Home prices fell 0.5 percent between June to July, according to the monthly House Price Index released by the Federal Housing Finance Agency (FHFA) last week.
WASHINGTON, DC – U.S. house prices fell 0.5 percent on a seasonally adjusted basis from June to July, according to the Federal Housing Finance Agency’s monthly House Price Index. The previously reported 0.3 percent decline in June was revised to a 1.2 percent decline. The unusually large revision mainly reflects the addition of new data from late June that show considerably weaker prices than earlier in the month. For the 12 months ending in July, U.S. prices fell 3.3 percent. The U.S. index is 13.8 percent below its April 2007 peak.
The FHFA monthly index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac. For the nine Census Divisions, seasonally adjusted monthly price changes from June to July ranged from -1.6 Percent in the South Atlantic Division to +1.1 percent in the Pacific Division.
Some analysts say the further 0.5 percent month-over-month fall in the FHFA’s national measure of home prices could simply be part of a temporary move linked to the plunge in home sales seen after the expiration of the homebuyer tax credit.
While others warn that it’s possibly bigger than that. Fear that a more longer-lasting slide is underway because June’s 0.3 percent m/m decline was revised to a 1.2 percent m/m drop.
“These price falls could be linked linked to the 34 percent plunge in home sales seen since the expiry of the tax credit in April. Once home sales stabilize, prices could level off again. Retouring low levels of mortgage applications suggest that the current weakness of demand is more than temporary.
Mortgage Bankers Association’s (MBA) index of applications for home purchases dropped 3.3% being the second drop just short of the 14-year low experienced in August.
The big drop in housing prices is behind us but with high unemployment, heavy indebtedness, and widespread negative equity are pulling the market down and add in a high excess of inventory but a second price adjustment seems to be in the shadows threatening even further the possibility for a quick economic recovery.
Bill Sanjurjo
http://www.miamipersonalrealtor.com/
bsanjurjo@gmail.com
The FHFA monthly index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac. For the nine Census Divisions, seasonally adjusted monthly price changes from June to July ranged from -1.6 Percent in the South Atlantic Division to +1.1 percent in the Pacific Division.
Some analysts say the further 0.5 percent month-over-month fall in the FHFA’s national measure of home prices could simply be part of a temporary move linked to the plunge in home sales seen after the expiration of the homebuyer tax credit.
While others warn that it’s possibly bigger than that. Fear that a more longer-lasting slide is underway because June’s 0.3 percent m/m decline was revised to a 1.2 percent m/m drop.
“These price falls could be linked linked to the 34 percent plunge in home sales seen since the expiry of the tax credit in April. Once home sales stabilize, prices could level off again. Retouring low levels of mortgage applications suggest that the current weakness of demand is more than temporary.
Mortgage Bankers Association’s (MBA) index of applications for home purchases dropped 3.3% being the second drop just short of the 14-year low experienced in August.
The big drop in housing prices is behind us but with high unemployment, heavy indebtedness, and widespread negative equity are pulling the market down and add in a high excess of inventory but a second price adjustment seems to be in the shadows threatening even further the possibility for a quick economic recovery.
Bill Sanjurjo
http://www.miamipersonalrealtor.com/
bsanjurjo@gmail.com
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