By: By Mia Lamar and Ben Fox Rubin

Check out these low rates! Take advantage of these rates with a great bargain buy! Go to http://HotOCbuys.com

Mortgage rates in the U.S. declined over the past week as rates continued to hold near record lows, according to Freddie Mac’s weekly survey of mortgage rates. For the week ended Thursday, the 30-year fixed-rate mortgage averaged 3.88%, compared with 3.9% the previous week and 4.88% a year ago.

Rates on 15-year fixed-rate mortgages averaged 3.13%, compared with 3.17% a week earlier and 4.15% a year ago. This shorter-term mortgage is a popular option for refinancing, and the latest rate marks a new record low in the survey, which has tracked the 15-year fixed since 1991.

Five-year Treasury-indexed hybrid adjustable-rate mortgages, or ARMs, averaged 2.81%, compared with 2.83% the prior week and 3.73% a year ago.

To obtain the rates, 30-year and 15-year fixed-rate mortgages required an average 0.8 point payment. Five-year and one-year adjustable rate mortgages required an average 0.7 point and 0.6 point payment, respectively. A point is 1% of the mortgage amount, charged as prepaid interest.

Ashlie Ducros          714-743-9778        www.ashlieducros.com

By: Krista Franks

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generation actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

For more information visit: www.Ashlieducros.com 714-743-9778 ADucroshomes@gmail.com

Existing-home sales rose 4.3 percent in January to a seasonally adjusted annual rate of 4.57 million, marking the third gain for home sales in the last four months, the National Association of REALTORS® reports. 

 “The uptrend in home sales is in line with all of the underlying fundamentals – pent-up household formation, record-low mortgage interest rates, bargain home prices, sustained job creation and rising rents,” NAR’s Chief Economist Lawrence Yun says.

 While sales ticked up, inventories of for-sale homes also continued to show improvement, NAR reported. At the end of January, total housing inventory fell 0.4 percent to 2.31 million existing homes for sale, which represents a 6.1-month supply at the current sales pace.  

“The broad inventory condition can be described as moving into a rough balance, not favoring buyers or sellers,” Yun says. “Foreclosure sales are moving swiftly with ready home buyers and investors competing in nearly all markets. A government proposal to turn bank-owned properties into rentals on a large scale does not appear to be needed at this time.”

 Unsold listed inventory has steadily dropped since reaching a peak of 4.04 million in July 2007. It now is 20.6 percent below where it was a year ago, NAR reports.

 Housing Affordability Improves

 As home prices have fallen and mortgage rates at all-time record lows, housing affordability is at some of its highest levels on record.

 “Word has been spreading about the record high housing affordability conditions and our members are reporting an increase in foot traffic compared with a year ago,” says NAR President Moe Veissi. “With other favorable market factors, these are hopeful indicators leading into the spring home-buying season. We’re cautiously optimistic that an uptrend will continue this year.”

 The national median existing-home price for all housing types in January was $154,700, which is down 2 percent year-over-year.

 Distressed sales, which tend to sell at steep discounts, continue to hamper home prices nationwide. Foreclosures and short sales accounted for 35 percent of all January home sales, which is up slightly from 32 percent in December.

 Still, “home buyers over the past three years have had some of the lowest default rates in history,” Yun said.  “Entering the market at a low point and buying at discounted prices have greatly helped in that success.”

Breakdown by Housing Type

 Here’s a closer look at how home sales fared by housing type in January:

 Single-family home sales: increased 3.8 percent to a seasonally adjusted annual rate of 4.05 million in January from 3.90 million in December. They are 2.3 percent above the 3.96 million-unit pace a year ago. Median price: $154,400 in January, down 2.6 percent from January 2011.

 Existing condominium and co-op sales: rose 8.3 percent to a seasonally adjusted annual rate of 520,000 in January from 480,000 in December. They are 10.3 percent lower than the 580,000-unit level in January 2011. Median price: $156,600 in January, up 2 percent from a year ago.

Home Sales by Region

 The following is a breakdown of existing-home sales in January by region:

 •Northeast: increased3.4 percent to an annual pace of 600,000 in January and are 7.1 percent above a year ago. Median price: $225,700, which is 4.2 percent below January 2011.

•Midwest: increased 1 percent in December to a level of 980,000 and are 3.2 percent higher than January 2011. Median price: $122,000, down 3.9 percent from a year ago.

