The bill instructs lenders with loans backed by Fannie Mae, Freddie Mac and the Federal Housing Administration, (which is about 90 percent of the market) to account for expected energy cost savings.

Those savings must then be factored into how much the borrower can afford in a monthly mortgage payment, so the energy savings are essentially subtracted from a borrowers expenses.

“You would be amazed at how a few dollars can make a difference in a transaction, $50 in a monthly payment, because people calculate their purchase and what to borrow based upon what it’s going to cost them per month,” argued Isakson.

The bill also tells lenders to add the value of expected energy savings to the value of the home in the appraisal. Since mortgage amounts are based on a percentage of the value of the home, this would allow borrowers to get a bigger mortgage.

(Read more: Housing starts stall, optimism doesn’t)

That’s where homeowners, like Tamara Lyons in Darnestown, Md., who already have green technology in their homes, will be able to make more money when they sell. The value of green will be in the appraisal.

“A lot of my neighbors feel that it’s too much of an initial investment, and they don’t want to put that money down,” explained Lyons, “But, if they see that it’s going to add to the value of their home for resale purposes I think it would definitely make the idea more sexy and more appealing.”

The legislation could also benefit companies that are investing heavily in green product development.

“Certainly companies like Dow or Home Depot who have been working on selling and highlighting their energy-efficient products. Insulation manufacturers … the whole host of manufacturers who make the products that go into the homes that make them more energy efficient,” said Stephen Cowell, CEO of Conservation Services Group.

“So we have a host of technologies and this would give manufacturers, builders, retailers and retrofit companies all an opportunity to begin reaching consumers to say ‘if you take advantage, if you put these products in, you can increase your home’s value’ because it’s now available to a broader range of homebuyers in the marketplace.”

Article source: http://www.cnbc.com/id/100899584

Mortgage applications to purchase a home are rising for two reasons: Buyer demand is increasing, and those buyers are afraid rates will go up dramatically, so they want to lock in fast.

(Read More: Depression Begone! Home Prices Set Record in April)

Alicia and Ryan Diederichs say they are in a race against time. A job transfer recently sent them and their three young children to Oceanside, Calif. Now crammed into a small rental apartment, they are hoping to buy a house quickly.

“I’m afraid we’re going to miss the boat,” said Alicia Diederichs. “I feel like we might get priced out of the market in a few months, and just depending on the mortgage payment whether we could afford it if the interest rates go up more.”

The Diederichs need a large house to fit their family, but home prices are rising fast on the California coast, and they have not yet locked in a mortgage rate.

“Ideally we would do a 30-year fixed, but it’s all going to be dependent on the end mortgage payment, what we can afford, so we would have to look at an ARM potentially if rates continue to rise,” she said.

(Read More: Mortgage Cop: Four Top Banks Fail Consumers)

The combination of sharply higher home prices and rising rates is squeezing buyers who are already facing tighter underwriting standards. In order to qualify for loans, they must fit into strict debt-to-income calculations, and those calculations change with every increase in mortgage rates.

Article source: http://www.cnbc.com/id/100845777

(Read More: Housing’s Big Challenge: Student Debt)

Back in the mid-eighties and nineties, Americans spent nearly 20 percent of their median monthly incomes on their home loans—compared to just 12.5 percent today, according to Zillow.

The trouble is that wages have either stagnated or dropped at the same time that home values are rising. Pre-bubble, U.S. homebuyers spent 2.6 times their median annual incomes on the purchase price of a typical home, but now they are spending three times their incomes—meaning homes are 14.5 percent more expensive relative to income, according to Zillow. That is all made possible by government-subsidized, record low rates.

(Read More: Betting on the Home Builders as Housing Battles Back)

“The days of historically high levels of housing affordability are numbered,” said Zillow Chief Economist Stan Humphries. “Current affordability is almost entirely dependent on low interest rates, and there’s no doubt that rates will begin to rise in the next few years.”

Rates will rise because the Federal Reserve will inevitably have to get out of the business of buying agency mortgage-backed securities, which currently drives down rates. This won’t happen immediately, but it will in the next two to three years.

Article source: http://www.cnbc.com/id/100631625

The median home price in Marin also rose to $650,000 last month, a 21.4 percent increase over February 2012 and a $10,000 jump from the median sale price in the county in January.

