N. California College of Construction News Blog

See the Difference a Small College can Make!

Home loans and building permits optimistic

Posted by nahetsblog on November 22, 2011

The percentage of borrowers falling behind on home loans dropped in the second and third quarter, and building permits for single-family homes has risen in September and October to their highest level in the previous 12 months.

The Mortgage Bankers Association said Tuesday that the percentage of mortgage borrowers who have missed one payment, fell to 8% in the third quarter from 8.4% in the second quarter.

The percentage of borrowers more than 30 days delinquent but less than 60 days late fell the most, to a four-year low of 3.2% from 3.5% in the second quarter.

That drop suggests that fewer borrowers are falling behind for the first time, which will reduce foreclosures years from now.

Still, 4.2 million borrowers are more than 90 days delinquent. Most of those borrowers will lose their homes to foreclosure or other distressed sales.

That will continue to put pressure on home prices, said Paul Dales, economist at Capital Economics. He expects U.S. home prices, down about 4% from last year, to stay flat next year.

Single-family starts were up 3.9% from September.

Permits, which are better indicator of future activity, rose 5.1% for single-family homes and 24% for multi-family units, the Commerce Department said.

The October results point to a single-family market that’s "finally getting off the mat" and a multi-family segment that’s making "small strides," said Patrick Newport, economist at IHS Global Insight. Still, single-family home starts and permits are likely to set record lows this year, Newport says.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: