• Public comments are being requested a a new proposed rule for collecting data under the Home Mortgage Disclosure Act (HMDA). The Consumer Financial Protection Bureau (CFPB) said the new rule includes changes the could help in shedding more light on consumers' access to mortgage credit. The Bureau said it also aims to simplify the reporting process for financial institutions.

    HMDA, enacted in 1975, requires that many lenders report information regarding home loans for which they receive applications or originate or purchase. The information is available to both the public and to regulators who can use it to monitor whether financial institutions are serving the needs of their communities and to identify discriminatory lending patterns. The Dodd Frank Wall Street Reform and Consumer Protection Act authorized CFPB to expand the HMDA dataset to gather additional information that might be helpful to better understand certain aspects of the market.

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  • The Home Price Index (HPI) released on Monday by Black Knight Financial Services showed another strong month-over-month gain for housing values in May.  The HPI increased by 0.9 percentto a value of $239,000 from $236,000 in April.  The index is up 3.4 percent from the beginning of 2014 when it registered at $231,000 and 5.4 percent from May 2013 when the value was $224,000.

    Black Knight's Data and Analytics Division bases its HPI on residential real estate transactions combined with information from its own property and loan level databases.  This is used to produce a repeat sales analysisfor more than 18,500 U.S. ZIP codes.

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  • Zillow, the Seattle based company which started out in the mid-2000s as a website where one could check on one's own and one's neighbor's property values and has grown to a large on-line source of information on homes for sale is acquiring another housing boom start-up, Trulia.  The purchase, which actually appears to be more of a merger, was confirmed on Monday and will give $3.5 billion in Zillow stock to the company's stockholders.  The boards of directors of both companies have approved the transaction which is expected to close next year.

    The two companies are self-described as primarily media companies which generate the majority of their revenue through advertising sales to real estate professionals.  A corporate press release said that despite continued growth as public companies, "significant opportunities of scale remain as the majority of advertising dollars in the real estate sector have yet to migrate online or to mobile. For example, the two companies' combined revenue currently represents less than 4 percent of the estimated $12 billion real estate professionals spend on marketing their services to consumers each year.

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  • Pending home sales declined modestly in June after three months of what the National Association of Realtors® (NAR) called "solid gains." NAR's Pending Home Sales Index (PHSI) declined 1.1 percent to 102.7 in June from 103.8 in May. June's value was 7.3 percent below the level in June 2013 of 110.8.

    The May Index had surged by 6.11 percent compared to April, the largest month-over-month increase for the index since the period just before the end of the homebuyer tax credit in April 2010. Despite the June dip, that the index remained above 100 for the second month in a row is considered positive. Prior to the May surge the PHSI had failed to reach 100, which is viewed as an average level of contract activity, since November 2013.

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  • It was a bad day on Wall Street Thursday for housing stocks. In no particular order Census Bureau data was released showing that new home sales had declined by 8.1 percent in June compared to May and that May's numbers weren't nearly as shiny as was first thought. Then several of the big home builders released quarterly earnings that missed analysts expectations. An already jittery stock market did not take it well. The exchange traded fund that trucks home construction fell to a two month low, losing 3.4 percent of its value as most home builder and home builder-related stocks fell. ITB was down another 0.79 percent in early trading on Friday.

    Both D.R. Horton and Pulte announced that their earnings fell short. Horton reported earnings in its fiscal third quarter of .32 per share; analysts had expected 0.49. Pulte reported 2nd quarter earnings of 0.11 per share, less than half of the 0.26 expected.

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  • Freddie Mac said today that its Multi-Indicator Market Index or MiMi for May is sending out mixed signalsto the housing market.  While more markets entered their stable range of housing activity, most markets remained stalled, just as they were in April, due primarily to weak mortgage application activity. 

    MiMi is designed to monitor and measure the stability of the housing market nationally and in the states and 50 top metro markets relative to the long-term stable range in each.  The index combines proprietary Freddie Mac data with current local market data on home purchase applications, payment-to-income ratios (changes in home purchasing power based on house prices, mortgage rates and household income), proportion of on-time mortgage payments and the local employment picture.  The data is used to produce a composite number for each locality.   MiMi also indicates whether each market is trending closer to, or further away from its stable range.  The nation's all-time MiMi low of -4.49 was in November 2010 when the housing market was at its weakest.

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  • New homes sales retreated in June from the very strong performance reported for May; a performance that turns out to have been less strong. A joint release from the Census Bureau and the Department of Housing and Urban Development this morning put June sales of newly constructed single family homes at a seasonally adjusted annual pace of 406,000 units. This represents an 8.1 percent dropfrom the revised May rate of 442,000. May sales however were originally estimated to be at the rate of 504,000 units which would have been an 18.6 percent increase over April and, the report said, the most rapid increase in 20 years.

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  • The theme for the economy and the housing market's in 2014 has been set for months; the economy will continue to slowly strengthen; the modest recovery in housing will be sustained. Each monthly or quarterly report or round of economic analysis seems to merely join the chorus. Fannie Mae's most recent entry on Wednesday merely added a new note. Growth is expected to strengthen during the second half, but not enough to save the year.

