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America's property market struggles to recover from its hangover



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By : John Smith    99 or more times read
The latest bracket of somewhat uncertain information was released by the Mortgage Bankers Association on Wednesday last – they think the delinquency rate is up to 9.38% of all mortgages, compared to 8.22% a year ago. In the same breath the Mortgage Bankers Association also say the rate is 10% when adjusted for seasonal variations.

After sowing this drop of confusion in the minds of non-fiscally orientated folk like you and me, the same Bankers then added that they were unsure whether their seasonal variation could be trusted. This is because, while the seasonally adjusted data suggested a worsening delinquency rate, actual events indicated a marked improvement.

And these are the guys America trusts to keep a steady hand on its banking industry? This time my heart goes out to Obama – just imagine trying to negotiate with an opponent playing with a mixed pack like that?

Chief Economist of the said Mortgage Bankers Association thinks that “We may be at a point where the market is changing for the better, but we can’t be sure because of the confounding effect of seasonal differences."

Setting the uncertain rate of mortgage delinquencies aside for a moment, other recent housing data indicates a property market that's still changing for the worse. Median house prices are expected to continue falling in the light of the April 2010 expiry of the federal tax credit for first time home buyers, and applications for mortgages are at their lowest rate since 1997, despite interest rates being at their best since November 2009.

Is the rush to buy over? Tim O’Shea of Weichert Realtors in Summit, NJ certainly thinks so. “People are decompressing,” he told me. “It’s like a hangover.”

O’Shea’s concerns are shared by the Federal Reserve Bank’s Federal Open Market Committee that’s tasked with making policy. The minutes of the Committee’s April meeting state that housing recovery “appeared to have stalled in recent months despite various forms of government support.” The record adds that some committee members were of the opinion that increasing foreclosures might add to the inventory of empty homes, “posing a downside risk to home prices.”

Lower prices are good for sales, but bad for struggling underwater households. Whose side are you on?
Original Post: America’s property market struggles to recover from its hangover on ForeclosureDataBank.com.

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