Mortgage rates fell during the week ending on Thursday, April 15, returning to levels seen two weeks earlier, according to Freddie Mac’s weekly survey of conforming rates. The 30-year fixed-rate mortgage averaged 5.07%, down from 5.21% in the prior week. “After rising for four consecutive weeks, mortgage rates eased back to where they were two weeks ago and still remain historically low,” said Freddie Mac Chief Economist Frank Nothaft. Recent upward pressure on rates has been only partly due to the Federal Reserve ending its purchase of mortgage-backed securities at the end of last month, said Keith Gumbinger, vice president for HSH Associates, a publisher of consumer loan information. “The bump is partially related to uncertainty surrounding the Fed’s exit, but mostly due to the rise in underlying interest rates as economic news has become somewhat brighter of late,” he said. Despite some bright spots, the economy still remains weak — and that should keep mortgage rates relatively low in the months ahead, he said. “With the economy still pretty weak, inflation non-existent and labor ‘slack’ quite considerable, mortgage rates should remain favorable for the foreseeable future, but no one should expect them to return to or remain at ‘emergency’ levels for too long,” he said. (www.marketwatch.com)
MarketWatch (4/15/10); Amy Hoak

The share of home owners behind on their mortgages fell in the first quarter, the first drop in four years and a possible sign that the foreclosure crisis has peaked. The portion of mortgages that were delinquent 30 days or more fell to 6.57% in the first quarter from 6.60% in the last three months of 2009, according to Equifax and Moody’s Economy.com. That’s a drop of about 16,630 delinquent loans and, though modest, it is the first decline in the delinquency rate since early 2006. “It will take years to work through all the troubled mortgage loans in the foreclosure pipeline, but this is the first indication that the number of loans entering the pipeline is declining,” said Mark Zandi, chief economist for Moody’s Economy.com. “It portends a peaking of the foreclosure crisis.” He added that, “There is still a foreclosure problem that is going to cause people to lose their homes, but in terms of new delinquencies starting, those are probably at their peak. This summer will be the peak of foreclosures started.” (www.usatoday.com)
USA Today (4/14/10); Stephanie Armour

After a dismal 2009 that saw the fewest housing starts in more than 30 years, Kansas City area builders through the first two months of this year are taking out 32.2% more permits. This year the Home Builders Association of Greater Kansas City projects that about 2,600 homes will be built, up 21% from last year’s collapse. One indication of how the year may go is the response to the annual Spring Homes Tour sponsored by the builders association and now in its second week. The event is offering 253 homes for touring, down from 337 a year ago. “Part of it is the fact the builders don’t have the inventory to show,” said George Schluter, who just stepped down as the interim director of the association. But that’s good news. A year ago, the inventory of unsold new homes was about 2,900. This year, it’s closer to 1,800. Reducing the glut that peaked at 5,800 in September 2006 has been a key goal for builders. Schluter said the word from builders is the first-time buyer credit is spurring sales, but the review of the move-up tax credit has been mixed. “We’re doing excellently this spring,” said Jim Engle of Custom Homes LLC. “It’s a buyer’s market with low interest rates and the government offering rebates,” he said. “That’s created a firestorm of buyers.” Engle has about 80 homes under construction in southern Johnson County, compared with 50 last year. “The customers are there, but since it’s a buyer’s market, they’re taking more time to pay attention to details.” Tom French of Tom French Construction expects to build 15 to 20 homes this year, compared with nine in 2009. “A lot more people are out looking, and I think a lot of that has to do with the tax credit,” he said. “I’m optimistic things will continue to improve as we move forward.” (www.kansascity.com)
Kansas City Star (4/18/10); Kevin Collison

