Housing Scorecard: Signs of Progress

September 17, 2012 (Chris Moore)

The housing market showed signs of stabilizing during June and July according to the August release of the Obama Administration’s Housing Scorecard as new and existing home sales and prices, foreclosure activity, and overall loan performance exhibited signs of positive progress.

Mortgage delinquency rates on prime, sub-prime and FHA mortgages fell across the board in July with the delinquency rate of prime mortgages that were at least 30 days or more delinquent decreasing from 4.1 percent in June to 4.0 percent in July. In July of last year, the delinquency rate was 4.5 percent.

Performance of sub-prime mortgages also improved as the percentage of delinquent loans fell to 29.1 percent from 29.5 percent in June and was down from 33.1 percent posted a year earlier.

Delinquency rates of mortgages insured by the Federal Housing Administration (FHA) also fell, declining to 11.9 percent in July from 12.0 percent in June. The delinquency rate on FHA loans a year ago was 12.2 percent.

Seriously delinquent prime mortgages, those that are 90 days or more past due, declined in July with 1.335 million loans in trouble, down from 1.353 million in June and down from 1.469 million a year earlier.

Sub-prime mortgages that were seriously delinquent numbered 1.585 million in July, down from 1.599 million in June. In July of last year, 1.733 million sub-prime mortgages were seriously delinquent.

Loans insured by the FHA that were seriously delinquent increased to 726,000 in July, up from 721,000 in June, and were substantially higher than the 599,000 delinquent loans in July 2011.

HOPE NOW proprietary loan modifications increased in July, growing to about 66,000 modifications from around 46,200 modifications in June. HARP refinances fell from 125,900 in June to 96,400 in July.

Loan originations for home purchases increased 6.7 percent from the first quarter of 2012 to the second quarter but were 9.0 percent lower than last year while refinance originations were up 1.1 percent from the first to the second quarter and were up 41.8 percent from the second quarter of last year.

Home prices continued to improve with all three of the indices used in the Housing Scorecard, Core-Logic, FHFA and the Case-Shiller Indices, posting pricing gains in June and July.

Sales of new homes increased by a seasonally adjusted 3.7 percent from June to July, while sales of existing homes improved by 2.3 percent.

Distressed property sales accounted for 22 percent of all re-sales in June, down from a revised 24 percent in May and down from 27 percent the previous year.

The inventory of existing homes fell slightly from the previous month with a 6.4 months supply of homes available for purchase. New home inventory fell to a 4.6 months supply of inventory, down from a revised 4.8 months supply in June.

Foreclosure activity improved in July with foreclosure starts falling 5.5 percent and foreclosure sales falling by 2.4 percent. Compared to a year ago, foreclosure starts and sales were mixed with starts up 1.8 percent and foreclosure sales down 9.1 percent.

The estimated number of homeowners whose homes are worth less than what they owed declined to 10.8 million at the end of the 2nd quarter of 2012 from a revised 11.4 million at the end of the first quarter.

Tags: August Housing Scorecard, Obama Administration, loan modifications, mortgage delinquencies, trial modifications, prime mortgages, sub-prime mortgages, FHA

Source:
HUD