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The Norris Group Real Estate News Roundup 3/12/10

Friday, March 12th, 2010

Today’s News Synopsis:

The FDIC sold $1.8bn of residential mortgage-backed securities. The Federal Reserve bought a total of $10bn worth of mbs. More than 25 percent of the home owners who received trial modifications have been removed from Obama’s program. Approximately 462,000 new unemployment claims were made last week.

In The News:

Housing Wire – “FDIC Details $1.8bn Structured Financing Transaction” (3-12-10)

“The Federal Deposit Insurance Corp. (FDIC) today closed on a sale of notes backed by residential mortgage-backed securities (RMBS) from seven failed bank receiverships. The news of the closing, summarized in an FDIC press release today, marks the first official release of information on $1.8bn of structured notes that roadshowed and priced in recent weeks.”

Housing Wire – “BofA Makes 21,000 HAMP Modifications Permanent” (3-12-10)

“Bank of America (BAC: 16.985 -0.79%) reported 21,000 permanent modifications under the Home Affordable Modification Program (HAMP) through February. The US Treasury Department launched HAMP in March 2009 to provide incentives to servicers for the modification of loans on the verge of foreclosure. BofA faced industry criticism for reporting 98 permanent modifications through November 2009.”

Housing Wire – “Fed MBS Purchases 98% Complete with Another $10bn” (3-12-10)

“The New York Federal Reserve Bank bought another $10bn of agency mortgage-backed securities (MBS) in the week ending March 10 as the $1.25trn program, now 98% complete, winds down to a close. The Fed bought $29.4bn gross of MBS — $4.4bn Freddie Mac (FRE: 1.2801 -1.53%) MBS, $25bn Fannie Mae (FNM: 1.0701 -2.72%) MBS, and no Ginnie Mae MBS. After reporting $19.4bn of MBS sales through the same week, the Fed’s net purchases came to $10bn, level with last week’s agency MBS buys.”

Bloomberg - “More Than 250,000 Borrowers Dropped From U.S. Modification Plan” (3-12-10)

“More than 250,000 of the 1 million borrowers who have received trial loan modifications through the Obama administration’s chief foreclosure prevention plan have either dropped out or been removed from the program through February, the Treasury Department said.”

Inman - “Credit Starvation Fallout” (3-12-10)

“Overall retail sales have risen 6 percent since the pit one year ago, but are still 6.5 percent below 2008. New unemployment claims are still elevated, running 462,000 last week.”

Inman - “NAR: Don’t rein in FHA” (3-12-10)

“FHA insured nearly 30 percent of purchase loans in 2009, including more than half of mortgages taken out by first-time homeowners, and NAR also wants lawmakers to make temporary increases in FHA loan limits in costly housing markets permanent. But rising claims have eroded FHA’s capital reserves below statutory limits, forcing the program’s administrators to tighten underwriting requirements and raise upfront mortgage insurance premiums.”

Orange County Register – “85,000 O.C. real estate jobs gone” (3-12-10)

“In January, Orange County real estate and finance bosses employed 199,200 workers, 24,600 below 2009 levels and 85,100 less than the recent cycle’s peak, by the state Employment Development Dept.’s freshly revised math.”

Looking Back:

One year ago, the MBA reported that commercial and residential mortgage delinquencies increased during the 4th quarter of 2008. Riverside and San Bernardino County were ranked as the 6th highest foreclosure market. U.S. foreclosures increased by 30 percent in one month. Freddie Mac’s statistics showed that 30-year mortgage rates decreased to 5.03 percent.

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The Norris Group Real Estate News Roundup 3/11/10

Thursday, March 11th, 2010

Today’s News Synopsis:

According to the MBA, the delinquency rate for CMBS increased by 1.63 percent during the last half of 2009. Statistics from RealtyTrac show that 2 percent fewer homes entered the foreclosure process in February. Nineteen percent of home listings experienced a price reduction since March 1st.

