The up 1.7% for March was compared to Feb. DUH! In 1/2 the country you don't buy houses in Feb because you can't get around for the snow, ice, and cold. If you compare March to March of last year it was down 8%. I wouldn't mind if they gave both numbers, but most of the news reports didn't, and they just pretended it was a good number, and that was that.
It was actually January to February numbers they gave. Yeah, down 8% YoY. People are morons...the fact that they even pay attention to the month over month sales during such turbulent weather months is a joke. From the WSJ this morning: Payment Woes Worsen On Riskiest Mortgages Late Bills, Defaults Increase For Subprime Home Loans; Problem Expected to Deepen By JAMES R. HAGERTY April 4, 2007; Page A2 The number of borrowers in the U.S. falling behind on the riskier types of home mortgages continues to grow, according to new data from First American Loan Performance, a research firm in San Francisco. The rapid rise in overdue payments and defaults has forced dozens of lenders out of business or into bankruptcy protection in recent months and darkened the outlook for the U.S. housing market. ⢠The News: Late mortgage payments increased again in January. ⢠The Impact: Lenders are tightening standards, leaving some would-be borrowers out in the cold. ⢠The Outlook: Less credit and more foreclosures will add to the downward pressure on home prices. Yesterday, the National Association of Realtors reported that its index of pending U.S. home sales in February stood at 109.3, down 8.5% from a year earlier but up 0.7% from January. The index, which equates the 2001 sales level to 100, is based on home-purchase agreements that haven't yet been completed. The First American data show that in January payments were at least 60 days late on 14.3% of "subprime" loans that had been packaged into securities, up from 13.4% in December and 8.4% in January 2006. Subprime loans are those made to borrowers with weak credit records or large debts in relation to their incomes. For Alt-A loans -- a category between prime and subprime that includes many loans that don't require full documentation of the borrower's income or assets -- the late-payment figure rose to 2.6% in January from 2.3% in December and 1.3% in January 2006. As more borrowers fall behind or default, lenders are beginning to clamp down. Many of them have eliminated no-money-down loans for subprime borrowers and are insisting on seeing pay stubs, tax forms or other evidence of income. That means many potential borrowers are likely to be turned down. [Overdue Payments] Subprime lending could decline by as much as 50% this year from last year's total of about $600 billion, says David Liu, a mortgage analyst at UBS AG in New York. Alt-A lending also is expected to fall sharply. Together, subprime and Alt-A accounted for nearly 40% of the U.S. home-mortgage loans originated last year, according to Moody's Economy.com, a research firm based in West Chester, Pa. Overdue payments and defaults will get worse in the months ahead, warns Mark Zandi, chief economist at Economy.com, in a recent report. For one thing, he notes, many borrowers will face higher monthly payments in the next couple of years as their loans "reset" to higher rates from their low introductory "teaser" rates. Because of tighter lending standards, many won't be able to refinance into loans with easier terms. The number of foreclosures in the U.S. is likely to reach a record 1.3 million this year, compared with an estimated 900,000 in 2006, Mr. Zandi says. Foreclosures will cause more homes to be dumped on the market at discount prices at a time when inventories of unsold homes already are high in much of the nation. As a result, Mr. Zandi predicts, the median price for sales of previously occupied homes will fall nearly 5% this year, which would mark the biggest national drop since the Depression of the 1930s. As recently as January, he expected a more modest drop of 2.5%. Price changes vary greatly by region and even by neighborhood, of course. Prices are falling in some areas but still rising in others.