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The Obama Administration’s Efforts To Stabilize the Housing Market and Help American Homeowners August 2015 U.S. Department of Housing and Urban Development | Office of Policy Development and Research U.S Department of Housing and Urban Development hcraeseR dna tnempoleveD yc nempoleveD yciloP fo ecif fO | tnempole The Administration’s goal remains to stabilize the housing market and provide security for homeowners. To meet these objectives in a 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, housing counseling, continued Federal Housing Administration (FHA) engagement, support for Fannie Mae and Freddie Mac, and increased consumer protections. In addition, Federal Reserve and Treasury Mortgage-Backed Securities purchase programs have helped to keep mortgage interest rates at record lows. More detail on the Administration’s efforts can be found in the Appendix. • Sales of previously owned (existing) homes rose for a third straight month in July. The National Association of Realtors® (NAR) reported that sales of existing homes (including single-family homes, townhomes, condominiums, and cooperatives) climbed 2.0 percent in July to 5.59 million (SAAR)—the strongest pace since February 2007. Sales were 10.3 percent higher than one year ago and have increased year-overyear for ten consecutive months. The share of first-time buyers shrank to 28 percent, however, the smallest percent since January. • Purchases of new homes climbed to 507,000 (SAAR) in July and have now been above the 500,000 mark for five of seven months this year. Purchases of new homes rose 5.4 percent, the strongest increase this year, and were 25.8 percent higher than a year earlier. Data on new home sales can be volatile and are often revised. (Source: HUD and Census Bureau.) • House prices continue upward trend in June and year-overyear house price changes have settled into a 4- to 5-percent pace. The Federal Housing Finance Agency (FHFA) seasonally adjusted purchase-only house price index for June showed home values rose 0.2 percent over the previous month and 5.4 percent over the previous year. The year-over-year house price gain in May was 5.7 percent. The FHFA index shows that U.S. home values now stand just 1.6 percent below their previous peak in March 2007 and 24.2 percent above their previous low in May 2011. Another index tracked in the Scorecard, the non-seasonally adjusted (NSA) S&P/Case-Shiller 20-City Home Price Index, posted a monthly increase in home values of 1.0 percent in June and year-over-year returns of 5.0 percent, the same as in May. The Case-Shiller index showed home values are now on par with prices in March 2005. (The Case-Shiller and FHFA price indices are released with a 2-month lag.) • Foreclosure starts fell in July but foreclosure completions increased. Lenders started the public foreclosure process on 45,381 U.S. properties in July, down 8 percent from June and down 9 percent from a year earlier. Newly initiated foreclosures have been below the pre-crisis (2005 and 2006) monthly average of 52,000 for the past 4 months. Lenders completed the foreclosure process (bank repossessions or REOs) on 46,957 U.S. properties in July, up 29 percent from the previous month and up 81 percent from one year ago. A partial explanation for the yearover-year increase in REOs in recent months is RealtyTrac’s modification of their data collection procedures in the first quarter of 2015, which allowed the data to be obtained more quickly. Filings that would have been reported in subsequent months previously are now being reported earlier. In addition, foreclosure activity has been volatile in recent months as states with a substantial pool of foreclosure inventory move to reduce the backlog. (Source: RealtyTrac.) • The Administration’s foreclosure mitigation programs continue to provide relief for millions of homeowners as the recovery from the housing crisis continues. In all, more than 9.8 million mortgage modification and other forms of mortgage assistance arrangements were completed between April 2009 and the end of July 2015. More than 2.4 million homeowner assistance actions have taken place through the Making Home Affordable Program, including over 1.5 million permanent modifications through the Home Affordable Modification Program (HAMP), while the Federal Housing Administration (FHA) has offered nearly 2.9 million loss mitigation and early delinquency interventions through July. These Administration programs continue to encourage improved standards and processes in the industry, with lenders offering families and individuals more than 4.8 million proprietary modifications through June (data are reported with a 2-month lag). You can read the Treasury’s MHA report here. Encouraging news notwithstanding, there is a need to continue with recovery efforts to foster home sales, help