In The News:

Mortgage Bankers Association – “MBA Report Shows Economic Fallout Continues to Impact Commercial Real Estate Markets/Delinquencies in 4th Quarter 2009″ (3-11-10)

“Between the third and fourth quarters, the 30+ day delinquency rate on loans held in commercial mortgage-backed securities (CMBS) rose 1.63 percentage points to 5.69 percent. The 60+ day delinquency rate on loans held in life company portfolios decreased 0.04 percentage points to 0.19 percent. The 60+ day delinquency rate on multifamily loans held or insured by Fannie Mae rose 0.01 percentage points to 0.63 percent. The 90+ day delinquency rate on multifamily loans held or insured by Freddie Mac increased 0.04 percentage points to 0.15 percent. The 90+day delinquency rate on loans held by FDIC-insured banks and thrifts rose 0.49 percentage points to 3.92 percent.”

LA Times – “Fewer homes enter foreclosure process in February” (3-11-10)

“The number of homes caught up in some stage of the foreclosure process in February fell 2% from the previous month to 308,524, a real estate firm will report Thursday. That number is up 6% compared with the same month a year earlier but marked the smallest year-over-year increase since January 2006, according to RealtyTrac Inc.”

Housing Wire – “Sellers Cut Fewer Listing Prices as Home Price Declines Slow” (3-11-10)

“Fewer US homes for sale experienced listing price reductions this month, according to online real estate market Trulia.com. It’s further indication of a leveling out in listing price declines amid government stimulus to buy homes. A new low of 19% of listings currently on the market experienced a price cut as of March 1, 2010, based on Trulia’s database of live listings. Sellers slashed $21.6bn off of listing prices.”

Housing Wire – “COP Cites Missed Opportunities in Federal Bailout of GMAC” (3-11-10)

“GMAC, once the credit arm of General Motors and now the 14th largest bank holding company in the US, could have been placed into bankruptcy and its costly subsidiary operations wound-down, the Panel said.”

Housing Wire – “FDIC Pricing Second Round of ABS” (3-11-10)

“The second round of structured financed notes being issued by the Federal Deposit Insurance Corp. (FDIC) is being priced today. The news comes after the successful launch of the FDIC project to use structured finance as a way to profit from the certain assets of failed banks. It is believed the FDIC is cherry-picking the best performing loans to sell to investors as asset-backed securities (ABS).”

Housing Wire – “Jumbo RMBS Delinquencies Nearing Third Year of Rises” (3-11-10)

“The prime jumbo mortgage market, especially in California and Florida, continues to deteriorate in the residential-mortgage backed securities (RMBS) space, posting rising 60-day or more delinquencies for the 33rd consecutive month, according to Fitch Ratings. And to jumbo market players, the trend is expected to continue for some time.”

Housing Wire – “Weekly Mortgage Rates Dip Again” (3-11-10)

“Freddie Mac’s (FRE: 1.30 -0.76%) weekly survey put the average rate for a 30-year FRM at 4.95% with an average 0.7 origination point for the week ending March 11, down from the previous week when it was 4.97%. A year ago, Freddie’s survey averaged 5.03%.”

Housing Wire – “Storm Brews Over Short Sale Valuations as the Mortgage Market Prepares for HAFA” (3-11-10)

“A storm is brewing between appraisers and broker price opinion (BPO) professionals vying for valuation work for short sales conducted through the Making Home Affordable Foreclosure Alternatives (HAFA) program. The Appraisal Institute — a trade group that represents appraisers — released a public letter it wrote to Treasury Secretary Timothy Geithner on Tuesday, calling for an end of the practice of using BPOs for Making Home Affordable modifications and refinancings, as well as amending the rules for the upcoming HAFA program to require appraisals to determine value for government-incentivized short sales.”

Bloomberg - “REIT Chief Executives See Strengthening Market for Asset Sales” (3-11-10)

“Investors with abundant cash and few deals to chase are driving up commercial property prices, real estate chief executive officers said today.”

