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Author Topic: Median Existing-Home Price Rises  (Read 807 times)

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Median Existing-Home Price Rises
« on: July 20, 2011, 03:41:01 PM »
Daily Market Commentary for July 20, 2011

Median existing-home price was $184,300 - an increase of 0.8% from June 2010. (read more at Millennium-Traders.Com)

Builder confidence in the market for new single-family housing edged higher during July, according to the National Association of Home Builders. In week ended July 15, mortgage applications jumped 15.5% - mainly due to refinancing - and weekly mortgage applications for purchase loans slipped 0.1%.

It has been known that data provided by NAR has been under scrutiny since other measurements of home sales show an overstatement in NAR figures of up to 20%. NAR concedes that its data could be overstated due to various measurement difficulties and has previously disclosed they are conducting a review of data released. Chief economist of NAR said he doesn’t anticipate the full restatement by the summer, but a preliminary review may be ready in August.

Higher-cost mortgages may push more borrowers and refinancers into adjustable-rate mortgages, with their enticingly lower interest rates. Conforming-loan limits are set to drop to a lower dollar amount and more loans will be considered 'jumbo' loans. These 'jumbo' loans come with higher interest rates because Fannie Mae or Freddie Mac can’t purchase and securitize those loans. Conforming loan Limits vary by market and the lower limits are equal to 115% of the median single-family home price, ranging from $417,000 to as much as $625,500. The change officially takes effect October 1 however, it may be reflected in loan quotes as early as the end of July. The loan-limit reduction will affect 250 counties in the country, according to the Federal Housing Finance Agency - that is 8% of the counties in the U.S. Additionally the Federal Housing Administration has loan limits for loans it will insure and those will be changing in the fall as well.

Zillow (NasdaqGM: Z) got a nice start on its opening day. Shares jumped 123%, rising to $45 in early morning trade after opening on the market at $60 a share.

Skullcandy (NasdaqGM: SKUL) posted a high on their opening day debut of $23.40 a share.

Economic data released today:

MBA Mortgage Applications: Mortgage Bankers Association's seasonally adjusted index of mortgage application activity rose 15.5% in week ended July 15 the biggest monthly increase in four months which was driven by a huge rise in refinancing applications. MBA's seasonally adjusted index of refinancing applications jumped 23.1%, while the agency's measure of new purchase applications was almost unchanged.

Existing Home Sales: Existing-home sales per NAR [National Association of Realtors] - completed transactions that include single-family, townhomes, condominiums and co-ops - declined 8% to a seasonally adjusted annual rate of 4.77 million in June from 4.81 million in May and remain 8.8% below the 5.23 million unit level in June 2010. In the West, Existing-home sales declined 1.7% to an annual pace of 1.14 million in June and are 2.6% below 2010 stats.

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