•South: rose 3.5 percent to an annual level of 1.76 million in January but are unchanged from a year ago. Median price: $134,800, which is 0.3 percent below January 2011.

•West: increased 8.8 percent to an annual pace of 1.23 million in January but are 3.1 percent below a spike in January 2011. Median price: $187,100, down 1.8 percent from a year ago.

Contract Delays, Cancellations Remain High

 Twenty-one percent of NAR members in January reported delays in contracts, and 33 percent said contracts fell through, according to NAR. The number of contract cancellations remains mostly unchanged from December.

 The increase in the past year of contract cancellations or delays has been blamed on more lenders declining mortgage applications from stricter underwriting standards and low appraisals coming in under the agreed upon contract price.

All the signs are pointing this way... Find out why now is the right time to buy a home!!

Housing affordability rose to a record high during the fourth quarter of 2011, which means a home buyer’s purchasing power is greater than it ever has been before, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.

 The index showed that 75.9 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the national median income of $64,200, according to the index. That marks the highest percentage recorded in the index’s 20-year history.

 "While today's report indicates that home ownership is within reach of more households than it has been for more than two decades, overly restrictive lending conditions confronting home buyers and builders remain significant obstacles to many potential homes sales, even with interest rates at historically low levels," says Barry Rutenberg, chairman of the National Association of Home Builders.

 Most Affordable Cities

 According to the index, the most affordable major housing market was Youngstown-Warren-Boardman, Ohio, in which 95 percent of all homes sold during the fourth quarter were affordable to households earning the median family income of $54,900, according to the index.

 Other top affordable housing markets include:  Lakeland-Winter Haven, Fla.; Modesto, Calif.; Harrisburg-Carlisle, Pa.; and Toledo, Ohio.

 Least Affordable Cities

 However, some metro areas still remain too pricey for buyers. The least affordable major housing market during the fourth quarter was New York-White Plains-Wayne, N.Y.-N.J., in which 29 percent of all homes sold were affordable to those earning the area's media income of $67,400.

 Other high-priced metro areas at the bottom of the affordability index include: Honolulu; San Francisco-San Mateo-Redwood City, Calif.; Santa Ana-Anaheim-Irvine, Calif.; and Los Angeles-Long Beach-Glendale, Calif.

Source: National Association of Home Builders

The long-awaited housing recovery is beginning to blossom, according to industry experts taking a look at recent existing-home sales.  While admitting home sales “are still very low,” Paul Dales, chief economist at Capital Economics, says “it is clear that housing recovery is now well underway.” The evidence: home sales have been on the rise for the past three months, posting a 5 percent increase in December.

Lawrence Yun, chief economist for the National Association of Realtors (NAR), concurs with Dales’ assessment, saying “The pattern of home sales in recent months demonstrates a market in recovery.” Yun suggests consumers are gaining confidence from “record low mortgage interest rates, job growth and bargain home prices.” In addition to the 5 percent increase in December, NAR reported a 1.7 percent annual increase in existing-home sales in 2011, a total of 4.26 million homes for the year.

Distressed homes made up 32 percent of sales in December, according to NAR’s existing home sales report for the month. Foreclosed home sales closed at about 22 percent below market rate in December, a discount 2 percent higher than that recorded a year earlier. Investor demand remains steady with 21 percent of homes sold in December going to investors after this category of buyers took 19 percent of purchases in November and 20 percent one year ago. Cash sales – commonly linked to investors – made up 31 percent of December’s existing-home sales. This rate was 28 percent in November and 29 percent a year ago. Purchases by first-time home buyers declined in December – both from the previous month and the previous year. First-time home buyers accounted for 31 percent of purchases in December, down from 35 percent in November and 33 percent in December 2010.

Housing inventory is on the decline and fell to its lowest level since March 2005 last month, according to NAR. Approximately 2.3 million homes are available for sale currently. “The inventory supply suggests many markets will continue to see prices stabilize or grow moderately in the near future,” Yun said. However, listed inventory is only part of the equation, and according to CoreLogic’s latest numbers, shadow inventory stands at about 1.6 million. Regardless, Dales believes sales will rise this year. “Housing still won’t contribute much to GDP growth over the next few years, but at least it will no longer subtract from it,” Dales says.