Marin fell in line with regional and statewide real estate trends last month, which saw fewer homes sales than in February 2012, according to figures provided by DataQuick, a San Diego-based analysis service.

Sales are generally flat from January to February, according to DataQuick’s analysts.

Marin saw a slight decline in the number of homes sold between February 2013 (201 homes) and February 2012 (203 homes). But more homes were sold in Marin County in February than in January of this year, when 181 houses traded hands.

The median price of a home sold in the nine-county San Francisco Bay Area skyrocketed nearly 25 percent when comparing February 2013 to February 2012, the data showed. The median has had a double-digit year-over-year increase the last nine months, and the past four months have seen gains above 20 percent.

Other interesting real estate market facts this month? DataQuick supplied these:

• The typical monthly mortgage payment that Bay Area buyers committed themselves to paying last month was $1,460. That was down from $1,479 in January, and up from $1,243 a year ago.
• The most active lenders to Bay Area home buyers last month were Wells Fargo with 15.0 percent of the market, Stearns Lending with 4.0 percent, and RPM Mortgage with 3.7 percent.
• Foreclosure resales – homes that had been foreclosed on in the prior 12 months – accounted for 13.6 percent in the Bay Area in February. That’s the lowest since November 2007.

“…[W]ith a recovering economy, prices still closer to the bottom than to the top, with ultra-low mortgage interest rates and tight supply, the stage is set for price gains,” said John Walsh, DataQuick president. “This spring is going to be interesting.”

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Article source: http://larkspurcortemadera.patch.com/articles/marin-home-prices-rose-more-than-20-percent-in-february-323dc8ba

Sonoma County bucked regional and statewide real estate trends last month, which saw fewer homes sales than in February 2012, according to figures provided by DataQuick, a San Diego-based analysis service.

Sales are generally flat from January to February, according to DataQuick’s analysts.

But Sonoma County saw a 6.6 percent increase in the number of homes sold between February 2013 (403 homes) and February 2012 (378 homes). Last month’s sales also are on-par with the 398 homes sold in January of this year.

The median home price in Sonoma County also rose to $345,000 last month, a 16.9 increase over February 2012 and a $5,000 jump from the median sale price in the county in January.

Last month’s figures showed the median home price for the county was $340,000, up from $285,000 in January 2012.

The median price of a home sold in the nine-county San Francisco Bay Area skyrocketed nearly 25 percent when comparing February 2013 to February 2012, the data showed. The median has had a double-digit year-over-year increase the last nine months, and the past four months have seen gains above 20 percent.

Other interesting real estate market facts this month? DataQuick supplied these:

• The typical monthly mortgage payment that Bay Area buyers committed themselves to paying last month was $1,460. That was down from $1,479 in January, and up from $1,243 a year ago.
• The most active lenders to Bay Area home buyers last month were Wells Fargo with 15.0 percent of the market, Stearns Lending with 4.0 percent, and RPM Mortgage with 3.7 percent.
• Foreclosure resales – homes that had been foreclosed on in the prior 12 months – accounted for 13.6 percent in the Bay Area in February. That’s the lowest since November 2007.

“…[W]ith a recovering economy, prices still closer to the bottom than to the top, with ultra-low mortgage interest rates and tight supply, the stage is set for price gains,” said John Walsh, DataQuick president. “This spring is going to be interesting.”

Article source: http://petaluma.patch.com/articles/sonoma-county-home-prices-on-the-rise-again

Delinquencies dropped 6 percent annually in 2011 and 7 percent in 2010. This after jumping over 50 percent in each of the previous two years. The trouble is not with new loans but with a long legacy of troubled loans from the housing boom. While these loans make up 60 percent of mortgages outstanding, they account for 90 percent of loans gone bad. Attempts at loan modifications as well as long delays in the foreclosure process have kept these loans stuck in a bloated pipeline.

There are borrowers today that have not made a mortgage payment in several years but have still not lost their homes. New laws in California and Nevada slowed the foreclosure process considerably, while New York and New Jersey are still facing huge backlogs of bad loans that will take years to make their way through the states’ court process.

