The pace of the S&P CoreLogic Case-Shiller US National Home Price Index index (equal to 100 in January 2000) rose from 136.7 in December 2011 to 179.4 in May of 2016. The monthly change between April and May was 0.2 per cent, or 2.3 per cent on an annualized basis, and the index is up 5 per cent since last May according to the National Association of Home Builders’ Eye on Housing Tuesday.
Meanwhile, NAHB analysis of the most recent Census estimates concerning sources of financing for new home sales reveals that the share of mortgages financed through conventional, FHA, and VA loans, as well as cash, held steady in 2Q 2016, while the number of new homes sold grew by 22 per cent, said Eye on Housing Thursday.
According to data from the Census Bureau’s Quarterly Sales by Price and Financing and NAHB calculations, new home sales due to FHA-backed loans increased to a quarterly count of 28,000 as market share of remained at 17 per cent for 2Q 2016. Over the long run, the current FHA-share is lower than the 28 per cent share determined for 1Q 2010 but still substantially higher than the 10 per cent 2002-2003 average.
Cash-based transactions for 2Q made up 5 per cent of sales.
It is also worth noting that a different measure from CoreLogic shows a higher market share for cash sales for new construction: 14.5 per cent in April.
Conventional financing has expanded as the housing recovery has grown. The market share of new home sales with conventional financing was 58 per cent in 2009 and came in at approximately 69 per cent for 2Q 2016. This share has remained between 69 and 73 per cent every quarter over the last three years.