White House Housing Scorecard Shows Big Gains as Mortgage Rates Today Decline
The White House housing scorecard shows the housing market continues to recover, aided by low mortgage rates today which are moving even lower. Every month the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury produces a monthly scorecard on the health of the nation's housing market.
The report shows how the Obama Administration's efforts are helping the housing market recover from the worst bust since the Great Depression of the 1930s. The March 2013 report shows housing is making key progress in both home prices and home sales. Home prices showed large gains for the 12 months that ended in January 2013 and the number of new and existing home sales continues to increase.
Over the past year mortgage rates also declined, making a series of record lows. 30 year conforming mortgage rates hit an all-time record low of 3.27 percent in November 2012 and 15 year conforming mortgage rates hit a record low of 2.63 percent. Average rates have moved higher from the record lows but rates are still very low, historically speaking.
The FHFA purchase-only index increased 6.5 percent from one year ago. Another home price indicator, the Case-Shiller 20-city index, was up 8.1 percent over the same period. We haven't seen home price increases like this since the housing bubble and home prices are expected to continue to move higher over the next several years.
The number of new home purchases in February 2013 was up 12 percent from one year ago. This is the second highest number since April 2010. Existing home sales are also up in the double digits. February existing home sales are up 10 percent, the highest since November 2009, when the First-Time Home Buyer Tax Credit gave home buyers up to an $8,000 credit for buying a home.
The Administration's programs to help the housing market continue to provide relief for millions of homeowners. To date, more than 1.5 million homeowner assistance actions have taken place through the Making Home Affordable Program. The assistance includes more than 1.1 million permanent mortgages modifications through the Home Affordable Modification Program (HAMP).
These programs were designed to help individuals who bought homes at the top of the bubble and/or obtained mortgage loans with mortgage rates that are higher than where today's mortgage rates are. Since the home buyers bought at the top of the market, they owe more on their mortgage than their home is worth, making it impossible to refinance without government help.
The biggest factor that will help millions of people who are underwater on their home is rising home prices. The Housing Scorecard notes home owner equity grew by more than $1.64 trillion in 2012. Home price increases last year have lifted 1.7 million home owners "above water" again, enabling these homeowners to refinance if they choose to.
If you're in a position to refinance your loan, the general rule of thumb is that it pays to refinance if you can get a refinance rate that is at least 1 percent lower than your current mortgage rate. Right now, the lowest 30 year conforming refinance rates can be found around 3.25 percent with points. The lowest 15 year refi rates with points are around 2.25 percent.
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