What We're Reading in Housing: November 28

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 now 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 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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Mortgage Interest Deduction, Once a Sacred Cow, Is Under Scrutiny By Peter Eavis The New York Times “Given the apparent sturdiness of the higher end of the housing market, politicians may decide there are few risks in effectively capping mortgage deductions for high earners. Limiting tax breaks in a way that could reduce mortgage relief would be a change for Washington, which has done so much to support housing.” Read more here.

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Brighter Housing Picture Dimmed by Past Price Collapse By Nick Timiraos The Wall Street Journal “Home-price gains are also increasingly broad based geographically speaking, with 18 of 20 metro areas now posting year-over-year increases (including even Atlanta, which earlier this year was showing an implausible 17% year-over-year decline). The two cities that are showing year-over-year declines, New York and Chicago, are down 2.3% and 1.5%, respectively.” Read more here.

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Despite Fiscal Shadow, Consumer Confidence Rises By Catherine Rampell The New York Times “Consumer confidence has been rising for the last three months, and the latest pickup was driven by more buoyant expectations for the economy, as opposed to consumers’ assessment of current conditions. In fact, for the last four years, consumers have been consistently more positive about the future of the economy than its present, which is the reverse of their attitudes for most of the expansion that preceded the financial crisis.” Read more here.

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Housing Market Recovery Accelerating, Now 47% Back To Normal By Jed Kolko Trulia “In October 2012, all three housing measures improved: construction starts increased again, existing-home sales rose, and the delinquency + foreclosure rate dropped considerably. Even though construction and sales declined month-over-month in the Northeast region, stronger activity in the rest of the country outweighed the impact of Hurricane Sandy.” Read more here.

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Housing regulator sees recovery taking root Reuters “”I am cautiously optimistic that the signs of stability – and in some areas, strength – that have started to emerge in certain sectors of the housing market are signals that it is beginning to recover,” Edward DeMarco, acting director of the Federal Housing Finance Agency, told the Exchequer Club.” Read more here.

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America’s 14 Million Vacant Homes, And What To Do With Them By Tom Gara The Wall Street Journal “As of the end of June there are just over 132.7m housing units in America, and 10.6% of them – more than 14m – are vacant all year round for some reason or another. That very broad number includes everything from holiday homes to places in the temporary purgatory between being rented or sold and being moved into by the new occupant. But at the pointy end of that spectrum are nearly four million homes that aren’t just sitting unsold or unrented – they’re not even on the market.” Read more here.

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Do Foreclosures Increase Crime After All? By Eric Jaffe The Atlantic Cities “The two recent studies do agree on one thing: headlines claiming that criminals rush into foreclosed neighborhoods don’t have much evidence behind them. There is, however, some very logical theory behind the connection. Home owners facing foreclosure naturally let their property deteriorate to some extent, which creates an air of social disinterest that criminals find inviting. High turnover further reduces engagement in a community, as well as the ability to identify an outsider. Prolonged vacancies, in particular, can create safe havens.” Read more here.

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Where Demand Is Sprouting, Labor Shortages Are Close Behind By Teresa Burney Builder “Home builders in areas across the country where the market is starting to improve are beginning to experience the first pangs of labor shortages. ‘Where there has been a fundamental pop in sales volume it has been big enough and sustained enough to start maxing out the base’ of labor supply, says Jody Kahn, a vice president at John Burns Real Estate Consulting (JBREC). While the problem isn’t ubiquitous, it has already begun to impact the time it takes to start and finish homes. A survey of builders by JBREC shows that the average time it takes to start a home across the country is eight weeks, three weeks longer than the typical average of five, says Kahn. The time it’s taking to complete a home, from start to finish, has climbed from four months to 4.3 months.” Read more here.

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The vanishing first-time homebuyer By Kerri Ann Panchuk HousingWire “It was only a matter of time before the market learned the true fate of the young, first-time homebuyer who may have a solid credit history and a good job, but lacks a 20% downpayment. The reality is they are disappearing before our very eyes. And the type of middle-class borrower that used to help drive new home sales is lost in translation as regulators continue to create a housing market that, while more careful in its future construction, may be more disruptive to the American dream.” Read more here.