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The Obama Administration’s Efforts
To Stabilize The Housing Market
and Help American Homeowners
August 2010
U.S. Department
of Housing
and Urban
Development
| Office
of Policy
Development
Research
U.S Department
of Housing
and Urban
Development
| U.S.
Department
of theand
Treasury
The Administration’s goal is to promote stability for both the housing
market and homeowners. To meet these objectives in the context of
a very challenging market, the Administration developed a broad
approach implementing state and local housing agency initiatives, tax
credits for homebuyers, neighborhood stabilization and community
development programs, mortgage modifications and refinancing,
continued Federal Housing Administration (FHA) engagement, and
support for Fannie Mae and Freddie Mac. In addition, Federal
Reserve and Treasury MBS purchase programs have helped to keep
mortgage interest rates at record lows over the past year. More detail
on the Administration’s efforts can be found in the Appendix.
August 2010 Scorecard on Administration’s
Comprehensive Housing Initiative
The President’s housing market recovery efforts began immediately
after taking office in February 2009. As of August 2010, the
Administration’s comprehensive response, as outlined above, has
yielded the following results:
•
Stabilizing housing prices drive improving expectations
in some regions: After 30 straight months of decline, home
prices have leveled off in the past year; futures indices have
shifted upward since January 2009 as signs of recovery continue
although overall housing outlook measures remain mixed.
•
Historic low rates continue to promote affordability:
Families continue to benefit from the lowest rates in history on 30year fixed mortgages. Since April of 2009, record low rates have
helped 7.1 million homeowners to refinance, resulting in more
stable home prices and $12.7 billion in total borrower savings.
•
More than twice as many modification arrangements
begun compared to foreclosure completions: More than
3.15 million modification arrangements were done from April 2009
through the end of June 2010. This includes more than 1.3 million
trial Home Affordable Modification Program (HAMP) modifications
started, over 472,000 FHA loss mitigation and early delinquency
interventions, and 1.4 million proprietary modifications under HOPE
Now. The number of agreements offered continues to more than
double foreclosure completions for the same period (1.24 million).
•
More than 4.2 million families have benefited from
housing counseling since April 2009: Working with a HUDapproved housing counselor can help borrowers manage debts
apart from a mortgage – car payments, credit cards and personal
loans, for example – and help them to avoid falling into default.
•
More than 37,000 homeowners received a HAMP
permanent modification in July: While the pace of program
entry has slowed due to upfront documentation requirements in
place since June 1, this policy change streamlines the process
to help more eligible homeowners convert to a permanent
modification. Homeowners in permanent modifications are
experiencing a median payment reduction of 36 percent, or more
than $500 per month. View the latest Making Home Affordable
program report at: http://www.financialstability.gov/docs/
JulyMHAPublic2010.pdf
Despite these positive indicators, some data in the August report
underscores continued market fragility, suggesting recovery will take
place over time. For example, foreclosure starts went up slightly
in July from the previous month, but remain well below July 2009
levels. Foreclosure completions also inched upward as the volume
of serious delinquencies continues to work through the pipeline.
The impact of new and expanded resources introduced in July
is expected to contribute to progress captured in future Housing
Scorecards. For example, the FHA announced a short refinance
option targeted to help people who owe more on their mortgage
than their home is worth because their local markets saw large
declines in home values. The option will allow certain underwater
non-FHA borrowers – those current on their existing mortgage and
whose lenders agree to write off at least 10 percent of the unpaid
principal balance of the first mortgage – the opportunity to qualify
for a new FHA-insured mortgage.