Bloomberg - “Apartment Vacancy Rates in U.S. to Decline in 2010, CBRE Says” (3-11-10)

“Apartment vacancies in the U.S., which reached a record high of 7.4 percent in 2009, will fall this year as job losses stabilize and fewer new rental homes enter the market, CB Richard Ellis Group Inc. said. The vacancy rate will decline to 6.8 percent in 2010, the property broker said in a report today. Effective rents, or what tenants pay after concessions, will end the year less than 1 percent down from the fourth quarter of 2009. Rents fell 4.7 percent in the final quarter of last year from a year earlier. “

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The Norris Group Real Estate News Roundup 3/10/10

Wednesday, March 10th, 2010

Today’s News Synopsis:

The MBA reports that mortgage loan application volume increased by 0.5 percent. The percent of first-time buyers increased to 47 percent in 2009. FHFA is being sued over attempts to secure records of political contributions from Fannie Mae and Freddie Mac. John Burns claims that the real estate market is still in bad shape.

In The News:

Mortgage Bankers Association – “Purchase Applications Increase in Latest MBA Weekly Survey” (3-10-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending March 5, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 0.5 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 1.2 percent compared with the previous week.”

Mercury News – “San Jose council agrees to levy fee on affordable housing developers” (3-10-10)

“The San Jose City Council on Tuesday agreed to amend a city ordinance that for 22 years has given affordable housing developers a pass on paying to build parks. The city now will require those developers to pay 50 percent of the parkland fee that other developers pay. While preserving an incentive to build apartments for lower-income residents, the new agreement will provide the cash-strapped city more money to build or improve parks or trails near housing projects.”

CAR - “C.A.R. releases ‘State of the California Housing Market’ report” (3-10-10)

“Affordable home prices, tax credits for home buyers, historically low interest rates, and a large number of distressed properties prompted many first-time home buyers to enter the market in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) 2009-2010 ‘State of the California Housing Market’ report released today. The percent of first-time buyers increased dramatically in 2009, from 35.9 percent in 2008 to 47 percent in 2009, according to the report. The share of first-time buyers exceeded the long-run average of 38.6 percent and was the highest since 1995, when more than half of all buyers were first timers.”

Housing Wire – “Watchdog Sues FHFA Over Fannie and Freddie Records” (3-10-10)

“A watchdog group is fighting a legal battle with the Federal Housing Finance Agency (FHFA) over attempts to secure records of political contributions made by Fannie Mae (FNM: 1.10 +2.80%) and Freddie Mac (FRE: 1.31 +2.34%) since 2005. Judicial Watch filed its suit after the FHFA denied a May 29, 2009 Freedom of Information Act (FOIA) request, the group said in a press statement. According to the Judicial Watch, the FHFA claimed that while Fannie Mae and Freddie Mac might possess the requested documents, the FHFA was not obligated to release them under FOIA”

Housing Wire – “Housing Gets D+ in Latest John Burns Report Card” (3-10-10)

“The US Housing Market got a grade of D+ in the monthly John Burns Real Estate Consulting (JBREC) report card. The housing supply received a grade of F; steady from last month, albeit at very low levels, JBREC said. New home completions were down, but housing starts were up.”

Housing Wire – “Lend America, VP Ashley Banned from FHA” (3-10-10)

“Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week. The court judgment, issued in New York on March 3, brings to a close a nearly five-month-long ordeal that began in October when the Department of Housing and Urban Development’s (HUD) Mortgagee Review Board issued a notice of violation against Ideal Mortgage Bankers, parent company of Lend America and Lending Key.”

Bloomberg - “Apollo Said to Triple Property Assets With Citi Unit Purchase” (3-10-10)

“Apollo Management LP agreed to buy Citigroup Inc.’s real estate investment unit in a move that will more than triple the value of the private-equity firm’s property assets, a person with knowledge of the deal said yesterday. The purchase of Citi Property Investors will give New York- based Apollo 65 real estate investments in 26 countries with a net asset value of $3.5 billion, said the person, who asked not to be named because the negotiations are private. Apollo’s global head of real estate, Joseph Azrack, helped assemble the portfolio when he led the Citigroup unit from 2004 to 2008.”

