The U.S. housing market benefitted from falling levels of mortgage delinquencies and increased home sales in the first quarter. But home prices remain volatile, creating ongoing uncertainty in the mortgage market, the Obama administration said Friday.

The administration's Housing Scorecard for April cites data showing existing home sales in the first quarter rose 5.3% from 355,000 sales last year to 373,300 sales in the most recent quarter.

Meanwhile, new home sales grew from 25,400 sales in the first quarter one year ago to 27,300 closings in the most recent Q1 report.

Inventory levels also declined to their lowest level in years. At the current sales pace, it could take 5.3 months to sell the current months' supply of new homes and 6.3 months to sell the current supply of existing homes. A six-month supply is generally considered a balanced housing market.

Mortgage origination data shows 918,100 refinancing originations were recorded a year ago, compared to 1.1 million in the most recent Q1 period. Refinance activity rose as interest rates continued to fall, with the average 30-year, fixed rate mortgage plummeting from 4.78% last year to 3.88% in the first quarter of 2012.

Fewer borrowers were late on their loans during the first four months of the year.

The Housing Scorecard shows the nation with a prime mortgage delinquency rate of 3.8% in Q1, compared to a 4.2% delinquency rate a year earlier. In addition, the subprime delinquency rate sits at 28.6%, compared to 31.8% a year earlier. The FHA-delinquency rate grew from 10.6% last year to 11.4% in the most recent period.

kpanchuk@housingwire.com