It was reported today that the number of homes listed for sale has continued to decline in July, falling by 1.2% from June and nearly 18% from one year ago.
The Data from Realtor.com shows that there were 2.31 million homes listed for sale at the end of July. This is the lowest level for July since the series began in 2007. Most inventories tend to decline in July as the spring sales rush gives way to summer vacations. Zelman & Associates, a research firm, says July listings have typically fallen by 0.8% from June over the past 28 years.
The info from Realtor.com includes sale listings from more than 900 multiple-listing services across the country.
Since 2007 housing inventory has only been lower in five months: the first four months of this year, and in January 2010. Housing demand has been noticeably weaker than expected for most of the year which brings new worries about the strength of the U.S. economy that could push the market into another stall.
Inventory levels might be even higher—putting more pressure on prices—were it not for banks holding foreclosures off the market as they revamp their foreclosure-processing infrastructure.
Realty Trac is reporting that Foreclosure filings dropped once again in July and hitting their lowest level since November 2007. This drop was helped by processing delays and foreclosure prevention measures that enabled a larger number of delinquent borrowers to remain in their homes.
Filings were down 4% compared to June and were 35% lower than July 2010, marking the tenth straight month of year-over-year declines.
RealtyTrac reported that 212,764 U.S. homes received some kind of foreclosure filing — notice of default, notice of auction sale or completed foreclosure — during the month. Bank repossessions totaled 67,829 which is down 33.6% from the peak month of September, 2010 — when banks took back 102,134 homes, and off 27% from 12 months earlier.
This downward trend in foreclosure activity appears to be related to processing delays, combined with the smorgasbord of national and state-level foreclosure prevention efforts that may be allowing more distressed homeowners to stave off foreclosure.
A newly proposed rule by federal regulators to impose a minimum 20 percent down payment, stringent debt-to-income ratio requirements and rigid credit standards will most likely deny millions of Americans access to safe, low-cost mortgages, according to the National Association of Realtors®.
In a comment letter submitted recently, NAR expressed dissatisfaction over the unduly narrow definition of qualified residential mortgages (QRM) that would be exempt from risk retention requirements. Non-QRM mortgages will have higher interest rates and fees, making home ownership more expensive or unattainable for many of today’s aspiring home owners. NAR urged regulators to withdraw the proposed risk retention rule and go back to the drawing board.
As the leading advocate for home ownership the NAR firmly believes Congress intended to create a broad QRM exemption and strong evidence shows that responsible lending standards and ensuring a borrower’s ability to repay have the greatest impact on reducing lender risk The proposed rule should be withdrawn, revised and republished for public comment. If this does not happen then millions of hard-working, creditworthy consumers will not be able to achieve their dreams of owning a home.
NAR has criticized the proposed rule to require a 20 percent minimum down payment requirement saying it ignores strong evidence that responsible lending standards and ensuring a borrower’s ability to repay have the greatest impact on reducing lender risk. The low foreclosure rate among Federal Housing Administration and Veterans Administration loans, which have the lowest down payment requirements and relatively low default rates, is further evidence that the key to safe lending is sound underwriting and documentation rather than high down payments.
Based on NAR estimates, it would take more than a decade for a family with a median household income to save enough for a 20 percent down payment. A 10 percent down payment would take a family more than eight years to save. The impact on minority and first-time home buyers would be even worse.
California homeowners continue to have trouble getting home loan modifications that stick under the Obama Administration’s Home Affordable Mortgage Program, according to a report released Tuesday by the CaliforniaReinvestment Coalition, a consumer advocacy organization whose members provide foreclosure counseling.
The findings of the report suggest that modifications are still hard to come by, and that servicers have not corrected many of the problems that have led to investigations of foreclosure abuses the coalition wrote in summarizing its findings after it reviewed data the Treasury made public earlier this year and its own latest survey of nonprofit housing counselors.
Among the highlights of its report:
Of 568,630 borrowers who have requested loan modifications, 46 percent were denied immediately, 23 percent received a permanent mortgage modification, and a third of applicants were stuck in trial modifications or had their modifications cancelled.
Principal reductions are nearly impossible to receive. In Los Angeles andFresno only 5 percent of loan modifications included some degree of principal forgiveness.
94 percent of housing counselors reported that homeowners are losing their homes to foreclosure while still in negotiations with their servicers for loan modifications.