Inman - “ZipRealty posts $2.1M Q4 loss” (3-10-10)

“ZipRealty Inc. boosted revenue by 14.6 percent in 2009, to $120.7 million, helping the company trim its annual loss to $12.9 million, down 3.4 percent from 2008. In the final three months of the year, the Emeryville, Calif.-based brokerage company handled 6,355 transactions, a 46.6 percent increase from the same period a year ago.”

Orange County Register - “24% of new South Coast homes: short sales” (3-10-10)

“There are 6,867 total pending sales in all of Orange County. Of those, 4,254 are short sales, 62%. Yet, only 27% of all closed residential resales in February were short sales. Most short sales are simply not closing. They are waiting on lender, or in many cases lenders, approval of the sale. Of the 4,254 pending short sales, only 757 have been pending for less than a month. 1,488 have been pending for over three months. The data does not even capture the short sales where a frustrated buyer walks away after waiting too long.”

Looking Back:

One year ago, homebuilder Hovnanian reported its 10th consecutive quarterly loss. JP Morgan feared that Obama’s mortgage-modification plan would require too many modifications to be made. Broker commissions decreased by 18 percent.

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The Norris Group Real Estate News Roundup 3/9/10

Tuesday, March 9th, 2010

Today’s News Synopsis:

Capital Economics claims that U.S. home values are 20 percent undervalued. Yields on Fannie Mae and Freddie Mac mortgage securities fell to record lows. Trulia reports that 19 percent of homes had a price reduction last month. Real estate appraisers claim that Obama’s new foreclosure program encourages fraud.

In The News:

ABC - “More Work Ahead on Housing Market: Treasury” (3-9-10)

“Michael Barr, the Treasury’s assistant secretary for financial institutions, said in prepared remarks to state housing agency officials that the Obama administration’s housing policies ‘are helping to stabilize housing markets’. He said mortgage rates remain near historic lows, unsold home inventories are falling and prices are declining less rapidly in most markets with some prices increasing.”

The Press Enterprise – “State law to save foreclosure victims from losing shirt on taxes” (3-9-10)

“Passing the Assembly by a 47-27 vote, the bill authored by Sen. Lois Wolk (D-Davis) would exempt people who did short sales or received loan modifications or lost their houses in foreclosure last year from having to pay state tax on any mortgage debt that was forgiven. Otherwise the forgiven debt would be considered income for the homeowners even though they received no money from the sale of their home.”

Housing Wire – “State Housing Finance Agencies Uneven in Plans to Use $1.5bn Federal Fund” (3-9-10)

“Last week, the US Treasury Department cleared select state HFAs to submit proposals for the fund. President Barack Obama announced the plan in February to use $1.5bn of the Troubled Asset Relief Program (TARP) to help homeowners in states where house prices have dropped 20% from peak. Nevada, California, Arizona, Florida and Michigan are making plans to target unemployed or underwater borrowers and provide second-lien relief.”

Housing Wire – “Economists Find US House Prices are Undervalued Globally” (3-9-10)

“House prices in the United States are nearly 20% undervalued, especially in the states of California, Nevada, Michigan and Ohio, when compared to global markets, according to a report from independent macroeconomic research consultancy firm Capital Economics.”

Bloomberg - “Fannie Mae Mortgage-Bond Spreads Fall to Record: Credit Markets” (3-9-10)

“Yields on Fannie Mae and Freddie Mac mortgage securities that guide U.S. home-loan rates fell to the lowest relative to Treasuries on record, even as the scheduled end of Federal Reserve purchases approaches. The difference between yields on Washington-based Fannie Mae’s current-coupon 30-year fixed-rate mortgage bonds and 10- year Treasuries narrowed about 0.01 percentage point to 0.61 percentage point as of 4:15 p.m. in New York, the smallest gap since at least 1984, according to data compiled by Bloomberg.”

Inman - “Trulia: Price reductions reach new low” (3-9-10)

“As of the first day of this month, sellers had reduced prices on less than 20 percent of listed homes for the first time since Trulia started tracking price reductions in April 2009, the property search site announced in a report Tuesday. The March report found that sellers had reduced prices at least once on 19 percent of the homes listed on the site, compared with 21 percent the month before. The report included about 3 million properties and excluded foreclosures and new homes from its calculations.”

