Existing-home sales declined in June but have stayed well above year-ago levels for the past two years, while the median price shows seven straight months of double-digit year-over-year increases, according to information released Monday by the National Association of Realtors®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dipped 1.2 percent to a seasonally adjusted annual rate of 5.08 million in June from a downwardly revised 5.14 million in May, but are 15.2 percent higher than the 4.41 million-unit level in June 2012.

Lawrence Yun, NAR chief economist, said there is enough momentum in the market, even with higher interest rates.  “Affordability conditions remain favorable in most of the country, and we’re still dealing with a large pent-up demand,” he said.  “However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.07 percent in June from 3.54 percent in May, and is the highest since October 2011 when it was also 4.07 percent; the rate was 3.68 percent in June 2012.

Total housing inventory at the end of June rose 1.9 percent to 2.19 million existing homes available for sale, which represents a 5.2-month supply at the current sales pace, up from 5.0 months in May.  Listed inventory remains 7.6 percent below a year ago, when there was a 6.4-month supply.  “Inventory conditions will continue to broadly favor sellers and contribute to above-normal price growth,” Yun remarked.

The national median existing-home price for all housing types was $214,200 in June, up 13.5 percent from June 2012.  This marks 16 consecutive months of year-over-year price increases, which last occurred from February 2005 to May 2006.

Distressed homes – foreclosures and short sales – were 15 percent of June sales, down from 18 percent in May, and are the lowest share since monthly tracking began in October 2008; they were 26 percent in June 2012.  The decline in sales of distressed homes, which typically sell at a reduced price, accounts for some of the price growth.

Eight percent of June sales were foreclosures, and 7 percent were short sales.  Foreclosures sold for an average discount of 16 percent below market value in June, while short sales were discounted 13 percent.

NAR President Gary Thomas, broker-owner of Evergreen Realty in Villa Park, Calif., said some owners who were hurt by the downturn are now in the market.  “Rising values have improved the position of homeowners, and 16 percent of Realtors® surveyed in June report they worked with a client that previously had an underwater mortgage,” he said.

“Of those previously underwater owners, 53 percent were planning to buy another home and 22 percent intend to rent, but 25 percent weren’t sure what they’d do.  In addition, 47 percent of Realtors® report they have potential sellers who are waiting for additional price appreciation before they sell,” Thomas said.

The median time on market for all homes was 37 days in June, down from 41 days in May, and is 47 percent faster than the 70 days on market in June 2012.  Short sales were on the market for a median of 68 days, while foreclosures typically sold in 39 days and non-distressed homes took 35 days.  Forty-seven percent of all homes sold in June were on the market for less than a month.

First-time buyers accounted for 29 percent of purchases in June, compared with 28 percent in May and 32 percent in June 2012.  “First-time buyers should be closer to 40 percent of the market, but they’re held back by the frictions of tight credit and very limited inventory in the lower price ranges in most of the U.S.,” Yun said.

All-cash sales made up 31 percent of transactions in June, down from 33 percent in May; they were 29 percent in June 2012.  Individual investors, who account for many cash sales, purchased 17 percent of homes in June, down from 18 percent in May and 19 percent in June 2012.

Single-family home sales slipped 1.1 percent to a seasonally adjusted annual rate of 4.50 million in June from 4.55 million in May, but are 14.5 percent above the 3.93 million-unit pace in June 2012.  The median existing single-family home price was $214,700 in June, which is 13.2 percent above a year ago.

Existing condominium and co-op sales fell 1.7 percent to an annualized rate of 580,000 units in June from 590,000 in May, but are 20.8 percent higher than the 480,000-unit level a year ago.  The median existing condo price was $210,200 in June, up 15.4 percent from June 2012.

Regionally, existing-home sales in the Northeast declined 1.6 percent to an annual rate of 630,000 in June but are 16.7 percent above June 2012.  The median price in the Northeast was $270,400, which is 6.8 percent above a year ago.

Existing-home sales in the Midwest were unchanged in June at a pace of 1.21 million, and are 17.5 percent higher than a year ago.  The median price in the Midwest was $170,100, up 8.9 percent from June 2012.

In the South, existing-home sales slipped 1.5 percent to an annual level of 2.03 million in June but are 16.0 percent above June 2012.  The median price in the South was $186,300, which is 13.7 percent above a year ago.

Existing-home sales in the West declined 1.6 percent to a pace of 1.21 million in June but are 11.0 percent above a year ago.  With ongoing supply constraints, the median price in the West was $282,000, a jump of 19.9 percent from June 2012.

