Housing Market Conditions Improving

Upscale HomeHousing Market Conditions Improving

Housing indicators are showing that markets are making slow strides towards improving conditions. Boosted by the first time buyers’ $8,000 federal tax credit and other incentives, home sales are up in many of the hardest hit urban markets, including Los Angeles, Las Vegas and Phoenix.

Additionally, government insured mortgage applications hit the highest level since November 1990 in June, according to the Mortgage Bankers Association. An increase in government backed loans, including VA and FHA mortgages are part of the Obama Administration’s housing rescue plan.real estate flipper

However, about four million mortgages were delinquent in the first quarter of 2009, according to the bankers association. A coalition of mortgage companies, Hope Now says that as of the end of April just 518,155 mortgages have been modified. The number represents a small fraction of the more than 4-million plus homes that have been foreclosed.

The government-insured share of purchase applications in June reached 38.6%, up from 27.8% one year ago. The share of applications has averaged 36.6 % in 2009 compared to an average of 21.8% in 2008.

The data also shows that refinances are improving with more than 1 out of 3 applications being approved. The refinance share of mortgage activity increased to 48.4% from 46.4% the previous week, which shows that fewer homes may be foreclosed as long as more applicants are granted refinancing.

Many state governments are also becoming more involved in helping homeowners in danger of foreclosure. Connecticut and New Jersey started programs to help homeowners to challenge foreclosure. California has adopted a new law requiring lenders to negotiate with homeowners to modify mortgages, which halts the process for up to 90 days.

The foreclosure crisis has become an epidemic that is so wide-spread that housing advocates are saying many foreclosures are unnecessary. In Myrtle Beach, South Carolina officials estimate half of all homes being foreclosed are unnecessary.

A handbook has been printed in Arizona to help those in default by the Arizona Foreclosure Prevention Task Force, offering guidance.

Work shops, designed to aid homeowners obtain loan modifications are helping more families avoid foreclosure. Workshops guide homeowners through the application process, develop a budget and review options like refinancing, short sales and the deed-in-lieu of foreclosure process.

The foreclosure epidemic hit another milestone when the Mortgage Bankers Association said foreclosures and homes in default hit a new all-time high. Nearly five months after the Obama Administration announced its housing rescue plan, millions of homeowners are caught in the trap of being unable to get help.

Mortgage companies and loan servicers are over-loaded by the sheer volume of mortgages that need to be modified or refinanced. When all else fails bankruptcy can sometimes be another route to save a home from foreclosure.

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