The Obama Administration’s Efforts To Stabilize The Housing Market and Help American Homeowners | August 2010
Expectations on House Prices Have Shifted Up from 2009
House Prices Show Signs of Stabilizing
Existing Homes on the Market Below Peak, But Number
of Units Held Off the Market Has Increased
Existing and New Home Sales
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
The Obama Administration’s Efforts To Stabilize The Housing Market and Help American Homeowners | August 2010
7.1 Million Homeowners Have Refinanced Since April 1, 2009
Mortgage Rates Fall to Record Low and Affordability
Index Remains High
Foreclosure Starts and Completions Remain Elevated
Mortgage Aid Has Been Extended to More than Three Million Borrowers,
Outpacing Foreclosures
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
The Obama Administration’s Efforts To Stabilize The Housing Market and Help American Homeowners | August 2010
Homeowners Save From Reduced Mortgage Payments
Home Equity Up More than $1 Trillion Since First Quarter 2009
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U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S. DepartmentEff
of orts
Housing
and UrbanTh
Development
| Office and
of Policy
and Research | August 2010
The Obama Administration’s
To Stabilize
e Housing Market
HelpDevelopment
American Homeowners
HOUSING ASSISTANCE AND STABILIZATION PERFORMANCE METRICS
Indicator
Distressed Borrowers Assisted (thousands)
HAMP Trial Modifications
HAMP Permanent Modifications
FHA Loss Mitigation Interventions
HOPE Now Modifications
This Period Last Period
Cumulative From Apr 1, 2009
Latest Release
24.6
36.7
56.1
123.2
38.7
51.2
32.9
112.1
1,307.5
434.7
472.6
1,445.9
713.5
839.4
4,272
----
----
2,313.3
2,397.3
12,737.3
2nd Q 10
2nd Q 10
2nd Q 10 (r)
Activities Completed Under NSP (housing units)
New Construction or Residential Rehab
Demolition or Clearance
Direct Homeownership Assistance
3,033
1,041
1,147
2,537
667
1,094
9,249 [36,292] (b)
2,987 [8,252] (b)
3,768 [18,000] (b)
2nd Q 10 (r)
2nd Q 10 (r)
2nd Q 10 (r)
Change in Aggregate Home Equity ($ billions)
28.6
97.3
1,079.4
Counseled Borrowers (thousands)
Borrower Annual Savings ($ millions)
HAMP Trial Modifications
HAMP Permanent Modifications
All Refinances
July-10
July-10
July-10
June-10
2nd Q 10
1st Q 10
HOUSING MARKET FACT SHEET
Indicator
Mortgage Rates (30-Yr FRM, percent)
This Period Last Period
4.42
4.44
Year Ago
5.12
As of Dec 2008
5.1
Latest Release
19-Aug-10
Housing Affordability (index)
158.9
166.5
162.5
166.3
June-10
Home Prices (indices)
Case Shiller (NSA)
FHFA (SA)
146.4
196.0
144.6
195.1
140.0
198.4
150.5
198.8
May-10
May-10
Home Sales (thousands, SA)
New
Existing
First Time Buyers
27.5
447.5
223.3
22.3
471.7
232.1
33.0
407.5
207.0
31.4
395.0
174.8
June-10
June-10
June-10
Housing Supply
Existing Homes for Sale (thousands, NSA)
Existing Homes - Months’ Supply (months)
New Homes for Sale (thousands, SA)
New Homes for Sale - Months’ Supply (months,SA)
Vacant Units Held Off Market (thousands)
3,992.0
8.9
210.0
7.6
3.7
3,893.0
8.3
213.0
9.6
3.6
3,811.0
9.4
280.0
8.5
3.5
3,700.0
9.4
353.0
11.2
3.5
Mortgage Originations (thousands)
Refinance Originations
Purchase Originations
1,132.7
925.0
1,050.9
614.7
1,941.0
997.4
767.2
986.4
FHA Originations (thousands)
Refinance Originations
Purchase Originations
Purchases by First Time Buyers
27.0 (p)
63.0 (p)
47.3 (p)
32.0 (r)
128.1 (r)
89.7 (r)
67.0
112.4
89.1
62.9
72.7
56.2
July-10
July-10
July-10
5.4
36.4
12.5
5.6
36.6
12.4
5.2
33.8
13.2
4.4
34.1
14.3
July-10
July-10
July-10
1,861.8
1,909.6
559.6
1,889.0
1,916.8
551.3
1,542.6
1,792.4
424.8
912.8
1,642.1
333.1
July-10
July-10
July-10
11,276.9
11,321.7
10,163.3 (a)
--
97.1
135.2
92.9
96.2
132.1
85.5
134.5
138.4
87.3
121.5
103.0
78.9
Mortgage Delinquency Rates (percent)
Prime
Subprime
FHA
Seriously Delinquent Mortgages (thousands)
Prime
Subprime
FHA
Underwater Borrowers (thousands)
Foreclosure Actions (thousands)
Foreclosure Starts
Notice of Foreclosure Sale
Foreclosure Completions
June-10
June-10
June-10
June-10
2nd Q 10
2nd Q 10 (r)
2nd Q 10 (r)
1st Q 10
July-10
July-10
July-10
SA = seasonally adjusted, NSA = not SA, p = preliminary, a = adjusted for methodology change, r = revised, b = brackets include in process.
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S. DepartmentEff
of orts
Housing
and UrbanTh
Development
| Office and
of Policy
and Research | August 2010
The Obama Administration’s
To Stabilize
e Housing Market
HelpDevelopment
American Homeowners
A. Items in Tables
SOURCES AND METHODOLOGY
Description
Frequency
Sources
Notes on Methodology
Distressed Homeowners Assisted
HAMP Trial Modifications
HAMP Permanent Modifications
FHA Loss Mitigation Interventions
HOPE Now Modifications
Monthy
Monthy
Monthy
Monthy
Treasury
Treasury
HUD
Hope Now Alliance
As reported.
