The National Association of Home Builders (NAHB) wants members of the military, foreign service and intelligence communities to know that they may have an additional year to buy a home and claim the home buyer tax credit, which expires for most Americans on April 30.
The law provides qualified service members who served on official extended duty outside of the United States for 90 days or more at any time between Jan. 1, 2009, to April 30, 2010, another year to buy a home and claim the credit. They have until April 30, 2011, to sign a sales contract, and until June 30, 2011, to settle and close on the home. Both the $8,000 first-time and $6,500 repeat home buyer tax credits are included in the rule.
“Congress recognized that many service members may have missed out on the home buyer tax credit due to being posted overseas,” said NAHB Chairman Bob Jones, a builder and developer in Bloomfield Hills, Mich. “It is only fitting that they be given another year to take advantage of this opportunity in appreciation of the sacrifices they have made serving our country.”
“Qualified service members” are defined as a member of the uniformed services of the United States military, a member of the Foreign Service of the United States, or an employee of the intelligence community.
The rule that requires buyers to repay the credit if they move out of their home within three years has also been waived for qualified service members if they have to sell their home due to receiving government orders for extended duty service.
NAHB provides information on the home buyer tax credit, including eligibility requirements and links to home buying resources, on its consumer website www.FederalHousingTaxCredit.com.
Monday, April 26, 2010
Friday, April 23, 2010
New Home Sales Surge 27%, Blowing Past Estimates
Sales of new homes surged 27 percent last month, bouncing off the previous month's record low and blowing past expectations as better weather and government incentives boosted sales.
The Commerce Department said new home sales rose in March to a seasonally adjusted annual sales pace of 411,000.
It was the strongest month since last July and the biggest monthly increase in 47 years.
Economists surveyed by Thomson Reuters had expected a sales pace of 330,000.
February's results were revised upward to 324,000, but remained an all-time low. Sales had been especially weak over the winter, partly due to bad weather in much of the country.
The Commerce Department said new home sales rose in March to a seasonally adjusted annual sales pace of 411,000.
It was the strongest month since last July and the biggest monthly increase in 47 years.
Economists surveyed by Thomson Reuters had expected a sales pace of 330,000.
February's results were revised upward to 324,000, but remained an all-time low. Sales had been especially weak over the winter, partly due to bad weather in much of the country.
Saturday, April 17, 2010
Housing Starts And Permits Rise in March
Nationwide housing starts rose for a third consecutive month in March to a seasonally adjusted annual rate of 626,000 units from an upwardly revised February number, according to figures released today by the U.S. Commerce Department. The rate of permit issuance for new housing construction also rose by a solid 7.5 percent in the month, to a seasonally adjusted annual rate of 685,000 units.
“After an uncertain couple of months, home builders are gradually getting back to what they do best as the spring home buying season commences and consumers return to the market,” said Bob Jones, Chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich. “While we still have a long way to go, today’s numbers are an indication that builders are looking down the road with a bit more optimism.”
“Today’s report is very encouraging, because it signifies that home builders are confident enough to begin work on homes that will very likely be completed after the expiration of the home buyer tax credits,” noted NAHB Chief Economist David Crowe. “The solid gain in permit issuance last month is particularly welcome news, since those numbers are generally a reliable indicator of future building activity. That said, considerable headwinds continue to impede housing’s recovery, including the critical shortage of credit for housing production that is stifling new development in reviving markets.”
While single-family starts slipped 0.9 percent in March, this small decline – from an upwardly revised number the previous month – was due entirely to a drop-off in the Midwest from an abnormally high February level; all other regions reported single-family gains in March. Nationwide multifamily starts gained 18.8 percent to a 95,000-unit rate for the month.
The 7.5 percent gain in nationwide building permits reflected a 5.6 percent uptick to 543,000 units on the single-family side and a 15.4 percent gain to a 142,000-unit rate on the multifamily side.
Regionally, combined single- and multifamily starts activity rose 18.2 percent in the South, which is the largest regional housing market, but fell 28.4 percent in the Midwest, 8.3 percent in the Northeast and 2.1 percent in the West.
