What We're Reading: April 10

Throughout the week, the BPC Housing Commission highlights news items that address critical developments in housing policy. Any views expressed in the content posted on this forum do not necessarily represent the views of the Commission, its co-chairs or the Bipartisan Policy Center. What We’re Reading posts include a compilation of useful links in the Housing Visualized section below. These resources offer the latest economic indicators, expert insight, and statistical trends related to the U.S. housing market.

Housing Visualized

2010 Census l Mapping the Census l Comparing Recessions and Recoveries Infographic: Rental Housing Market Trends l Housing by the Numbers Infographic: Household Formation Gap l Who Gains Most From Tax Breaks Infographic: Housing’s Economic Impact l Measuring Economic Mobility Past Commissions and Reports l Trulia’s Housing Barometer Credit Conditions l U.S. Housing Summary l Mortgage Data Changes in Home Prices l Wells Fargo Monthly Economic Outlook WF Real Estate & Housing Reports l Prices and Inventory by Metro Area

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Housing Market Shows Fastest Rate of Recovery Since Before the Crash By Hari Sreenivasan PBS Newshour “New reports show a spike in U.S. home prices, rising at the fastest pace since 2006. To learn what’s driving this recovery, Hari Sreenivasan talks with Nicholas Retsinas of the Harvard Business School.” Read more here.

 

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Fannie Mae, Freddie Mac to offer streamlined loan modifications By E. Scott Reckard The Los Angeles Times “In a push to simplify loan modifications, many borrowers who become 90 days or more past due on mortgages backed by Freddie Mac and Fannie Mae will be offered lowered payments without having to prove hardship, the federal regulator of the home-finance giants said. The streamlined modification program, to be put into effect in July, would reduce monthly payments by about 30% on average, officials said in announcing the program Wednesday.” Read more here.

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Home Value Highest Since ’07 as U.S. Houses Make Cash By Kathleen M. Howley Bloomberg “An expanding group of homeowners is able to get cash from their properties as banks show more willingness to make home equity loans with the market’s recovery. Originations for the mortgages should rise 10 percent to almost $83 billion this year, from about $75 billion in 2012, said Shaun Richardson, a vice president at Icon Advisory Group, a mortgage analytics firm in Greensboro, North Carolina.” Read more here.

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Senate Makes Future Hikes in G-Fees More Difficult By Brian Collins National Mortgage News “By unanimous consent, the Senate approved the amendment late Friday night that allows any senator to raise a point of order and demand a 60-vote majority to pass a GSE guarantee-fee hike. All the members of the Senate Banking Committee joined in co-sponsoring the 60-vote amendment.” Read more here.

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Three Myths About Housing Market Rebound By Nick Timiraos Wall Street Journal “Housing is recovering due to the extremely low supply of homes for sale. Demand, meanwhile, is up amid strong appetite from investors and from extremely favorable affordability conditions thanks to record-low interest rates. The upshot is that the recovery is unfolding faster than it would due to low inventory, low interest rates, and investors. But does that make for another bubble?” Read more here.

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Big Profits at Fannie and Freddie Reignite Debate on Housing Supports By Peter Eavis New York Times “The huge profits rolling in at Fannie, and at its corporate sibling Freddie Mac, reflect the enormous role the government is playing in the housing market nearly five years after the crisis. As a result, the earnings will intensify the debate over the amount of involvement that government should have in housing.” Read more here.

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Immigrant Dreams to Keep Sparking U.S. Housing Recovery By Michelle Jamrisko Bloomberg “The number of foreign-born homeowners will increase by 2.8 million in the decade ending 2020, compared with a 2.4 million gain in the previous 10 years, according to a Mortgage Bankers Association study that didn’t assess the potential impact of any new legislation. Research by a group of Hispanic real-estate agents concludes the increase could be even bigger if undocumented workers were put on a path to citizenship.” Read more here.

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Owners of energy-efficient homes less likely to default on loans By Kenneth R. Harney The Los Angeles Times “Using a sample of 71,000 home loans from across the country that were originated between 2002 and 2012, researchers found that mortgages on homes with Energy Star certifications were on average 32% less likely to default compared with loans on homes with no energy-efficiency improvements. Energy Star homes, which can be renovated dwellings or newly built, provide documentable savings of 15% or higher on utility bills compared with houses containing minimal energy improvements.” Read more here.

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GAO report blame regulators for faulty foreclosure reviews Reuters “A federal government watchdog faulted bank regulators for the poor performance of third-party consultants reviewing more than 4 million home foreclosures by mortgage servicers in a botched process that was halted earlier this year. A report released on Thursday by the U.S. Government Accountability Office, an independent arm of Congress, said the Office of the Comptroller of the Currency and the Federal Reserve issued overly broad instructions to consultants involved in the project and failed to monitor it for consistency.” Read more here.

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Residential mortgage debt may lead to tipping point in GSE takeover By Christina Mlynski HousingWire “The CBO recently projected that Fannie Mae and Freddie Mac will slide from their top spot in the mortgage-guarantee market space as the securitization market stages a comeback. However, this estimation by the CBO is a bold one, given the fact that both government-sponsored enterprises are thriving in the market more so than ever before.” Read more here.

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Americans Seize Second Chance Mortgages Post-Foreclosure By Prashant Gopa Bloomberg “As the economy has recovered from the longest recession since the Great Depression, Americans have lifted their credit scores by paying off credit cards, car loans and other debts, said Joanne Gaskin, product management director for scores at FICO, which measures on a scale that ranges from 300 to 850 and is crucial in determining access to credit. More mortgage borrowers have scores of 800 or more than two years ago and a greater number of them are rising in the 560 to 660 range, she said. The median score climbed from 711 in October 2011 to 714 a year later.” Read more here.

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Americans’ Attitudes Toward Owning a House Have Changed By Ann Carrns New York Times “Many Americans still say they have a strong desire to own their own home, but the overall appeal of renting compared with owning is changing, the survey found. Fifty-seven percent of adults believe that “buying has become less appealing,” and 54 percent believe that “renting has become more appealing” than it was before. And nearly half of current homeowners (45 percent) say they can see themselves renting at some point in the future.” Read more here.

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Analysis: Supply crunch to take steam out of home sales By Lucia Mutikani Reuters “The surge in demand for houses, thanks to an improving labor market and the Federal Reserve’s very accommodative monetary policy, is putting a firmer foundation under the economy as it deals with the headwinds from belt tightening in Washington. In February, there were 1.94 million previously owned homes on the market, representing 4.7 months of supply. The inventory of new single-family homes available for sale during the same period was about 150,000, or 4.4 months’ worth.” Read more here.

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Polar opposites Hensarling, Waters tackle weighty issues on House Financial Services By Danielle Douglas Washington Post “With such a dichotomy of views at its top, the committee may struggle to get anything done, some analysts predict. And a number of pressing matters are on its plate this year, such as revamping the nation’s mortgage system and overseeing the implementation of the financial regulatory overhaul.” Read more here.