DAILY REAL ESTATE NEWS |

A boom in farm prices has caused many Midwest cities to emerge as leaders for some of the strongest predictions for housing appreciation in 2012. Kansas City, Kan., came in the top spot in HousingPredictor’s annual survey, forecasting an appreciation of 5.8 percent for this year. 

“The recovery is starting in housing with these cities and will eventually spread to other communities throughout the nation as the U.S. recovers from the worst collapse in real estate since the Great Depression,” according to HousingPredictor.

Here are the top cities expected to have housing appreciation in 2012 and by how much, according to HousingPredictor’s latest report: 

1. Kansas City, Kan.: 5.8%

2. Topeka, Kan.: 4.7%

3. Charleston, W.V.: 4.5%

4. Oklahoma City, Okla.: 4.3%

5. Minot, N.D.: 4.2%

6. Overland Park, Kan.: 4.2%

7. Wichita, Kan.: 4.1%

8. Huntington, W.V.: 4%

9. Wheeling, W.V.: 3.9%

10. Bismarck, N.D.: 3.6%

11. Casper, Wyo.: 3.5%

12. Lake Charles, La.: 3.4%

13. Rapid City, S.D.: 3.2%

14. El Paso, Texas: 3.2%

15. Cheyenne, Wyo.: 3.2%

​If you would like more information on this article please contact us!

Source: “Best Housing Markets 2012,” HousingPredictor (January 2012)

by Guest Author @ Realty BizNews

Buying a first home is often fraught with uncertainty and stress. The home buying process may be made easier and less stressful with a few tips from the first time buyer.

1. Don’t Stretch Your Budget:

Figure out how much you are able to comfortably afford before looking for a home. A $1000 a month rent payment does not mean that you are able to afford the same mortgage payment. Owning a home has increased costs over a home. Taxes, insurance and unforeseen maintenance costs will add up to higher expenses. Consider all of thee factors when deciding on a home budget. A mortgage calculator will help determine these costs.

2. Find A Realtor:

Find a reputable realtor. Real estate agents will help a prospective buyer find the perfect home. Good realtors know the local marketplace and whether the house is a good price. They will be aware of what is available and how much is a fair price for the amenities within the home. Seasoned realtors will help walk the home buyer through the negotiating process to ensure the best possible purchase price.

3. Buy A Foreclosure:

Foreclosure properties are available with huge savings. Buying a foreclosure often allows a buyer to purchase a home in a better neighborhood and receive more home for their money. Foreclosures will often have instant equity as soon as the purchase is completed.

4. Obtain Mortgage Pre-approval:

Have financing in place before stepping foot into any home. Pre-approval is different from pre-qualified. Pre-approval means that financing up to a set amount is guaranteed by the lender. Pre-approval letters from the mortgage company offer the buyer an advantage in the negotiating point of the home purchase. Potential buyers will be able to show they are serious and have funding in place. This allows them leverage over another potential buyer who does not have mortgage pre-approval.

5. Have A Home Inspection:

Home inspection is a vital part of purchasing a property. A good inspector will look for a variety of issues to help determine if there are any problems within the home. Issues found by an inspector will allow the buyer the ability to renegotiate price. Buyers may walk away from the house if severe issues are discovered and they do not feel capable of dealing with the problems.

6. Remember Closing Costs:

First time home buyers need to remember closing costs. These fees typically range from two to four percent of the total loan amount. Closing costs depend on how many fees the lender is charging for the loan. Some realtors may be able to help a buyer negotiate closing costs with the seller paying some or all of these fees. Use a closing cost calculator to help determine your closing costs.

For more information or questions, please contact me at 714-743-9778 or log on to www.AshlieDucros.com

Mortgage Rates Fall to Record Lows

By Les Christie @CNNMoney December 15, 2011

NEW YORK (CNNMoney) -- Mortgage rates sunk to record lows again this week.

The average rate on the 30-year fixed mortgage fell to 3.94%, matching the all-time low hit in early October, according to Freddie Mac's weekly mortgage rate survey. Meanwhile, 15-year fixed-rate loans hit a new record low of 3.21%, surpassing the record set on October 6.

Five-year adjustable rate mortgages also plumbed new depths, hitting 2.86% for the week.

"We've been hanging around record lows for a few months now and we finally hit another one," said Keith Gumbinger of HSH Associates, a provider of mortgage data.

