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Pending HPI Forecasts 5.7 Percent Year-Over-Year Increase for October

The CoreLogic Home Price Index (HPI) showed that home prices nationwide, including distressed sales, increased on a year-over-year basis by 5 percent in September 2012 compared to September 2011. This change represents the biggest increase since July 2006 and the seventh consecutive increase in home prices nationally on a year-over-year basis. On a month-over-month basis, including distressed sales, home prices decreased by 0.3 percent in September 2012 compared to August 2012*. The HPI analysis from CoreLogic shows that all but seven states are experiencing year-over-year price gains.

Excluding distressed sales, home prices nationwide also increased on a year-over-year basis by 5 percent in September 2012 compared to September 2011. On a month-over-month basis excluding distressed sales, home prices increased 0.5 percent in September 2012 compared to August 2012, the seventh consecutive month-over-month increase. Distressed sales include short sales and real estate owned (REO) transactions.

The CoreLogic Pending HPI indicates that October 2012 home prices, including distressed sales, are expected to rise by 5.7 percent on a year-over-year basis from October 2011 and fall by 0.5 percent on a month-over-month basis from September 2012 as sales exhibit a seasonal slowdown going into the winter. Excluding distressed sales, October 2012 house prices are poised to rise 6.3 percent year-over-year from October 2011 and by 0.2 percent month-over-month from September 2012. The CoreLogic Pending HPI is a proprietary and exclusive metric that provides the most current indication of trends in home prices. It is based on Multiple Listing Service (MLS) data that measure price changes for the most recent month.

“Home price improvement nationally continues to outpace our expectations, growing 5 percent year-over-year in September, the best showing since July 2006,” said Mark Fleming, chief economist for CoreLogic. “While prices on a month-over-month basis are declining, as expected
in the housing off-season, most states are exhibiting price increases. Gains are particularly large in former housing bubble states and energy-industry concentrated states.”

Highlights as of September 2012

  • Including distressed sales, the five states with the highest home price appreciation were: Arizona (+18.7 percent), Idaho (+13.1 percent), Nevada (+11.0 percent), Hawaii (+8.9 percent) and Utah (+8.7 percent).
  • Including distressed sales, the five states with the greatest home price depreciation were: Rhode Island (-3.5 percent), Illinois (-2.3 percent), New Jersey (-1.8 percent), Alabama (-1.3 percent) and Delaware (-0.5 percent).
  • Excluding distressed sales, the five states with the highest home price appreciation were: Arizona (+14.0 percent), Idaho (+10.5 percent), Nevada (+9.5 percent), Montana (+8.5 percent) and California (+8.4 percent).
  • Excluding distressed sales, this month only four states posted home price depreciation: Alabama (-3.1 percent), New Jersey (-1.6 percent), Delaware (-1.4 percent) and Rhode Island (-1.3 percent).

“Home prices are responding to better market fundamentals, such as reduced inventories and improved buyer demand,” said Anand Nallathambi, president and CEO of CoreLogic. “So far this year, we’re seeing clear signs of stabilization and improvement that show promise for a gradual recovery in the residential housing market.”

*August data was revised. Revisions with public records data are standard, and to ensure accuracy, CoreLogic incorporates the newly released public data to provide updated results.

Click here to download the full September 2012 HPI data report >>

Most Current, Most Comprehensive HPI Data

CoreLogic HPI monthly updates offer the quickest HPI collateral valuation information in the industry—complete HPI datasets five weeks after month’s end—and leverage the full authority of CoreLogic’s industry-leading real estate databases, covering 6,783 Zip codes, 623 Core Based Statistical Areas (CBSAs), and 1,188 counties in all 50 states and the District of Columbia.

12-Month HPI Change as of September 2012
CoreLogic HPI covers 6,783 ZIP codes, 623 Core Based Statistical Areas (CBSA) and 1,188 counties in all 50 states and the District of Columbia.

