A new piece of legislation may force lenders to factor in a borrower's anticipated energy costs when underwriting a government-backed mortgage, says the Institute for Market Transformations.The Sensible Accounting to Value Energy Act, co-sponsored by Senators Michael Bennet and Johnny Isakson, if enacted, would have lenders for Fannie Mae, Freddie Mac and the Federal Housing Administration examine a borrowers electricity and gas payments to determine if they would still be able to meet their monthly mortgage payment afterwards."The SAVE act would address this blind spot, giving a more complete picture of the costs of homeownership and borrowers’ capacity to service debt," said a statement from the senators.Annually, many homeowners spend more on energy expenses than either real estate taxes and home insurance. The Senators say the SAVE Act would open doors for homeowners to make energy upgrades a part of their mortgage.This bill would affect homeowners nationally, but Houston homes are generally subject to higher energy costs, especially during the summer season. But there are options for making a home more energy efficient. Fixing leaks, installing insulation, upgrading the A/C and going solar are all viable options to keep utility costs down.Courtesy of 2M Realty News

According to new data, housing starts rose in the month of September, says a report from the U.S. Census Bureau and the Department of Housing and Urban Development.

Nationally, housing starts were up 15 percent in September over the previous month, and are up 10.2 percent over September 2010. This accounts for a seasonally adjusted rate of 658,000 units.

Single-family homes, which make up 70 percent of all starts, rose 1.7 percent to a rate of 425,000 units.

"The September starts report shows new housing activity to be stronger than expected," according to analysts with Econoday. "The big question is whether the demand exists to absorb added supply."

This data comes a day after the National Association of Home Builders confidence index rose four points for the month of October.

The growing number of home starts directly impacts Houston real estate. The Houston Association of Realtors announced in its September report that Houston-area home sales have increased for the fourth straight month, performing better than the national average. This growing trend might mean it's a good time to look at Houston listings for a new home.

Courtesy of 2M Realty News 

Data from a recent report shows sales in the Houston real estate market have risen for the fourth consecutive month, finds the Houston Association of Realtors.

The sales of single-family homes has risen 16.9 percent from September 2010. The price of Houston homes has also increased to an all time high, while the month's inventory fell to its lowest level since May 2010. Pending sales rates rose and the number of active listings in the market place declined.

Houston's overall housing market yielded positive results in all sales categories compared to September 2010. In past months, data was skewed by the expiration of a 2010 tax credit that caused a major drop in home sales.

"The combination of increased closed and pending sales, fewer active listings and strong pricing suggests that we are entering the fall home buying season on strong footing," said HAR chairman Carlos P. Bujosa. "HAR's September report shows rebalanced supply and demand throughout the Houston housing market with diminishing traces of the distortions caused by last year's federal home buyer tax credit."

The average price for a Houston home marginally increased by 0.4 percent from a year ago to $213,334 - the highest September level ever recorded. The median price increased by 1.6 percent to $157,500 also breaking records. Total Houston residential property sales increased 15.9 percent totalling 5,469 transactions. The total dollar value of these transactions equaled approximately $1.1 billion.

Total sales of homes in every price range showed gains in September. Homes priced less than $80,000 rose 11.4 percent while homes between $80,000 and $150,000 increased 21.8 percent. Sales on homes between $150,000 and $250,000 were up 18.7 percent while homes between $250,000 and $500,000 increased 26.8 percent. Overall sales in the luxury market also increased, recording a 2.3 percent increase.

Houston's housing market was hit hard with foreclosures in recent years. Foreclosure property sales increased 2.4 percent and made up 19.4 percent of all property sales. According to RealtyTrac, in the month of September Harris County had 2,466 foreclosures.

Total active listings declined 11.5 percent to 48,752. The housing supply also decreased to 7.1 months, compared to a 9.4 month national average, reported the National Association of Realtors. 

 

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New mortgage standards for major lenders are due to take effect starting January 2012, Marketwatch reports.

The new rules have been in effect for months, but only on a voluntary basis. Starting in 2012, these regulations will be mandatory.

The new standards are known as the servicer alignment initiative and will be applicable to all mortgages backed by Freddie Mac, Fannie Mae and the Federal Housing Administration, reports the news source.

Under the new rules and regulations, servicers will be required to provide guidance on foreclosure alternatives for borrowers who are 30 days delinquent. The alternative measures include loan reinstatement, eliminating delinquency through repayment programs, government modification programs or a private short-sale process.

"In that 30-day time period the borrower is going to be evaluated for the best alternative," Freddie Mac servicing director Robert Kimble told the source.

According to RealtyTrac, Houston has been hit hard with foreclosures and short-sales in past years. This new program will ensure owners of Houston homes are well informed on the foreclosure process and given a chance to look for alternatives.

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Home prices have declined more than 30 percent in the past five years, but two key indicators might be saying its a good time to buy again, reports The Wall Street Journal.

The first indicator is the restoration of the Price-to-Rent ratio. This measures the median price of a home and divides it by its potential rental value. According to the WSJ, the ratio has been restored to its pre-bubble average. The second indicator is low mortgage rates making homes the most affordable they've been in years.

As a result, monthly house payments could the cheapest they've been for borrowers in four decades. Buyers today will be able to get more house for their dollar, but conservative buyers who opt for a moderate house will have smaller payments.

The Houston real estate market has seen ups and downs in recent years, but home prices have been stabilizing. According to Zillow, Houston home prices in September averaged $164,000 - a 0.5 percent decrease from September 2010. Taking these trends into account, consumers may want to start looking into purchasing a new home.

Courtesy of 2M Realty News        

This year Houston's Best Community award from the Greater Houston Builders Association went to The Falls at Imperial Oaks, reports The Woodlands Villager.

The award, designed to recognize Houston's best residential master-planned community, uses a panel of judges from outside the industry to judge the communities based on master plan, amenities, landscaping, product variety and success in the marketplace.

Falls at Imperial Oaks was recognized for its outstanding amenities like The Lake Club, which won a "Houston's Best" award in 2010 for best reception center. Other emphasis from the judges was on tree preservation and natural landscaping, along with a strong feeling of resident involvement, according to the paper. The community's continued commitment to environmental friendliness was also recognized since many of its homes now have solar panels.