The easy credit that crashed the housing market led to lending standards so strict that Federal Reserve Board Chairman Ben Bernanke blamed them for hurting the recovery.

In recent months, however, lenders have relaxed their grip somewhat as the market has rebounded and home prices have soared.

More ways to get a mortgage are in the offing, mostly for borrowers with solid incomes and strong track records. Real estate analysts also say rising rates could spur renewed competition among lenders.

“They are considerably more flexible than they were two years ago. It’s gaining steam,” says Guy Cecala, publisher of Inside Mortgage Finance, a company that tracks and analyzes the mortgage market. “If you didn’t qualify a year ago, it wouldn’t hurt to go back and find out if you can qualify now.”

Freddie Mac recently released the results of its Primary Mortgage Market Survey(R) (PMMS®), showing average fixed mortgage rates easing along with market concerns over the Federal Reserve's bond purchase program.

The 30-year fixed-rate mortgage (FRM) averaged 4.37 percent with an average 0.7 point for the week ending July 18, 2013, down from last week when it averaged 4.51 percent. Last year at this time, the 30-year FRM averaged 3.53 percent.

• 15-year FRM this week averaged 3.41 percent with an average 0.7 point, down from last week when it averaged 3.53 percent. A year ago at this time, the 15-year FRM averaged 2.83 percent.
• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.17 percent this week with an average 0.6 point, down from last week when it averaged 3.26 percent. A year ago, the 5-year ARM averaged 2.69 percent.
• 1-year Treasury-indexed ARM averaged 2.66 percent this week with an average 0.4 point, unchanged from last week. At this time last year, the 1-year ARM averaged 2.69 percent.

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury today released the June edition of the Obama Administration's Housing Scorecard – a comprehensive report on the nation’s housing market. Data continue to show signs that the housing market is strengthening, with home prices continuing to rise and new and existing home sales remaining strong, although officials caution that there is regional variation and the overall economic recovery remains fragile. The full Housing Scorecard is available online at www.hud.gov/scorecard.

“The Obama Administration’s efforts to speed the housing recovery are showing continued progress as the June scorecard indicators highlight ongoing improvements throughout the housing market,” says HUD Deputy Assistant Secretary for Economic Affairs Kurt Usowski. “Foreclosure starts and completions are down significantly from one year ago; and since January 2012, rising home values have lifted 2.4 million homeowners back above water. That said, we remain cautious because although mortgage delinquencies are trending down, they still remain quite high compared to historic norms.”

“Homeowners who receive help from the Administration’s HAMP program continue to show success at avoiding foreclosure, which benefits families, communities and the economy,” says Treasury Assistant Secretary for Financial Stability Tim Massad. “HAMP has also put into place important standards for the mortgage servicing industry that have improved outcomes for struggling families more broadly.”

Newly built, single family homes are on the rise, as builder confidence landed at a 7-year high this month, showcasing the highest sentiments since January of 2006.

Builder confidence rose six points to 57 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for July, released this week. This is the index’s third consecutive monthly gain.

“Today’s report is particularly encouraging in that it shows improvement in builder confidence across every region as well as solid gains in current sales conditions, traffic of prospective buyers and sales expectations for the next six months,” noted NAHB Chairman Rick Judson, a home builder from Charlotte, N.C. However, he cautioned that “This positive momentum could be disrupted by threats on the policy side, particularly with regard to the mortgage interest deduction and federal support for the housing finance system.”

“Builders are seeing more motivated buyers coming through their doors as the inventory of existing homes for sale continues to tighten,” noted NAHB Chief Economist David Crowe. “Meanwhile, as the infrastructure that supplies home building returns, some previously skyrocketing building material costs have begun to soften.”

Homeowners in the U.S. paid a median price of $110,000 for their homes, according to a 2011 American Housing Survey profile released recently. This is an increase of 2.3 percent from the $107,500 reported in the 2009 survey. The median purchase price of homes constructed in the past four years was higher at $235,000, down 2.1 percent from the $240,000 reported for new construction in 2009.

The profile released this week provides information on the nation's housing costs, mortgages and a variety of other physical and financial characteristics about housing in the U.S. The statistics come from the American Housing Survey, which is sponsored by the Department of Housing and Urban Development (HUD) and conducted by the U.S. Census Bureau, and is the most comprehensive housing survey in the United States. National data are collected every odd-numbered year and metropolitan area data are collected on a rotating basis. The Census Bureau also released profiles for 29 selected metro areas.