Combined permit activity rose 17.6 percent in the Midwest and 18.4 percent in the South, but fell 19.5 percent in the Northeast and 6.7 percent in the West in March
“After an uncertain couple of months, home builders are gradually getting back to what they do best as the spring home buying season commences and consumers return to the market,” said Bob Jones, Chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich. “While we still have a long way to go, today’s numbers are an indication that builders are looking down the road with a bit more optimism.”
“Today’s report is very encouraging, because it signifies that home builders are confident enough to begin work on homes that will very likely be completed after the expiration of the home buyer tax credits,” noted NAHB Chief Economist David Crowe. “The solid gain in permit issuance last month is particularly welcome news, since those numbers are generally a reliable indicator of future building activity. That said, considerable headwinds continue to impede housing’s recovery, including the critical shortage of credit for housing production that is stifling new development in reviving markets.”
While single-family starts slipped 0.9 percent in March, this small decline – from an upwardly revised number the previous month – was due entirely to a drop-off in the Midwest from an abnormally high February level; all other regions reported single-family gains in March. Nationwide multifamily starts gained 18.8 percent to a 95,000-unit rate for the month.
The 7.5 percent gain in nationwide building permits reflected a 5.6 percent uptick to 543,000 units on the single-family side and a 15.4 percent gain to a 142,000-unit rate on the multifamily side.
Regionally, combined single- and multifamily starts activity rose 18.2 percent in the South, which is the largest regional housing market, but fell 28.4 percent in the Midwest, 8.3 percent in the Northeast and 2.1 percent in the West.
Combined permit activity rose 17.6 percent in the Midwest and 18.4 percent in the South, but fell 19.5 percent in the Northeast and 6.7 percent in the West in March
Friday, April 16, 2010
Builder Confidence Improves in April
Builder confidence in the market for newly built, single-family homes improved significantly in April as consumers rushed to take advantage of home buyer tax credits set to expire at the end of the month, according to results of the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The HMI surged four points to 19 in April, its highest level since September of 2009.
"Home builders reported some real improvement in current sales activity and traffic of prospective buyers through their model homes over the past month," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "While we remain cautious about what future months will bring, it's great to have this positive momentum at the start of the spring home buying season."
"An expected surge in buyer activity leading up to the expiration of the home buyer tax credits and a gradually improving economy helped to brighten builders' view of the marketplace in April," confirmed NAHB Chief Economist David Crowe. "Meanwhile, builders have a more neutral view of what may come in the next six months, and are very aware of the many factors that continue to drag on housing at this time - including the critical shortage of credit for new and existing projects, problems with inaccurate appraisals, and the ongoing flow of foreclosed properties on the market. Greater economic growth, particularly in the job market, and the abatement of these housing issues are needed to help move home building to a more sustained recovery."
Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.
The HMI's four-point gain to 19 this month returned it to where it was in September of 2009, just prior to the expiration of the last home buyer tax credit. The component gauging current sales conditions rose by five points to 20 - the strongest gain in that index since 2003 - while the component gauging traffic of prospective buyers rose a solid four points, to 14. However, the index gauging sales expectations in the next six months registered only a marginal one-point increase to 25, an indication of builders' continued cautious outlook.
The Midwest and South each registered substantial HMI gains in April, rising five points to 15 and four points to 21, respectively. Meanwhile, the Northeast posted no change at 22 and the West dipped two points to 13.
Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be accessed online at: www.nahb.org/hmi. More information on housing statistics is also available at: www.housingeconomics.com.
"Home builders reported some real improvement in current sales activity and traffic of prospective buyers through their model homes over the past month," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "While we remain cautious about what future months will bring, it's great to have this positive momentum at the start of the spring home buying season."
"An expected surge in buyer activity leading up to the expiration of the home buyer tax credits and a gradually improving economy helped to brighten builders' view of the marketplace in April," confirmed NAHB Chief Economist David Crowe. "Meanwhile, builders have a more neutral view of what may come in the next six months, and are very aware of the many factors that continue to drag on housing at this time - including the critical shortage of credit for new and existing projects, problems with inaccurate appraisals, and the ongoing flow of foreclosed properties on the market. Greater economic growth, particularly in the job market, and the abatement of these housing issues are needed to help move home building to a more sustained recovery."
Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.
