsold homes on the market increased 4.3% to 2.43 million, a 6.4-month supply at the current sales pace, up from a 6-month supply in January.

New home sales fell 1.6% in February to a seasonally adjusted annual rate of 313,000 units from a downwardly revised rate of 318,000 units in January. The initial January reading was 321,000. The December rate was revised higher to 336,000 units, the highest level since the economic recovery began. On a year-over-year basis, new home sales are up 11.4%. At the current sales pace, there’s a 5.8-month supply of new homes on the market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending March 16 fell 7.4%. Refinancing applications decreased 9.3%. Purchase volume fell 1%.

from Prospect Mortgage Economic Update

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Last Week in the News

Existing home sales rose 4.3% in January to a seasonally adjusted annual rate of 4.57 million units from a downwardly revised 4.38 million units in December. The inventory of unsold homes on the market decreased to 2.31 million, a 6.1-month supply at the current sales pace, down from a 6.4-month supply in December.

Retail sales rose 3% for the week ending February 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.2%.

New home sales fell 0.9% in January to a seasonally adjusted annual rate of 321,000 units from an upwardly revised rate of 324,000 units in December. The initial December reading was 307,000. The November rate was also revised higher to 318,000 units. At the current sales pace, there’s a 5.6-month supply of new homes on the market, the lowest reading in six years.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending February 17 fell 4.5%. Refinancing applications decreased 4.8%. Purchase volume fell 2.9%.

Industrial production at the nation’s factories, mines and utilities was unchanged in January after advancing an upwardly revised 1% in December. Compared to a year ago, industrial production is up 3.4%. Capacity utilization fell slightly to 78.5% in January from 78.6% in December.

Initial claims for unemployment benefits for the week ending February 18 were unchanged at 351,000. Continuing claims for the week ending February 11 fell by 52,000 to 3.392 million, the lowest level since August 2008.

From Prospect Mortgage Economic Update

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Last Week in the News

The combined construction of new single-family homes and apartments in November rose 9.3% to a seasonally adjusted annual rate of 685,000 units. Single-family starts increased 2.3%. Multifamily starts rose 25.3%. Applications for new building permits, seen as an indicator of future activity, rose 5.7% to an annual rate of 681,000 units.

Existing home sales rose 4% in November to a seasonally adjusted annual rate of 4.42 million units from 4.25 million units in October. The inventory of unsold homes on the market decreased to 2.58 million, a 7-month supply at the current sales pace, down from a 7.7-month supply in October.

The Commerce Department announced that gross domestic product — the total output of goods and services produced in the U.S. — increased at a revised annual rate of 1.8% in the third quarter of 2011.

New home sales rose 1.6% in November to a seasonally adjusted annual rate of 315,000 units from a revised rate of 310,000 units in October. Compared to a year ago, new home sales were up 9.8%.

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — rose a strong 0.5% in November, following a 0.9% increase in October.

Orders for durable goods — items expected to last three or more years — rose $7.5 billion or 3.8% to $207 billion in November. Excluding volatile transportation-related goods, orders posted a monthly increase of 0.3%.

Initial claims for unemployment benefits fell by 4,000 to 364,000 for the week ending December 17. Continuing claims for the week ending December 10 fell by 79,000 to 3.546 million.

PS – The Federal Housing Administration (FHA) has extended the temporary waiver of anti-flipping regulations through December 31, 2012.

from Prospect Mortgage Economic Update

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Last Week in the News

New home sales fell 2.3% in August to a seasonally adjusted annual rate of 295,000 units from a revised rate of 302,000 units in July. Compared to a year ago, new home sales were up 6.1%.

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 0.9% in July after a 1.2% increase in June. On a year-over-year basis, prices fell 4.1% compared with July 2010.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 23 rose 9.3%. Refinancing applications increased 11.2%. Purchase volume rose 2.6%.

Pending home sales, a forward-looking indicator based on signed contracts, fell 1.2% in August after a 1.3% increase in July. On a year-over-year basis, pending sales are up 13.1%.

Initial claims for unemployment benefits unexpectedly fell by 37,000 to 391,000 for the week ending September 24. Continuing claims for the week ending September 17 fell by 20,000 to 3.7 million.

from Prospect Mortgage Economic Update

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Economic Update – News from Last Week

The National Association of Home Builders/Wells Fargo monthly housing market index was unchanged in May at 16. An index reading below 50 indicates negative sentiment about the housing market.

The combined construction of new single-family homes and apartments in April fell 10.6% to a seasonally adjusted annual rate of 523,000 units. Single-family starts decreased 5.1%. Multifamily starts fell 24.1%. Applications for new building permits, seen as an indicator of future activity, fell 4% to an annual rate of 551,000 units.

Industrial production at the nation’s factories, mines and utilities was unchanged in April, following a revised 0.7% increase in March. Compared to a year ago, industrial production is up 5%. Capacity utilization was 76.9% in April.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending May 13 rose 7.8%. Refinancing applications increased 13.2%. Purchase volume fell 3.2%.

Existing home sales fell 0.8% in April to a seasonally adjusted annual rate of 5.05 million units from a revised 5.1 million units in March. The inventory of unsold homes on the market increased 9.9% to 3.87 million, a 9.2-month supply at the current sales pace, up from an 8.3-month supply in March.

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — fell 0.3% in April, following a revised 0.7% increase in March.

Initial claims for unemployment benefits fell by 29,000 to 409,000 for the week ending May 14. Continuing claims for the week ending May 7 fell by 81,000 to 3.7 million.

-Posted from Prospect Mortgage Economic Update

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