"We are very grateful to the Houston's Best judges for recognizing the many attributes that make The Falls at Imperial Oaks ‘Houston's Best’ community, We are thrilled to receive this award, which comes near the end of a very successful year that includes our major expansion and the announcement of ExxonMobil’s new campus only minutes away from us," Jim Holcomb, president of the developing company, Holcomb Properties told the news source.

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The major settlement between major banks and many of the state attorneys general may not absolve banks of all liability over problems with the mortgage process, Bloomberg reports.

Iowa Attorney General Tom Miller is leading a settlement with the lenders that is getting closer to finalization. However, he pointed out that the settlement would not prevent towns or individual states from suing lenders that allegedly cut them out of millions of dollars through filing fees, said the news source.

Harris County is one such municipality that may pursue the matter.

Houston Homes were hit especially hard in recent years, accounting for 2,466 foreclosures in September alone, according to RealtyTrac.. Lawyers for Harris Country said last week that they would were pursuing talks with county government officials to file claims against lenders. The request will likely be heard on October 25 by the Harris County Commissioners Court.

"This is a local issue. The county attorneys want a seat at the table and to be part of any discussion," assistant Harris County attorney John Odam, told the source.

Courtesy of 2M Realty News

The nation's fragile housing market may start to stabilize after another year or two, reports the Wall Street Journal.

While gathered at the Mortgage Banker Associations annual conference, chief economist at Moody's Analytics Mark Zandi told industry leaders that a few minor tweaks, instead of a major industry overhaul, should be enough to stabilize the housing market.

"The key to home prices is the share of home sales that are distressed. A year, year-and-a-half down the road that share will start coming down (and) you get price stability and then price growth," Zandi said, according to the Journal.

Foreclosures are a major concern for the market's stability. Foreclosures can depress prices in the near term, but shrinking discounts for these distressed properties is a positive sign that housing demand may be improving, the paper says Zandi observed.

Texas currently has 10,148 foreclosure properties, the seventh highest in the country, reports RealtyTrac. The Houston real estate market has been hit especially hard with foreclosures. Harris County currently has 2,485 active foreclosures, which is one in every 794 housing units.

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Former Florida Governor and Texas native Jeb Bush has recently shown doubt that President Barack Obama will take a firm stance on the country's current housing crisis, HousingWire reports.

Bush is currently the head of his own consulting firm, Jeb Bush & Associates, and spoke to the Mortgage bankers Association at their 98th Annual Convention and Expo in Chicago.

"The hope and feeling of optimism (has been) replaced with despair. All the polling numbers have been so bad as to the pessimism of the country, so that 70 percent feel we are heading to recession," Bush said.

Bush continued by examining how the heavy-handed regulatory environment of the housing market will hinder long-term solutions.

The Houston real estate market could benefit if Bush's words were taken into consideration. At present, older more established neighborhoods with home prices over $200,000 have done well despite the weak market. However, newer neighborhoods with home prices below $200,000 have been affected by foreclosures and short sales, according to the most recent report from the Houston Association of Realtors.

Currently, the average price of a home in the Houston area is $185,182, according to the report.

Courtesy of 2M Realty News

Creating a fairer mortgage system and repairing the housing market will ease the frustration the country has with Wall Street, former senior adviser to President Obama, David Axelrod told the Mortgage Bankers Association, according to HousingWire.

Calling for a more transparent financial system, Axelrod examined how putting subprime mortgages into securities was the key factor in the economic downturn and should have been prevented. "Loans need to be given on terms borrowers can understand and afford. Some borrowers share the blame for agreeing to these problematic mortgages," he said, according to the report.

Axelrod believes such mortgages will never return, but called for a necessary fair lending standard. A clearly thought-out reduction in government regulation to promote business in the Houston real estate market and others nationwide is also necessary, he argued, such as bringing an end to the government-sponsored enterprises.

"We have to end Fannie and Freddie as we know them," Axelrod said, according to HousingWire. "There is no reason Fannie and Freddie should own 300,000 homes."

He continued by calling for the immediate appointment of Richard Cordray as head of the Consumer Financial Protection Bureau to get the process going.

Courtesy of 2M Realty News 

The US government recently began to pullback the assistance it has been providing to the mortgage market to see if private lenders can pick up the slack, reports The Wall Street Journal.

Critics are concerned the move will cause more issues in regions where housing demand has not yet recovered amid the slow economy.

One recent move reduced the loan limits Congress expanded in 2008, allowing Fannie Mae, Freddie Mac and the Federal Housing Administration to buy mortgages up to $729,750. The FHA has financed nearly half of all home purchases since the market crash of 2008 and allowed buyers to make minimal down payments - many as low as 3.5 percent.

"The net-net here is that the available pool of credit for housing is shrinking. Prices will have to decline," Christopher Whalen, co-founder of Institutional Risk Analytics, told the WSJ.

Some say home sellers are in for a suprise when there find much fewer potential buyers able to qualify after the government's retreat. The changes may deter "trade-up" buyers who would typically use home equity, which declined after 2008, as a down payment to finance the purchase of Houston real estate.

Courtesy of 2M Realty News 

The amount of Americans who own their homes has seen its largest drop since the Great Depression, says the US Census Bureau.

Home ownership fell to 65.1 percent in 2010, 1.1 percent lower than a decade earlier. In the 1930s homeownership plunged 4.2 percent.

"Home ownership during the 2000s was really high in the middle of the decade, up to almost 70 percent at one point around 2004," said Ellen Wilson, a survey statistician with the bureau.

However, certain areas were hit harder than others. The Midwest had the highest rate of homeownership with 69.2 percent, the South with 66.7 percent, the Northeast with 62.2 percent, and the West with 60.5 percent.

The Houston real estate market was also likely impacted as Texas saw the largest decrease in homeownership with a subsequent increase in renter occupancy with 19.8 percent. The state also had one of the largest percentage increases in housing units at 22.3 percent.

There has also been a substantial growth in the number of vacant home across the country. According to the survey, there are 15 million empty homes, up from 10.4 million in 2000.

Courtesy of 2M Realty News 

A recent report from Fitch Ratings revealed that a significant number of prime mortgage borrowers nationwide are experiencing troubles with their loan.

