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Obama Administration's Housing Scorecard

AP

It's June, so it must be report card season, right?

The question is: Is the U.S. Department of Housing and Urban Development's new "Monthly Housing Scorecard," released this morning, really a true assessment of all the administration's work this year, and the current grade level of the housing recovery?

It's full of numbers, I'll give them that. It came in a package of data, emailed to reporters, that included the already widely cited Home Affordable Modification Program monthly status report. This is the one that calls out all the banks on how many borrowers they're getting into trial and permanent modifications, and how many are failing the program.

This new report bundles even more programs...the FHA and the Hope Now modification programs. It also adds the number of borrowers counseled, which, don't get me wrong, is a big number at 839,000 in May (although down from 1.075 million in April).

Then there's my favorite part, where they calculate the "change in aggregate home equity" which is somehow how much we have all saved, due to home price increases, which are of course due to government intervention — or so I'm assuming they believe. The number is about 1 trillion dollars since Q1 2009.

To be fair, the report also shows the ugly side, like FHA delinquencies and prime loan delinquencies both on the rise. Foreclosure completions are also way up from a year ago, and the number of borrowers failing the HAMP program is growing faster than the number of borrowers getting permanent mods. In May, 47,724 borrowers got so-called permanent status, while 152,056 trial mods were "canceled."

The HUD Secretary, Shaun Donovan, said on a conference call that this is all about "open and transparent government." And I applaud that. But representatives of the government should know, if anyone should, that all those stats about mortgage modifications and home price stabilization are backward looking...looking straight into the mouth of a government subsidized housing market.

After the expiration of the home buyer tax credit, home buyer traffic fell off a cliff. Realtors, mortgage bankers, home builders...ask any of them. The drop off is even worse than expected. Initial data points to a double dip in home sales and prices before a recovery, perhaps, some time next year. We are also seeing a recent surge in bank repossessions and short sales, which will only put more pressure on home prices.

"Obviously we are not out of the woods," Donovan admitted. "Our housing recovery remains fragile."

I'm always wary of report cards, especially those with strong political agendas behind them. The numbers are clear and irrefutable, but I'm not sure they included all the subject matter that needs to be covered.

Questions? Comments? RealtyCheck@cnbc.com

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  • Diana Olick serves as CNBC's real estate correspondent as well as the editor of the Realty Check section on CNBC.com.

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