The March Housing Scorecard for March, jointly produced by the Departments of Treasury and Housing and Urban Development, focused on the large annual gains in home prices over the 12 months ending in January and the strengthening sales of both new and existing homes.

The Federal Housing Finance Agency's purchase-only home price index was up 6.5 percent over January 2012 and the Case-Shiller 20-city index had an annual increase of 8.1 percent over the same period.  Sales of new homes in February were up 12 percent from the previous year and at the highest level since April 2010.  Sales of existing homes rose 10 percent from February 2012 to February 2013, achieving the highest level of sales since the First-time Homebuyers Tax Credit was in effect. 

The Making Home Affordable Program continued to work with homeowners on alternatives to foreclosure through its various programs including the Home Affordable Modification Program (HAMP) and the Second Lien Modification Program (2MP) which is featured in this month's report. 

Second liens have been a major stumbling block for homeowners and servicers in working out affordable modifications of senior liens and also in completing short sales. 2MP requires that participating servicers offer a second lien modification if the borrower also has a permanent and active first lien HAMP modification and the second lien has an unpaid balance of $5,000 or more and a monthly payment of at least $100.  To date 107.400 2MP modifications have been initiated and 70,762 modifications are currently active.  27,296 of those modifications have involved full extinguishment of the second lien. 

Homeowners with active 2MP modifications save a median of $155 per month on their second mortgage, resulting in a median total first and second lien payment reduction of 41 percent.  Homeowners who receive a full extinguishment of their second lien have a total payment reduction of 53 percent.

HAMP trial modifications now total 2,000,224 with 12,921 trials started since the January HAMP report.    There are 59,459 trials in progress and 1,166,726 have been converted to permanent status.  There are currently 862,636 active permanent modifications.

The HAMP Principal Reduction Alternative (PRA) has reduced the principal balance on 119,444 mortgages; 3,180 borrowers started the program since the January report.  There are 82,813 active permanent modifications which have received a median reduction in principal of $73,344, an aggregate reduction of $7.67 billion. There have been about 40,000 additional mortgages modified under HAMP but outside of PRA.  These mortgages received a median principal reduction of 18 percent. Loans owned or guaranteed by either Freddie Mac or Fannie Mae are precluded from participating in any principal reduction programs.

Servicer results released by the HAMP program this month include their performance in establishing Right Party Contact with homeowners of delinquent HAMP eligible loans and evaluating their eligibility for a HAMP modification.  Performance across the largest servicers varied widely.