2011 seen as ‘turning point’ for home prices

More than half of economists, real estate experts and investment strategists polled by MacroMarkets LLC in June said they now expect national home prices to hit a bottom sometime in 2011 and remain stable through 2015.

MacroMarkets polls more than 100 housing experts with a wide range of views, including FusionIQ CEO Barry Ritholtz, Moody’s Analytics economists Mark Zandi and Celia Chen, National Association of Realtors Chief Economist Lawrence Yun, Freddie Mac Chief Economist Frank Nothaft, and Rosen Consulting Group’s Kenneth Rosen.

Read more at Inman News, Where Real Estate and Technology Connect.

U.S. Home Prices: ‘Double-Dip’ Confirmed

U.S. home prices hit their lowest level since the beginning of the recession, according to the latest Standard & Poor’s/Case-Shiller National Home Price Index released today.

NEW YORK (CNNMoney) — Home prices hit another new low in the first quarter, down 5.1% from a year ago to levels not reached since 2002.

It was the third straight quarterly drop for the S&P/Case-Shiller national home price index, which was released Tuesday.

Prices are now down 32.7% from their peak set five years ago.

“Home prices continue on their downward spiral with no relief in sight,” said David Blitzer, spokesman for Standard and Poor’s.

The index covers 80% of the housing market, and this month’s report confirmed “a double-dip in home prices across much of the nation,” said Blitzer.

The housing market went through a brief recovery period starting in mid-2009, recovering nearly 5% of earlier losses. After homebuyer tax credits expired last April, the slump resumed.

A separate S&P/Case-Shiller index covering 20 major cities also dropped during March, the index’s eighth straight monthly decline.

Of the 20 cities, only Washington has posted a home-price gain: 4.3% over the past 12 months.

Minneapolis homes lost the most value over that period, with prices falling 10%.

Other big losers include Phoenix (- 8.4%), Chicago (- 7.6%) and Portland, OR. (- 7.6%)

Prices continue to be hammered by foreclosures with high numbers of repossessed homes flooding the market.

Many repossessed properties are in poor condition and sell at a big discount to conventionally sold homes, driving down overall values.

Falling home prices have a devastating impact on new home construction, according to Pat Newport, a housing market analyst for IHS Global Insight.

“They are a key reason why builders aren’t building new homes, even in the fastest growing states, like Texas,” he said. “Existing homes are selling for so much less, the builders can’t compete.”

Normally, new-home construction is an important contributor to the economic recovery. Not so this time, according to Mike Larson, an analyst with Weiss Research.

“Housing has been an albatross for the economy as opposed to an engine powering it,” he said.

If residential development had come back as it has in the past, the current recovery would be much stronger. There’s be much more robust hiring of construction workers, building materials manufacturers and drivers and deliverymen to bring the products to site.

Newport pointed out that when developers build a new home for $300,000 it adds $300,000 to the economy, as measured by GDP. An existing-home sale just adds 5% or 6% in broker’s commission.

“As a component of the GDP,” said Larson, “housing has been out to lunch.”

Read more at CNN Money.

Foreclosures account for 28% of real estate sales in Q1

Foreclosure sales accounted for 28 percent of U.S. home sales in the first quarter, with those properties selling for nearly 27 percent less, on average, than homes not in the foreclosure process, data aggregator RealtyTrac said in a report released today.

A total of 158,434 U.S. residential properties either owned by banks or in some stage of foreclosure sold to third parties in the first quarter, a decrease of 16 percent from fourth-quarter 2010 and a decrease of nearly 36 percent from first-quarter 2010, RealtyTrac said.

Properties in some stage of foreclosure – default, scheduled for auction or bank-owned (REO) — had an average sales price of $168,321, down 1.9 percent from fourth-quarter 2010 and down 1.5 percent from first-quarter 2010, RealtyTrac said. The 27 percent foreclosure discount for the first quarter was unchanged quarter-to-quarter, and up slightly from a 26 percent discount in first-quarter 2010.

“While foreclosure sales continue to account for an unusually high percentage of all residential home sales, sales volume is well off the peak we saw in the first quarter of 2009, when nearly 350,000 foreclosure properties sold to third parties,” said James J. Saccacio, RealtyTrac’s CEO, in a statement.

