The U.S. housing market is far better off when compared to recessionary levels, but even with underwater borrowers gaining equity and home prices rising all the time, the market is not back to normal, Obama administration officials said.
"As indicated in the August housing scorecard, the administration continues to work to stabilize the housing market and help responsible homeowners get back on their feet," said U.S. Department of Housing and Urban Development Deputy Assistant Secretary for Economic Affairs Kurt Usowski. "With the number of underwater homeowners decreasing by more than 40%, it is clear that we are moving in the right direction."
Home prices continue to trudge forward, with the S&P Case-Shiller home price index up from 156.2 in May to 159.5 in the latest report in June. Year-over-year the index is up from 142.4 in June 2012.
The number of buyers wanting to acquire a home before rates rise even further is reflected in the existing-home sales numbers. According to the National Association of Realtors, existing-home sales rose significantly from a revised 421,700 in June to 449,200 in July.
Homebuilders, who have been facing a number of challenges as of late, are continuing to see a lag in activity. New home sales fell from 37,900 in June to 32,800 in July, according to data from the U.S. Census Bureau and HUD.
The pool of existing-homes for sale has continued to grow, a positive sign for potential buyers, with inventory up from a revised 4.3-month supply in June to a 5.2-month supply in July, NAR reported. The supply of new homes for sale dropped slightly, remaining unchanged month-over-month at 5.1 months.
Foreclosure starts continue to yo-yo after falling from 72,700 in May to 57,300 in June, data from RealtyTrac revealed. From June to July, foreclosure starts have inched back up to 60,600.
According to a report from Lender Processing Services, mortgage delinquency rates for prime borrowers were down from 3.5% in June to 3.3% in July.
Usowski added, "As we regain stability in our housing markets, it is important to remember that we still have a long way to go in making sure that our housing finance system is strong for future generations."