The report relayed that more than one-third of all prime borrowers in private-label securitizations currently have negative equity. Fitch Ratings managing director Grant Bailey explained that despite modest gains recently, home prices will need to plunge further before a sustained recovery can take place.

"With home prices likely to decline another 10 percent, roughly half of prime borrowers will wind up underwater on their mortgage," said Bailey.

The Fitch report also revealed that slightly more than 12 percent of all prime borrowers are seriously delinquent on their home loans. Bailey explained that prime mortgage default rates will continue to remain high, as home prices fall and the national unemployment rate stays high.

Declining equity, rising delinquencies and growing payment shock risk led to negative rating actions for Fitch's review of residential mortgage-backed security transactions, the report showed.

With a significant number of homeowners struggling with their loans, the Houston real estate market may experience a rise in foreclosures soon.

Courtesy of 2M Realty News

According to the National Association of Home Builders' second edition of its First American Improving Markets Index, the number of improving housing sectors nearly doubled.

The company's IMI showed that 23 individual housing markets showed better conditions during September, up from 12 in the previous report. To qualify, a market must show sustained improvement in terms of housing permits, employment and prices of homes for sale for at least six months.

Texas had the most markets on the list with seven, including Amarillo, McAllen, Midland, Sherman, Waco, Odessa and Wichita Falls. Pittsburgh and New Orleans were the two most-improved markets, NAHB representatives relayed. The only region to drop from the list between editions was Bangor, Maine, as it experienced a drop in local building permits.

"Both the number and geographic diversity of improving housing markets expanded this month, with Iowa, Illinois and South Carolina all newly represented by one entry or more on the list," said NAHB chairman Bob Nielsen.

While the Houston real estate market was not one of the 23 making the list, its housing statistics have shown monthly improvements for a significant period of time.

Courtesy of 2M Realty News

According to Freddie Mac's Primary Mortgage Market Survey, October has started with a bang for prospective homeowners.

For the week ending October 6, the average rate for a 30-year fixed loan sunk to 3.94 percent, down from 4.01 percent the week before and 4.27 percent during the same week the previous year. This marks the first time the rate has dropped below 4 percent since the beginning of Freddie Mac's survey in 1971. The average rate for a 15-year fixed loan was 3.26 percent, down from 3.28 percent the previous week.

"Average 30-year conventional fixed mortgage rates fell below 4 percent for the first time in history this week following a sharp drop in 10-year Treasuries early in the week as concerns over a global recession grew," said Frank Nothaft, Freddie Mac's chief economist and vice president. "Average 15-year fixed rates fell to a record low in the PMMS as well."

The average rate for a five-year adjustable-rate loan was 2.96 percent, declining from 3.02 percent the previous week and 3.47 percent the year before. Meanwhile, the rate for a one-year ARM averaged 2.95 percent, which was up from 2.83 percent the week before.

With interest rates continuing to reach record lows, the Houston real estate sector may continue to experience success with more prospective homeowners entering the market.

Courtesy of 2M Realty News

Speaking at a recent forum, National Association of Realtors president Ron Phipps relayed that the struggling housing sector needs to remain the nation's top priority.

Phipps explained that homeownership affects all Americans and that a recovery in the housing sector could prompt better economic times.

"As the leading advocate for homeownership, Realtors know that issues like affordable financing, natural disaster insurance, the mortgage interest deduction and foreclosures and short sales don't just affect people who own a home - homeownership shapes communities and strengthens the nation's economy," said Phipps.

Phipps advocated for stronger public policies that promote responsible and sustainable homeownership, which may help stabilize the market and support an economic recovery. He believes that legislative and regulatory help in the form of homeownership tax benefits may spur more real estate purchases and ease the nation's consumer tension.

Furthermore, allowing more consumers to receive home loans, especially considering their record-low rates, may also provide a boost for the sector.

The Houston real estate market is one of many examples that show how a better sector can improve consumer conditions. The region has recorded several straight months of higher home prices and greater real estate sales.

Courtesy of 2M Realty News 

A recent article in The Wall Street Journal explained that many economists are predicting a rise in the nation's mortgage rates soon.

"It's hard to imagine how long-term, 30-year fixed-rate mortgages could go lower than they are right now," said Frank Nothaft, vice president and chief economist of Freddie Mac. "These are the cheapest rates we’ve ever seen."

The article explains that economists have been largely duped by the economy this year, with many not expecting it to weaken as badly as it did. These experts didn't foresee troubles in the European market, which maqny analysts believe led to lower consumer confidence, or for the Federal Reserve's Operation Twist, which was put in place to drive interest rates lower.

For the week ending September 29, rates for 30-year fixed-loans averaged 4.01 percent, the lowest rate on record since Freddie Mac's Primary Mortgage Market Survey began in 1971.

While Nothaft and other experts predict rates to rise, Bob Walters, chief economist at Quicken Loans, believes rates could push lower since 2011 has been full of surprises.

With rates remaining low for a prolonged period, the Houston real estate market has benefited, recording better sales for several months, according to the Houston Association of Realtors.

Courtesy of 2M Realty News

Roughly $27 billion was put into the Houston economy by the Houston Airport System in 2010, with hundreds of thousands of jobs created through HAS, a report by Aviation News Today states.

According to the source, a study reveals HAS was responsible for 230,000 jobs in the Houston area last year, the majority of which were related to George Bush Intercontinental Airport.

"As the results indicate, our diverse system of airports remain a driving force in Houston's regional economy and will provide a solid foundation for future economic growth and prosperity," said Houston Airport System director Mario Diaz.

This news follows the release of findings from the Associated General Contractors of America, which show that in the last year, no other U.S. metro added more construction jobs than Houston.

Add to these factors that mortgage interest rates have hit record lows, and area homebuyers may find the fourth quarter of 2011 to be a prime time to secure loans and purchase Houston homes for sale.

Courtesy of 2M Realty News

The Mortgage Bankers Association's most recent Weekly Mortgage Applications Survey showed a significant increase in home loan submissions, as more borrowers attempted to refinance their loans.

The Market Composite Index, which gauges the volume of home loan submissions, was up 9.3 percent on a seasonally adjusted basis. Unadjusted, the index grew 9.2 percent. The Refinance Index, which measures how many borrowers applied to adjust their current loan, increased 11.2 percent, while the Purchase Index was up 2.6 percent on an adjusted basis from the previous week.

