The sales pace of new homes sold in October was virtually unchanged from the month before, according to estimates jointly released by the U.S. Census Bureau and the Department of Housing and Urban Development. Sales were down 0.3 percent to a seasonally adjusted annual rate of 368,000, but remain 17.2 percent above last year’s estimate of 314,000. The month’s totals were affected by a significant drop in activity in the Northeast, which was hit by Hurricane Sandy. The median sales price of new houses sold in October was $237,700; the average sales price was $278,900. Also, there was a 4.8 month supply of new homes available for sale at the end of the month. More here and here.
According to the Mortgage Bankers Association’s Weekly Applications Survey, the seasonally adjusted Purchase Index rose 3.0 percent last week after an adjustment for the Thanksgiving holiday. Despite the increase, the Market Composite Index, which measures both refinance and purchase loan volume, was relatively flat, falling 0.9 percent due to a 2.0 percent drop in the Refinance Index. Average mortgage rates were virtually unchanged. The average interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to 3.53 percent from 3.54 percent the week before. The refinance share of total mortgage activity also held steady from the previous week at 81 percent of total applications. More here and here.
Economic activity accelerated in the third quarter after a sluggish second quarter, according to Fannie Mae’s Economic and Strategic Research Group. Their November outlook expresses encouragement based on recent increases in consumer spending and confidence but suggest looming economic uncertainty continues to create obstacles for the pace of the recovery. Doug Duncan, Fannie Mae’s chief economist, said recent economic data has been modestly favorable and increases in consumer spending are encouraging due to their positive effect on housing. In the third quarter,the housing market saw improvement in both new and existing home sales and prices spiked 5.0 percent from last year, the largest gain since 2006. Also, the housing market is expected to contribute to GDP growth next year, reversing the trend of the past six years. More here.
According to Zillow’s Real Estate Market Report, home prices rose 1.1 percent in October, the twelfth consecutive month of increases and the largest gain since August 2005. Year-over-year, home values were up 4.7 percent, which is the biggest annual improvement since 2006. Dr. Stan Humphries, Zillow’s chief economist, said the bottom line is homes are more affordable now than at any time in recent memory and buyers are seizing the opportunity regardless of the factors cited by those that are still skeptical about the durability of the housing recovery. Only one of the 30 largest metro areas covered by the report saw declining values in October and 26 metropolitan areas saw increases over last year. The cities that saw the biggest annual improvement included Phoenix, San Jose, Denver, San Francisco, and Miami. More here.
The National Association of Home Builders Housing Market Index measures builder confidence in the market for newly built, single-family homes on a scale where any number below 50 indicates that more builders view conditions as poor than good. In November, the index rose five points to 46. It was the seventh consecutive monthly gain and a significant improvement over last year’s reading of 19. Builder confidence is now at its highest level since May 2006. Barry Rutenberg, NAHB’s chairman, said builders are reporting increasing demand for new homes as inventories of foreclosed and distressed properties begin to shrink across the country. Components measuring current sales conditions and expectations for the next six months both experienced gains, as did all four regions of the country. More here.