HPI for the Country’s Largest Core Based Statistical Areas (CBSAs):

September 2012
12-Month HPI
Change by CBSA
CBSA
Single
Family
Single Family
Excluding
Distressed
Phoenix-Mesa-Glendale, AZ
22.1%
17.4%
Houston-Sugar Land-Baytown, TX
6.6%
5.2%
Riverside-San Bernardino-Ontario, CA
5.2%
6.7%
Los Angeles-Long Beach-Glendale, CA
4.8%
6.3%
Washington-Arlington-Alexandria, DC-VA-MD-WV
4.8%
5.3%
Dallas-Plano-Irving, TX
4.1%
6.5%
New York-White Plains-Wayne, NY-NJ
3.1%
3.1%
Atlanta-Sandy Springs-Marietta, GA
2.2%
5.0%
Philadelphia, PA
-0.2%
0.6%
Chicago-Joliet-Naperville, IL
-2.9%
1.8%

Source: CoreLogic

Download Latest Complimentary Report
To view the September 2012 report, please click here (registration required).


NOTE: Beginning with this Shadow Inventory Report, the methodology used to estimate CoreLogic shadow inventory data has been enhanced. Specifically, CoreLogic adjusted the roll rate approach by incorporating cure rates to more accurately capture increasing foreclosure timelines. As a result of this methodology revision, previous CoreLogic shadow inventory measurements have been updated and can be found at http://www.corelogic.com/downloadable-docs/shadow-inventory-methodology.pdf. Please refer to the extended methodology section of the report for more detail.

Summary

Current residential shadow inventory as of July 2012 fell to 2.3 million units, representing a supply of six months. This was a 10.2 percent drop from July 2011, when shadow inventory stood at 2.6 million units, which is approximately the same level the country was experiencing in March 2009. Currently, the flow of new seriously delinquent (90 days or more) loans into the shadow inventory has been roughly offset by the equal volume of distressed (short and real estate owned) sales.

Shadow Inventory Q2 2012 Figure1

 

Click here to download the full Shadow Inventory report.

Data Highlights

 

 

 

  • As of July 2012, shadow inventory fell to 2.3 million units or six-months’ supply and represented just over three-fourths of the 2.7 million properties currently seriously delinquent, in foreclosure or in REO.
  • Of the 2.3 million properties currently in the shadow inventory, 1 million units are seriously delinquent (2.9 months’ supply), 900,000 are in some stage of foreclosure (2.5-months’ supply) and 345,000 are already in REO (1.0-months’ supply).
  • The dollar volume of shadow inventory was $382 billion as of July 2012, down from $397 billion a year ago and $385 billion last month.
  • Serious delinquencies, which are the main driver of the shadow inventory, declined the most from April 2012 to July 2012 in Arizona (3.2 percent), Pennsylvania (2.8 percent), New Jersey (2.3 percent), Delaware (2.2 percent) and Maine (2.2 percent).
  • As of July 2012, Florida, California, Illinois, New York and New Jersey make up 45 percent of all distressed properties in the country.

“Broadly speaking, the shadow inventory continued to shrink in July,” said Anand Nallathambi, president and CEO of CoreLogic. “The reduction is being driven by a variety of resolution approaches. This is yet another hopeful sign that the housing market is slowly healing.”

“The decline in shadow inventory has recently moderated reflecting the lower outflow of distressed sales over the past year,” said Mark Fleming, chief economist for CoreLogic. “While a lower outflow of distressed sales helps alleviate downward home price pressure, long foreclosure timelines in some parts of the country causes these pools of shadow inventory to remain in limbo for an extended period of time.”

Click here to download the full Shadow Inventory report.


Foreclosure Inventory Declines to Lowest Level Since April 2010

There were 57,000 completed foreclosures in the U.S. in August 2012, down from 75,000 in August 2011 and 58,000* in July 2012. Since the financial crisis began in September 2008, there have been approximately 3.8 million completed foreclosures across the country. Completed foreclosures are an indication of the total number of homes actually lost to foreclosure.