(Read More: New Housing Fears: Home Prices Are Rising Too.)

Nationally, the mortgage delinquency rate now stands at 5.19 percent, down from 6.01 percent a year ago, but still far from the historical average of around one to two percent. While loans made in the past few years, using far stricter underwriting, are faring very well, there is a concern that thousands of mortgage modifications made during the same time will default again. Negative equity, while improving, continues to plague millions of borrowers and makes selling the home impossible. Should these borrowers need to move, they will likely have to default on their home loans.

(Read More: Why Home Builders Won’t Drop New Home Prices,)

Article source: http://www.cnbc.com/id/100453098

Yes, rates moved down, 0.125 percent, according to several sources, but that was not as low as some had predicted. Remember, we hit the low of 3.49 percent in July, but then we jumped back into the mid to high threes. (Read More: Fed Pulls Trigger, to Buy Mortgages in Effort to Lower Rates.)

“Short term, people who are thinking about moving really need to lock in,” says Craig Strent of Maryland-based Apex Home Loans. He is concerned that the strong consumer sentiment number that came in today could cause the Federal Reserve to pull back on its buying in the future. “When this thing turns, it’s going to be fast. Just pulling back a little sends a message,” adds Strent.

But others argue that the housing market is still on such shaky ground that that’s unlikely to happen. Mortgage applications to purchase a home have declined five of the last six months, according to Diane Swonk of Mesirow Financial.

“I think that this will be a trillion dollar commitment from the Fed,” said Swonk on CNBC’s “Squawk on the Street.” “Home values appreciating, that’s something very important in this economy getting more legs and moving forward more rapidly.” (You can watch the interview here.)

So say mortgage rates could dip lower than the latest record, perhaps to around 3.25 percent. How does that help me? Does it boost my home price? (Read More: Will Fed’s Mortgage Buying Juice the Housing Recovery?)

On the one hand, lower mortgage rates give potential buyers more purchasing power. “A 0.125 percent drop in rates adds 1.5 percent to your maximum purchase price (given all the other fees),” according to Dan Green at Waterstone Mortgage. “Assuming a mortgage payment of $1500, that’s the difference between $404,800 and $411,000-ish.” So that is how much more house you can buy. If people can buy more house, then perhaps home prices will rise.

But as we’ve noted so many times before, the great low rate doesn’t mean anything if you can’t qualify, if you don’t have the down payment or credit scores to get it.

“Instead, the underlying improvement in housing demand is still very reliant on cash buyers and investors,” notes Paul Diggle of Capital Economics, who does not believe mortgage rates will fall dramatically. “Admittedly, low bond yields and savings rates more generally are probably playing a part in the strength of investor demand for housing.”

Lower rates could cause a boost in refinances, but so many have already refied at record low rates that it would take a pretty large drop to lure more in, given the fees and hassle involved. And of course negative equity keeps millions of potential refinancers out of the game. The government’s refinance program for underwater borrowers (HARP) has helped over half a million borrowers get lower rates since the beginning of this year, but unless you have a Fannie Mae or Freddie Mac
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There is a push by Democrats in Congress to expand the government’s refi program, and lower mortgage rates could help more Republicans come on board, but that is unlikely to happen before election day. (Read More: Wealthiest Counties Rake In Government-Backed Mortgages)

“To ensure as many voters as possible can benefit from this, we believe there will be another push to enact HARP expansion legislation during the lame duck session that will start after the election,” says Jaret Seiberg of Guggenheim Partners. “Lower mortgage rates only matter if people can refinance and plow that extra cash into the economy. Given that as many as a quarter of borrowers may be underwater, the HARP is the way to translate the Federal Reserve’s effort into economic stimulus.”

It is hard to say now just how low rates will go and just who will be able to benefit from lower mortgage rates. In today’s tricky housing recovery, so dependent on investors and so sensitive to a still-swollen pipeline of foreclosed properties and delinquent loans, mortgage rates are just one piece of the recovery puzzle.

Sector Watch – Nation’s Biggest Mortgage Lenders:

• Wells Fargo
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• JPM Chase
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• Bank of America
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• Citi
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• U.S. Bancorp
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Questions?  Comments?  And follow me on Twitter @Diana_Olick