The HMI's four-point gain to 19 this month returned it to where it was in September of 2009, just prior to the expiration of the last home buyer tax credit. The component gauging current sales conditions rose by five points to 20 - the strongest gain in that index since 2003 - while the component gauging traffic of prospective buyers rose a solid four points, to 14. However, the index gauging sales expectations in the next six months registered only a marginal one-point increase to 25, an indication of builders' continued cautious outlook.
The Midwest and South each registered substantial HMI gains in April, rising five points to 15 and four points to 21, respectively. Meanwhile, the Northeast posted no change at 22 and the West dipped two points to 13.
Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be accessed online at: www.nahb.org/hmi. More information on housing statistics is also available at: www.housingeconomics.com.
Wednesday, April 14, 2010
Federal Government Needs Central Role in New Housing Finance System
April 14, 2010 - As Congress begins to debate how to reform government-sponsored enterprises (GSEs) Fannie Mae, Freddie Mac and the Federal Home Loan Bank System, the National Association of Home Builders (NAHB) today called on lawmakers to ensure that the federal government continues to provide a backstop for the housing finance system to ensure a reliable and adequate flow of affordable housing credit.
Testifying before the House Financial Services Committee, NAHB Third Vice Chairman Rick Judson, a builder and developer from Charlotte, N.C., said the need for such support is underscored by the current state of affairs, with the GSEs, Federal Housing Administration and Ginnie Mae acting as the primary conduits for residential mortgage credit.
“NAHB feels the federal backstop must be a permanent fixture in order to ensure a consistent supply of mortgage liquidity as well as to allow rapid and effective responses to market dislocations and crises,” said Judson.
Regarding the future of Fannie Mae and Freddie Mac, NAHB recommended the following policy changes in terms of structure and operations to restore and improve the secondary mortgage market and housing finance system:
•Degree and structure of government support. While government support is needed to ensure that mortgage credit is available and affordable in all areas of the country under all economic circumstances, for the conforming conventional portion of the mortgage market, that support should not be provided directly to private companies. Rather, the federal government should provide an explicit guarantee of the timely payment of principal and interest on securities backed by conforming conventional mortgages, in the same manner that Ginnie Mae now provides guarantees for investors in securities representing interests in government-backed mortgages.
•Operation of the conforming conventional mortgage market. NAHB envisions that private companies, called conforming mortgage conduits (CMCs), would be chartered to purchase conforming conventional loans that are originated by approved mortgage lending institutions such as banks, savings and loan associations, mortgage banking companies and credit unions. CMCs would issue securities backed by those mortgages, which would carry a federal government guarantee of the timely payment of principal and interest for the securities investors.
CMCs would guarantee the timely payment on the mortgages that are pooled in the government-guaranteed securities and would be required to be well-capitalized and to maintain reserves at levels appropriate for their risk exposure. However, CMCs and the mortgages backing their securities would not have implicit or explicit support from the federal government. A fund would be established by the government to provide a guarantee of timely payment of principal and interest to investors in the securities. CMCs benefitting from the federal securities guarantees would pay a fee to capitalize the fund, which would be designed to mitigate the federal government’s risk so that it would only be exposed in the case of a “catastrophic” occurrence.
•Conforming conventional mortgages. Mortgages eligible for inclusion in securities receiving an explicit federal guarantee should be products with well-understood risk characteristics -- such as fixed-rate mortgages, standard adjustable-rate mortgages and selected multifamily mortgage loans.
NAHB is in the process of updating its policy on the future of the Federal Home Loan Bank System and believes that policymakers must account for their significant structural and operational differences from Fannie Mae and Freddie Mac when considering the future make-up of the housing finance system.
With Fannie Mae and Freddie Mac now operating under conservatorship and experiencing severe financial pressures, NAHB urged Congress to proceed with caution as lawmakers take steps to transition to a new housing finance system.
“Any changes should be undertaken with extreme care and with sufficient time to ensure that U.S. home buyers and renters are not placed in harm’s way and that the mortgage funding and delivery system operates efficiently and effectively as the old system is abandoned and a new system is put in place,” said Judson.
Testifying before the House Financial Services Committee, NAHB Third Vice Chairman Rick Judson, a builder and developer from Charlotte, N.C., said the need for such support is underscored by the current state of affairs, with the GSEs, Federal Housing Administration and Ginnie Mae acting as the primary conduits for residential mortgage credit.