Highlights as of August 2012:

  • The five states with the highest number of completed foreclosures for the 12 months ending in August 2012 were: California (110,000), Florida (92,000), Michigan (62,000), Texas (58,000) and Georgia (55,000). These five states account for 48.1 percent of all completed foreclosures nationally.
  • The five states with the lowest number of completed foreclosures for the 12 months ending in August 2012 were: South Dakota (25), District of Columbia (113), Hawaii (435), North Dakota (564) and Maine (612).
  • The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were: Florida (11.0 percent), New Jersey (6.5 percent), New York (5.2 percent), Illinois (4.8 percent) and Nevada (4.6 percent).
  • The five states with the lowest foreclosure inventory as a percentage of all mortgaged homes were: Wyoming (0.5 percent), Alaska (0.8 percent), North Dakota (0.8 percent), Nebraska (0.9 percent) and South Dakota (1.1 percent).

Foreclosure Inventory by State Map as of August 2012“August marks the fourth month in a row there were fewer completed foreclosures, which is more evidence that the housing industry is finding its footing,” said Mark Fleming, chief economist for CoreLogic. “While we are seeing improvement on a national level, there remain higher concentrations of foreclosures in some areas with five states accounting for nearly half of all completed foreclosures nationwide during the last year.”

“The continuing downward trend in foreclosures and a gradual clearing of the shadow inventory are important signals that the recovery in housing is gaining traction,” said Anand Nallathambi, president and CEO of CoreLogic. “The reduction in foreclosure volumes is to some degree being facilitated by the rising popularity of alternative resolution methods, such as short sales and loan modifications.”

*July data was revised. Revisions are standard, and to ensure accuracy CoreLogic incorporates newly released data to provide updated results.

Click here to download the full August 2012 Foreclosure Report.


The presence and health of birds often signal the health of an environment. An abundance of waterfowl, for example, can signal that the surrounding wetlands are healthy. An unhealthy canary in a coal mine indicates the presence of toxic gases. One “bird” that indicates the health of the real estate development industry is the construction crane, and it appears to be making a comeback.

Report-South Florida Condo Revival 2012


Pending HPI Forecasts 5 Percent Year-Over-Year Increase in September

The CoreLogic Home Price Index (HPI) showed that home prices nationwide, including distressed sales, increased on a year-over-year basis by 4.6 percent in August 2012 compared to August 2011. This change represents the biggest year-over-year increase since July 2006. On a month-over-month basis, including distressed sales, home prices increased by 0.3 percent in August 2012 compared to July 2012*. The August 2012 figures mark the sixth consecutive increase in home prices nationally on both a year-over-year and month-over-month basis. The HPI analysis from CoreLogic shows that all but six states are experiencing price gains.

Excluding distressed sales, home prices nationwide increased on a year-over-year basis by 4.9 percent in August 2012 compared to August 2011. On a month-over-month basis excluding distressed sales, home prices increased 1 percent in August 2012 compared to July 2012, also the sixth consecutive month-over-month increase. Distressed sales include short sales and real estate owned (REO) transactions.

The CoreLogic Pending HPI indicates that September 2012 home prices, including distressed sales, are expected to rise by 5 percent on a year-over-year basis from September 2011 and fall by 0.3 percent on a month-over-month basis from August 2012 as the summer buying season closes out. Excluding distressed sales, September 2012 house prices are poised to rise 6.3 percent year-over-year from September 2011 and by 0.6 percent month-over-month from August 2012. The CoreLogic Pending HPI is a proprietary and exclusive metric that provides the most current indication of trends in home prices. It is based on Multiple Listing Service (MLS) data that measure price changes in the most recent month.

“Again this month prices rose on a year-over-year basis and our expectation is for that to continue in September based on our pending HPI forecast,” said Mark Fleming, chief economist for CoreLogic. “The housing markets gains are increasingly geographically diverse with only six states continuing to show declining prices.”

Highlights as of August 2012

  • Including distressed sales, the five states with the highest home price appreciation were: Arizona (+18.2 percent), Idaho (+10.4 percent), Nevada (+9.0 percent), Utah (+8.9 percent) and Hawaii (+8.0 percent).
  • Including distressed sales, the five states with the greatest home price depreciation were: Rhode Island (-2.6 percent), Illinois (-2.3 percent), New Jersey (-1.4 percent), Alabama (-0.7 percent) and Connecticut (-0.5 percent).
  • Excluding distressed sales, the five states with the highest home price appreciation were: Arizona (+13.0 percent), Utah (+10.0 percent), Montana (+8.8 percent), Idaho (+8.6 percent) and North Dakota (+7.7 percent).
  • Excluding distressed sales, this month only three states posted home price depreciation: Rhode Island (-1.7 percent), New Jersey (-1.4 percent), Alabama (-0.2 percent).