Low-interest mortgages will be available at least through mid-2012, according to Freddie Mac's chief economist, Frank Nothaft.

Where homes are affordable

The low rates can translate into big savings for home buyers. Five years ago, a home buyer would have been lucky to land a 5% rate on a 15-year loan. On a $200,000 mortgage, that would have meant the borrower would have paid $1,582 a month. Should a borrower land a 3.2% rate on a $200,000 loan now, the monthly mortgage payment would come to $1,400 -- a savings of $182 a month.

Mortgage rates tend to closely track Treasury bond yields, which have also been very low lately. For the past three months, 10-year Treasury notes have often fallen below the 2% mark as bond investors steer clear of Europe and its debt woes and buy U.S. Treasuries instead.

Parents helping kids buy homes

"There's been a flight to quality out of Eurobonds and into Treasuries," said Gumbinger. On Thursday, the 10-year Treasury stood at 1.92%.

The rock-bottom interest rates, combined with the lowest housing prices in years, have made home buying extremely affordable right now. Although most borrowers are looking to refinance existing loans rather than buy.

10 cheap homes for sale by Uncle Sam

Last week, mortgage applications climbed 4.1%, driven by a surge of home buyers trying to refinance to record-low rates. According to the Mortgage Bankers Association's latest Market Composite Index, close to 80% of loan applications were to refinance existing loans.   

For more information or questions, please contact me at 714-743-9778 or log on to www. AshlieDucros.com

CNBC – Fri, Dec 9, 2011

After half a decade of withering sales and slumping prices, there are strong and diverse signs that the single-family housing market is poised for a rebound.

In some metropolitan areas, the market has bottomed, with both sales and prices on the rise and foreclosures on the decline.

This contrarian - and largely overlooked - thesis flies in the face of the persistent gloom that has nagged the industry since 2007, when the subprime crisis flared.

Industry analysts and players cite a number of reasons - some traditional (employment), others unique to the post-credit bubble era (foreclosures)  - for the long-awaited sea change. An analysis of industry and government data also support the forecast.

"It has become increasingly apparent to us that the pieces for a housing rebound next year are beginning to fall into place," declared Barclays Capital analyst Stephen Kim in a recent note to investors.

Proponents admit that the nascent rebound could easily be derailed, but stress that after years of government efforts to support sales and prices as well as the volatile impact of foreclosures, the market has regained a measure of normalcy.

"With the exception of really hard-hit markets, the vast majority is ready to turn around," adds Jerry Howard, president and CEO of the National Association of Home Builders, NAHB. "The Washington, D.C., area is not only ripe for recovery, they need to start building units."

The iShares Dow Jones US Home Construction Index Fund (NYSE Arca: itb), for example, is up some 38 percent, while the S&P 500 is up about 21 percent.

Nevertheless, skeptics overwhelmingly outnumber the optimists, given the false-starts of previous years, the economy's sub-par performance, a new wave of distressed properties and the capacity for the European debt crisis to spook business, consumers and investors.

"I think it's premature," says Richard Smith, CEO of Realogy, the nation's largest real estate company, whose brands include Century 21, Coldwell Banker and Sotheby's International. "We see little indications here and there. Transaction volume is improving. Prices are still under pressure. This isn't going to be one of those spiked robust recoveries."

Smith is echoing the conventional industry calculus: that price increases follow sales growth amid consistently strengthening demand.

There's been little conventional, however, about this housing slump, which is one reason it's had so many false bottoms. Among its many firsts - housing starts fell through 1 million annual units, foreclosures topped 2 million in three consecutive years, and home prices declined on a national basis.

The catalysts to recovery are mostly the same: for potential buyers, residential rents have now risen enough to consider buying; existing-home inventory is the lowest in five years, while that of new homes is at a 40-year low; affordability is at a record high; delinquencies have peaked;consumer confidence is on the rise ; and job growth is accelerating.

For investors, with a continuation of the gold rally in question, real estate is beginning to look like a viable inflation hedge alternative, while rising rents mean greater profits.

That thinking may help explain why the iShares Dow Jones US Home Construction Index Fund(NYSE Arca: itb), a broad barometer for the housing market, is up some 38 percent from the stock market's October bottom, while the S&P 500 is up about 21 percent.

