U.S. Banks Bullish on Housing Recovery, Believe Rising Home Prices Sustainable
With the spring home-buying season well under way, a survey of U.S. banks found that lenders are bullish on the housing recovery and confident that home prices are rising at a sustainable pace.
The survey, conducted in the first quarter of 2013 for Fair Isaac Corp. (FICO), found that 71 percent of risk managers at U.S. banks believe the rise in home prices over the past year is sustainable, and 84 percent predicted that the level of mortgage delinquencies will decrease or stay the same — a significant improvement from the previous quarter.
Also, 59 percent expect the supply of credit for residential mortgages to meet demand over the next six months.
“The latest survey results, combined with data that indicates the real estate market is improving in many regions, paint a positive picture for a sector of the economy that has been slow to join the recovery,” Andrew Jennings, chief analytics officer at FICO, said in a statement.
“Mortgage lenders have been understandably guarded over the past five years. The improvement in their sentiment should be welcome news, and I wouldn’t be surprised to see lenders cautiously expanding their mortgage and home equity lending businesses.”
FICO said the bankers’ responses were the most positive recorded since the survey’s inception three years ago.
(Illustration courtesy of 401(K) 2013, via Flickr.)