Rates Hit Another Low, Pending Home Sales Struggle

Mortgage & Real Estate

It appears that rock bottom mortgage rates have yet to cure the housing industry’s woes.

According to two separate data sets released Thursday, the rate offered on a 30-year fixed-rate loan fell to another all-time low for the week ending September 29 (4.01%), but pending home sales declined.

The National Association of Realtors reported that pending sales in August fell 1.2% on a sequential basis, but compared to the same month a year prior rose 7.7%.

NAR, which tracks pending deals through an index, noted that the prospect for sales is uneven. “The biggest monthly decline was in the Northeast, which was significantly disrupted by Hurricane Irene in the closing weekend of August,” said trade group chief economist Lawrence Yun. “But broadly speaking, contract signing activity has been holding in a narrow range for many months.”

He predicted that the housing market is underperforming, given what the trade group describes as a “pent-up demand” in household formation. 

“We continue to experience a pattern in which financially qualified home buyers, willing to stay well within their means, are being denied credit – a factor in elevated levels of contract failures,” Yun said.

As for rates, with the yield on the benchmark 10-year Treasury bobbing above 2% Thursday, it’s possible that the all-time low established this week may be one for the record books.

Daily Briefing | Thursday, September 29, 2011

  • OCC Offers Sobering News on Foreclosures

    Nine major servicers regulated by the Office of the Comptroller of the Currency completed 180,000 foreclosure actions in the second quarter, but these firms are still managing roughly 1.3 million borrowers who are going through the foreclosure process.

  • B of A Top Warehouse Lender in 2Q, But Unit’s Future in Doubt

    Bank of America ranked first among all warehouse providers in the second quarter with $12 billion of funding commitments, a 20% decline from a year ago, according to new figures compiled by National Mortgage News.

  • CoreLogic Spots a Reduction in Mortgage Fraud, But…

    Roughly $7.4 billion of fraudulent mortgages will be originated this year, a 40% decline from 2011, a decrease primarily due to significantly lower fundings volumes in 2011, according to a new report from CoreLogic.

  • Idaho Bank to Outsource Origination Function

    Home Federal Bancorp, Nampa, Idaho, as part of a major restructuring, will outsource its residential origination function to a third-party vendor.

  • Fed President Wants GSEs to Step Up on Refis

    Boston Federal Reserve Bank president Eric Rosengren wants Fannie Mae and Freddie Mac to do more to refinance homeowners and address housing market problems.

  • European Banks to Sell Troubled CRE Loans

    Banks in Europe will try to unload roughly 15 billion euros ($20 billion) of loans secured by commercial real estate in Europe through 2012 as they comply with tighter capital regulations, according to Situs Companies, a debt advisor.

  • Cascade Bancorp of Oregon Selling Problem Loans

    Cascade Bancorp in Bend, Ore., has agreed to sell about $108 million of problem loans, generating $58 million in proceeds in an effort to remain well capitalized.

  • Mortgage Stanley’s Mantz Joins Rialto

    The executive who helped build one of the world’s leading real estate investment platforms at Morgan Stanley has landed in Miami, where he will oversee one of the country’s largest home builder’s workout business.

  • NCUA Failed to Spot CU’s High Concentration of Risky MBS

    A new report issued by the National Credit Union Administration blames the agency’s Office of Corporate Credit Unions for failing to identify a high concentration of risky MBS at the now defunct Southwest Corporate Credit Union of Texas, a $12 billion institution.

Leave a Reply