Finally, there's the intangible fatigue with bad news, and a desire to end the negative feedback loop.

"We believe there is sizable housing demand that could be released into the market," says Lawrence Yun, chief economist of the National Association of Realtors, NAR.

The NAR is forecasting existing home sales will rise 5 percent in both 2012 and 2013; prices will edge up 2 percent in each of those two years, then 4 percent in 2014.

The NAHB is forecasting a 5.1-percent increase in new home sales and a 10-percent increase for new home starts in 2012.

Jobs, Jobs, Jobs

A turnaround in the housing market will require continued improvement in the job market.

The economy has created jobs 13 months in a row for a total of almost 1.9 million. Weekly jobless claims have been routinely below the key level of 400,000, and the national jobless rate is down to 8.6 percent.

There are already signs in some markets that an improving employment picture is boosting housing demand and sale prices.

In cities such as Tampa, Fla., South Bend, Ind., Grand Rapids, Mich., Raleigh, N.C., Wichita, Kan., and Green Bay, Wis.., the median sales price of an existing single family home increased 1-2 percent in the third quarter, during which time the jobless rate and/or payrolls growth improved dramatically.

Even in the Cape Coral-Fort Myers, Fla. metropolitan area - considered the epicenter of the foreclosure crisis a few years ago - prices were just 1.4 percent lower in the third quarter than the previous year.

A new index by the NAHB and First American, the Improving Markets Index, IMI, launched in September, tracks housing markets throughout the country that are showing signs of improving economic health. Thirty cities - including San Jose, Pittsburgh, New Orleans and Winston-Salem, N.C. - are showing growth in permits, sales and employment.

In San Diego - where in the last year the jobless rate has fallen from 10.4 percent to 9.7 percent and 24,000 jobs have been added - home inventory is down to two months; in some areas of San Francisco (9.4 vs. 10.3 percent), it is one month.

More broadly, 40 percent of all states showed existing home sale increases on both a quarterly and annual basis in the third quarter, according to National Association of Realtors data. That includes high foreclosure-rate states, such as California, Georgia, Michigan and Utah. All but six states showed double-digit gains year over year.

Location, Location, Location

There's even a strong case to be made that the foreclosure crisis is easing.

"The pipeline of distressed property is plentiful but less than last year," when foreclosure activity hit a record 2.18 million, says Yun.

For the first nine months of 2011, foreclosure activity is down sharply from the same period last year (26.59 percent), whether it is the worst-off states - (Florida, 54.98 percent; California, 31.51 percent; Utah, 27.41 percent) - or better-off ones (New York, 46.57 percent; Mississippi, 33.25 percent; South Dakota, 26.59 percent), according to RealtyTrac, which tracks the data.

Third-quarter foreclosures (610,337) were up 1 percent from the previous quarter but down 34 percent from the year-ago period.

The wild card right now is an impending wave of new foreclosed properties on the market, following the removal of state moratoria and the settlement of state and federal lawsuits with lenders and loan servicers.

It's unclear how many properties will hit the market, but conservative estimates put the number at over a million.

Still, of the top 20 markets in the new wave, nine are in California, five in Florida and two in Ohio, according RealtyTrac, so the impact will be fairly concentated.

Another question is whether that wave will be a tsunami or merely a breaker. If the market is in fact recovering, why would banks want to weaken it again by deluging it with cheap properties.

"You could see them trying to gauge the market like speculators," answers Howard.

Kim of Barclays is among those who say the threat is exaggerated, perhaps misunderstood. He estimates that 40 percent of the foreclosed properties haven't had a payment made on them in two years, which means they are in poor condition and thus unattractive to many buyers.

"The deterioration has been great," he says. "It flies in the face of all the bearish arguments."

Kim's thesis is that there are now two kinds of buyers in the market; those who'll take a chance on a bargain-priced, distressed property and those who'll only make a conventional transaction. He says it helps explain why the Core Logic data he used for his latest report shows non-distressed prices flat or slightly higher in the past year.

"Even if the banks decide to move their inventory more aggressively, and I suspect they will, it's OK because the buyer is making a distinction," explains Kim.

"There's a ready appetite for it," adds Smith of Realogy, who agrees that there's substantial pent-up demand for housing in general but also great uncertainty. "If you can relieve consumers of some of that uncertainty, then I can see a nice little recovery."

