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» makes a "healthy" housing market. According to the GSE's projections, the current trajectory of the recovery should bring the market to a healthy state by 2017. By that time, housing starts should increase to about 1.7 to 1.8 million homes per year, Freddie Mac forecasts. The pace is well below the 2.1 million peak set in 2005, however, Freddie Mac VP and chief economist Frank Nothaft says the projected pace should be "much more sustainable" given the rate of household formation. Housing starts in the third quarter of 2012 reached about 790,000, according to the GSE's data. Home sales are expected to increase to about 5 percent of the housing stock, or 6.5 to 7 million homes per year, compared with sales of 7 percent of the stock in 2005. At the same time, home price appreciation is anticipated to rise gradually to about 3 percent per year—far lower than the 11 percent gain seen during the boom year 2005. Meanwhile, Freddie expects vacancy rates to ease further to about 1.7 percent on for-sale homes and 8 percent for rental homes, down from peaks of about 3 percent in 2008 and 11 percent in 2009, respectively. Seriously delinquency rates are forecast to hover near 2 percent in the "healthy" market of 2017, down from a peak of 9.5 percent in 2010. While the projections may not impress those who expected a return to peak levels, Nothaft says the slow but steady path will be better in the long run. "What a healthy housing market should look like will dismay those who keep comparing housing to what it was during its peak years," he said. "However, taking into account recent trends, key housing indicators, and the shifting demographic patterns that will define a new and realistic trajectory toward a healthy housing market, the long-term prognosis is promising—just don't expect the housing market to wake up at 98.6 degrees tomorrow morning." STAT INSIGHT 21,319 Virginia households that reached out for HAMP assistance through October 2012. Source: U.S. Treasury Washington rank: 23 90+ Day Delinquency Rate Foreclosure Rate october 2012 3.87% Unemployment Rate 2.81% 8.2% year ago 4.63% 1.80% 8.9% percent point change -16.4% 56.1% -7.9% Top County 90+ Day Delinquency Rate PierCe CounTy Foreclosure Rate october 2012 5.67% 4.22% year ago 6.68% 2.54% percent point change -15.0% 66.2% Top Core-Based Statistical Area ShelTon, WA 90+ Day Delinquency Rate Foreclosure Rate october 2012 4.46% 3.97% year ago 5.15% 2.43% percent point change -13.4% 63.3% note: The 90+ Day delinquecy rate is the percentage of outstanding mortgage loans that are 90plus days delinquent. The foreclosure rate is the percentage of outstanding mortgage loans currently in foreclosure. State rank is based on the October 2012 foreclosure rate. All figures are rounded to the nearest decimal. The unemployment rate reflects preliminary October 2012 figures released by the Bureau of Labor Statistics. All other data courtesy of Lender Processing Services. IN THE NEWS Zillow to Grow Rental Offerings with Purchase of HotPads Zillow, Inc., announced in November 2012 its sixth acquisition in the last two years. The company has entered into an agreement to buy San Francisco-based HotPads, a mapbased rental and real estate search site. The $16 million deal was expected to close by the end of 2012. HotPads offers rental tools for both consumers and professionals, including a website and five mobile apps across iPhone, iPad, and Android. Nearly 2.8 million unique users visited HotPads in October 2012, most of whom were there to shop for rentals. According to a release from Zillow's Seattle headquarters, nearly 70 percent of listings viewed on HotPads during October 2012 were homes or apartments for rent. The deal marks Zillow's first acquisition of a primarily consumer-facing company. The real estate information company hopes the purchase will expand the size of its growing VISIT US ONLINE @ DSNEWS.COM rental audience and extend the reach of its marketing tools for professionals. "This acquisition represents a significant step-change for Zillow Rentals, allowing us to dramatically increase the number of leads we send to landlords. HotPads has a younger, complementary, and rental-focused audience. Now Zillow will become even more relevant to consumers at the beginning of their real estate life cycle," said Zillow CEO Spencer Rascoff. Rascoff added, "By acquiring an amazing engineering team, with a deep understanding of how people search for rentals and become tenants, we expect to accelerate our innovation and monetization of our rental marketplace." The acquisition signals Zillow's intent to continue its quick expansion of services. Since June 2012, the company has announced deals to acquire Mortech, Inc., Buyfolio, and RentJuice. According to the company's release, the acquisitions "support Zillow's strategic expansion beyond a traditional media model to offer a suite of marketing and business services to local professionals." "At HotPads, we're passionate about empowering people with tools and information to help them find the right place to live, and we have always admired Zillow's similar vision," said Matt Corgan, co-founder and CEO of HotPads. "Combining Zillow's toolkit for owners and managers with an unmatched community of new tenants—across Zillow, Yahoo!, and HotPads—we believe will enable the first true marketplace at scale for rentals." HotPads will continue to operate from San Francisco. SharperLending Enhances Appraisal Firewall Through Partnership Mortgage tech provider SharperLending LLC announced in November 2012 enhancements to its Appraisal Firewall platform with a new technical integration to appraisal management firm American Reporting Company (ARC). Under the terms of the companies' agreement, ARC will provide appraisal management services to lenders who utilize the Appraisal Firewall system to order real estate appraisals and manage their own appraisal processes. The integration between Appraisal Firewall and ARC provides users with the option 157

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