"With lower rates, refinance application volume increased to its highest level since August 19, 2011," said MBA vice president of Research and Economics Michael Fratantoni. "Purchase application volume also increased. However, the increase was in conventional purchase applications, which were up by 4.9 percent."

The four-week averages for the Market and Refinance Indices were up, growing 1.96 percent and 2.60 percent, respectively. The average for the Purchase Index declined 0.18 percent.

With more mortgage applications being submitted during the week, more sales of Houston properties may take place soon and further improve the region's real estate market.

Courtesy of 2M Realty News

According to the Federal Housing Finance Agency, the average interest rate of mortgages sold to government-sponsored enterprises fell during August, representing the fifth-straight month of declines.

Overall, the interest rate averaged 4.56 percent during the month, down 1 basis point from July. In March, the rate averaged 4.84 percent, and has declined each month since.

Frank Nothaft, Freddie Mac's chief economist and vice president, explained that the efforts of the Federal Reserve have helped pushed rates to lows not seen in a half-century. However, the Fed has offered to help even more, planning to purchase up to $400 billion in long-term Treasurys and new agency mortgage-backed securities beginning October 1. The Reserve believes doing so will allow rates to main at these historic lows.

According to the FHFA report, the average rate for a 30-year fixed loan was 4.63 percent during August, down 6 basis points from July. For all fixed- and adjustable-rate mortgages, mortgages sold to GSEs was 4.52 percent, which fell 3 basis points from the previous months.

With home loan rates remaining historically low, more Houston properties may be purchased in upcoming months, continuing the region's recent successful real estate run.

Courtesy of 2M Realty News

According to a recent report from the Real Estate Center at Texas A&M University, the state continues to lead the nation in terms of job creation, more than doubling the country's pace during the last year.

The report explained that the state added 271,400 nonfarms jobs between August 2010 and 2011, which represents an annual growth rate of 2.6 percent, well ahead of the nation's average of 1 percent. In fact, the number of nonfarm jobs added in Texas accounted for 21.1 percent of the country's total during this period.

According to the report, the state's private sector increased by 284,200 jobs, representing a 3.3 percent incline, compared to the country's 1.6 percent jump. Unemployment in the state reached a seasonally adjusted rate of 8.5 percent during August 2011, up from 8.3 percent the year before. Nationally, the jobless rate was down during August, falling from 9.5 percent to 9.1 percent.

Outside of the information industry and the state's government sector, every other industry in Texas added jobs during the previous year, with the mining and logging sector creating the most jobs.

With more jobs available, a greater number of consumers may now be interested in purchasing properties in the Dallas and Houston real estate sectors.

Courtesy of 2M Realty News

Freddie Mac's most recent Primary Mortgage Market Survey revealed that mortgage rates continued to remain close to historic lows for the second-straight week, which may prompt more potential homeowners into action.

For the week ending September 22, the average rate was 4.09 percent for a 30-year fixed loan, the second-straight period the average remained at this record-low level. Compared to the same week the year before, the average is down from 4.37 percent. The rate for 15-year loans averaged 3.29 percent, falling from 3.30 percent the previous week and 3.82 percent the year before.

"A sluggish economy and investor concerns over the European debt markets left mortgage rates largely unchanged this week," said Freddie Mac chief economist and vice president Frank Nothaft. "The Federal Reserve Board reported that households lost nearly $150 billion in net worth in the second quarter, representing the first quarterly decline in a year."

Average rates for adjustable-rate mortgages grew during the week, as the rate for a five-year ARM was up from 2.99 percent the week before to 3.02 percent. Meanwhile, the rate for a one-year ARM averaged 2.82 percent, up from 2.81 percent the week before. Both rates were down from the year before.

With mortgage rates continuing to decline, more consumers may look to purchase homes, which could signal even more sales for the Houston real estate market following a successful August.

Courtesy of 2M Realty News

The Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending September 16 revealed the volume of home loan submissions increased as more homeowners attempted to refinance their mortgages.

The Market Composite Index, which measures mortgage loan application volume, increased 0.6 percent on a seasonally adjusted basis during the week. Unadjusted, the index was up 25.2 percent. The Refinance Index also grew, jumping 2.2 percent from the week before, while the Purchase Index was down 4.7 percent on an adjusted basis. Unadjusted the index increased 17.1 percent.

The four-week averages for each of the indices decreased during the week, according to the report. The Market and Refinance Indices' four-week averages were down 3.15 percent and 0.54 percent, respectively, while the Purchase Index average fell 3.91 percent on an adjusted basis.

Overall, refinance applications accounted for 78.3 percent of submissions, which is up from 76.8 percent the week before.

With more mortgage applications being submitted, the Houston real estate market may conduct even more sales in September after sales increased in August.

Courtesy of 2M Realty News

A recent report from Lender Processing Services may serve as a point of optimism for the national real estate market, which has been marred by distressed properties and late mortgage payments in recent months.

Overall, the report showed tha 8.13 percent of the nation's home loans were delinquent during August, representing a 2.5 percent decrease from July and an 11.8 percent decline from the previous year.

In addition, the country's foreclosure pre-sale inventory rate remained relatively unchanged during the month, rising only 0.1 percent from July to 4.11 percent of all properties. This total is up 8.2 percent from August 2010, however.

In all, the nation's foreclosure pre-sale inventory totaled 2.15 million properties during August. Factoring in properties that are 30 or more days delinquent, the total increased to 6.40 million units.

Florida, Mississippi, Nevada, New Jersey and Illinois had the highest percentage of non-current loans during August, while Montana, Wyoming, Arkansas and North and South Dakota had the lowest percentage.

In the Houston real estate market, distressed property sales accounted for 19.8 percent of all transactions during August, the Houston Association of Realtors recently reported.

Courtesy of 2M Realty News

According to a recent survey conducted by an online real estate company, owning a home remains a priority for many consumers who still consider it part of the American Dream.

More than 2,000 adults over the age of 18 responded to the company's survey, 70 percent of whom claim homeownership is part of achieving their personal dream. This percentage is unchanged from a similar poll taken in January, despite the continued overall struggles of the national real estate market and economic strife experienced so far in 2011.

