“Housing Crash Fades as Defaults Decline to 2007 Levels”

by Laura Ehrenberg-Chesler on May 10, 2013

in Credit Crisis,housing

This was the headline of a piece I recently received from Fidelity Investments.  The following are some positive statistics on the housing market, as well as the mortgage market.  If these statistics hold, it may bode very well for the equity markets in the next few months.

1.  First time delinquent home loans fell to .84 percent of the 50.2 million mortgages in March, the first month below 1 percent since 2007.  They peaked at 2.89 percent in January 2009.

2.  Mortgage credit quality is improving rapidly, and will continue to improve as we work through the last bulge of foreclosed property over the next 18 to 24 months.

3.  The number of home loans with negative equity is down 47% from the peak number in 2011.

4.  The average rate for a 30-year mortgage dropped to 3.35 % in the past week, and the 15-year rate is a record low 2.56%.

5.  Demand continues to rise as the price for homes remains about 29% below their 2006 peak.  Inventory is also tight, prompting a “feeding frenzy in housing”, according to Ross Perot, Jr. who chairs his own real estate based company in Dallas.

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