As reported.
All FHA loss mitigation and early delinquency interventions.
All proprietary modifications completed.
Counseled Borrowers (thousands)
Quarterly
HUD
Housing counseling activity reported by all HUD-approved housing counselors.
Borrower Annual Savings
HAMP Trial Modifications
Quarterly
HUD, Treasury, and Freddie Mac
HAMP Permanent Modifications
Quarterly
HUD and Treasury
All Refinances
Quarterly
HUD, and MBA
HUD estimate of annualized savings based on Treasury reported active HAMP trial modifications
and Freddie Mac monthly savings estimates.
HUD estimate of annualized savings based on Treasury reported active HAMP permanent
modifications and median monthly savings estimates.
Refinance originations (see below) multiplied by HUD estimate of annualized savings per refinance.
Quarterly
HUD
Demolition or Clearance
Quarterly
HUD
Direct Homeownership Assistance
Quarterly
HUD
Change in Aggregate Home Equity
Quarterly
Federal Reserve Board
Difference in aggregate household owners’ equity in real estate as reported in the Federal
Reserve Board’s Flow of Funds Accounts of the United States for stated time period.
Mortgage Rates (30-Yr FRM)
Weekly
Freddie Mac
Primary Mortgage Market Survey, as reported.
Housing Affordability
Monthly
National Association of Realtors ® NAR’s composite housing affordability index as reported. A value of 100 means that a
family with the median income has exactly enough income to qualify for a mortgage on a
median-priced home. An index above 100 signifies that family earning the median income
has more than enough income to qualify.
Home Prices
Case-Shiller (NSA)
Monthy
Standard and Poor’s
Monthy
Federal Housing Finance Agency
Monthy
HUD and Census Bureau
Completed Activities under NSP (housing units)
New Construction or Residential Rehab
FHFA (SA)
Home Sales (SA)
New
Existing
Monthy
First Time Buyers
Monthy
Housing units constructed/rehabilitated using Neighborhood Stabilization Program.
Bracketed numbers include units in process, to be completed by 3/2013.
Housing units demolished/cleared using Neighborhood Stabilization Program. Bracketed
numbers as above.
Completed downpayment assistance or non-amortizing second mortgages by grantee to
make purchase of NSP unit affordable. Bracketed numbers as above.
Case-Shiller 20-metro composite index, January 2000 = 100. Standard and Poor’s
recommends use of not seasonally adjusted index when making monthly comparisons.
FHFA monthly (purchase-only) index for US, January 1991 = 100.
Seasonally adjusted annual rates divided by 12. A newly constructed house is
considered sold when either a sales contract has been signed or a deposit accepted, even if
this occurs before construction has actually started.
National Association of Realtors ® Seasonally adjusted annual rates divided by 12. Existing-home sales, which include
single-family, townhomes, condominiums and co-ops, are based on transaction closings. This
differs from the U.S. Census Bureau’s series on new single-family home sales, which are based
on contracts or the acceptance of a deposit.
Sum of seasonally adjusted new and existing home sales (above) multiplied by National
NAR, Census Bureau, and HUD
Association of Realtors ® annual estimate of first time buyer share of existing home sales.
Housing Supply
Existing Homes for Sale (NSA)
Existing Homes - Months’ Supply
New Homes for Sale (SA)
New Homes for Sale - Months’ Supply (SA)
Vacant Units Held Off Market t
Monthly
Monthly
Monthly
Monthly
Quarterly
National Association of Realtors ®
National Association of Realtors ®
HUD and Census Bureau
HUD and Census Bureau
Census Bureau
As reported.
As reported.
As reported.
As reported.
As reported.
Mortgage Originations
Refinance Originations
Quarterly
Purchase Originations
Quarterly
Mortgage Bankers Association
and HUD
Mortgage Bankers Association
and HUD
HUD estimate of refinance originations based on MBA estimate of dollar volume of
refiance originations.
HUD estimate of home purchase originations based on MBA estimate of dollar volume of
home purchase originations.
FHA Originations
Refinance Originations
Purchase Originations
Purchases by First Time Buyers
Monthy
Monthy
Monthy
HUD
HUD
HUD
FHA originations reported as of date of loan closing. Estimate for current month scaled upward
due to normal reporting lag and shown as preliminary.
Mortgage Delinquency Rates (NSA)
Prime
Subprime
FHA
Monthy
Monthy
Monthy
LPS-McDash Analytics
LPS-McDash Analytics
HUD
Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.
Total mortgages past due (30+ days) but not in foreclosure, divided by mortgages actively serviced.
