Fannie Mae’s January 2013 Economic & Housing Outlook report predicts that housing will be making a significant contribution to US economy in 2013. The economic growth is predicted to be modest 2% over the next one year and 2.6% for the following year. However, the housing recovery trend will continue with home price appreciation, rising rents and declining vacancy rates.
The Federal Reserve Beige book reported that existing residential real estate activity has expanded in all districts that reported, and the growth is due to affordable home prices, low interest rates and rising rents.
The Wall Street Journal reported that economists predicted positive trends for all housing parameters at the International Builders show held last week in Las Vegas.
The Federal Housing Finance Agency House Price Index is up by 0.6% in November. The increase is 5.6% on a year-over-year basis.
The National Association of Realtors reported that existing-home sale prices rose 6.3% during 2012 to $176,600.
Trulia’s Housing Barometer, which is a measure of how quickly housing is getting back to normal, is at by 52% compared to 27% in Dec 2011. The indicator is based on Construction Starts, Existing Home Sales and delinquency plus foreclosure rate.
The Zillow Home Price Index in December 2012 increased by 5.9% compared to December 2011. Rents increased by 4.2% in December 2012 from last year with HomeUnion® cash flow zone, Chicago showing 5.9% increase.
Home Prices are expected to see 2% to 3% rise in 2013, and residential sales are expected to rise by 8% according to Frank Nothaft, the Chief Economist of Freddie Mac.
Weekly mortgage applications increased by 7.9% according to survey data by Mortgage Bankers Association. The refinance index increased by 8% compared to the previous week data.
RedFin reported that over 8 in 10 respondents to a survey of potential sellers believe home prices will rise in the next 12 months. Rising prices may cause inventory shortage as the sellers will incubate on rising market prices. As we have been reporting for a while, institutional investors also aggressively acquire REO properties eroding the inventory.
David Crowe, the Chief Economist, of NAHB predicted 2.2% increase in 2013 for new single-family home construction.
Freddie Mac’s Primary Mortgage Market Survey shows weekly average rate on 30-year fixed is at 3.42%, and the average on 15-year fixed is at 2.71%.