Housing Market News To Dominate The Week

This week we will have some interesting housing statistics published that will give us an idea of how our housing market is recovering. On Monday new home sales numbers will be released. This is key indicator for our economy because of all the related jobs and services that surround new construction. A slight improvement is expected but still a far cry from the numbers we would like to see. The problem is that there are too many foreclosures out there diluting the market and taking the business of bargain hunters.

Since January 2009, the information service Realty Trac reported 1.5 million foreclosures in our country. The leading four states are Nevada, Arizona, Florida and California. Why buy a new home with a brutal builder contract and a long difficult process when you can go find a “quick deal” in the form of a foreclosure. On the mortgage financing side, this situation is improved further for the buyer by two nifty programs designed to provide an added incentive. I have a $100 down program for the purchase of any HUD owned foreclosure and a 97% financing program with no mortgage insurance for the purchase of any Fannie Mae owned foreclosure. In each case the median minimum credit score required is 620.

On Tuesday of this week we have numbers released from Standard and Poor’s Schiller Index. This is one of the most widely followed indexes that indicate composite home values. The number is expected to fall but not at the pace of the previous month. On Thursday we have reports on jobless claims and Friday Gross Domestic Product. Jobless claims are expected to be up a little which is understandable for the summer months. Gross Domestic Product is expected to be down but at a much less significant pace as the previous quarter which is good news. All of these expectations are already factored into the market. So if numbers come in on target, don’t expect any major interest rate changes.

Last week existing home sales bolstered the markets on Thursday. That’s three months in a row in which units were up. To me, three months in a row is a trend. Look for more similar trends this week and the months ahead. Soon our discussion will be about interest rates on the rise. Presently all of this information is better but still mixed which is keeping our rate low. When all of these indexes remain consistent and the general public acknowledges this and latches on to the term “recovery” interest rates will start to rise. As I reported last week, homes are being snatched up quicker now once they are listed. The window of opportunity for purchasing that first home at a discounted price and low rate with a tax incentive is slowly closing.

Sincerely,
Preston Ware
http://www.prestonware.com
First South Mortgage 704-542-8057
Email is preston@prestonware.com.