those homeowners that remain underwater, and reduce mortgage delinquency rates that remain elevated. There is also considerable geographic variation in market conditions not captured in the national statistics, which suggests some markets are improving at different rates than others. August 2015 National Scorecard | Page 1 U.S Department of Housing and Urban Development The Obama Administration’s Efforts To Stabilize the Housing Market and Help American Homeowners | August 2015 August 2015 National Scorecard | Page 2 U.S Department of Housing and Urban Development The Obama Administration’s Efforts To Stabilize the Housing Market and Help American Homeowners | August 2015 August 2015 National Scorecard | Page 3 U.S Department of Housing and Urban Development The Obama Administration’s Efforts To Stabilize the Housing Market and Help American Homeowners | August 2015 August 2015 National Scorecard | Page 4 U.S Department of Housing and Urban Development U.S. DepartmentEfforts of Housing and Urbanthe Development | Officeand of Policy and Research | August 2015 The Obama Administration’s To Stabilize Housing Market HelpDevelopment American Homeowners Indicator HOUSING ASSISTANCE AND STABILIZATION PERFORMANCE METRICS This Period Last Period Cumulative From April 1, 2009 Latest Release Distressed Homeowners Assisted (thousands) HAMP Trial Modifications HAMP Permanent Modifications FHA Loss Mitigation Interventions HOPE Now Modifications HARP Refinances Counseled Borrowers (thousands) 8.9 (s) 9.7 (s) 36.0 24.7 9.4 9.2 9.7 41.0 24.4 10.4 2,352 1,523 2,871 4,510 3,334 (r) 319.6 360.4 11,955 Borrower Annual Savings ($ millions) HAMP Active Trial Modifications HAMP Active Permanent Modifications All Refinances ---- ---- 155 8,770 65,247 Activities Completed Under NSP (housing units) New Construction or Residential Rehab Demolition or Clearance Direct Homeownership Assistance ---- ---- 41,021 [64,807] 23,667 [24,364] 11,224 [16,809] 443.2 297.8 Change in Aggregate Home Equity ($ billions) Indicator Mortgage Rates (30-Yr FRM, percent) Last Period 3.84 Year Ago 3.93 1st Q 15 (r) (b,s) (b,s) (b,s) 5,553.8 (r) HOUSING MARKET FACT SHEET This Period July-15 July-15 July-15 June-15 June-15 1st Q 15 1st Q 15 1st Q 15 1st Q 15 As of Dec 2008 4.10 2nd Q 15 2nd Q 15 2nd Q 15 Latest Release 5.10 27-Aug15 Housing Affordability (index) 153.1 159.2 (r) 155.2 162.9 Home Prices (indices) Case-Shiller (NSA) FHFA (SA) CoreLogic–Excluding Distressed Sales (NSA) 180.9 223.4 184.7 179.1 222.9 182.2 (r) 172.3 211.7 173.6 150.5 195.7 159.9 Home Sales (thousands, SA) New Existing First-Time Buyers Distressed Sales (percent, NSA) 42.3 465.8 167.7 10 40.1 456.7 163.9 11 (r) (r) (r,s) 33.6 422.5 150.5 13 31.4 334.2 149.9 32 July-15 July-15 July-15 June-15 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) 2,240 4.8 218 5.2 3,822 2,250 4.9 214 5.3 3,863 (r) (r) (r) (r) (r) 2,350 5.6 204 6.1 3,993 3,130 9.4 353 11.2 3,542 July-15 July-15 July-15 July-15 2nd Q 15 Mortgage Originations (thousands) Refinance Originations Purchase Originations 676.9 967.0 (r) (r) 696.8 666.2 (r) (r) 574.5 790.1 767.1 986.3 2nd Q 15 2nd Q 15 FHA Originations (thousands) Refinance Originations Purchase Originations Purchases by First-Time Buyers 25.9 88.2 70.5 (p) (p) (p) 35.7 89.5 58.5 (r) (r) (r) 15.1 61.0 49.6 62.9 72.7 56.2 July-15 July-15 July-15 Mortgage Delinquency Rates (percent) Prime Subprime FHA 2.6 26.5 8.4 2.7 26.6 9.1 (r) 3.1 30.0 9.7 4.4 34.3 14.3 July-15 July-15 July-15 528 779 443 549 790 470 (r) (r) 703 951 543 915 1,632 333 July-15 July-15 July-15 5,116 5,370 (r) 6,349 -- 45.4 47.0 15.1 27.1 49.1 36.5 15.8 31.0 (r) (r) 49.6 25.9 19.6 39.0 148.6 78.9 14.0 74.8 Seriously Delinquent Mortgages (thousands) Prime Subprime FHA Underwater Borrowers (thousands) Foreclosure Actions (thousands) Foreclosure Starts Foreclosure Completions Short Sales REO Sales (s) (p) (p) (p) (r) (r) (r) (s) June-15 (r) June-15 June-15 June-15 1st Q 15 July-15 July-15 June-15 June-15 SA = seasonally adjusted, NSA = not SA, p = preliminary, r = revised, b = brackets include units in process, s = see Additional Notes in Sources and Methodology. August 2015 National Scorecard | Page 5 U.S Department of Housing and Urban Development U.S. DepartmentEfforts of Housing and Urbanthe Development | Officeand of Policy and Research | August 2015 The Obama Administration’s To Stabilize Housing Market HelpDevelopment American Homeowners A. Items in Tables SOURCES AND METHODOLOGY Description Distressed Homeowners Assisted HAMP Trial Modifications HAMP Permanent Modifications HARP Refinances FHA Loss Mitigation Interventions HOPE Now Modifications Counseled Borrowers (thousands) Borrower Annual Savings HAMP Active Trial Modifications Frequency Sources Notes on Methodology Monthly Monthly Monthly Monthly Monthly Treasury Treasury Federal Housing Finance Agency HUD Hope Now Alliance As reported. Also see additional note in Section C below on HAMP Tier 2. As reported. Also see additional note in Section C below on HAMP Tier 2. As reported. All FHA loss mitigation and early delinquency interventions. All proprietary modifications completed. Quarterly HUD Housing counseling activity reported by all HUD-approved housing counselors. 