"The last five years remind us how central housing is to each of us personally, to the fiscal health of our cities and counties, and the national economy. For 40 years, the American Housing Survey has provided a unique set of data that connects the detailed characteristics of who is living in homes to the detailed characteristics of the homes themselves," said Kurt Usowski, HUD's Deputy Assistant Secretary for Economic Affairs. "From the American Housing Survey, we can see why people chose to move, how often homes need repairs, and the extent to which housing costs are outpacing income growth. All this information can help inform policymaking around continued recovery in the U.S. and in metropolitan areas around the country."

It's official: the buyer's market is behind us. With the market improving, the real estate industry is abuzz with positive news every day. While increasing prices and multiple offers may be a dream for a seller, it may be a nightmare for a buyer.

"The latest Homes.com Local Market Index continues to show encouraging trends, with pricing gains month over month and year over year," says Brock MacLean, executive vice president of Homes.com.

"Adding to this momentum, the ‘Homes.com Rebound Report’ reveals how the housing recovery process is unfolding across the country, measuring how far each market has recovered from its peak to its greatest drop in index value,” adds MacLean. “The latest Rebound Report indicates 14 of the top 100 markets have fully recovered from the 2007 Great Recession, up from nine as reported in the previous months report."

Homeowners in the U.S. paid a median price of $110,000 for their homes, according to a 2011 American Housing Survey profile released recently. This is an increase of 2.3 percent from the $107,500 reported in the 2009 survey. The median purchase price of homes constructed in the past four years was higher at $235,000, down 2.1 percent from the $240,000 reported for new construction in 2009.

The profile provides information on the nation’s housing costs, mortgages and a variety of other physical and financial characteristics about housing in the U.S. The statistics come from the American Housing Survey, which is sponsored by the Department of Housing and Urban Development (HUD) and conducted by the U.S. Census Bureau, and is the most comprehensive housing survey in the United States. National data are collected every odd-numbered year and metropolitan area data are collected on a rotating basis. The Census Bureau also released profiles for 29 selected metro areas.

“The last five years remind us how central housing is to each of us personally, to the fiscal health of our cities and counties, and the national economy. For 40 years, the American Housing Survey has provided a unique set of data that connects the detailed characteristics of who is living in homes to the detailed characteristics of the homes themselves,” says Kurt Usowski, HUD’s Deputy Assistant Secretary for Economic Affairs. “From the American Housing Survey, we can see why people chose to move, how often homes need repairs, and the extent to which housing costs are outpacing income growth. All this information can help inform policymaking around continued recovery in the U.S. and in metropolitan areas around the country.”

Fewer new problem loans, declining levels of negative equity and shrinking inventories of bad loans from the boom era have helped to reduce mortgage delinquencies by the largest year-to-date decline since 2002.

The May Mortgage Monitor report from Lender Processing Services found that the national delinquency rate continued to fall in May, Delinquencies are down more than 15 percent since the end of December 2012, coming in at 6.08 percent for the month.

As LPS Applied Analytics Senior Vice President Herb Blecher explains, much of this improvement is supported by the fact that new problem loan rates are approaching the pre-crisis average. “Though they are still approximately 1.4 times what they were, on average, during the 1995 to 2005 period, delinquencies have come down significantly from their January 2010 peak,” Blecher says. “In large part, this is due to the continuing decline in new problem loans — as fewer problem loans are coming into the system, the existing inventories are working their way through the pipeline. New problem loan rates are now at just 0.73 percent, which is right about on par with the annual averages during 2005 and 2006, and extremely close to the 0.55 percent average for the 2000-2004 period preceding.

Mortgage rates rebounded following a better-than-expected jobs report, with the benchmark 30-year fixed mortgage rate rising to 4.66 percent, according to last week’s Bankrate.com national survey. The average 30-year fixed mortgage has an average of 0.28 discount and origination points.

The average 15-year fixed mortgage increased to 3.75 percent, while the larger jumbo 30-year fixed mortgage rate climbed to 4.82 percent. Adjustable rate mortgages moved higher also. The popular 5-year adjustable rate jumped to 3.63 percent, the highest in more than two years, while the 10-year adjustable hit 4.07 percent.  

Last week’s jump in mortgage rates, which more than wiped out the prior week's retreat, came after the release of the monthly employment report. Job growth for June that exceeded expectations, coupled with upward revisions to April and May payrolls, were evidence of the type of improvement the Fed will need to see to begin curtailing their bond purchases. And for that reason, we saw further increases in both bond yields and mortgage rates, to levels above where they were following Ben Bernanke's late June press conference.