New record for house price index

by Steve Randall26 Apr 2017
New record for house price index

For the fourth consecutive month, a key measure of American home prices has set a new record high.

The S&P CoreLogic Case-Shiller National Home Price Index was up 5.8 per cent year-over-year in February with stronger pace of gains also shown in the 10-city and 20-city composites.

“Housing and home prices continue to advance,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “The S&P CoreLogic Case-Shiller National Home Price Index and the two composite indices accelerated since the national index set a new high four months ago. Other housing indicators are also advancing, but not accelerating the way prices are.”

Seattle, Portland, and Dallas reported the highest year-over-year gains among the 20 cities with gains of 12.2 per cent, 9.7 per cent and 8.8 per cent respectively.

Month-over-month, the national index was up 0.2 per cent in February, before seasonal adjustment.

Fannie Mae moves to help those with student loan debt

Homebuyers burdened by student loan debt will be able to get more help from new Fannie Mae policies.

The corporation says that it is responding to a sharp rise in student loan debt in the past decade and wants to help more first-time buyers and existing homeowners to qualify for a mortgage.

“We understand the significant role that a monthly student loan payment plays in a potential home buyer’s consideration to take on a mortgage, and we want to be a part of the solution,” said Jonathan Lawless, Vice President of Customer Solutions, Fannie Mae. “These new policies provide three flexible payment solutions to future and current homeowners and, in turn, allow lenders to serve more borrowers.”

The three policies are:
  • Student Loan Cash-Out Refinance: Offers homeowners the flexibility to pay off high interest rate student debt while potentially refinancing to a lower mortgage interest rate.
  • Debt Paid by Others: Widens borrower eligibility to qualify for a home loan by excluding from the borrower’s debt-to-income ratio non-mortgage debt, such as credit cards, auto loans, and student loans, paid by someone else.
  • Student Debt Payment Calculation: Makes it more likely for borrowers with student debt to qualify for a loan by allowing lenders to accept student loan payment information on credit reports.

Builders warn lumber tax will increase house prices

The proposed tariffs on import of softwood lumber from Canada will lead to higher prices for American homebuyers, the National Association of Home Builders is warning.

The Trump administration could hit imports with tariffs up to 24 per cent which will have a significant impact on costs; 33 per cent of lumber used last year in the US was imported, 95 per cent of that from Canada.

“NAHB is deeply disappointed in this short-sighted action by the U.S. Department of Commerce that will ultimately do nothing to resolve issues causing the U.S.-Canadian lumber trade dispute but will negatively harm American consumers and housing affordability,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas.

Disputes over Canadian lumber, which the US government says is unfairly subsidized by Canadian taxpayers and damaging to US mills, are not new. Tariffs on lumber imports were defeated in the early 1980s.

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