Sunday, July 12, 2009

Market Recap

Many pundits were predicting a second wave of foreclosures headed our way in the second half of the year, as banks tried to unload homes they can’t refinance. But for now, at least, the big wave of bank-owned properties appears to have crested. According to, foreclosures dropped 11% nationally in the second quarter of 2009 to 205,000 compared to 231,000 in the first quarter of 2009. Even more encouraging, June’s foreclosure numbers reached record lows for the year.

More good news on housing was dispensed by Clear Capital, which noted that for the first time since 2006, the nation posted positive quarter-over-quarter price returns in the second quarter of 2009, according to its July Home Data Index Report released last Thursday. Fueled by strong seasonal spring sales in the Midwest , which had a price increase of 5.3% over the first quarter of 2009, the overall U.S. price growth increased by 1.7%.

It's obvious that people are buying more homes – foreclosures or otherwise. The Mortgage Bankers Association released its Weekly Mortgage Applications Survey for the week ending July 3, and new loan applications increased 10.9% from the previous week. Mortgage rates remain low, and are actually dropping. The benchmark 30-year, fixed-rate mortgage fell 11 basis points to average 5.59% last week, according to the national survey of large lenders, while the benchmark 15-year, fixed-rate mortgage fell 14 basis points to average 4.93%. The drop should assuage concerns among many potential borrowers that they missed the boat.

Eric P. Egeland
Broker Associate