“While this is probably helping to keep home prices relatively stable, it is also delaying the housing recovery. At the first quarter foreclosure sales pace, it would take exactly three years to clear the current inventory of 1.9 million properties already on the banks’ books, or in foreclosure.”

A total of 107,143 bank-owned (REO) properties sold to third parties in the first quarter, down nearly 30 percent year-over-year, at an average discount of 35 percent, up from an average discount of 33 percent in first-quarter 2010. REOs comprised nearly 19 percent of all sales last quarter.

Another 51,291 pre-foreclosure properties — homes in default or scheduled for auction — sold to third parties in the first quarter, down 45 percent year-over-year, at an average discount of 9 percent, down from an average discount of 14 percent in first-quarter 2010. Pre-foreclosure sales comprised nearly 9 percent of all sales last quarter.

It took an average of 176 days for an REO to sell after it had been repossessed; pre-foreclosure properties were in the foreclosure process for 228 days on average before selling, RealtyTrac said.

Nevada, California and Arizona had the highest share of foreclosure sales. Ohio, Illinois and Kentucky had the largest foreclosure discounts.

Source: RealtyTrac

Survey: Next 2 years is prime time for real estate investors

Real estate investors are likely to be three times more active than other types of homebuyers in their local markets within the next two years, according to a nationwide survey from Realtor.com operator Move Inc.

Market research firm GfK Custom Research North America conducted the survey on behalf of Move from April 11-15, 2011. The survey included telephone interviews of 1,200 U.S. adults, of which about 200 were identified as real estate investors. Data was weighted by age, sex, education, race and geographic region.

A third of real estate investors are planning to buy in the next 24 months, compared to 8.6 percent of typical homebuyers — those planning to purchase a primary residence, vacation home or retirement property. Another 9.1 percent of typical homebuyers, and 28 percent of investors, plan to purchase between two and five years from now.

Read more at Inman News, Where Real Estate and Technology Connect.

Foreclosure Rate Retreats from Record High

The percentage of homeowners with mortgages who were in foreclosure or seriously delinquent fell during the first three months of the year, and improvement in the performance of loans taken out from 2005-07 suggests a sustainable trend, the Mortgage Bankers Association said today in releasing its quarterly National Delinquency Survey.

The serious delinquency rate — the percentage of loans in foreclosure or delinquent by 90 days or more — was 8.1 percent during the first quarter, down from 8.6 percent during the last three months of 2010 and 9.54 percent a year ago.

The percentage of mortgages in foreclosure was 4.52 percent, down from a record high of 4.64 percent in the fourth quarter, and the percentage of loans behind by 90 days or more dropped for the fifth consecutive quarter, to 3.58 percent.

Read more at Inman News, Where Real Estate and Technology Connect.

Foreclosure Filings Ease in Western States

Foreclosure-related filings fell during April in four of five Western states covered by ForeclosureRadar, a surprising trend given that banks have had time to resolve robo-signing issues and lenders would be expected to be trying to make up for recent delays, the company said.

Foreclosure-related filings tracked by ForeclosureRadar declined from March to April in Arizona, California, Nevada and Washington.

Oregon, however, saw notices of default jump 236 percent, to 3,719. Much of that increase was attributed to Bank of America subsidiary ReconTrust, which filed 2,840 new notices of default in April, up from 131 during the first three months of the year.

Bank repossessions in Oregon fell 14.8 percent from March to April and 59.1 percent from a year ago, to 248, while sales to third parties were up 38.7 percent month-over-month, totaling 43.

Read more at Inman News, Where Real Estate and Technology Connect.

NAHB’s Spring Forecast Analyzes an Elusive Recovery

While each of the three presenters at the NAHB’s spring 2011 Construction Forecast agreed that things will be better by the end of next year, there was some dissention on the extent to which improvement can be expected, underscoring how elusive an accurate projection of the recovery continues to be.

David Crowe, chief economist at the NAHB, defined a normal housing market as one in which 1.5 million new homes are being produced each year. He calculates that we are currently at less than a third of such a rate, but is expecting modest increases to show up in this year’s second-quarter reports. From there, Crowe anticipates that the recovery will stay on a steady upward track until reaching the 1.5 million mark by the end of 2012.

Mark Zandi, chief economist at Moody’s Analytics, defines a normal annual production rate as a slightly higher 1.6 million units, but doesn’t think the market will achieve that level until 2013. By the end of 2012, he predicts, the industry will be at an annual rate of 1.3 million units.

