The fragility is demonstrated by a decline in the numbers of both new and existing houses and home prices and an increase in homes available for sale. Sales of new homes totaled 20,800 in February compared to 25,100 in January and existing home sales dropped from 450,000 to 406,700. The number of first-time buyers also declined from 237,500 to 213,800. The inventory of existing homes for sale increased from a 7.5 month supply to 8.6 months and new homes from 7.44 months to 8.9 months while the number of vacant units that are not on the market for a variety of reasons increased from 3.56 million to 3.6 million.
The delinquency rate for prime mortgages was up one basis point to 4.8 percent but subprime delinquencies declined from 36.2 percent to 35.1 percent and FHA mortgages from 12.8 percent to 12.2 percent. The numbers of “underwater” borrowers, those who owe more on their mortgages than the market value of the home, increased from 10.78 million to 11.09 million.
“There’s no question that this month’s figures show a troubling dip in home sales and housing prices,” said HUD Assistant Secretary Raphael Bostic. “While we should not ignore the real impact that the Obama Administration’s programs are having for millions of homeowners and borrowers, these statistics clearly show that housing markets across the country continue to struggle to regain stable footing. We must remain steadfast in our efforts to support homeowners and communities in ways to help advance market stabilization and a transition towards health.”