As falling prices attract buyers, rising interest rates present another challenge to the housing market. The rate on a 30-year fixed loan has averaged 5.42% this month, up from 4.86% in May, according to Freddie Mac. The rate reached 4.78% in April, the lowest level since records began being kept in 1972.
Yun said some sales were delayed or canceled because of "faulty" appraisals. He said buyers have been rejected for loans because of appraisals that give undue weight to foreclosed-home sales.
Richard Dugas, chief executive of Pulte Homes Inc., one of the nation's largest home builders, told an industry conference Tuesday that sales would continue to be sluggish.
Dugas said low consumer confidence and difficulty obtaining mortgages would continue to weigh on sales.
"I'm not here today before you to call a bottom for our industry," he said.
Another sign of housing-market stress came from the Federal Housing Finance Agency, which reported that serious mortgage delinquencies were on the rise. The number of borrowers at least 60 days behind on mortgages owned or guaranteed by Fannie Mae and Freddie Mac rose to 1.1 million from 926,000 in the fourth quarter, the agency said Tuesday. The overall delinquency rate rose to 3.62%, from 3.03% the previous quarter.
McLean, Va.-based Freddie Mac and Washington-based Fannie Mae own or guarantee $5.3 trillion of the $12 trillion in U.S. residential mortgage debt.
The firms modified 37,328 loans in the first quarter, up from about 23,777 in the fourth quarter, the report showed.
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peter.hong@latimes.com