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. Also see additional note in Section C below on HAMP Tier 2. HUD estimate of annualized savings based on Treasury reported HAMP permanent modifications and median monthly savings estimates. Also see additional notes in Section C below on HAMP Tier 2 and change to reporting savings on all permanent modifications. Refinance originations (see below) multiplied by HUD estimate of annualized savings per refinance. Quarterly HUD Quarterly HUD Quarterly HUD Quarterly Federal Reserve Board Mortgage Rates (30-Yr FRM) Weekly Freddie Mac Primary Mortgage Market Survey, as reported for 30-Year fixed rate mortgages (FRM). 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 a family earning the median income has more than enough income to qualify. Home Prices Case-Shiller (NSA) Monthly Standard and Poor’s Monthly Monthly Federal Housing Finance Agency CoreLogic 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 (purchaseonly) index for US, January 1991 = 100. CoreLogic national combined index, distressed sales excluded, January 2000 = 100. (Only available as NSA). Monthly HUD and Census Bureau Existing Monthly National Association of Realtors® First Time Buyers Monthly NAR, Census Bureau, and HUD Distressed Sales (NSA) Monthly CoreLogic 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 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 in Census CPS/HPS Table 4. Estimates of Housing Inventory, line item “Year-round vacant, held off market for reasons other than occasional use or usually reside elsewhere.” Vacant units can be held off the market for a variety of reasons. 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 refinance originations. HUD estimate of home purchase originations based on MBA estimate of dollar volume of home purchase originations. Completed Activities Under NSP (housing units) New Construction or Residential Rehab Demolition or Clearance Direct Homeownership Assistance Change in Aggregate Home Equity FHFA (SA) CoreLogic - Excluding Distressed Sales (NSA) Home Sales (SA) New Housing units constructed/rehabilitated using Neighborhood Stabilization Program. Bracketed numbers include units in process. 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. 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. 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. 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 Association of Realtors ® annual estimate of first time buyer share of existing home sales. Short sales and REO (Real Estate Owned) sales as a percent of total existing home sales (current month subject to revision). FHA Originations Refinance Originations Purchase Originations Purchases by First Time Buyers Mortgage Delinquency Rates (NSA) Prime Subprime FHA Monthly Monthly Monthly 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. Monthly Monthly Monthly LPS Applied Analytics LPS Applied 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 Applied Analytics, MBA, and HUD Mortgages 90+ days delinquent or in foreclosure, scaled up to market. LPS Applied Analytics, MBA, and HUD Mortgages 90+ days delinquent or in foreclosure, scaled up to market. HUD Mortgages 90+ days delinquent or in foreclosure. Underwater Borrowers Quarterly CoreLogic As reported. Foreclosure Actions Foreclosure Starts Monthly Realty Trac Monthly Monthly Monthly Realty Trac CoreLogic CoreLogic Foreclosure starts are reported counts of notice of default or scheduled foreclosure auction, depending on which action starts the foreclosure process in a state. Real Estate Owned (REO). Count of Short Sales for the month as reported (current month subject to revision). Count of REO (Real Estate Owned) Sales for the month as reported (current month subject to revision). Foreclosure Completions Short sales REO Sales August 2015 National Scorecard | Page 6 U.S Department of Housing and Urban Development U.S. DepartmentEfforts of Housing and Urbanthe Development | Officeand of Policy and Research | August 2015 The Obama Administration’s To Stabilize 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, FHFA monthly (purchase-only) index for US (SA), January 1991 = 100, and CoreLogic-Distressed Sales Excluded (Monthly) for US (NSA), January 2000 =100. 2. S&P/Case-Shiller 10-metro composite index (NSA) as reported monthly. Implied Case-Shiller futures index figures report forward expectations for the level of the S&P/Case Shiller index as of the date indicated, estimated from prices of futures purchased on the Chicago Mercantile Exchange reported by CME Group. The January 2009 market trend projection reports forward expectations estimated from prices of futures contracts reported by Radar Logic. Also see additional note in Section C below. 