The survey also discovered that 57 percent of current homeowners claim owning a property is the best long-term investment they could have made, ahead of contributing money to retirement accounts and 401(k) plans.

Furthermore, 80 percent of respondents relayed their plans to purchase another home in the future, 69 percent of whom were adults over the age of 55.

The lowest percentage of optimism regarding homeownership was among adults between ages 18 and 34, with 24 percent stating their American Dream does not include owning a property.

Consumers in the South may regard homeownership as a priority, as the Houston real estate market recorded another stellar month in terms of sales and price increases during August, the Houston Association of Realtors recently reported.

Courtesy of 2M Realty News

According to data released by the U.S. Department of Commerce, the pace of residential construction during August showed fluctuations in all areas.

During August, the rate of building permits issued for privately owned homes increased by 3.2 percent to a seasonally adjusted pace of 620,000, surpassing July's revised rate of 601,000. In addition, the monthly pace was 7.8 percent better than the pace of 575,000 recorded in August 2010.

Single-family authorizations during August also increased during August, growing 2.5 percent to an adjusted pace of 413,000. However, the pace for both starts and completions were lower.

During August, privately owned home starts dropped 5 percent from July to an adjusted rate of 571,000. The total is also down 5.8 percent from the pace of 606,000 recorded in August 2010. Single-family starts fell 1.4 percent from July to an adjusted pace of 417,000.

Private home completions settled at an adjusted pace of 623,000, which is 2.7 percent below July's rate and 2.6 percent behind the pace set in August 2010 of 607,000.

In addition to slowed rates, home builder confidence declined slightly during August amid economic strife. However, in the Houston real estate market, sales may hold steady, as the local job market has continued to remain strong.

Courtesy of 2M Realty News

According to recent data, an increasing number of consumers have begun applying for 15-year home loans in place of the normal 30-year terms to refinance their mortgages.

During August, according to figures accumulated by a mortgage website, the number of refinancing loan applications for 15-year mortgages increased 29 percent from the previous year. By comparison, 30-year home loan refinancing applications were up 12 percent.

"It's all the trend right now," Kristine Marr, a senior loan officer, told the Contra Costa Times. "Most borrowers are asking about switching to a 15-year-loan. Everybody's in a mood now to get those mortgages paid off. They want to see an end to those payments, and that's what's driving it."

While 15-year mortgages require larger monthly payments than 30-year terms, they can provide more savings in terms of interest payments.

Another mortgage experts believes consumers have an eye on retirement when opting for 15-year terms, as many hope to build equity faster. Obtaining a 30-year loan when consumers are planning to retire in 20 years isn't a good investment, the expert told the news source.

With interest rates for mortgages falling to record lows recently, and the local job market continuing to improve, more Houston properties may be sold soon.

Courtesy of 2M Realty News

According to data recorded by the National Association of Home Builders/Wells Fargo Housing Market Index for September, confidence among builders in the new single-family market remained virtually unchanged during the month.

Overall, confidence in the sector declined a single point to 14, which represents the sixth consecutive month the index has registered a reading between 13 and 16.

"Very little has changed in terms of housing market conditions so far this year," said NAHB chairman Bob Nielsen. "Builders continue to confront the same challenges in accessing construction credit, obtaining accurate appraisal values for new homes, and competing against foreclosed properties that they have seen for some time."

Nielsen referred to the recent Standard & Poor's credit downgrade and congressional gridlock on the budget deficit as reasons for lower builder and consumer confidence, as the economic strife continues.

In the Houston real market, home sales and prices have held strong in recent months, as the region has continued to maintain a healthy job sector, prompting more interest in local properties.

Courtesy of 2M Realty News

Homebuilder confidence was stagnant in September from the month before, according to the National Association of Home Builders' Housing Market Index for September.

The NAHB's report indicates a HMI of 14 during the month - a marginal drop from August. For the sixth consecutive month, the index has fallen somewhere between 13 and 16. Any reading above 50 indicates a high confidence level.

NAHB chairman Bob Nielsen stated that since housing market conditions have remained the same since the beginning of the year, builders' perspective on construction prospects for the remainder of 2011 are also the same.

"Builders continue to confront the same challenges in accessing construction credit, obtaining accurate appraisal values for new homes, and competing against foreclosed properties that they have seen for some time," said Nielsen. "Beyond this, both builder and consumer confidence took a hit in recent weeks with the market disruptions caused by the S&P downgrade and congressional gridlock on the budget deficit."

While builder confidence may still be low for the nation, it may rise for the Houston real estate market soon. Sales in the metro area improved 17 percent month-to-month in July, the Houston Association of Realtors reports.

Courtesy of 2M Realty News

According to a recent report from The Community Impact Newspaper, homebuilders in Houston have remained busy lately, but many are becoming upset with new fees and regulations, which could threaten their business.

Overall, the Houston real estate market has led the nation in terms of new home starts, and values of Houston properties have not dropped, the Greater Houston Builders Association reports. However, the costs to build new homes have increased due to the new fees and regulations. In addition, builders are unable to raise the price of their new homes given the ongoing economic strife. As a result, sales of new homes have reached a 48-year low, the National Association of Home Builders reports.

While the market doesn't favor homebuilders, it does make properties more affordable for potential homebuyers, the president of a local homebuilding company told the new source.

"Our consumers are getting the very best home that has ever been built at the lowest price possible," the executive relayed to the newspaper.

Despite the new fees and regulations, homebuilders remain optimistic about construction, however, as home prices will have to increase sooner or later as the cost of building properties rises.

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A recent editorial in CultureMap Houston referred to a comeback taking place in the region's real estate market.

The piece refers to data released by the Houston Association of Realtors that showed a 17 percent increase in Houston property sales during July. In addition, the city's inventory of homes has shrunk by close to 10 percent from the previous year.

"We are in the early part of a recovery," a local Realtor told the news source. "We have consistently stayed above last year."

The editorial also refers to the region's strong economics, as close to 65,000 jobs have been added during the past 12 months, with the oil and gas industry leading the way. In addition, many energy companies have relocated to Houston, bringing jobs with them.

These trends have all contributed to represent positive movement for the region's real estate market, as home sales in Houston are up significantly from the previous year, the report states.

"Our phones have been ringing much more," another Realtor told the news source. "[There] are people who wish to buy and there is an abundance of them."

