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The delinquency rate for mortgage loans on one-to-four-unit residential properties decreased to a seasonally adjusted rate of 9.85 percent of all loans outstanding in the second quarter, down 21 basis points from the first quarter, but up 61 basis points from one year ago, according to the recently released Mortgage Bankers Association’s (MBA) National Delinquency Survey.

The delinquency rate includes loans that are at least one payment past due, but does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the second quarter was 4.57 percent, a decrease of six basis points compared with the first quarter of 2010 but an increase of 27 basis points from one year ago.

“Ultimately the housing story, whether it is delinquencies, homes sales, or housing starts, is an employment story,” said MBA Chief Economist Jay Brinkmann. “Only when we see a consistent increase in employment will we see an increase in sales and starts, and a sustained improvement in the delinquency numbers. Until we see the increase in the number of households that comes with an increase in the number of paychecks, all measures of the health of the housing industry will continue to be weak.”

Home prices increased 4.4 percent in the second quarter of 2010 and now are 3.6 percent above their year-earlier levels, according to the S&P/Case-Shiller U.S. National Home Price Index, released yesterday.

The index, which covers all nine U.S. census divisions, recorded a 3.6 percent improvement in the second quarter of 2010 compared with the second quarter of 2009.

The 10-City and 20-City Composites recorded annual returns of 5 percent and 4.2 percent, respectively, in June. Following 16 consecutive months of improvement in their annual rates of return, June’s figures were the first to moderate from their prior month’s pace, indicating a possible deceleration in home price returns.

More than half of all home shoppers report that green home features, from energy efficient appliances to solar panels, are an important part of their purchasing decision, though only one percent of home listings market these features to buyers, according to a ZipRealty survey.
The survey revealed that 55 percent of respondents rated a home’s green features as a “somewhat important” or “very important” part of their home hunt.

Home buyers who view green features as a priority ranked them important because they help save money and allow them to help the environment, according to the survey. Other reasons home buyers value green features include: Occupant/family health, 37 percent; tax credit availability, 12 percent; and the home’s resale value, 15 percent.

Although homebuyers overwhelmingly rated energy efficiency the most important green feature in a home (89 percent), an additional survey found that less than 1percent of homes on the market included the term in their description of the home.

California Insurance Commissioner Steve Poizner is encouraging California homeowners to review their homeowners’ policies and to consider their options regarding vacancy protection. According to Commissioner Poizner, vacant or unoccupied homes can leave the homeowner exposed to loss and liability that may not be covered by their insurance.

Homeowners’ policies are intended to insure occupied homes. Generally home insurance policies include exclusions for neglect or property abandonment on a home left vacant or unoccupied for a specified number of consecutive days. Vacant and unoccupied homes pose a higher risk for damage than occupied homes, so insurance companies insure these properties differently and usually at a higher price.

Home prices nationwide remained level in July following 30 consecutive months of declines, according to the August edition of the Obama administration’s Housing Scorecard. Although foreclosure starts increased slightly, historically low interest rates continue to promote home affordability and refinancing options, according to the report.

Highlights of the August Housing Scorecard include:

More than 3.15 million modification arrangements were completed from April 2009 through the end of June 2010, including more than 1.3 million trial Home Affordable Modification Program (HAMP) modifications, more than 472,000 Federal Housing Administration (FHA) loss mitigation and early delinquency interventions, and 1.4 million proprietary modifications under HOPE Now.
More than 37,000 homeowners received a HAMP permanent modification in July. Homeowners in permanent modifications are experiencing a median payment reduction of 36 percent, or more than $500 per month.

The Federal Reserve Board on Monday issued final rules for mortgage brokers and the companies that employ them, and mortgage loan officers employed by depository institutions and other lenders. The rules, which go into effect April 1, 2011, are designed to protect mortgage borrowers from unfair, abusive, or deceptive lending practices.

Currently, lenders commonly pay loan originators more compensation if the borrower accepts an interest rate higher than the rate required by the lender (referred to as a “yield spread premium”). The new rule reverses that practice. Loan originators can continue to receive compensation based on a percentage of the loan amount.

The final rule also prohibits a loan originator who receives compensation directly from the consumer from also receiving compensation from the lender or another party. The new rule seeks to ensure that consumers who agree to pay the originator directly do not also pay the originator indirectly through a higher interest rate.

Additionally, the new rule prohibits loan originators from directing or “steering” a consumer to accept a mortgage loan that is not in the consumer’s interest in order to increase the originator’s compensation. The rule will preserve consumer choice by ensuring that consumers can choose from loan options that include loans with the lowest rate and loans with the least amount of points and origination fees, rather than loans that maximize the originator’s compensation.

Builder confidence in the market for newly built, single-family homes declined from 14 points in July to 13 in August, its lowest level since March 2009, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The component gauging home sales expectations for the next six months decreased three points to 18 in August compared with July. The component gauging traffic of prospective buyers was unchanged and held steady at 10, while the component gauging current sales conditions declined one point to 14, according to the report. Regionally, the HMI results were mixed in August. The West, which includes California, posted a one-point decline, falling to 8, according to the report.

President Obama on Friday signed HR 5569, the National Flood Insurance Program Extension Act of 2010, funding the program through Sept. 30, 2010.  The bill is retroactive and covers from June 1, 2010 to the date of enactment of the extension.  Flood insurance is required for mortgages on properties in the 100-year floodplain. Congress has allowed the program to lapse three times this year, forcing many real estate transactions to be placed on hold and, in some instances, cancelled.

Following nearly three decades of increases, the size of newly built single-family homes declined to an average of 2,438 square feet last year, according to data collected by the Census Bureau.  New homes constructed in 2009 had fewer bedrooms than those in previous years.  After increasing for nearly 20 years, the number of single-family homes with four or more bedrooms declined to 34 percent in 2009 compared with its peak of 39 percent in 2005.  The number of single-family homes with three bedrooms increased from 49 percent to 53 percent between 2005 and 2009.

Homes built in 2009 also had fewer bathrooms. The proportion of homes with three or more bathrooms declined to 24 percent in 2009 compared with 28 percent in 2008.  The percentage of single-family homes with two bathrooms rose to 37 percent in 2009 compared with 35 percent in 2008.