Inman - “Beware listings scammers” (3-9-10)

“Real estate agents beware: Scammers can take the listings information from your real estate Web site and peddle them as rental properties to try to bleed unsuspecting prospective tenants of their money and personal information, according to a story by a news agency in Pittsburgh, Pa.”

Orange County Register - “Fed sees ‘little change’ in West’s housing” (3-9-10)

“Demand for housing appeared to be little changed on net, while demand for commercial real estate slid further. The pace of home sales was mixed across areas but appeared to be largely unchanged after adjusting for normal seasonal variation. Home prices reportedly rose a bit further in some areas of the District. However, the number of available homes for sale remained elevated, which substantially offset builders’ incentives to increase the pace of new home construction. Demand slid further for commercial real estate, and tenants continued to push for and often achieve rent concessions and other favorable terms through renegotiation of existing leases. However, one contact noted an increase in leasing activity in some segments of the major markets in the District, as well as slightly improved availability of financing for new commercial development and investment transactions.”

Orange County Register – “Appraisers: Obama plan encourages fraud” (3-9-10)

“Real estate appraisers today announced their opposition to part of an Obama administration plan to pay homeowners in trouble to move if they agree to a short sale, saying the program will lead to mortgage fraud. Under the plan, which takes effect April 5, delinquent borrowers who couldn’t get a loan modification can get $1,500 to move if they sell for less than the balance of the mortgage. Banks and second mortgage lenders would get $1,000 to process each of these short sales.”

Orange County Register – “Laguna Beach homes selling slower” (3-9-10)

“Homes are selling at a slower pace than two weeks ago, according to a biweekly report by Steven Thomas of Altera Real Estate. Laguna Beach’s market time, or home-selling pace, slowed from 9.14 months to 11.07 months. Countywide, the trend was the same. Two weeks ago, it would have taken an expected 2.51 months to sell Orange County’s home stock, which improved to 2.77 months.”

Looking Back:

One year ago, the San Francisco real estate market had the second largest year-to-year price decline in the United States. Economists claimed that the United States was in danger of deflation. Orange county had a 4 month supply of unsold home inventory. San Diego condo sales increased by 40 percent from 2008 to 2009.

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The Norris Group Real Estate News Roundup 3/8/10

Monday, March 8th, 2010

Today’s News Synopsis:

Multifamily home building will likely become more expensive in San Diego, as a new water meter program gains popularity. According to RealtyTrac, one in every 25 Los Angeles homes received a notice of foreclosure in 2009. Silicon Valley Bank forecasts an increase in foreclosures in Napa Valley.

In The News:

MBA – “MBA and Others Express Grave Concerns About Regulations Proposed Under SAFE Act” (3-8-10)

“HUD is proposing to exceed its statutory authority under the SAFE Act establishing a backup system and determining whether state laws meet the SAFE Act’s minimum requirements.  In this regard, HUD indicates it may require states to treat servicer employees engaged in loan modifications as originators for the purposes of the Act.  If the regulation is finalized as proposed, HUD risks significantly curtailing the ability of servicers to complete loan modifications until their employees are registered or licensed.”

Sign On San Diego – “S.D. could require multifamily water meters” (4-8-10)

“The City Council takes up a proposed ordinance tomorrow after months of fine-tuning. The proposal is widely expected to pass, creating what several water experts said would be a first in the county. It would require submetering for new complexes with three or more units and in cases when an entire interior drinking water system is replaced for a complex with three or more homes. Some exemptions apply.”

Housing Wire - “Los Angeles to Pull Investments from Foreclosure-Heavy Financial Firms” (3-8-10)

“According to the real estate data provider, RealtyTrac, the Los Angeles metropolitan statistical area (MSA) had the 32nd highest foreclosure rate in the country in 2009 as foreclosures remained concentrated the sand states. There, one in every 25 homes received a foreclosure filing, a 37% increase from 2008. California leads all states with the most permanent modifications under the Home Affordable Modification Program (HAMP), according to the US Treasury Department.”