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A recent MSN Money article explained that due to continued home repossessions, the government is now responsible for nearly 250,000 properties.

The number of repossessions has continued to increase as more homeowners are unable to make payments on their mortgages and default on their loans. Reports also show that a significant number of homes are still moving toward default, which would only raise the number of distressed properties for which the government is responsible.

In all, the country has close 800,000 repossession homes, meaning the government accounts for nearly one-third of this total.

To deal with the onset of more repossessions, officials from Freddie Mac, Fannie Mae and the Federal Housing Administration have discussed potential courses of action to unload the properties without affecting the currently depressed housing market. However, experts don't believe this will happen.

"They're stuck," Karen Shaw Petrou, a managing partner at Federal Financial Analytics, told the news source. "They don't know what to do."

While the national scene has become ugly, the Houston real estate market remains one of the better-performing, more-consistent sectors in the country, according to reports.

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Freddie Mac's recent Primary Mortgage Market Survey revealed new lows for mortgage interest rates.

For the week ending September 15, 30-year fixed loans recorded an average rate of 4.09 percent. This average is down from 4.12 percent the week before and 4.37 percent during the same week the previous year. The average rate for a 15-year fixed loan was 3.3 percent, down from 3.33 percent the week before and 3.82 percent the year prior.

"Continued investor concerns over the state of the European debt markets kept U.S. Treasury bond yields low and allowed mortgage rates to ease once more this week," said Frank Nothaft, Freddie Mac chief economist and vice president. "In comparison, the average interest rate of mortgages outstanding in the second quarter was 5.28 percent."

After showing no change during the previous week, the average rate for a five-year adjustable-rate mortgage increased to 2.99 percent from 2.96 percent. The rate is still below 3.55 percent recorded the previous year. One-year ARMs averaged a rate of 2.81 percent, down from 2.84 percent the week before and 3.40 percent in 2010.

A recent report from employment company Manpower revealed Houston companies expect to increase hiring later this year. If interest rates remain low, a significant number of Houston properties may be sold before the end of 2011.

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According to a survey conducted recently by employment company Manpower, many businesses in Houston are planning to either maintain their workforce or increase hiring during the fourth quarter of 2011.

Of those responding to the survey, 22 percent anticipate hiring increases, while 13 expect to reduce their staff. Overall, 64 percent plan to keep their current workforce in tact.

Among the sectors with the best job prospects are non-durable goods manufacturing, transportation and utilities, wholesale and retail trade and information and financial activities, the report states. The sectors expecting to reduce their workforce are construction and durable goods manufacturing.

Currently, Texas' employment outlook is the third-best in the nation, the report states. Overall, 20 percent of the state's companies plan to hire, while 9 percent anticipate cuts and 67 percent expect their workforce to remain unchanged.

The greater number of jobs forecasted to be available may improve the Houston real estate sector as well, as more potential homebuyers may then enter the market, especially with interest rates for mortgages remaining historically low.

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According to RealtyTrac's U.S. Foreclosure Market Report for August, the nation's total foreclosure activity continued to decline on a yearly basis, despite higher monthly volumes.

In all, 228,098 properties received foreclosure filings during August, which is up 7 percent from July, but down 33 percent from the year before. Overall, one in every 570 housing units became distressed during the month.

Default notices grew 33 percent from July, reaching a nine-month high of 78,880. Foreclosure auctions and bank repossessions declined, however, falling 1 and 4 percent between July and August, respectively.

"The big increase in new foreclosure actions may be a signal that lenders are starting to push through some of the foreclosures delayed by robo-signing and other documentation problems," said James Saccacio, chief executive officer of RealtyTrac. "It also foreshadows more bank repossessions in the coming months as these new foreclosures make their way through the process."

In Texas, 10,148 homes received a foreclosure filing during the month, representing one in every 958 properties. While data has not yet been released for August, 13.5 percent more homes in the Houston real estate market became distressed in July than the previous year, the Houston Association of Realtors reported.

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According to CoreLogic's most recent release, the nation's total number of underwater mortgages declined slightly during the second quarter. However, the volume is still high by historic standards.

Overall, 10.9 million Americans had underwater mortgages at the end of June, representing 22.5 percent of the nation's borrowers. This figure is down slightly from 22.7 percent in the first quarter. However, the total is still high and, in addition, another 2.4 million borrowers had less than 5 percent equity on their home, known as near-negative equity. In total, 27.5 percent of the country's mortgage owners had either near-negative or negative equity during the second quarter.

By state, Nevada had the highest percentage of underwater mortgages with 60 percent, followed by Arizona at 49 percent, Florida at 45 percent Michigan at 36 percent and California at 30 percent.

"High negative equity is holding back refinancing and sales activity and is a major impediment to the housing market recovery," said Mark Fleming, chief economist with CoreLogic. "The hardest hit markets have improved over the last year, primarily as a result of foreclosures. But nationally, the level of mortgage debt remains high relative to home prices."

Underwater mortgage concentrations appear to be the highest in regions with many foreclosures. In the Houston real estate market, foreclosures represented 19.6 percent of all property sales in July, which is slightly up from June, the Houston Association of Realtors reported.

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According to a recent report from TD Bank affiliate TD Economics, the economy will continue to grow at a meager pace for the next several years as a result of many factors experienced this year.

Earlier in 2011, high gas prices, the fallout from the natural disaster in Japan and overal bad weather contributed to hold the economy back. However, more recently, declining consumer confidence has affected the economy the most.

"Financial markets suffered a crisis of confidence this summer, the fallout from which will impact the economic recovery," said TD chief economist Craig Alexander, who authored the report. "A more robust pace of economic growth will require tackling the legacy issues of the financial crisis still burdening the recovery."

The report forecasts the real gross domestic product to increase to 1.6 percent in 2011, followed by a rise to 1.7 percent in 2012 and 2.6 percent in 2013.

In areas with stronger job sectors and steady home sales, such as the Houston real estate market, the economic forecast may prove to be slightly healthier.

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According to data compiled by the Texas A&M Real Estate Center, record-low interest rates for mortgages have driven more consumers to purchase properties in Northern Texas.

During August, the region sold 27 percent more properties than the previous year, totaling 6,822, the report states.