“Sustained economic recovery in the U.S. requires a healthy housing market. You cannot have a healthy housing market without price stabilization and ultimately home price appreciation,” said Anand Nallathambi, president and CEO of CoreLogic. “Improving pricing trends over the past few months and our forecast for continued gains in September bode well for a progressive rebound in the residential housing market.”

*July data was revised. Revisions with public records data are standard, and to ensure accuracy, CoreLogic incorporates the newly released public data to provide updated results.

Click here to download the full August 2012 HPI data report >>

Most Current, Most Comprehensive HPI Data

CoreLogic HPI monthly updates offer the quickest HPI collateral valuation information in the industry—complete HPI datasets five weeks after month’s end—and leverage the full authority of CoreLogic’s industry-leading real estate databases, covering 6,768 Zip codes, 620 Core Based Statistical Areas (CBSAs), and 1,183 counties in all 50 states and the District of Columbia.

12-Month HPI Change as of August 2012
CoreLogic HPI covers 6,768 ZIP codes, 620 Core Based Statistical Areas (CBSA) and 1,183 counties in all 50 states and the District of Columbia.

HPI for the Country’s Largest Core Based Statistical Areas (CBSAs):

August 2012
12-Month HPI
Change by CBSA
CBSA
Single
Family
Single Family
Excluding
Distressed
Phoenix-Mesa-Glendale, AZ
21.8%
16.9%
Houston-Sugar Land-Baytown, TX
6.3%
6.6%
Washington-Arlington-Alexandria, DC-VA-MD-WV
4.8%
5.1%
Dallas-Plano-Irving, TX
4.3%
7.8%
Los Angeles-Long Beach-Glendale, CA
4.0%
6.0%
Riverside-San Bernardino-Ontario, CA
4.0%
6.4%
New York-White Plains-Wayne, NY-NJ
3.4%
3.6%
Atlanta-Sandy Springs-Marietta, GA
1.0%
4.3%
Philadelphia PA
1.0%
1.9%
Chicago-Joliet-Naperville IL
-2.5%
1.5%

Source: CoreLogic

Download Latest Complimentary Report
To view the August 2012 report, please click here (registration required).


New guidelines make it easier for building tenants to qualify for FHA-backed loans

Here’s some encouraging news for condominium unit owners, sellers and buyers: The biggest source of funding for low down payment condo mortgages, the Federal Housing Administration, has revamped controversial rules that caused thousands of buildings across the country to lose their eligibility for FHA financing. The revised guidelines, which were issued Sept. 13 and took effect immediately, should make it easier for large numbers of condo associations to seek certification by FHA.

The certification process is intended to provide FHA, a government-run mortgage insurance agency, with key information about a condominium development’s legal, physical and financial status. Without approval of an entire project — whether a small garden apartment development in the suburbs or a massive high-rise in the center city — no individual unit can be financed or refinanced with an FHA mortgage.

The agency’s previous rules were criticized as heavy-handed, costly and not in touch with the economic realities of condominiums in some parts of the country. For example, the rules prohibited FHA insurance of units in buildings where more than 25 percent of the total floor space was used for commercial or nonresidential purposes. Yet many condominiums in urban areas have lower floors devoted to retail stores and offices that generate revenues that help support the entire project. Many of those buildings suddenly found themselves ineligible for FHA financing for residents. The revised rules allow exceptions up to 35 percent commercial use, and provide for additional case by case exceptions to 50 percent or higher.

As a direct result of the previous FHA rules, just 2,100 of the estimated 25,000 condominium projects nationwide that were eligible for unit financing were recertified by late last year, according to the agency. Insurance volume also has plummeted. FHA estimated that it would insure 110,000 condo unit loans during fiscal 2012, which ends this month. But by July, it had only insured 35,433 units.