Read more at Builder.com.

Foreclosure activity hits 40-month low in April

U.S. foreclosure filings on U.S. properties fell 34 percent year-over-year in April, according to a report from foreclosure data site RealtyTrac.

One in every 593 housing units, or 219,258 properties, received a foreclosure filing — default notice, scheduled auction, or bank repossession — last month. That’s a 9 percent drop from March and a 34 drop from April 2010.

“Foreclosure activity decreased on an annual basis for the seventh straight month in April, bringing foreclosure activity to a 40-month low,” said James J. Saccacio, RealtyTrac’s CEO, in a statement.

“This slowdown continues to be largely the result of massive delays in processing foreclosures rather than the result of a housing recovery that is lifting people out of foreclosure.”

States with a judicial foreclosure process saw activity decrease 47 percent year-over-year in April, while states with a nonjudicial foreclosure process saw activity fall 26 percent year-over-year.

In the first quarter, completed foreclosures took an average of 400 days from the initial default notice to bank repossession, compared to 340 days in first-quarter 2010 and 151 days in first-quarter 2007, the report said.

Average foreclosure timelines were longest in New Jersey and New York, both over 900 days, and Florida, at 619 days.

“The first delay occurs between delinquency and foreclosure, when lenders and services are no longer automatically pushing loans that are more than 90 days delinquent into foreclosure but are waiting longer to allow for loan modifications, short sales and possibly other disposition alternatives,” Saccacio said.

“Data from the Mortgage Bankers Association shows that about 3.7 million properties are in this seriously delinquent stage. The second delay occurs after foreclosure has started, when lenders are taking much longer than they were just a few years ago to complete the foreclosure process.”

Default notices fell the most year-over-year: 39 percent, with 63,422 properties receiving that initial filing. Scheduled foreclosure auctions fell 37 percent, to a total 86,304 properties — a 31-month low. Bank repossessions fell 25 percent year-over-year, with 69,532 foreclosed on in April.

Ten states accounted for 70 percent of all foreclosure activity last month. California had the highest volume of properties receiving a filing (55,869), followed by Florida (19,649), Arizona (13,419), Michigan (12,996), Nevada (11,761), Illinois (10,055), Texas (8,793), Georgia (8,479), Ohio (7,962) and Colorado (4,379).

Nevada had the highest foreclosure rate among states for the 52nd straight month in April: one in 97 housing units received a foreclosure filing that month, the report said. Though overall foreclosure activity in the state fell 27 percent year-over-year, bank repossessions rose 12 percent to hit an all-time monthly high: 4,606.

For the fifth straight month, Arizona held the highest foreclosure rate in the nation with one in 205 housing units receiving a filing. Overall foreclosure activity in Arizona fell 17 percent year-over-year, though bank repossessions rose 22 percent.

Bank repossessions also rose 22 percent year-over-year in California, while overall foreclosure activity fell 20 percent. The Golden State had the third highest foreclosure rate in the nation, with one in 240 units receiving a foreclosure filing.

Read more at Inman News, Where Real Estate and Technology Connect.

Valley should be OK despite national home price drops

U.S. home prices fell in February for the seventh straight month, a closely followed index released Tuesday shows, with the housing market returning to its lowest levels since the recession began.

Home prices in 20 major U.S. cities declined 1.1 percent in February, according to the Case-Shiller home-price index released by Standard & Poor’s.

Prices rose in one of 20 cities — hard-hit Detroit — in February on a monthly basis. Over the past year, only Washington, D.C., has seen prices advance. Prices fell 3.3 percent year over year in February, compared with a 3.1 percent drop in January.

The 20-city index is slightly above its April 2009 trough, meaning that home prices have retreated almost completely from the gains they posted from May 2009 through June 2010. A drop below the April 2009 level would put housing in a double-dip downturn.

The Coachella Valley’s housing market as a whole will not double-dip, said Patrick Veling, CEO of Real Data Strategies, which analyzes Southern California real estate data. The double-dip nationally will “be based on median price and will be specific to certain submarkets,” he said.

From its peak, the home-price index has dropped 32.5 percent, S&P said. The 20-city index is at 139.27; its low point, in April 2009, was 139.26.

Read more at the Desert Sun Online.