In Tarrant County, 27 of the 32 submarkets analyzed recorded an increase in sales, including all parts of Arlington. In fact, in southeast Arlington, property transactions were up 120 percent.

Sales in Roanoke doubled as well, while transactions in Fort Worth were down 25 percent.

Year-to-date, home sales totaled 43,879, which is down 4 percent from the same period in 2010, however, the percentage gap is narrowing, according to the report.

The median home price was up 2 percent in the region during August, growing to $154,000. However, year-to-date, the price remained flat at $148,000.

In the southern part of the state, the Houston real estate market has flourished recently, recording greater sales and median prices in July. Data for August is expected to be released soon.

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According to a recent report from the Federal Reserve Bank of Dallas, Texas' energy sector has been driving the state's economy, while other sectors have been unable to record growth.

The report showed that economic activity in the Dallas district, which encompasses Texas, northern Louisiana and southern New Mexico, grew at a moderate pace between July and August. In comparison, other sectors, such as manufacturing, financial services, retail sales and employment, were stable during the period.

The report also showed that demand for single-family housing remained weak, however, interest in the multifamily sector was strong. The commercial real estate sector also showed improvement between July and August.

In addition, two larger retailers relayed to the Federal Reserve that sales in Texas and the Southwest region were outpacing the rest of the country, albeit at a small margin.

A recent report from the Texas A&M Real Estate Center showed the improving economy in the state led to 27 percent more home sales in August in North Texas, compared to 2010.

Additionally, previous reports have shown an increased number of Houston properties being sold at greater prices recently.

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According to a recent editorial in The Los Angeles Times, the jobs creation plan President Barack Obama detailed in his speech on Thursday, September 8 failed to hit on one of the nation's more pressing areas - the struggling housing sector.

The editorial's author, Don Lee, expresses that home sales, prices and construction figures have all been declining for a prolonged period of time, so much so that many Americans seem to be numb to the sector.

Furthermore, Lee feels the housing sector's struggles are some of the problems plaguing the country.

"More than four years after the sector's initial collapse, housing has become the economy's silent killer," Lee writes.

Close to one-fourth of all U.S. homes are in foreclosure or have underwater mortgages, which has prevented many Americans from switching jobs, financing other items or increasing spending. In addition, few Americans may be able to regain their financial standing. The Federal Reserve relays that more than half the $13.5 trillion Americans had in home equity in 2006 was lost as a result of the recession.

While job creation and housing sectors are stable in some regions, such as the Houston real estate market, other areas have been hit hard, a fact that the new jobs plan seems to ignore, Lee argues.

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A recent New York Times report explained that Realtors nationwide have continued to deal with an increasing number of home sales cancellations, partially due to the waning economy.

A developer in the New York region spoke with the news source and explained that the struggling economy has made real estate transactions far from a sure thing. To deal with the rising amount of cancellations, the developer now requires a 10 percent cash down payment and a signed contract before breaking ground on any new construction.

"You have to 'sell' a house three or four times before you can find a buyer who is sellable," the developer told the Times.

The developer further explained that property deals are contingent on financing, which can take up to three to four months for potential borrowers to find out if their mortgage application has been approved or denied.

The Realtors Confidence Index showed that 16 percent of brokers experienced a homebuyer cancellation during June and July. In May, 4 percent of brokers reported cancellations.

National Association of Realtors chief economist Lawrence Yun cites the waning economy, lower consumer confidence and tough lending standards as part of the reason for high cancellation rates.

In Houston, properties have continued to sell well during the last several months, as the region's healthy job market has keep consumer confidence high.

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Fannie Mae's recent national survey revealed consumer confidence continued to decline nationwide in August.

Of those responding to the August National Housing Survey, 78 percent believe the economy is currently on the wrong path to recovery, while 16 percent think it's heading in the right direction.

In addition, 27 percent of respondents believe home prices will decline during the next year, falling by an average 0.5 percent. In July, respondents predicted an average decline of 0.3 percent. August marks the third-straight month respondents forecast a drop in home values during the next 12 months.

In terms of personal finance, 22 percent of respondents believe their situation will become worse during the next year, up from 20 percent in July. The additional amount of respondents predicting home price declines as well as worse financial situations mark the highest levels of pessimism for both indicators since August 2010.

"The degree to which consumer attitudes appear to be sensitive to global events is interesting, and seems to be reflected in their view of the economy and their growing overall pessimism," said Doug Duncan, vice president and chief economist of Fannie Mae.

While pessimism may be high in most of the nation, cities in Texas have continued to flourish. Due to a healthy local job sector, the Houston real estate market has remained strong in past months.

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A recent survey conducted by Reuters revealed a growing pessimistic sentiment among economists regarding the country's housing market.

Economists responding to the survey agreed that the housing market will continue to fall until reaching a bottom later this year or early next year, while home prices will increase modestly in 2012. However, the experts were unable to determine when the bottom will be reached, debating between the end of 2011 or sometime in 2012.

During this time, according to the report, existing-home sales were expected to increase moderately, which is in line with economists' prediction of a weakened housing market limping along for the next several years.

Experts also point to the large inventory of distressed properties and struggling job market as roadblocks for the sector's recovery.

"There's still a huge pipeline of homes that are going to be foreclosed upon and the weak job market certainly isn't helping," Scott Brown, a real estate expert in St. Petersburg, Florida, told Reuters.

Due to its reduced inventory of foreclosed homes, as well as its healthy job sector, the Houston real estate market has recorded gains in property sales the last several months.

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In a surprising result, the amount of consumer borrowing in July doubled what economists had predicted and rose by $12 billion.

The substantial raise follows an $11.3 billion jump in June, the Federal Reserve recently reported. Prior to the report's release, economists responding to a Bloomberg News survey had predicted a $6 billion increase. As a result of the monthly incline, the rise in non-revolving loans is the most on record since November 2001.

Revolving credit declined, however, falling by its largest amount in six months. A recent Bloomberg report stated the drop may be the result of Americans cutting back on non-essential items as the job market has slowed and wage growth has decreased.

"The softness in revolving credit is indicative of a cautious consumer," Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez in New York, told Bloomberg. As for the overall gain, "school loans are part of it, as is auto finance."

