Price recovery escaping affordable homes: Black Knight
JACKSONVILLE, Fla. (1/13/15)--While home prices have steadily climbed in recent months overall, prices for affordable homes have failed to keep up, especially compared with those at the priciest end of the market, according to recent data.
Jacksonville, Fla.-based Black Knight Financial Services reported Monday that home prices in the bottom 20% of the market in terms of affordability have fallen substantially behind those homes in the top 10% (Housingwire.com Jan. 12).
For example, as of November in California, homes in the top 20% value tier fell only 3% behind their pre-recession levels, while those in the bottom 20% fell a full 32% behind.
Home prices for the bottom end of the market have had an especially difficult time in states where the financial crisis hit hardest, according to Trey Barnes, senior vice president of Loan Data Products for Black Knight.
Barnes pointed to Nevada, where properties in the lowest tier remain 47% behind their pre-recession levels, compared with 36% for those in the highest tier of homes.
"In many cases, these disparities between price tiers can be attributed to the fact that during the bubble, lower-tier properties appreciated at much higher rates than higher-valued properties and likewise fell harder and further when the bubble broke," Barnes said.
Black Knight also reported that loan modification activity fell in 2014, but that modifications through the Home Affordable Modification Program (HAMP), which make up more than half of all modifications, re-defaulted at a higher rate than that of each of the prior two years.
The national delinquency rate also spiked 11.8% in November, Black Knight found. The jump was the largest monthly increase since 2008, though part of the surge was tied to a reduced number of processing days for the month because of two federal holidays and because November ended on a Sunday.