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 permanent modifications started, FHA loss mitigation and early delinquency interventions, plus proprietary modifications completed as reported by HOPE Now Alliance. Some homeowners may be counted in more than one category. Foreclosure completions are properties entering Real Estate Owned (REO) as reported by Realty Trac. Also see additional note in Section C below on HAMP Tier 2. 6. Beginning with the September 2012 release, filings of a notice of default or scheduled foreclosure auction, depending on which action starts the foreclosure process in a state, are reported for foreclosure starts. Foreclosure defaults previously had been reported as a proxy for foreclosure starts. Foreclosure 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. See additional note below on FHA market share. C. Additional Notes. Beginning with the February 2013 release, the House Price Expectations Chart was updated by replacing market expectations as they existed in January 2009 with expectations as of December 2011. Prices of futures purchased for the S&P/Case-Shiller 10-metro composite index, available on the web from CME Group, were used to estimate expectations for December 2011 and for the current month. Market trend as of January 2009 is estimated from percentage changes in house price futures based on a different house price index: RadarLogic RPX. This trend has been added back to the chart because it imparts important information on how house price expectations have changed over time. Beginning with the January 2013 release, mortgage aid under HAMP Tier 2 is included in the totals. Effective June 2012, HAMP Tier 2 expanded eligibility requirements to further reduce foreclosures and help stabilize neighborhoods. For non-GSE loans, eligibility was expanded to allow for more flexible debt-toincome criteria and to include properties currently occupied by a tenant, as well as vacant properties which a borrower intends to rent. FHA market share estimates are based on new methodology beginning with the October 2013 report; estimates were revised back through Q1 2013. See the FHA Market Share report on their website for an explanation of the new methodology: http://portal.hud.gov/hudportal/HUD?src=/program_offices/ housing/rmra/oe/rpts/fhamktsh/fhamktqtrly. The Q1 2015 NSP projection count was revised for direct homeownership assistance. The estimate for first-time buyers was revised downward from 38 percent to 33 percent beginning with the November 2014 release based on the NAR Profile of Home Buyers and Sellers 2014. Beginning with the January 2015 release, savings on permanent modifications are reported based on all permanent modifications instead of active permanent modifications. This change was made because of a change in reporting by the Treasury Department, which now reports the median monthly savings on all permanent modifications instead of active permanent modifications. August 2015 National Scorecard | Page 7 U.S Department of Housing and Urban Development U.S. DepartmentEfforts of Housing and Urbanthe Development | Officeand of Policy and Research | August 2015 The Obama Administration’s To Stabilize Housing Market HelpDevelopment American Homeowners Appendix The Administration has taken a broad set of actions to stabilize the housing market and help American homeowners. Three years 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 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 helped more than 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 $6.92 billion in support for the Neighborhood Stabilization Program to restore neighborhoods hardest hit by the concentrated foreclosures; • Created the $7.6 billion HFA Hardest Hit Fund for innovative foreclosure prevention programs in the nation’s hardest hit housing markets; • Launched the $1 billion Emergency Homeowners Loan Program, as part of the DoddFrank Wall Street Reform and Consumer Protection Act, to help unemployed and underemployed homeowners pay a portion of their monthly mortgage. • Created an FHA Short Refinance Option that helps underwater borrowers refinance into a new, stable, FHA-insured mortgage that is more aligned with actual property values. • Supported home purchase and refinance activity through the FHA to provide access to affordable mortgage capital and help homeowners prevent foreclosures. • Implemented a series of changes to the Home Affordable Refinance Program (HARP) in an effort to attract more eligible borrowers who can benefit from refinancing their home mortgages during this time of historically low mortgage rates. ### August 2015 National Scorecard | Page 8
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