Tuesday, June 4, 2013

More positive news ... (or maybe not)

The housing sector continues to see positive news as home prices rose annually and month-to-month led by tighter supplies and pent-up buyer demand. CoreLogic reported today that home prices, including distressed sales, rose by 12.1% from April of 2012 to April of 2013 and jumped 3.2% from March to April. It was the largest annual gain since February of 2006. In addition, 33 large metro areas saw double digit increases annually while all states showed annual price appreciations for non-distressed sales.
The debate of whether or not to taper the monthly Bond purchases by the Federal Reserve (the Fed) has been a hot topic since the beginning of May. The Fed is currently purchasing a total of $85 billion per month in Treasury and Mortgage Backed Securities in an effort to boost the economy, reduce long-term interest rates and promote job growth. Just yesterday, San Francisco Federal Reserve President John Williams said that an improving U.S. economy would the lead the Fed to pullback on the buying and it could happen by the time the summer ends. However, if inflation continues to run low and actually decrease from current levels, it would be a catalyst to increase the Bond buying program.
New York State Attorney General Eric Schneiderman is planning to sue HSBC Holdings Plc for not helping to protect struggling homeowners from being placed into foreclosure without the homeowner receiving a chance to renegotiate their mortgages. The move comes after Schneiderman announced plans to sue the Bank of America and Wells Fargo for violating the terms of the $25 billion state settlement over mortgage servicing abuses.

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