That's the psychological dimension of the wild card - the negative feedback loop that has plagued housing.

Optimists say most of the uncertainty and fear is gone.

"The major driver of negative sentiment was that prices were going down across the market by large amounts," says Kim of Barclays. "Buyers need to see a stabilization."

A contributing element to that is the unwinding of government intervention - whether to artificially spur demand - as was the case with the first-time buyer tax incentive program of 2009 and 2010 - and/or to retard and prevent foreclosures.

Many regard those efforts as largely ineffective, if not counter-productive because they delayed the inevitable - a deep descent to a market bottom, which has finally been touched.

"The numbers you're looking at you can trust," says Kim. "There are no exogenous factors."

Though tight lending conditions and forthcoming regulations of the Dodd-Frank legislation are still an issue for some, sweeping housing finance reform is off the agenda for at least the next year.

"You're back to the natural forces of the market," says Howard of the builders association.

For more information or questions, please contact me at 714-743-9778 or log on to www.AshlieDucros.com

Existing-home sales improved in October while the number of homes on the market continued to decline, according to the National Association of REALTORS^®.

Total existing-home sales — completed transactions that include single-family, townhomes, condominiums and co-ops — rose 1.4 percent to a seasonally adjusted annual rate of 4.97 million in October from a downwardly revised 4.90 million in September, and are 13.5 percent above the 4.38 million unit level in October 2010.

Room for Improvement

Lawrence Yun, NAR chief economist, said the market has been fairly steady but at a lower than desired level. “Home sales have been stuck in a narrow range despite several improving factors that generally lead to higher home sales such as job creation, rising rents, and high affordability conditions. Many people who are attempting to buy homes are thwarted in the process,” he explained.

“A higher rate of contract failures has held back a sales recovery. Contract failures reported by NAR members jumped to 33 percent in October from 18 percent in September, and were only 8 percent a year ago, so we should be seeing stronger sales,” Yun added.

Contract failures are cancellations caused by declined mortgage applications, failures in loan underwriting from appraised values coming in below the negotiated price, or other problems including home inspections and employment losses. “Other recent factors include disruption in the National Flood Insurance Program, and lower loan limits for conventional mortgages, which paradoxically force some of the most creditworthy consumers to pay unnecessarily higher interest rates,” Yun said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.07 percent in October from 4.11 percent in September; the rate was 4.23 percent in October 2010.

NAR President Moe Veissi said consumers can increase their odds of obtaining a mortgage by being aware of how credit scores are determined. “If you want to get a mortgage, don’t buy a car or take on new installment debt or credit cards,” he said. “Pay all your bills on time, maintain old credit lines, and don’t use more than 30 percent of your credit limit. REALTORS^® can help you understand the issues surrounding access to affordable credit, in addition to helping you find the right home and negotiate terms.”

A Mixed Bag

An ongoing positive trend is a steady decline in the number of homes on the market. Total housing inventory at the end of October fell 2.2 percent to 3.33 million existing homes available for sale, which represents an 8.0-month supply at the current sales pace, down from an 8.3-month supply in September. Inventories have been trending gradually down since setting a record of 4.58 million in July 2008.

The national median existing-home price for all housing types was $162,500 in October, which is 4.7 percent below October 2010. Distressed homes — foreclosures and short sales typically sold at deep discounts — slipped to 28 percent of sales in October from 30 percent in September (17 percent were foreclosures and 11 percent were short sales); they were 34 percent in October 2010.

“In some areas we’re hearing about shortages of foreclosure inventory in the lower price ranges with multiple bidding on the more desirable properties,” Yun said. “REALTORS^® in such areas are calling for a faster process of getting foreclosure inventory into the market because they have ready buyers. In addition, extending credit to responsible investors would help to absorb inventory at an even faster pace, which would go a long way toward restoring market balance.”

All-cash sales accounted for 29 percent of purchases in October, little changed from 30 percent in September and 29 percent in October 2010; investors make up the bulk of cash transactions.

Investors purchased 18 percent of homes in October, compared with 19 percent in September and 19 percent in October 2010. First-time buyers accounted for 34 percent of transactions in October, up from 32 percent in September; they were 32 percent in October 2010.

