New home sales increase 8.8% in March

Plus: Serious delinquencies at lowest since mid-2006 as foreclosures drop, prepayments rise

April 24, 2024

👋 Welcome back! Today's newsletter is 487 words, a 2.5-minute read. Let’s dive in…

Disclaimer: Average mortgage rates as of Apr 23, 2024. © MND's Daily Rate Index.

1. New home sales increase 8.8% in March

Sales of new single‐family houses in March 2024 were at a seasonally adjusted annual rate of 693,000, according to estimates released yesterday by the Census Bureau and the HUD. This is 8.8 percent above the revised February rate of 637,000 and is 8.3 percent above the March 2023 estimate of 640,000.

  • The median sales price of new houses sold in March 2024 was $430,700. The average sales price was $524,800.

Inventory: The seasonally‐adjusted estimate of new houses for sale at the end of March was 477,000. This represents a supply of 8.3 months at the current sales rate. The all-time record high was 12.2 months of supply in January 2009. The all-time record low was 3.3 months in August 2020. LINK

2. Fannie expects rates to stay higher for longer

Fannie Mae's Economic and Strategic Research (ESR) Group is expecting rates to stay "higher for longer" given hotter-than-expected inflation reports and strong employment gains.

“Financial markets rapidly repriced their interest rate expectations following hotter-than-expected inflation reports and ongoing strong payroll employment gains,” said Hamilton Fout, Fannie Mae VP, Economic and Strategic Research.

The ESR Group is also forecasting that existing home sales will rise modestly over the course of the year, and the flow of new listings to outpace home sales, which should help gradually thaw housing inventory. LINK

3. Catch up quick

🏘️ Nearly 40% of homeowners couldn’t afford their home If they were to buy It today. (Redfin)

🛑 FTC votes to ban most employers from using noncompete clauses. (FTC)

🧑‍⚖️ Judge approves $418 million settlement that will change real estate commissions. (The New York Times)

⚔️ Musklandia: Tesla divorces gigafactory land from city of Austin. (the RealDeal)

4. Serious delinquencies at lowest since mid-2006 as foreclosures drop, prepayments rise

Intercontinental Exchange (ICE) released a report on Monday looking at March 2024 month-end mortgage performance statistics derived from its loan-level database representing the majority of the national mortgage market. Here are the key takeaways from the report:

  • The national delinquency rate ticked down 14 basis points (bps) to 3.20% in March, holding 27 bps higher than the record low in March 2023

  • Serious delinquencies (loans 90+ days past due but not in active foreclosure) dropped 24K (-5.2%) from February to hit their lowest level since June 2006

  • The number of loans in active foreclosure fell to 205K in March – the fewest since January 2022 and still 28% below (-77K) pre-pandemic levels – with 5.8K foreclosures completed in the month

  • Prepayment activity rose to its highest level in seven months driven by the lower rate environment of January and early February combined the start of the spring homebuying season. Monthly prepayment rate of 48 basis points was over 15% higher than February.

You’re all caught up. See you on Friday!

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