Miami Mortgage Rates

Sales of Previously Owned U.S. Homes Probably Rebounded From Six-Month Low

Sales of previously owned U.S. homes probably rose in June from a six-month low as the industry struggled to overcome rising unemployment and foreclosures, economists said before a report today.

Purchases climbed 1.9 percent to a 4.9 million annual rate, according to the median forecast of 71 economists surveyed by Bloomberg News. The pace matches the total sold in 2010 that was the fewest in 13 years.

Stricter lending rules, unemployment above 9 percent and delays in processing foreclosures mean it may take years to reduce the number of distressed properties on the market even as all-cash purchases have recently helped buoy demand. Federal Reserve Chairman Ben S. Bernanke last week said the decline in confidence and lack of job growth that are impeding consumer spending are also keeping real estate “depressed.”

“Housing continues to bounce around the bottom,” said Peter Muoio, principal and chief economist at Maximus Advisors in New York . “We’re not expecting any kind of true upward momentum any time soon. The high inventory of existing homes is going to keep prices suppressed for an extended time.”

The National Association of Realtors will release the figures at 10 a.m. in Washington. Estimates in the Bloomberg survey ranged from 4.75 million to 5.2 million.

Existing-home sales have fallen since reaching an annual peak of 7.08 million in 2005, before the housing boom turned into a subprime-mortgage bust that helped dragged the U.S. into an 18-month recession.

Purchases of previously owned homes have been driven by investor cash transactions. In May, cash deals accounted for 30 percent of sales. The Realtors group started tracking the monthly figure in August 2008, and the share on a yearly basis before that was around 10 percent.

Job growth that sputtered in May and June, along with tighter bank credit, is also making it difficult for most Americans to take advantage of mortgage rates that are close to a record low.

Lender delays in processing home-loan defaults will push as many as 1 million U.S. foreclosure filings from this year into 2012 or beyond, casting an “ominous shadow” on the housing market, RealtyTrac Inc., a housing data provider, said last week. A clogged foreclosure pipeline may prevent real estate prices from finding a bottom.

Home construction surged last month as better weather helped builders begin work on projects delayed by storms and tornadoes earlier this year.

Mortgage Rates Fall This Week: 30-year FRM ... - Miami agent magazine

A year ago, the 30-year FRM was at 4.57 percent, and the 15-year rate was marked at 4.06 percent.

In the first week of July , mortgage rates and applications were climbing upward, with a 30-year FRM of 4.6 percent and 15-year FRM of 3.75 percent.

“Long-term bond yields and mortgage rates fell this week following a weak employment report. The economy added 18,000 jobs in June, well below the market consensus forecast, and the unemployment rate rose to 9.2 percent, the highest since December 2010. In addition, employee wages stagnated. These factors may lead to less consumer spending, which in turn, reduces the threat of inflation in the near term,” said Frank Nothaft, vice president and chief economist of Freddie Mac in a news release yesterday.

The 5-year Treasury-indexed hybrid adjustable rate-mortgage (ARM) averaged 3.29 percent (with an average 0.6 point) this week, and 1-year ARM slid down to 2.95 percent.

Last week, the 5-year ARM was 3.30 percent and the 1-year was 3.01 percent; last year, the 5-year ARM was 3.85 percent on average, and the 1-year ARM was 3.74 percent.

MarketWatch added that foreclosure activity is also down 29 percent in the first half of the year.

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