Single-family home sales increased 1.6 percent to a seasonally adjusted annual rate of 4.38 million in October from 4.31 million in September, and are 13.8 percent higher than the 3.85 million-unit pace one year ago. The median existing single-family home price was $161,600 in October, which is 5.8 percent below October 2010.

Regional Performance

Existing condominium and co-op sales were unchanged at a seasonally adjusted annual rate of 590,000 in October but are 10.5 percent above the 534,000-unit level in October 2010. The median existing condo price was $160,300 inOctober, down 1.5 percent from a year ago.

Regionally, existing-home sales in the Northeast fell 5.1 percent to an annual level of 750,000 in October but are 1.4 percent above October 2010. The median price in the Northeast was $224,400, down 5.5 percent from a year ago.

Existing-home sales in the Midwest rose 2.8 percent in October to a pace of 1.10 million and are 19.6 percent higher than October 2010. The median price in the Midwest was $132,800, which is 4.7 percent below a year ago.

In the South, existing-home sales increased 2.1 percent to an annual level of 1.94 million in October and are 14.1 percent above a year ago. The median price in the South was $145,700, down 1.6 percent from October 2010.

Existing-home sales in the West rose 4.4 percent to an annual pace of 1.19 million in October and are 15.5 percent higher than October 2010. The median price in the West was $207,500, which is 1.6 percent below a year ago.

For more information or questions, please contact me at 714-743-9778 or log on to www.AshlieDucros.com

For the second time in history—and the second time in as many months—average rates on 30-year fixed-rate mortgages fell below 4%.

After falling to an average 3.94% on a 30-year fixed mortgage in the week ending Oct. 6, rates had ticked back up over the past month.

Now, amid mixed signals about the health of the U.S. economy, rates on the 30-year mortgage fell to average 3.99% for the week ending Nov. 10, down from 4% last week and 4.17% a year ago, according to Freddie Mac's latest survey of conforming mortgage rates.

"The economy added 80,000 net jobs in October, below the market consensus forecast, but employment gains over the prior two months were revised up by 102,000 and the unemployment rate fell to 9.0%, the lowest in six months," said Freddie Mac Chief Economist Frank Nothaft.

Mr. Nothaft added that while one recent report showed improvement in factory orders, a separate reading also showed expansion slowed in the service industry last month.

Low home prices and mortgage rates have kept affordability high, Mr. Nothaft said, adding that the National Association of Realtors' housing affordability index in September hit its third highest reading on record.

Rates on 15-year fixed-rate mortgages also dropped slightly, averaging 3.3% this week, down from 3.31% last week and 3.57% a year ago.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 2.98% this week, up slightly from 2.96% last week. The ARM averaged 3.25% a year ago.

And 1-year Treasury-indexed ARMs averaged 2.95% this week, up from 2.88% last week. The ARM averaged 3.26% a year ago.

To obtain the rates, the 30-year fixed-rate mortgage required payment of an average 0.7 of a point, the 15-year fixed-rate mortgage required an average 0.8 point and the ARMs required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.

For more information or questions, please contact me at 714-743-9778 or log on to www.AshlieDucros.com

Late last year, banks were warned that they needed to guarantee that the paperwork necessary to start a foreclosure process on a family was both accurate and complete. Since then, the banks have slowed down the foreclosure process while they re-examined their procedures. They are now confident that all the required documentation is in order. We are currently waiting on a settlement between the banks and the state attorneys general which will establish what penalties will be assessed.

Once this settlement is reached, the banks will again move forward on many homes which are currently stalled at some stage in the foreclosure process.

How many homes are we talking about?

There are millions of homes in this category. Calculated Risk quantified the situation:

“There are a large number of seriously delinquent mortgage loans in limbo waiting for this settlement. According to LPS, at the end of August there were about 1.87 million loans seriously delinquent and another 2.15 million loans in the foreclosure process. This is only down slightly from a year ago when 4.4 million loans were seriously delinquent or in-foreclosure. Once the settlement is reached, the pace of foreclosures will pick up sharply.

The pace will “pick up sharply”.

Bottom Line

As more foreclosures come to the market at discounted prices, there will be greater downward pressure on all housing values. Waiting for the spring selling season to put your house on the market may not make sense this year. The increase in demand may be overshadowed by an increased supply of distressed properties.

For more information or questions, please contact me at 714-743-9778 or log on to www.AshlieDucros.com

Are Banks Getting Better on Short Sales?