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Watch interest low, outlook real estates, but declines still, property
As in weeks past, the real estate market's latest figures remain tepid. This lukewarm environment has resulted in decreased builder confidence, as well as a decline in median existing-house prices. The National Association of Realtors reported earlier this month that the median home price in the 2nd quarter was $171,900, down 2.8 percent from $176,900 in the 2nd quarter of 2010.
Lawrence Yuen, NAR chief economist, said home prices have been moderating, but that foreclosure pricing is also skewing results. “The level of foreclosures, which can artificially depress median prices, can vary notably in given markets," he said. "The annual price gauge smoothes out the quarterly swings and has shown fairly stable price trends in most markets.”
Yet, foreclosures aren't going anywhere anytime and do have a direct affect on market values. In fact, some experts worry that foreclosures may be in a temporary slump due to procedural reviews and adjustments being made.
James J. Saccadic, chief executive officer of Reattach, reports, “July foreclosure activity dropped 35 percent from a year ago, marking the 10th straight month of year-over-year decreases in foreclosure activity and the lowest monthly total since November 2007. This string of decreases was initially triggered by the robe-signing controversy back in November 2010, which forced lenders to substantially slow the pace of foreclosing, but the downward trend in foreclosure activity has now taken on a life of its own. It appears that the foreclosure processing delays, combined with the smorgasbord of national and state-level foreclosure prevention efforts — including loan modifications, lender-borrower mediations and mortgage payment assistance for the unemployed — may be allowing more distressed homeowners to stave off foreclosure."
"Unfortunately, the falloff in foreclosures is not based on a robust recovery in the housing market but on short-term interventions and delays that will extend the current housing market woes into 2012 and beyond,” Saccadic continued. “A stabilizing economy and improving job market are the long-term keys to a housing market recovery."
Housing starts were also down in July, according to the U.S. Commerce Department. Single-family housing starts were down 4.9 percent for the month.
The National Association of Home Builders' chairman, Bob Nielsen, put a positive spin on the decline , saying , "Although single-family housing production slid a few notches in July , the number was right in line with the second quarter average, so we view this report as an indication of relative stability ," said Bob Nielsen , chairman of the National Association of Home Builders (NAHB) . "This is in keeping with the fact that not much has changed over the past several months with regard to the outlook for new-house sales and production. Both builders and buyers continue to exercise a great deal of caution due to uncertainty about the current economic climate, the large number of foreclosed homes on the market, and concerns about access to credit."
