Continued Positive Signs for the Housing Sector by Tim McLaughlin
The CoreLogic Home Price Index (HPI) showed that home prices nationwide, including distressed sales, increased on a year over year basis by 2.0% in May 2012 compared to May 2011. On a month over month basis, home prices, including distressed sales, also increased by 1.8% in May 2012 compared to April 2012. The May 2012 figures mark the third consecutive increase in home prices nationwide on both a YOY and MOM basis.
Excluding distressed sales, home prices nationwide increased on a year over year basis by 2.7% in May 2012 compared to May 2011. On a month over month basis excluding distressed sales, the CoreLogic HPI indicates home prices increased 2.3% in May 2012 compared to April 2012, the fourth month over month increase in a row. Distressed sales include short sales and real estate owned (REO) transactions.
“Home price appreciation in the lower priced segment of the market is rebounding more quickly than in the upper end,” said Mark Fleming, chief economist for CoreLogic. “Home prices below 75 percent of the national median increased 5.7% from a year ago, compared to only a 1.8% increase for prices 125 percent or more of the median.”
“The recent upward trend in U.S. home prices is an encouraging signal that we may be seeing a bottoming of the housing down cycle,” said Anand Nallathambi, president and chief executive officer of CoreLogic. “Tighter inventory is contributing to broad, but modest, price gains nationwide.”
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In a recent poll conducted by some Wall Street trading desks, real estate consumers were asked their biggest concerns in getting approved for financing when applying for a mortgage. The top five concerns were as follows:
1. The ability to close the transaction by a given date
2. Qualifying for the loan and meeting the parameters
3. Dealing with a reputable, solid bank
4. Having enough funds for the required downpayment
5. The interest rate of the loan
It is telling that the concern that was once ranked #1 by a wide margin has fallen to #5 in the new world we live in.
