Morning Briefing: Completed foreclosures up 5 per cent, inventory continues to fall

by Steve Randall10 Aug 2016
Completed foreclosures up 5 per cent, inventory continues to fall
June saw 38,000 completed foreclosures, up 5.1 per cent compared to May but 4.9 per cent lower than June 2015.

CoreLogic’s data shows that the foreclosure inventory fell 25.9 per cent year-over-year with around 375,000 homes included; 1.0 per cent of all those with a mortgage. A year earlier 1.3 per cent of homes (507,000) were in the foreclosure process.

“Mortgage loan performance depends on the economic health of local markets, with varied differences even within a state,” said Dr. Frank Nothaft, chief economist for CoreLogic. “Within Texas, the serious delinquency rate in the Dallas metropolitan area has fallen by 0.5 per cent from a year earlier, as home prices and employment have continued to rise. The rate in the Midland area, on the other hand, has jumped 0.5 per cent, reflecting the weakness in oil production and job loss over the past year.”

The number of homes in serious delinquency (90 days or more past due including loans in foreclosure or REO) was down 21.3 per cent year-over-year to 1.1 million mortgages (2.8 per cent).
America’s household debt up to $12.29 trillion, mortgages lower
Total US debt reached $12.29 trillion in the second quarter as low interest rates saw increases credit cards, auto loans and other borrowing but a decrease in mortgages.

The Federal Reserve Bank of New York's Quarterly Report on Household Debt and Credit reveals that debt increased nationally by 0.3 per cent or $35 billion in the quarter.

The numbers are huge but remain 3.1 per cent below the 2008 peak of $12.68 trillion – however, they are more than 10 per cent above the trough of the second quarter of 2013.

The report notes that "mortgage balances shown on consumer credit reports on June 30 stood at $8.36 trillion, a $7 billion drop from the first quarter of 2016. Balances on home equity lines of credit (HELOC) also dropped by $7 billion, to $478 billion."
San Francisco leads US on prime property prices
A ranking of global prime property reveals that San Francisco is the top rated US city for price appreciation in the prime housing sector but is a long way behind some global peers.

Knight Frank’s Prime Global Cities Index compares the performance of the top 5 per cent of the wider housing market in each city using the firm’s quarterly data.

Vancouver has led the pack for 5 consecutive quarters now but the firm says that the 15 per cent tax introduced on international buyers this month is expected to slow the city’s pace.

Other US cities in the list include Miami, Los Angeles and New York but the North America region, with 10 per cent growth in prices of prime homes, is behind Australasia in this quarter’s index with 11 per cent appreciation.