Five years after the housing bust, voters still embrace home ownership. Plus, the stigma of buying foreclosures fades as more people take advantage of low prices at a time when the mortgage rate is at an all-time low. This and more in our roundup of the week’s top housing headlines.
NPR: After the Housing Bust, Revisiting Home Ownership
Has renting become “the future of home-dwelling” in America, as one cable news reporter posited? In a word: no. Five years after the market crash of 2007, the desire to own a home is actually very much alive and well. In a recent poll of likely voters by the Woodrow Wilson Center, 84% of respondents said home ownership today is just as important as or more important than it was five years ago. Ninety percent still think home ownership is part of the American dream.
REALTOR.com: Demand for Foreclosures Triples Among Buyers
Interest in buying foreclosures has almost tripled among potential home buyers in the past two and half years, and 92.1% of those buyers plan to live in them rather than use them as investments, according to a REALTOR.com survey. As the stigma associated with buying a foreclosure has declined in the past few years, so has the fear of losing a home to foreclosure. Back in 2009, more than 52.5% feared they or someone they know would face foreclosure in the next year; fewer than 35% of respondents expressed this concern in this survey.
HouseLogic: Hurry Up on Short Sale If You Don’t Want to be Slapped with Tax Next Year
Unless Congress acts this year, short sale sellers will be in for an income tax increase in 2013. Let’s say you owe $150,000 on your mortgage, but your REALTOR® finds a buyer willing to pay $120,000. The bank approves the short sale and forgives the $30,000 difference. If you don’t complete the sale by Dec. 31, 2012, as of Jan. 1, 2013, that $30,000 in forgiven mortgage debt will be considered taxable income by the IRS.
American Banker: Regulatory Uncertainty Prevents Meaningful Housing Recovery
Last week’s announcement by the Consumer Financial Protection Bureau that it would reopen the comment period (until July 9) on Qualified Mortgage rules (ways lenders can make a good faith assessment of borrowers’ ability to repay loans) and the Treasury Department’s comments that housing reform requires further study are the latest in a string of policy deferrals that prolong meaningful recovery in housing. While no single factor explains the mortgage industry’s reticence to expand credit availability, regulatory uncertainty over mortgage origination, servicing, and financing holds back the return of private capital to mortgage markets.
LA Times: Mortgage Rates Set Record Low for Sixth Week in Row
Mortgage rates fell to new lows for the sixth straight week, with lenders offering the 30-year fixed-rate loan at an average 3.67%, down from 3.75% a week ago, home finance giant Freddie Mac said. The 15-year fixed-rate loan averaged 2.94%, down from 2.97% last week.