As the Canadian currency reaches parity with the U.S. dollar, more of that country’s residences are flocking south to find a second home in the sun and sand. Lawrence Yun, chief economist at the National Association of Realtors®, says about 27,000 Canadians bought vacation homes in the U.S. last year, and that it looks like the Canadian influx is slated to continue through 2010. Experts expect the currency — the loonie — to continue to appreciate over the next several months, sending Canadian buyers on a shopping spree in Florida, California and Arizona. Many Canadians, spooked by the volatility of the stock market, are looking to invest their money in property, according to Wayne Levy, with Toronto-based real estate firm Florida Home Finders of Canada. Levy attributes Florida’s appeal to its proximity to Eastern Canada, easy access to the ocean from anywhere in the state, low maintenance fees and inexpensive taxes. Also at play is the nostalgia factor. “So many of our clients have been there as kids,” said Levy. “They went to Disneyland with their parents, or spent the odd Christmas with their grandparents down there. You’re going for the temperature, but you are also rekindling some of your childhood memories.” Most Canadian buyers, about 22,000, used cash for their U.S. property purchase in 2009. Mark Borg, a Realtor® with Prudential Real Estate based in Bonita Springs, Fla., has seen an increase in Canadian clients with the rising loonie. “My Canadian clients feel that the price point is extremely great and it’s a wonderful time to buy. Primarily they are looking for foreclosures, and there are plenty of them to choose from. Borg said in his area, which is located between Naples and Fort Myers, the majority of residential sales are foreclosures and short sales. He said the nationalities of his clientele change with fluctuating currencies. “During the boom time with the regular market, it was primarily foreign nationals from Europe. Now the only foreigners that I deal with are Canadians,” said Borg. (www.marketwatch.com)
MarketWatch (4/6/10); Tania L. Haas

With new home sales still far from robust, local active-adult communities in the Chicago area for those 55 and older are having some sales success. Sales at active-adult projects have held up better than sales at other types of projects during the downturn. While many older people can put off a move for a while, some really need a single-level house without stairs. Others want to be close to their children and grandchildren while they still have time. New active-adult developments also offer fancy fitness facilities, activities and someone else to handle snow shoveling and landscape maintenance. “Our old house was too big, and the taxes were too high,” said Ed McFarland, who lives with his wife, Pat, in a new house at Sun City Huntley, the big active-adult project by Del Webb in northwest suburban Huntley. It took the couple a year to sell their old house. They had to reduce the price by $100,000 and provide some financing for the buyer. “You have to roll with the punches,” said Ed, quickly adding, “We love it here.” Older home owners are usually in a better financial position to sell than other types of sellers because they often bought their homes years ago and have a lot of equity in them. They can still make a healthy profit even though housing prices have fallen. At the same time, home owners are gradually becoming more realistic in what they expect to get for their homes. Home sales at active-adult communities make up a growing percentage of the area’s new-home sales. Active-adult sales grew to 11.4% of the new-home sales market in 2009, compared with 7.4% in 2005, according to Tracy Cross & Associates, a Schaumburg, Ill.-based market research firm. (www.chicagotribune.com)
Chicago Tribune (3/14/10); Jane Adler

For the last few decades, the prevailing wisdom among many has been that you have to go to college and get an office job in order to make it in the technological workplace of the future. But today, many workers, rattled by the recession and wondering if their desk jobs will ever come back, are turning to trades that require more hands-on, dirty work — everything from carpentry to plumbing. These types of jobs may be coming back into vogue thanks in part to promised infrastructure investments from the federal government, such as bridge improvements, which will drive a need for welders. Tax incentives to boost home energy efficiency are opening the door to everything from electricians to solar panel installers. Right now, there is anything but a job bonanza in the skilled trades because of the economy, but most labor and skilled-trade experts believe the future is bright. Many of the people in the trades right now will be retiring in the next five to 10 years, said Fred Humphreys, president and CEO of the Home Builders Institute, the workforce development arm of NAHB. “We do not have enough workers coming into the industry to replace them,” he added. He’s also convinced initiatives by President Barack Obama’s administration will lead to more jobs. The American Recovery and Reinvestment Act of 2009 earmarked $5 billion for home weatherization, Humphreys said. And estimates show that every $100 million worth of residential remodeling activity creates more than 1,000 jobs, according to NAHB. (www.msnbc.com)
MSNBC (4/4/10); Eve Tahmincioglu