Despite continued weakness in US home sales, home affordability has improved substantially. Record low interest rates have led to millions of Americans refinancing and restructuring their mortgage loans. See the following article from HousingWire for more on this.
Home affordability remains near 10-year highs, according to the second edition of the Administration’s Housing Scorecard released today by the US Department of Housing and Urban Development (HUD) and the Treasury Department.
The July scorecard (download here) is the second aggregate of housing initiative reports, updated since the July scorecard showed 340,459 Home Affordable Modification Program (HAMP) modifications had become permanent so far. HAMP servicers added 51,000 permanent modifications — before cancellations — in June, according to the new scorecard.
“The housing market is performing better than the predictions made over a year ago,” said HUD assistant secretary Raphael Bostic, in a statement. “We’re absolutely not claiming victory, but due to the Obama Administration’s efforts, improved home affordability is continuing to provide opportunities for prospective, qualified, homebuyers, while promising neighborhood stabilization efforts are helping hard hit neighborhoods start to recover.”
More than 7.2m homeowners refinanced under historic low mortgage rates since April 2009, saving a total estimated $12.9bn, according to the scorecard. Nearly 3m borrowers restructured their mortgages — including through modification — since April 2009, twice the rate of 1.24m foreclosures during the same time period:
“The Administration’s programs to stabilize the housing market have helped many across the country weather this crisis,” said Treasury assistant secretary Herb Allison. “Our initiatives continue to offer responsible homeowners the chance to avoid the often painful process of foreclosure.”
The second scorecard adds the impact of $6bn of Neighborhood Stabilization Program (NSP) funds on hardest-hit communities. These efforts have fueled local investments and help jurisdictions address the foreclosure crisis by allowing grantees to acquire foreclosed homes and renovate them to sell to low- and moderate-income households, the administration said in the scorecard.
But uncertainty remains in the housing market, as weak new and existing home sales data in May indicated recovery in remains fragile, according to the scorecard. Analysts have said the plunge in sales data indicate a “vacuum of demand” left by the expired first-time homebuyer tax credit will likely pull down housing data further in the near-term.
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