Home prices nationwide rise for eighth consecutive month

CoreLogic’s October CoreLogic HPI report shows home prices nationwide, including distressed sales, increased on a year-over-year basis by 6.3 percent in October 2012 compared with October 2011, representing the biggest increase since June 2006 and the eighth consecutive increase in home prices nationally on a year-over-year basis.

On a month-over-month basis, including distressed sales, home prices decreased by 0.2 percent in October 2012 compared with September 2012. Decreases in month-over-month home prices are expected as the housing market enters the offseason. The HPI analysis from CoreLogic shows that all but five states are experiencing year-over-year price gains.

Highlights as of October 2012:

• Including distressed sales, the five states with the highest home price appreciation were: Arizona, 21.3 percent; Hawaii, 13.2 percent; Idaho, 12.4 percent; Nevada, 12.4 percent; and North Dakota, 10.4 percent.
• Including distressed sales, the five states with the greatest home price depreciation were: Illinois, -2.7 percent; Delaware, -2.7 percent; Rhode Island, -0.6 percent; New Jersey, 0.6 percent; and Alabama, -0.3 percent.
• The five states with the largest peak-to-current declines, including distressed transactions, were Nevada, -53.5 percent; Florida, -44.5 percent; Arizona, -40.2 percent; California, -36.6 percent; and Michigan, -35.3 percent.

Freddie Mac releases December outlook

Freddie Mac recently released its U.S. Economic and Housing Market Outlook for December showing what some of the market features are expected to look like in 2013.

According to the outlook, long-term mortgage rates will remain near their record lows for the first half of 2013, then rise gradually during the second half of the year, but remain below 4 percent.

Property values are expected to continue to strengthen with most U.S. house price indexes likely rising by 2 to 3 percent in 2013.

Household formation should step up further to a net 1.20 to 1.25 million household increase in 2013 with housing starts up around the 1 million annualized pace by the fourth quarter.

Vacancy rates for both apartments and the single-family for-sale market could bring aggregate vacancy rates down to 2002-2003 levels as household formation outpaces new construction.

While the refinance boom will continue into early 2013, it will be less compared with 2012, so single-family mortgage originations are likely to decline by 15 percent conversely, expect multifamily lending to rise approximately 5 percent.