Foreclosure Filings Hit Five-Year Low
Here?s some cheerful news for sellers, homeowners and anyone related to the housing market. Foreclosures plummeted 16 percent last month to a five-year low, according to RealtyTrac. This means we can probably stop worrying about the market getting flooded by distressed properties that drag down prices and the industry as a whole. In fact, home prices are on an upward trend, another sign that the market is indeed on its way to recovery
?We?ve been waiting for the other foreclosure shoe to drop,? Daren Blomquist, RealtyTrac vice president, told the paper. But, he said, it?s ?being carefully lowered to the floor.?
USA Today said that an improving economy, more short sales, and tighter restrictions on foreclosures have contributed to the decline in distressed properties. California, which led the country into the boom and the downfall, also helped shove foreclosure numbers to the bottom. According to Bloomberg News, defaults dropped 45 percent in the country?s most populous state. The state has also seen an uptick in home values, home prices and demand for housing.
Median house and condominium prices in six Southern California counties jumped 11 percent from a year earlier to $309,000, according to Bloomberg. The news agency reported that values in nine counties in the San Francisco Bay Area gained 11 percent to $410,000.
Two Years Until Full Recovery, Says CEO of Home Depot, Inc.
And here comes yet another validation that the housing market is on a recovery tract, albeit ?a slow one. Home Depot, the world?s largest home improvement retailer, says the market is healing. But true recovery is still far away, said Frank Blake, CEO.
The housing downturn dealt a heavy blow on home prices, home equity and consumer confidence. It also brought down the construction industry and home improvement sector.?As consumers began struggling with unemployment, foreclosures and economic uncertainty, they tightened their purse strings and shelved their plans about buying homes or diving into ?home improvement projects. During the housing downturn, Home Depot?s store sales dropped more than 20 percent in states such as California and Florida, according to Reuters.
?This housing market?s been very, very bad and it?s going to take some time to recover,? Blake said. ?The way we look at it is there?s going to be a period of a workout, a fine period of one to two years and then you?re going to get a more robust recovery,? Blake said.
Blake?s comments came on the heels of two Federal Reserve officials blaming the U.S. housing market for holding the economy hostage. Blake hinted that recovery has been conservative because foreclosures and tight lending practices are preventing the market from springing back.
Mortgage Rates Climb
An improving job market has helped heal the housing market, thereby triggering a rise in mortgage rates. The average rate for a 30-year fixed mortgage climbed to 3.39 percent from 3.36 percent for the week ended Oct. 11, according to Freddie Mac.The 15-year rate is now 2.7 percent, up from the previously recorded 2.69 percent.
?A positive job report is always good for the housing market,? Celia Chen, a housing economist at Moody?s Analytics, Inc. in West Chester, Pennsylvania, told Bloomberg. ?We do expect job growth to continue ? not strongly, but it will continue. That will be enough to keep housing on an upward trajectory.?
At 7.8 percent, the unemployment rate fell to its lowest since January 2009. With improving job prospects consumers are getting more optimistic about the economy and home buying. Mortgage data firm CoreLogic announced earlier that home prices jumped 4.6 percent in August, the biggest bump since July 2006.
Source: http://www.realestate.com/advice/mortgage-rates-inch-upward-as-foreclosure-filings-drop-99479
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