May House Prices Show Highest Increase Since 2006

House prices climbed 6.8% in May 2010 from last year, the largest yearly increase since July 2006, according to a report from real estate data provider Clear Capital.

In June 2009, Clear Capital reported a 19.3% drop in May house prices, a “far cry” from the increase shown in this report a year later, said Alex Villacorta, senior statistician at Clear Capital. The rolling quarter-over-quarter number, which measures houses prices against those three months ago showed a 1.8% decline, an improvement from the 5% drop in April.

“We continue to see sustained price growth throughout much of the country with yearly price gains reflecting the housing recovery off of last year’s lows,” Villacorta said. “The expiration of the tax credit at the end of April has certainly contributed to the growth of prices we are observing and as more sales close before the June 30 deadline we expect that markets across the country will continue to see strengthening of prices.”

The amount of REO properties on the market seems to be dropping, too, according to Clear Capital.  The national REO saturation rate dropped to 27.8%, down from 41.7% last year.

“This dramatic shift in price trends reflects the unprecedented volatility over the last couple of years and the delicate state of local real estate markets around the country,” Villacorta said.

Building Green, New Codes unveiled…

The International Code Council announced the release of Public Version 1.0 of the International Green Construction Code (IGCC) to regulate construction of new and existing commercial buildings. The IGCC aims to significantly reduce energy usage and greenhouse gasses. It addresses site development and land use, including preservation of natural and material resources. Enforcement of the code will improve indoor air quality and support the use of energy-efficient appliances, renewable energy systems, water resource conservation, rainwater collection and distribution systems, and the recovery of used water (graywater). Principals from the ICC, AIA and ASTM pointed out how the IGCC helps further the mission of their organizations and members.

We talked to communities who indicate that their voluntary green building programs reach only, but an important, 30 percent of the built environment,” said Code Council CEO Richard P.

Weiland. “This means that there is a clear need for a regulatory tool to establish a baseline to help jurisdictions meet their sustainability goals.” The IGCC emphasizes building performance, including features such as a requirement for building system performance verification and building owner education to ensure the best energy-efficient practices. A key feature of the new code is a section devoted to “jurisdictional electives” that will allow customization of the code beyond its baseline provisions to address local priorities and conditions.

Fannie, Freddie Set Appraisal Standards to Streamline Data Collection

The Federal Housing Finance Agency (FHFA) is rolling out a new initiative at government-sponsored enterprises (GSEs) Fannie Mae  and Freddie Mac  that aims to streamline home appraisal and loan delivery data.

The effort, called the Uniform Mortgage Data Program, sets standards on data and collection processes. The FHFA previously directed Fannie and Freddie to create common data sets and standards for electronic submission and loan delivery data.

“This initiative is a major step toward meeting industry requests for uniformity in appraisal and loan data,” said FHFA acting director Edward DeMarco in a statement (download here). “Improvements in data quality will benefit all mortgage market participants and strengthen the housing finance system.”

Median Home Prices Up In 60% of Cities in 1st Quarter

WASHINGTON (AP) — Home prices rose in nearly 60% of U.S. cities in the first quarter of this year, the National Association of Realtors says. The median sales price for previously occupied homes rose in 91 out of 152 metropolitan areas tracked in the January-March quarter versus a year ago. There were double-digit price increases in 29 cities.

CHART: Median sales price by metro area

 That’s a sharp improvement from the fourth quarter of last year, when prices rose in about 40% of cities. The national median price was $166,100, or 0.7% below the first quarter of last year.

 Sales of foreclosures and other distressed properties made up 36% of all sales in the first quarter.

 The largest percentage price increase was in Saginaw, Mich., where the median price doubled to nearly $61,000. Prices in Akron, Ohio were up 95% to about $95,000. Prices in Cleveland were up 54% to $106,400.

 The largest price decline was in Orlando, where they dropped 15% to nearly $132,000. Prices in Ocala, Fla., fell 14.5% to a median of nearly $93,000. Prices in Cumberland, Md., fell 14.4% to $98,300.

FHA is set to reduce closing costs paid by a seller…

The FHA will reduce allowable seller concessions — the percentage sellers can take from the sales price of a home to fund closing costs — from 6% to 3%. According to an announcement in January, the current level of 6% exposes the FHA to excess risk by creating incentives for appraisers to increase the value of these homes. The change will take place in “early summer,” according to the FHA, but a spokesperson said no specific date has been set.

The closing costs include fees for origination, attorneys, appraisal and inspections, title search, title insurance, credit reports, and more. Down payment assistance is not included as a closing cost.

If you are thinking about buying or selling a home please contact me for specific details and how this change can impact your real estate transaction.

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