While the nation continues to struggle with home sales, job growth and declining consumer confidence, the major cities in Texas have performed well recently. With a significant amount of retail jobs being added in the region recently, residents may soon purchase more Houston properties, as interest rates for mortgages have also dropped to record lows.

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According to a recent release from the Labor Department, the nation's jobless claims for the week of September 3 unexpectedly increased.

Overall, 414,000 claims were filed during the week, which is 2,000 more than the previous period. Prior to the release, economists had predicted a drop, expecting close to 405,000 claims to be processed.

The Labor Department's report also showed that job growth has slowed recently, becoming stagnant in August, while the nation's unemployment rate has remained high at 9.1 percent.

"Especially with the double-dip recession risk rising, firms are cutting labor costs," Jeffrey Roach, chief economist at Horizon Investments in Charlotte, North Carolina, told Bloomberg Businessweek before the report. "They are not quite ready to ramp up production and create the jobs needed for our struggling economy."

The report showed that the four-week moving average for jobless claims increased to 414,750 from 411,000 the week before. In addition, the number of people receiving unemployment benefits fell by 30,000 to 3.72 million during the week ending August 27.

While the national job market has been harsh, Houston has been one of the best performing sectors in the country. As a result, more citizens remain employed and the Houston real estate market has performed admirably.

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During his speech to Congress on Thursday, September 8, President Barack Obama spoke intently on increasing the market for mortgage refinancings as a way to provide economic relief to the country's homeowners.

"We're going to work with federal housing agencies to help more people refinance their mortgages at interest rates that are now near 4 percent," Obama said in his speech.

By providing aid to "responsible homeowners," Obama believes more than $2,000 per year can be issued back to households, which may provide the relief that many consumers seek after seeing their property values decline rapidly since the recession.

White House officials relayed the U.S. Treasury has engaged in conversations with Fannie Mae, Freddie Mac and the Federal Housing Finance Agency regarding ways to broaden the refinancing market.

One U.S. official expressed that they are doing everything they can to assist the housing market and "remove the barriers that exist in the current refinancing program."

With mortgage rates declining to their lowest average ever, according to Freddie Mac, more potential homeowners in the Houston real estate market may enter the market. In addition, current homeowners may also seek to refinance their home loans to take advantage of these rates.

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Freddie Mac's latest Primary Mortgage Market Survey revealed new lows for interest rates on the nation's home loans.

For the week ending September 8, the average rate for a 30-year fixed loan settled at 4.12 percent, down from 4.22 percent the previous week and 4.35 percent during the same week the year before. Rates for 15-year fixed loans averaged 3.33 percent, falling from 3.39 percent the week before and 3.83 percent the previous year.

Before these record lows, the previous benchmarks had been reached during the week of August 18, 2011, Freddie Mac reports.

"Market concerns over Eurozone sovereign debt default and a weak U.S. employment report for August placed downward pressure on Treasury bond yields and allowed fixed mortgage rates to hit new lows this week," said Frank Nothaft, Freddie Mac's vice president and chief economist.

The average rate for one-year adjustable-rate loans also declined, settling at 2.84 percent, down from 2.89 percent the week prior and 3.46 percent the year before. The rate for a five-year ARM stayed at 2.96 percent for the second-straight week.

A recent report from the Federal Reserve Bank of Dallas showed better economic activity in Texas. With more jobs available and home loan rates low, a greater number of Houston properties may soon be sold.

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According to a recent release from the Federal Reserve Bank of Dallas, the economy in Texas grew at a moderate pace during July, as employment and home sales expanded.

At the end of the month, Texas gained 25,900 jobs following the creation of 33,000 in June. The employment total statewide through July was 10.58 million. However, the state's unemployment rate increased during the month, rising from 8.2 percent in June to 8.4 percent in July. The rate is still below the national average of 9.1 percent.

The Federal Housing Finance Agency reported that the house price index for Texas was up 0.3 percent during the second quarter from the previous three-month period, but down 2 percent from the year before.

The total of single-family housing permits granted in the state declined 3.4 percent from June to July, the report shows. Housing starts were also down, decreasing 0.1 percent in July after they had jumped 29.7 percent in June. Starts were also down 17 percent from the previous year.

Existing-home sales increased, growing 1.5 percent between June and July and 22 percent year-over-year.

The Houston real estate market posted its own gains during July, as sales increased 16.7 percent from the previous year and the region recorded its highest median price ever for the month, the Houston Association of Realtors reported.

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A recent CNBC article explained that the prolonged decline of mortgage interest rate averages may soon come to an end.

During the past several weeks, Freddie Mac has continued to reveal low interest rates for the nation's mortgages, which has made homeownership more affordable for many potential buyers. In some cases, fixed-loan rate averages have reached lows unseen in nearly 50 years.

However, banks may soon put an end to these rates, as the number of homeowners looking to refinance their mortgages to take advantage of the low averages has become overwhelming.

"[Banks] don't have to go lower on the rates to get business because they make more money if they don't go to the lower market rate," Guy Cecala of Inside Mortgage Finance told the news source. "It's also a way to manage a potential flood of refi calls."

In recent weeks, nearly 80 percent of mortgage applications submitted on a weekly basis have involved refinancing activity. While this trend has slowed recently, the article forecasts heavier activity if interest rates fall below 4 percent.

In Texas, the economy continues to flourish with more home sales and jobs being created, according to recent reports. If interest rates continue to fall, more Dallas and Houston properties may be purchased.

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The Mortgage Bankers Association recently revealed that the number of home loan applications filed during the week ending September 2 decreased from the previous week.

Overall, 5 percent fewer applications were filed on a seasonally adjusted basis during the week. Refinance and purchase activity both fell on adjusted bases as well, as 5.5 percent fewer refinance and 3.8 percent fewer purchase applications were filed.

The decline comes a week after applications grew 16 percent, as more homeowners sought to take advantage of the nation's low interest rates and refinance their home loans. The average interest rate for 30-year fixed loans during the week was 4.57 percent, while rates for 15-year fixed-rate mortgages averaged 3.67 percent.

During the week ending September 2, just below 70 percent of the applications submitted involved refinancings, which is down from 70.1 percent the week before.

The four-week moving average for all mortgage applications also fell, declining 0.3 percent.

The Houston real estate market has continued to experience gains in recent months, so the fewer applications filed during the week may slow this trend slightly.

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