“NAHB feels the federal backstop must be a permanent fixture in order to ensure a consistent supply of mortgage liquidity as well as to allow rapid and effective responses to market dislocations and crises,” said Judson.
Regarding the future of Fannie Mae and Freddie Mac, NAHB recommended the following policy changes in terms of structure and operations to restore and improve the secondary mortgage market and housing finance system:
•Degree and structure of government support. While government support is needed to ensure that mortgage credit is available and affordable in all areas of the country under all economic circumstances, for the conforming conventional portion of the mortgage market, that support should not be provided directly to private companies. Rather, the federal government should provide an explicit guarantee of the timely payment of principal and interest on securities backed by conforming conventional mortgages, in the same manner that Ginnie Mae now provides guarantees for investors in securities representing interests in government-backed mortgages.
•Operation of the conforming conventional mortgage market. NAHB envisions that private companies, called conforming mortgage conduits (CMCs), would be chartered to purchase conforming conventional loans that are originated by approved mortgage lending institutions such as banks, savings and loan associations, mortgage banking companies and credit unions. CMCs would issue securities backed by those mortgages, which would carry a federal government guarantee of the timely payment of principal and interest for the securities investors.
CMCs would guarantee the timely payment on the mortgages that are pooled in the government-guaranteed securities and would be required to be well-capitalized and to maintain reserves at levels appropriate for their risk exposure. However, CMCs and the mortgages backing their securities would not have implicit or explicit support from the federal government. A fund would be established by the government to provide a guarantee of timely payment of principal and interest to investors in the securities. CMCs benefitting from the federal securities guarantees would pay a fee to capitalize the fund, which would be designed to mitigate the federal government’s risk so that it would only be exposed in the case of a “catastrophic” occurrence.
•Conforming conventional mortgages. Mortgages eligible for inclusion in securities receiving an explicit federal guarantee should be products with well-understood risk characteristics -- such as fixed-rate mortgages, standard adjustable-rate mortgages and selected multifamily mortgage loans.
NAHB is in the process of updating its policy on the future of the Federal Home Loan Bank System and believes that policymakers must account for their significant structural and operational differences from Fannie Mae and Freddie Mac when considering the future make-up of the housing finance system.
With Fannie Mae and Freddie Mac now operating under conservatorship and experiencing severe financial pressures, NAHB urged Congress to proceed with caution as lawmakers take steps to transition to a new housing finance system.
“Any changes should be undertaken with extreme care and with sufficient time to ensure that U.S. home buyers and renters are not placed in harm’s way and that the mortgage funding and delivery system operates efficiently and effectively as the old system is abandoned and a new system is put in place,” said Judson.
Monday, April 12, 2010
Federal Housing Administration to Accept DocuSign for Real Estate Contracts Nationwide
DocuSign, a leader in on-demand electronic signature solutions, announced e-signed third-party documents, including real estate contracts, are now being accepted by the Federal Housing Administration (FHA). DocuSign spearheaded an industry-wide effort to move the FHA to formally recognize e-signed third-party documents. The April 8, 2010 dated FHA mortgagee letter is the first in what is expected to be a series of responses to this initiative. With this policy statement from one of the nation’s largest mortgage insurers, real estate professionals can use DocuSign to get real estate contracts, addenda and other documents signed electronically, and their buyers can apply for FHA insurance with confidence.
“We commend FHA’s action. By clarifying its position on electronic signatures, the process of buying, selling and financing of homes across the country will be greatly improved,” said Ken Moyle, chief legal officer at DocuSign. “Buyers, sellers and agents can use DocuSign’s online process to eliminate the time, expense and environmental impact of printing, delivering and signing large stacks of paper documents, and mortgage lenders can take comfort in knowing that DocuSign’s e-signature process is designed for legal compliance in all 50 states and is fully evidenced by a comprehensive audit trail.”
Real estate agents can quickly access the DocuSign e-signing service from any laptop with Internet access, drag and drop familiar yellow StickEtabs onto the contract and send the envelope. The recipient immediately receives an e-mail notification that can be accessed through a computer or any Web-enabled mobile device, including Apple iPhone, RIM BlackBerry, Google Android or Windows Mobile, then adopts an e-signature and signs the document. Once completed, an e-mail notification is sent to all parties with a link to the final executed document. The result is a legally binding, fully ESIGN-compliant document supported by a comprehensive audit trail.
