Foreclosures down, Housing affordability rises according to 2009 4th Quarter Real Estate Market Data

Welcome back! What did you think of our Property Management Software? Are you subscribed to our feed and receiving email updates?

Housing affordability rose in the fourth quarter of 2009, according to the NAR Housing Affordability Index. The composite index for the fourth quarter of 2009 indicates that a family earning the median income had 167.3 percent of the income needed to purchase the median-priced, existing single-family home, using standard lending guidelines. That value is up 8.3 percentage points from the third quarter of 2009 and up 19.3 percentage points from the fourth quarter of 2008. The increase in affordability is attributed to a 3-percent decrease in the median price of existing single-family homes sold and a 24-basis-point drop in mortgage interest rates, which more than offset a 0.6-percent decline in median family income.

Estimates from the Mortgage Bankers Association’s (MBA’s) quarterly National Delinquency Survey indicate that,  for the third  quarter  of 2009 (the data are reported  with  a lag), the delinquency rate and the loans entering foreclosure for mortgages  on one- to four- family  homes  set new record highs.  (The data series began in 1972.) Although the percentage of foreclosure starts (newly initiated foreclosures) set a new record high, foreclosure starts on subprime loans declined and were more than offset by an increase in foreclosure starts on prime loans.  This change suggests a continuing shift away from mortgage defaults driven by interest rate increases on subprime adjustable rate mortgages to those defaults caused by unemployment and the recession.

The delinquency rate (SA) for all mortgage  loans  was 9.64 percent in the third  quarter  of 2009 (the data are reported  with  a lag), up from 9.24 percent in the second  quarter  of 2009 and 6.99 percent in the third  quarter  of 2008. The delinquency rate (SA) for prime mortgages was 6.84 percent in the third quarter of 2009, up from 6.41 percent in the second quarter and

4.34 percent in the third quarter of 2008. The delinquency rate (SA) for subprime mortgage loans was 26.42 percent in the third quarter of 2009, up from 25.35 percent in the second quarter and 20.03 percent in the third quarter of 2008. For FHA loans in the MBA survey, the delinquency rate (SA) was 14.36 percent in the third quarter of 2009, down from 14.42 percent in the second quarter of 2009 but up from 12.63 percent in the third quarter of 2008.

Newly initiated foreclosures represented 1.42 percent of all mortgage loans in the third quarter of 2009, up from 1.36 percent in the second quarter of 2009 and up 35 basis points from 1.07 percent in the third quarter of 2008. Foreclosures started on prime loans rose to 1.14 percent in the third quarter 2009, up from 1.01 percent in the second quarter of 2009 and 0.61 percent in the third quarter of 2008. In contrast, foreclosures started on subprime loans fell for the second consecutive quarter to 3.76 percent in the third quarter of 2009, down from 4.13 percent in the second quarter and 4.23 percent in the third quarter of 2008. Not all newly initiated foreclosures end in foreclosure. The lag between a foreclosure start and a completed foreclosure ranges between 2 and 15 months, with an average lag period of about 6 months. Approximately

32 percent of foreclosures initiated in the first quarter of 2009 were completed in the third quarter of 2009.

The national homeownership rate was 67.2 percent in the fourth quarter of 2009, down from 67.6 percent in the third quarter of 2009 and 67.5 percent in the fourth quarter of 2008. The homeownership rate for minority households decreased to 49.8 percent in the fourth quarter of 2009, down from 49.9 percent in the third quarter of 2009 and 50.1 percent in the fourth quarter of 2008. The decline in homeownership reflects the subprime lending crisis, the high rates of unemployment, and the recent severe recession. Servicer emphasis on home  retention actions, including those  actions under  the Making  Home Affordable program,  are helping  to keep the number of newly  initiated and completed foreclosures down, despite  rising serious  delinquencies.

This is a blog post for Real Estate Professionals, Investors, Landlord, Property Manager, and Property Management Companies. Foreclosures down, Housing affordability rises according to 2009 4th Quarter Real Estate Market Data is brought to you by SimplifyEm Pay Rent Online and Property Management Software

You might also want to read:

1. 2010 1st Quarter Real Estate Market Data – The State of US Real Estate Delinquencies and Foreclosures Total delinquencies for all loans past due were at 9.47 percent in the  fourth quarter of 2009, down 2 percent from the third quarter of 2009 but up 20 percent......
2. 2010 1st Quarter Real Estate Market Data – The State of US Housing Affordability Housing affordability is the ratio of median family income to the income needed to purchase the median ­priced home based on current interest rates and underwriting standards, expressed as an......
3. 2009 4th Quarter Real Estate Market Data – The State of US Housing Market Housing market conditions continued to show signs of stabilizing during the fourth quarter of 2009, after a downward trend that began in the first quarter of 2006 and just started......

Tagged as: foreclosures, housing affordability, Landlord, landlord software, online rent payment, Pay Rent, pay rent online, Property Management, property management accounting software, Property Management Software, Property Manager, real estate, rental management, rental management software, rental property management software, rental property software, rental property tax deduction, rental software, software for property management, Tenant