Total FHA mortgages past due (30+ days) but not in foreclosure, divided by FHA’s
insurance in force.
Seriously Delinquent Mortgages
Prime
Subprime
FHA
Monthly
Monthly
Monthly
LPS-McDash, MBA, and HUD
LPS-McDash, MBA, and HUD
HUD
Mortgages 90+ days delinquent or in foreclosure, scaled up to market.
Mortgages 90+ days delinquent or in foreclosure, scaled up to market.
Mortgages 90+ days delinquent or in foreclosure.
Underwater Borrowers
Quarterly
First American CoreLogic
As reported. Due to change in reporting methodology, underwater borrower estimates prior to
the third quarter of 2009 are adjusted to be compatible with current estimates.
Foreclosure Actions
Foreclosure Starts
Notice of Foreclosure Sale
Foreclosure Completions
Monthy
Monthy
Monthy
Realty Trac
Realty Trac
Realty Trac
Notice of default plus lis pendens.
Notice of sale (auctions).
Real Estate Owned (REO).
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S. DepartmentEff
of orts
Housing
and UrbanTh
Development
| Office and
of Policy
and Research | August 2010
The Obama Administration’s
To Stabilize
e Housing Market
HelpDevelopment
American Homeowners
SOURCES AND METHODOLOGY
B. Notes on Charts.
1. Monthly house price trends shown as changes in respective house price indices applied to a common base price set equal to the median price of an existing
home sold in January 2003 as reported by the National Association of Realtors. Indices shown: S&P/Case Shiller 20-metro composite index (NSA), January
2000 = 100, and FHFA monthly (purchase-only) index for US (SA), January 1991 = 100.
2. S&P/Case-Shiller 20 metro composite index (SA) as reported monthly. Futures index figures report forward expectations of the level of the S&P/Cash Shiller
index as of the date indicated, based upon prices of futures contracts reported by CME Group.
3. Reported seasonally adjusted annual rates for new and existing home sales divided by 12.
4. HUD estimate of refinance originations based on MBA estimate of dollar volume of refinance originations.
5. Cumulative HAMP modifications started, FHA loss mitigation and early delinquency interventions, plus proprietary modifications completed as reported by
Hope Now Alliance. Foreclosure completions are properties entering Real Estate Owned (REO) as reported by Realty Trac.
6. Foreclosure starts include notice of default and lis pendens, completions are properties entering REO. Both as reported by Realty Trac.
7. See “Borrower Annual Savings” above.
8. FHA market shares as FHA purchase and refinance originations divided by HUD estimates of purchase and refinance mortgage originations as noted in
“Mortgage Originations” above.
U.S Department of Housing and Urban Development
U.S. Department of the Treasury
U.S. DepartmentEff
of orts
Housing
and UrbanTh
Development
| Office and
of Policy
and Research | August 2010
The Obama Administration’s
To Stabilize
e Housing Market
HelpDevelopment
American Homeowners
Appendix
The Administration has taken a broad set of actions to stabilize the housing market and help American
homeowners. A year ago, stress in the financial system had severely reduced the supply of mortgage credit,
limiting the ability of Americans to buy homes or refinance mortgages. Millions of responsible families who
had made their monthly payments and had fulfilled their obligations saw their property values fall. They also
found themselves unable to refinance at lower mortgage rates.
In February 2009, less than one month after taking office, President Obama announced the Homeowner
Affordability and Stability Plan. As part of this plan and through other housing initiatives, the Administration
has taken the following actions to strengthen the housing market:
•
Supported to Fannie Mae and Freddie Mac to ensure continued access to affordable mortgage credit;
•
The Federal Reserve and the U.S. Treasury purchased more than $1.4 trillion in agency mortgage
backed securities through independent MBS purchase programs, helping to keep mortgage rates at
historic lows;
•
Launched a modification initiative to help homeowners reduce mortgage payments to affordable levels
and to prevent avoidable foreclosures;
•
Launched a $23.5 billion Housing Finance Agencies Initiative to increase sustainable homeownership
and rental resources;
•
Supported the First Time Homebuyer Tax Credit, which has helped 2.5 million American families
purchase homes;
•
Provided more than $5 billion in support for affordable rental housing through low income housing
tax credit programs and $2 billion in support for the Neighborhood Stabilization Program through the
Recovery Act to restore neighborhoods hardest hit by concentrated foreclosures;
•
Created the $2.1 billion HFA Hardest Hit Fund for innovative foreclosure prevention programs in the
nation’s hardest hit housing markets.
•
Supported home purchase and refinance activity through the FHA to provide access to affordable
mortgage capital and help homeowners prevent foreclosures.
###
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