Real Estate Roundup: Mortgage Rules to Loosen While Home Prices Keep Rising

Illustation of a house on a stack of moneyHere’s a look at recent news of interest to homebuyers, home sellers, and the home-curious:

MORTGAGE STANDARDS TO LOOSEN IN 2013
Tight mortgage standards that have bedeviled borrowers for more than a year are starting to loosen, and the trend will continue through 2013, according to a report from Moody’s Analytics.

The housing recovery that began last year “promises improvements this year as the drivers of tough credit standards reverse,” a Moody’s analyst noted. “Rising house prices give lenders more breathing room to extend credit.”

Lending will remain tight by historical standards, but  “improved consumer credit quality combined with steady growth in jobs, low mortgage interest rates, and modestly rising house prices makes it clear that more households will be able to qualify for a mortgage,” Moody’s said.

“Greater credit availability will in turn help drive stronger home sales and stronger price appreciation and help keep the housing market and the larger economy on an upward path.”


RISING HOME PRICES THROUGH 2017
Home prices will continue rising at least through 2017, climbing an average 3.7 percent between the third quarters of 2013 and 2014 and then 3.3 percent annually over the next three years.

That optimistic analysis from the research firm Fiserv was based on data from the Federal Housing Finance Agency.

“Although some recent real estate activity has been speculative, it seems as if buyers have more realistic expectations about housing market returns after having lived through the largest housing market crash in U.S. history,” Fiserv economist David Stiff said in a statement.

Another recent report, from CoreLogic, said U.S. home prices in January were up 9.7 percent from a year earlier, the biggest annual increase in nearly seven years, while prices rose 14.1 percent in California.


U.S. HOUSEHOLD WEALTH REGAINS PEAK
Here’s another sign that 2013 promises to be a banner year for housing: The Federal Reserve says surging stock prices and steady home appreciation have finally allowed Americans to recover the $16 trillion in wealth they lost during the recent recession.

The gains are helping boost the U.S. economy and could lead to additional spending and growth, the Fed said.


HOUSING A BRIGHT SPOT IN SURVEY
Americans are optimistic about the housing recovery, while opinions on the overall economy remain mixed.

A monthly survey by Fannie Mae found that the percentage of people who believe home prices will rise over the next year reached the highest level since the survey began in June 2010.

“Despite fiscal headwinds and political uncertainty, consumer sentiment toward housing is robust and continues to gather strength,” Doug Duncan, senior vice president and chief economist at Fannie Mae said in a statement. “We expect home prices to firm further amid a durable housing recovery, gradually reducing the population of underwater borrowers and helping to boost the share of consumers who say that now is a good time to sell.”


ZILLOW, TRULIA LISTINGS CHALLENGED
The accuracy of real estate listings on Zillow and Trulia websites are being challenged in a report from rival ZipRealty.

After analyzing listings in 50 selected ZIP codes in San Francisco and 12 other cities, ZipRealty said more than 15 percent of homes shown for sale on Zillow and Trulia were no longer on the market, and the sites failed to identify up to 30 percent of homes listed for sale in an MLS as being on the market.

Inman News noted in a news story that ZipRealty’s report followed similar claims by Redfin. Inman noted that both Zillow and Trulia questioned the accuracy of the reports.


HOUSING HURT BY STUDENT LOAN DEBT
Student loan debt is being blamed for the lowest level of young homebuyers in more than a decade.

A report from the New York Federal Reserve said increasing numbers of young college graduates are being denied home loans because of their debt load — estimated at nearly $1 trillion nationwide.

(Illustration courtesy of 401(K) 2013, via Flickr.)

Share this post:

Sign Up for Daily Blog Updates

Receive daily blog posts from Pacific Union in your inbox.

Sign up for Monthly Market Updates

Receive monthly real estate news from Pacific Union in your inbox.