    Katie Penote, a member of Fannie Mae's Economic & Strategic Research (ESR) Group, writes that the economy experienced the worst performance in five years in the first quarter and incoming data for the second quarter suggests only a moderate improvement. The first quarter's problems are attributed to a significant downward revision in healthcare spending. During the third and fourth quarters, she says, economic activity is expected to accelerate, driven principally by consumer spending with help from business, capital investment, and residential investment. Government spending may also contribute to growth for the first time in five years but inventory investment and exports will be a drag.

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  • Black Knight Financial Services said today that both delinquencies and foreclosure starts were up slightly in June. The information was part of the company's “first look” preview of data from its Mortgage Monitorreport that will be published in early August.

    The nation's delinquency rate, that is the percentage of mortgages that were 30 or more days past due but not in foreclosure, was 5.70 percent, an increase of 1.55 percent compared to May but 14.59 percent below the rate in June 2013. The percentages reflect an increase of 44,000 delinquent mortgages since May to a total of 2,88 million, 445,000 fewer delinquent mortgages than reported a year earlier. Of those delinquencies, 1.16 million are of 90 or more days duration but not yet in foreclosure, down 14,000 from May and 190,000 from a year earlier.

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  • The Market Composite Index, a measure of loan application volume had its first positive week since June 6 last week, increasing 2.4 percent on a seasonally adjusted basis from the previous week.  The Mortgage Bankers Association (MBA) said its unadjusted volume index also finished the week ended July 18 with an increase, up 3 percent.  All other weekly indicators also rose, the first time that has happened since January 10.  

    MBA’s Refinance Index increased 4 percentfrom the previous week and applications for refinancing edged up to a 54.4 percent share from 53.6 percent the previous week, and the highest share of the market since the week ended March. 

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  • The pace of existing home sales reached a nine month high in June, topping 5 million units for the first time since last October while there were reports of continued but moderating home prices from both the Federal Housing Finance Agency (FHFA) and the National Association of Realtors® (NAR). 

    NAR reports that sales of existing single-family homes, condos, cooperative apartments, and townhomes were at an annual rate of 5.04 billion, up 2.6 percent from the adjusted May pace of 4.91 million. The previous high in October 2013 was 5.13 million. June sales however remained below the 5.16 million pace established in June 2013. May sales number were a revision from the 4.89 million originally reported.

    Lawrence Yun, NAR chief economist, said housing fundamentals are moving in the right direction. “Inventories are at their highest level in over a year and price gains have slowed to much more welcoming levels in many parts of the country. This bodes well for rising home sales in the upcoming months as consumers are provided with more choices,” he said. “On the contrary, new home construction needs to rise by at least 50 percent for a complete return to a balanced market because supply shortages – particularly in the West – are still putting upward pressure on prices.”

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  • Two Bank of America Merrill Lynch (BAML) analysts are defending what they call their big high conviction views for what should happen in the housing world over the next two years.    Chris Flanagan and Gregory Fitter, ABS and MBS strategists say that their views are not mainstream but that recent data has corroborated their theories. 

    The two contend that home price increases will continue to moderate from the skyrocket trajectory they were on in late 2012 and early 2013 will peak in mid-2016.  Second, as unemployment continues to ease, the yield curve will continue to flatten (longer term rates getting lower while shorter term rates get higher, relative to each other) and the spread between two year and 10 year treasury yields should be at zero by the time home prices peak.  The long end of the curve will remain at surprising low yields, fostered by a soft housing market and low inflation.

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  • While he has written about some of the elements in the past, Mark Fleming neatly summed up the current state of housing's supply and demand constraints in the latest edition of CoreLogic's Market Pulse. That issue, the company's chief economist said, is one of the factors underlying the current faltering housing recovery and contributing to what he calls the new housing normal.

    First there is a pent-up supply of housing - that is homes that might be but aren't available for sale.  The shadow inventory, homes in the process of foreclosure (some definitions include homes with the potential of foreclosure) has worried economists since the start of the foreclosure crisis.  While the fear has been that these homes, once they become bank owned, might overwhelm the market they have instead come on the market at a fairly measured pace as foreclosure time-lines stretched into years and have provided a source of low-cost homes for both first-time buyers and investors.  The inventory is now becoming concentrated in a few judicial foreclosure states and REO (bank-owned homes) are available for sale.

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  • The Federal Housing Finance Agency's Office of Inspector General (FHFA OIG) has released an evaluation of Fannie Mae's and Freddie Mac's (the GSEs) increased recent level of purchases of loans from small banks, credit unions, and non-bank mortgage companies.  Such purchases, OIG said, presents both potential benefits and certain risks.  

    Historically the GSEs have purchased loans from large commercial banks and other financial companies that acted as loan aggregators by purchasing mortgages originated by smaller lenders and bundling them with their own loans for sale.  The aggregation system offered several benefits to participants:

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  • It has been a long eight years, but foreclosure activity appears to have returned to levels last seen before the housing downturn was born in 2006.  RealtyTrac said today that the 2 percent decrease in the various types of foreclosure filings in June brought overall activity down to the lowest it has been since July of that year.  The company released its Midyear Foreclosure Market Report which contains data on both June foreclosure filings and those that occurred during the first half of 2014.

    June filings, including default notices, scheduled auctions, and bank repossessions or completed foreclosures, were filed on a total of 107,194 properties, down 2 percent from May and 16 percent from June 2013.  For the first half of the year there were 613,874 filings, a decrease of 19 percentfrom the last half of 2013 and 23 percent from the first six months of that year.  Filings at mid-year equate to one filing for every 214 housing units in the U.S.

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