For the first time since June 2009, new housing starts rose above 500,000 as approximately 593,000 new homes were started under construction. In Orange County, California alone, new housing starts exceeding 55,000 new homes.

Over the next few months as we enter the peak summer buying months, we may see more buyers entering the home buying marketplace primarily in the FHA mortgage loan price range which is typically in the low $400,000 price range. In certain high priced home regions like coastal areas of California, FHA purchase loans (up to 96% to almost 97% LTV), the loan amounts may go as high as $729,000.

As the take-out (or long term purchase loans) mortgage financing market is what usually drives home sales in various real estate markets, I expect that most new home construction nationwide will be in the lower end of the housing price spectrum since that is where most of the available mortgage money is these days (i.e. Conforming (less than $417,000) and FHA money).