Though the previous rules focused on entire buildings, individual unit owners seeking to sell often have taken the brunt. Last year, one townhouse owner in Calabasas, Calif., Ryan O’Quinn, described his experience with his community’s failure to gain FHA certification as “a nightmare.” He lost four signed sales offers and had to cut the asking price on his condo by $81,000 because most buyers wanted to use FHA loans. Andrew Fortin, vice president of government affairs for Associa, a condo and homeowner association management firm based in Dallas, said he saw condos last week in the Tampa, Fla., area that could no longer be financed with FHA mortgages and are now selling for $15,000, all-cash.
The Community Associations Institute, the condo industry’s largest trade group, welcomed the relaxation of the FHA rules, predicting that “this will spark home sales and help tens of thousands of condominium communities begin to recover from the housing slump.”

One of the most significant changes FHA made involves personal legal liability for condo association boards and officers. The previous rules required officers to attest that they have “no knowledge of circumstances or conditions that might have an adverse effect on the project or cause a mortgage secured by a unit” to become delinquent, no knowledge of “dissatisfaction among unit owners about the operation of the project or owners association” or “disputes concerning unit owners.” The penalty for officers who “knowingly” and “willfully” submitted information to FHA that was found to be false: fines of up to $1 million and 30 years in prison.

Not surprisingly, many condo board officers — who generally are volunteers — declined to take on what they interpreted as lifetime legal responsibility for such details as whether the condominium fully complied with state and local environmental and real estate requirements. Though FHA insisted the associations were overreacting, the new certifications contain much less scary language. The penalties for intentional frauds against the government remain the same, however.

Among other key rule changes:

• Greater flexibility on investor ownership. In existing projects, one or more investors are now allowed to own up to 50 percent of the total units provided at least half of the units are owner-occupied. The previous rule required that no more than 10 percent of units could be owned by a single investor.

• The previous treatment of unpaid condo association dues was raised to 60 days from 30 days. Under the revised rule, condo communities where no more than 15 percent of unit owners are 60 days late on payment of dues can be approved for FHA loans.

• Clarification of certain insurance requirements that many communities found burdensome.

Ken Harney:  Washington Post


CoreLogic® released new analysis showing that 10.8 million, or 22.3 percent, of all residential properties with a mortgage were in negative equity at the end of the second quarter of 2012. This is down from 11.4 million properties, or 23.7 percent, at the end of the first quarter of 2012. An additional 2.3 million borrowers possessed less than 5 percent equity in their home, referred to as near-negative equity, at the end of the second quarter. Approximately 600,000 borrowers reached a state of positive equity at the end of the second quarter of 2012, adding to the more than 700,000 borrowers that moved into positive equity in the first quarter of this year.

Negative equity, often referred to as “underwater” or “upside down,” means that borrowers owe more on their mortgages than their homes are worth. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.

Together, negative equity and near-negative equity mortgages accounted for 27.0 percent of all residential properties with a mortgage nationwide in the second quarter, down from 28.5 percent at the end of the first quarter in 2012. Nationally, negative equity decreased from $691 billion at the end of the first quarter in 2012 to $689 billion at the end of the second quarter, a decrease of $2 billion driven in large part by an improvement in house price levels.

Most borrowers in negative equity are continuing to pay their mortgages. The share of borrowers that were underwater and current on their payments was 84.9 percent at the end of the second quarter in 2012. This is up from 84.8 percent at the end of the first quarter in 2012.

Highlights as of Q2 2012:

  • Nevada had the highest percentage of mortgaged properties in negative equity at 59 percent, followed by Florida (43 percent), Arizona (40 percent), Georgia (36 percent) and Michigan (33 percent). These top five states combined account for 34.1 percent of the total amount of negative equity in the U.S.
  • Of the total $689 billion in aggregate negative equity, first liens without home equity loans accounted for $339 billion aggregate negative equity, while first liens with home equity loans accounted for $353 billion.
  • Of the 10.8 million upside-down borrowers, 6.6 million hold first liens without home equity loans. The average mortgage balance for this group of borrowers is $216,000, the average underwater amount is $51,000, and 18 percent of the 6.6 million are in negative equity.