As on-demand software-as-a-service (SaaS), DocuSign requires no additional software or hardware purchases and no downtime for training. DocuSign eSignature service offers users one of the easiest, most simple to use and safest electronic signature experiences available today.
“We commend FHA’s action. By clarifying its position on electronic signatures, the process of buying, selling and financing of homes across the country will be greatly improved,” said Ken Moyle, chief legal officer at DocuSign. “Buyers, sellers and agents can use DocuSign’s online process to eliminate the time, expense and environmental impact of printing, delivering and signing large stacks of paper documents, and mortgage lenders can take comfort in knowing that DocuSign’s e-signature process is designed for legal compliance in all 50 states and is fully evidenced by a comprehensive audit trail.”
Real estate agents can quickly access the DocuSign e-signing service from any laptop with Internet access, drag and drop familiar yellow StickEtabs onto the contract and send the envelope. The recipient immediately receives an e-mail notification that can be accessed through a computer or any Web-enabled mobile device, including Apple iPhone, RIM BlackBerry, Google Android or Windows Mobile, then adopts an e-signature and signs the document. Once completed, an e-mail notification is sent to all parties with a link to the final executed document. The result is a legally binding, fully ESIGN-compliant document supported by a comprehensive audit trail.
As on-demand software-as-a-service (SaaS), DocuSign requires no additional software or hardware purchases and no downtime for training. DocuSign eSignature service offers users one of the easiest, most simple to use and safest electronic signature experiences available today.
Monday, April 5, 2010
Pending Home Sales Show Healthy Gain, Hint at Spring Surge
Pending home sales rose in February, potentially signaling a second surge of home sales in response to the home buyer tax credit, according to the National Association of Realtors®.
The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in February, rose 8.2 percent to 97.6 from a downwardly revised 90.2 in January, and remains 17.3 percent above February 2009 when it was 83.2. The data reflects contracts and not closings, which usually occur with a lag time of one or two months.
Lawrence Yun, NAR chief economist, said the improvement is another hopeful sign. “The rise in buyer contact activity may signal the early stages of a second surge of home sales this spring. The healthy gain hints home prices are continuing to flatten,” he said. “We need a second surge to meaningfully draw down inventory and definitively stabilize home values.”
The PHSI in the Northeast rose 9.0 percent to 77.7 in February and is 18.9 percent higher than February 2009. In the Midwest the index jumped 21.8 percent to 97.9 and is 18.7 percent above a year ago. Pending home sales in the South increased 9.2 percent to an index of 107.0, and the index is 17.5 percent higher than February 2009. In the West the index fell 4.8 percent to 98.0 but is 14.6 percent above a year ago.
“Anecdotally, we’re hearing about a rise of activity in recent weeks with ongoing reports of multiple offers in more markets, so the March data could demonstrate additional improvement from buyers responding to the tax credit,” Yun said.
The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in February, rose 8.2 percent to 97.6 from a downwardly revised 90.2 in January, and remains 17.3 percent above February 2009 when it was 83.2. The data reflects contracts and not closings, which usually occur with a lag time of one or two months.
Lawrence Yun, NAR chief economist, said the improvement is another hopeful sign. “The rise in buyer contact activity may signal the early stages of a second surge of home sales this spring. The healthy gain hints home prices are continuing to flatten,” he said. “We need a second surge to meaningfully draw down inventory and definitively stabilize home values.”
The PHSI in the Northeast rose 9.0 percent to 77.7 in February and is 18.9 percent higher than February 2009. In the Midwest the index jumped 21.8 percent to 97.9 and is 18.7 percent above a year ago. Pending home sales in the South increased 9.2 percent to an index of 107.0, and the index is 17.5 percent higher than February 2009. In the West the index fell 4.8 percent to 98.0 but is 14.6 percent above a year ago.
“Anecdotally, we’re hearing about a rise of activity in recent weeks with ongoing reports of multiple offers in more markets, so the March data could demonstrate additional improvement from buyers responding to the tax credit,” Yun said.
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