RealtyTrac Report Shows Home Prices Increasing At Highest Rate Since 1977

RealtyTrac: Home Prices Up For 16th Consecutive MonthU.S. housing markets continue to drive the economic recovery according to data released by RealtyTrac Inc.

National home prices rose by 11.90 percent year-over-year for June.

48 states reported rising home prices with only Delaware and Mississippi reporting lower home prices. Nevada led the states with a 26.50 percent gain over June 2012.

Cities also fared well on housing prices; 99 of the 100 largest U.S. cities reported gains in home prices.

Rising Home Prices And Mortgage Rates, Short Supply Of Homes

According to Mark Fleming, chief economist for CoreLogic, home price trends are rising at their fastest pace since 1977. While good news for sellers, homebuyers may find fewer affordable options over time while also contending with rising mortgage rates.

In spite of rapidly rising home prices, national home prices remain about 19 percent below their peak in April 2006.

Why The Shortage Of Available Homes?

Some homeowners are hoping to recoup losses on their homes before listing them for sale. This could be a risky decision, as many economists have previously characterized the last peak of the housing market to be a “bubble,” or an abnormal spike in home values.

In some markets cash buyers are snapping up homes and making it difficult for mortgage-dependent homebuyers to compete.

Another common scenario that presents challenges to home buyers in areas where homes are in high demand occurs when there are multiple purchase offers for one home.

Buyers who rely on mortgage loans for financing their home purchase can improve their chances by being pre-approved for a mortgage before shopping for a home.

Fewer Foreclosed Homes Contribute To Rising Home Prices

RealtyTrac estimates that 500,000 home mortgages will be foreclosed this year. This is approximately 25 percent lower than the number of 2012 residential foreclosures.

Bank-owned homes are typically offered at lower prices and with incentives such as direct financing, but most are sold as-is with no warranties or guarantees as to their condition.  Multiple foreclosed homes within a community can drag down home prices, so fewer foreclosed homes is positive for homeowners and communities alike.

Want To Buy A Home? Don’t Give Up

Rising mortgage rates and home prices can present challenges, but working with your trusted mortgage professional can help with finding an affordable home. Programs are available for assisting eligible first-time buyers with their down payment and closing costs.

Adjustable-rate mortgage loans that provide a low fixed rate for a specified introductory period provide an alternative to higher payments required of a fixed-rate mortgage. An adjustable-rate mortgage may be a good option for first-time buyers who plan to “move up” within a few years.

For assistance in finding an affordable home please feel free to reach out to your trusted mortgage professional today.

RealtyTrac Foreclosure Report Shows 28% Decrease From May 2012

RealtyTrac Foreclosure Report Shows 28 Percent Decline From May 2012

Foreclosure actions increased by 2.0 percent in May from April’s 75 month low point for foreclosure activity according to RealtyTrac’s U.S. Foreclosure Market Report released June 11. However, the good news is that May 2013 foreclosure filings were still 28 percent below May 2012 filings.

RealtyTrac reports that approximately one in 885 homes were in some stage of foreclosure in May. This does not mean that 1 in 885 homes was lost to foreclosure, but it does indicate that documents related to some phase of foreclosure (Notice of Default, Notice of Trustee Sale, and Bank Reposession) were filed.

Actual lender repossessions (REO) increased by 11 percent in May, but were down by 29 percent as compared to May 2012. 33 states reported increases in REOs with North Carolina, Oregon and Wisconsin having the highest numbers of REO properties added.

Judicial Foreclosure States Lagging In Clearing Foreclosure Inventory

Foreclosure starts were up by 4 percent in May, but were 33 percent lower than for May of 2012. States using judicial foreclosure proceedings were 5 of the top 6 states for foreclosure filings. The state of Nevada, which uses non-judicial foreclosure proceedings, was second after Florida and ahead of Ohio, South Carolina and Illinois.

In general, judicial foreclosure proceedings take longer to complete than non-judicial foreclosures. This results in homes being unavailable for sale for longer periods of time. Lenders are required to complete the foreclosure process and in some cases, they must await expiration of a redemption period before a foreclosed home can be repaired and sold.

In states using non-judicial foreclosure proceedings, the time between the initial foreclosure filing and the foreclosure sale can be as little as three to four months. Quickly turning over foreclosed homes is helpful for improving regional housing markets and making more homes available for purchase. Economists have recently cited low inventories of homes as holding back housing markets in some areas.

Bank Owned Properties Provide Buying Opportunities

Lender-owned properties provide potential opportunities for first-time buyers and others seeking affordable homes. Mortgage lenders tend to offer attractive sale terms on REO properties, as their objective is to move these homes out of their inventories as quickly as possible.

Some foreclosure properties are also lacking current maintenance and are often sold as-is. DIY enthusiasts can buy and renovate foreclosed homes for owner occupancy or investment.

It’s a good idea to discuss your interest in the opportunities available for financing a Maine lender-owned home with your trusted mortgage professional.