Read the complete Q2 2012 Negative Equity Report.

Figure 1: High Negative Equity Concentrated in a Small Number of States

“The level of negative equity continues to improve with more than 1.3 million households regaining a positive equity position since the beginning of the year,” said Mark Fleming, chief economist for CoreLogic. “Surging home prices this spring and summer, lower levels of inventory, and declining REO sale shares are all contributing to the nascent housing recovery and declining negative equity.”

“Nearly 2 million more borrowers in negative equity would be above water if house prices nationally increased by 5 percent,” said Anand Nallathambi, president and CEO of CoreLogic. “We currently expect home prices to continue to trend up in August. Were this trend to be sustained we could see significant reductions in the number of borrowers in negative equity by next year.”


Falloff Continues—Concentration Remains in Five States

There were 58,000 completed foreclosures in the U.S. in July 2012 down from 69,000 in July 2011 and 62,000* in June 2012. Since the financial crisis began in September 2008, there have been approximately 3.8 million completed foreclosures across the country. Completed foreclosures are an indication of the total number of homes actually lost to foreclosure.

Highlights as of July 2012:

  • The five states with the highest number of completed foreclosures for the 12 months ending in July 2012 were: California (118,000), Florida (92,000), Michigan (61,000), Texas (57,000) and Georgia (54,000). These five states account for 48.1 percent of all completed foreclosures nationally.
  • The five states with the lowest number of completed foreclosures for the 12 months ending in July 2012 were: South Dakota (32), District of Columbia (120), Hawaii (445), North Dakota (575), and Maine (608).
  • The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were: Florida (11.2 percent), New Jersey (5.7 percent), New York (5.2 percent), Illinois (4.9 percent) and Nevada (4.7 percent).
  • The five states with the lowest foreclosure inventory as a percentage of all mortgaged homes were: Wyoming (0.5 percent), Alaska (0.8 percent), North Dakota (0.8 percent), Nebraska (0.9 percent) and South Dakota (1.1 percent).

CoreLogic Serious Delinquency Rates  | As of July 2012“Completed foreclosures were down again in July, this time by 16 percent versus a year ago, as servicers increasingly rely on alternatives to the foreclosure process, such as short sales and modifications,” said Mark Fleming, chief economist for CoreLogic. “Completed foreclosures remain concentrated in five states, California, Florida, Michigan, Texas and Georgia, accounting for 48 percent of all completed foreclosures nationwide in July.”

“The decline in completed foreclosures is yet another positive signal that the housing market is continuing on a progressive path of stabilization and recovery,” said Anand Nallathambi, president and CEO of CoreLogic. “Alternative resolutions are helping to reduce foreclosures and often result in a more positive transition for the borrower and lower losses for investors and lenders.”

*June data was revised. Revisions are standard, and to ensure accuracy CoreLogic incorporates newly released data to provide updated results.

Click here to download the full July 2012 Foreclosure Report.


Home prices are improving throughout the U.S., according to the S&P/Case-Shiller Home Price Index released today. Nationally, prices rose 0.5 percent in June from the prior-year month and 2.3 percent since May. It was the second consecutive month all 20 cities tracked by the index reported monthly gains. Further, 18 of the 20 markets showed better annual returns in June than they did in May.

Only Charlotte and Dallas saw their annual rates decline in June, both by just 0.1 percent.

“We seem to be witnessing exactly what we needed for a sustained recovery; monthly increases coupled with improving annual rates of change.  The market may have finally turned around,” David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, said in a statement.

On a quarterly basis, home prices in the second quarter were 6.9 percent higher than they were in the first quarter of 2012, and 1.2 percent greater than they were in the same quarter a year ago.

Six cities — New York, Atlanta, Chicago, Las Vegas, Los Angeles and San Diego – while not declining, continued to show negative annual rates of change.

Atlanta experienced the worst year-over-year change, losing 12.1 percent. But in Miami, prices increased 1.6 percent in June over May and by 4.4 percent from June 2011. –


Downtown Raleigh, once a ghost town, is now a destination – Local/State – NewsObserver.com.

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