More great market news came through yesterday: According to S&P/Case-Shiller, in July, the average home price rose to the same level as those seen during summer 2003, when the housing boom first started its journey toward the 2006 peak. While this may not signify that we are currently standing on the cusp of a market boom, it does show a significant turnaround, and perhaps hints at a definite end to real estate’s bleak streak.

The recent S&P/Case-Shiller national home price index showed that in July, prices increased by 1.5 percent for the 10-City Composite and by 1.6 percent for the 20-City Composite.

This improvement marks the third straight month that prices rose in all 20 major markets followed by the index—which covers more than 80 percent of the U.S. housing market. Additionally, numbers show that if not for a .06 decline in Detroit in April, there would have been a four month improvement streak.

When compared to a year earlier, the index proved to be up 1.2 percent, an improvement from the year-over-year change reported for June. This marked the first month that prices were higher than they were the previous year.

“The news on home prices in this report confirm recent good news about housing,” said David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, in a recent release.

“Single family housing starts are well ahead of last year’s pace, existing home sales are up, the inventory of homes for sale is down and foreclosure activity is slowing. All in all, we are more optimistic about housing. Upbeat trends continue. For the third time in a row, all 20 cities and both Composites had monthly gains. Stronger housing numbers are a positive factor for other measures including consumer confidence.”

Real estate professionals located outside of the top metros are seeing movement inside their markets, too.

“We’ve been seeing a strengthening market for some time now but August sales are evidence of a major turning point,” says Jamie Moore, president of the Rhode Island Association of REALTORS®. “We may still experience a step or two backward in the months ahead but the forward momentum has clearly become more evident. The market is much stronger than it has been.”

And Dorothy Martwick, Broker/Owner of Century 21 Action REALTORS® in Minot, N.D., comments on her unique market, which never saw much of a real estate recession due to the oil boom in western N.D. and their proximity to the Minot Air Force Base.

“My opinion of the future of real estate here in Western N.D. is that the market will level off and stabilize in the near future and, depending on the national election results and the oil pipeline, capabilities may either stay level or boom again next year and for the next several years. “

“Overall, we’re thrilled to see hard evidence that the market is recovering. Great pricing and low interest rates have really helped turn things around,” says Rhode Island’s Moore.

To view the complete home price index, click here

source: RISMedia

The shadow inventory of troubled mortgages and foreclosed homes saw a 1.2 million decrease in the first half of the year, according to research conducted by JPMorgan Chase.

Chase researchers expect that progress to double before the year’s end, too. That would then bring the shadow inventory to more than 4 million, which is down from the 6 million peak reached in 2010.

A rising number of short sales has allowed more banks to clear the shadow inventory that has threatened the housing market’s recovery, according to the research. Banks also have been increasing loan modifications.

Shadow inventory is known for creating uncertainty in the housing market. In calculating the shadow inventory, Chase researchers include trouble mortgages that haven’t been paid in at least 60 days.

"Although re-defaults and new delinquencies will continue to keep shadow inventory elevated, the rapid decline should prevent downward pressure on home prices going into 2013," according to Chase analysts. "Combined with better existing home sales, investors have reason to be optimistic about running recovery scenarios."

Chase analysts say that if home prices rise 10 percent, the current number of 10.8 underwater borrowers could then decrease to 9 million.

Source: “Shadow Inventory Declines by 1.2 Million in 2012,” HousingWire

In a nation as diverse as the United States, the idea of "the American dream" means different things to different people. Many associate the dream with intangible ideals like freedom of expression, freedom of religion, optimism and family ties. But the American dream has also long been associated with attaining a higher standard of living, particularly one that surpasses that of the previous generation.

Click image for larger view.

source: NPR

Low-income households face a potential housing shortage that could lead to a large rise in homelessness, warns a new report by the Institute for Children, Poverty, and Homelessness.

The study shows that there are 5.4 million housing units available for rent to a family of three at the federal poverty line of $18,310. However, there are more than double the number of households below the poverty line (10.9 million).

The shortage in housing has led to a 20 percent rise in family homelessness from 2007 to 2010, according to the ICPH report, “A Home by Any Other Name: Enhancing Shelters Addresses the Gap in Low-Income Housing.” 

The ICPH blames the rising cost of rental units and a decline in the number of public housing projects for the shortage in affordable residences.

"It is clear that the number of affordable rental units has not changed in three decades as the number of people who need affordable housing has skyrocketed," says Matthew Adams, ICPH’s principal policy analyst. "This gap is unsustainable.”

Americans who earn the minimum wage cannot afford fair market value of rent for at two-bedroom apartment, according to the report. What’s more, the amount of federal dollars that is spent on housing programs for low-income households has dropped 20 percent since 1995 and is at a record low. 

Source: “Homeless Face Unprecedented, Overwhelming Housing Shortage,” Realty Times (Sept. 20, 2012)