Housing Wire – “State Applications Open for Federal Underwater Borrower Aid” (3-8-10)

“Select state Housing Finance Agencies (HFAs) can submit proposals for using $1.5bn from the HFA Hardest-Hit Fund to prevent foreclosures and stabilize local housing markets, according to the US Treasury Department. Eligible HFAs can apply for clearance to fund principal-forgiveness, unemployment and second-lien reduction programs.”

Housing Wire – “Investors Shun Fund of Funds for Higher Hedge Gains: Barclays” (3-8-10)

“The migration of money away from fund of funds and directly into the hedge fund space indicates investors are being drawn by the recent successes in the industry, which look set to continue, according to market analysts. The business for hedge funds in the United States is growing posting an estimated inflow of $7.1bn — or 0.5% of assets — in January, according to TrimTabs Investment Research and hedge fund data vendor BarclayHedge.”

Housing Wire – “Failed Banks May Get Pension-Fund Backing as FDIC Seeks Cash” (3-8-10)

“The Federal Deposit Insurance Corp. is trying to encourage public retirement funds that control more than $2 trillion to buy all or part of failed lenders, taking a more direct role in propping up the banking system, said people briefed on the matter.”

Bloomberg – “Vineyard Defaults Surge as Bargain Wines Hurt Napa” (3-8-10)

“In California’s Napa Valley, producer of the most expensive U.S. wines, 2010 may be a vintage year for foreclosures as the industry is squeezed by falling land values and a consumer shift to cheaper brands. As many as 10 wineries and vineyards in Napa will change hands in distressed sales or foreclosures this year and next, up from none in 2008, according to Silicon Valley Bank.”

Looking Back:

One year ago, the number of borrowers who defaulted after the first payment tripled. The Government predicted a 10.3 percent unemployment rate. 650,000 jobs dissapeared in one month.

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The Norris Group Real Estate News Roundup 3/5/10

Friday, March 5th, 2010

Today’s News Synopsis:

According to Callahan & Associates, the credit union industry originated $95bn from residential mortgages in 2009. The Labor Department reports that 36,000 jobs were lost in February. Chris Kotowski predicts that Fannie Mae and Freddie Mac may force other lenders to to buy back $21 billion of home loans this year. $4.1 billion in lending was sought from the Federal Reserve throughout the last six months.

In The News:

Business Journal – “Tiny supply builds hope for housing industry” (3-5-10)

“Existing homes listed for sale are in shorter supply here on a per-capita basis than in 18 major metro areas, including Chicago, Dallas and Atlanta. And unlike areas where condo towers proliferate, such as Las Vegas, the Southern California coast and south Florida markets, Sacramento has among the fewest finished-but-vacant new homes in the country.”

Wall Street Journal – “Study Sees FHA Taking More Risk” (3-5-10)

“economists warn that the Federal Housing Administration—which has jumped to fill the void left by the collapse of the private mortgage market—is overlooking factors that signal higher losses, according to a working paper released Thursday. The agency has traditionally turned a profit for the U.S. government. But the economists warn that by underestimating the risks it faces, the FHA has increased the likelihood that it will have to ask Congress for money for the first time in its 75-year history.”

Housing Wire – “Credit Unions Originate $95bn in Residential Mortgages in 2009″ (3-5-10)

“The credit union industry originated $95bn in residential mortgages in 2009, taking a 4.5% share of the nation’s total mortgage market. Including the mortgages written last year, the nation’s 7,710 credit unions originated more than $271.9bn in new loans, a 7.1% increase over 2008, according to data released by Callahan & Associates, a Washington, DC-based financial consulting firm that specializes in the credit union industry.”

Housing Wire – “Unemployment Holds at 9.7% in February” (3-5-10)

“The economy lost 36,000 jobs in February and the unemployment rate held at 9.7%, according to the Labor Department’s Bureau of Labor Statistics monthly report. The 9.7% unemployment rate is steady from January, but up from February 2009’s rate of 8.2%. The U-6 unemployment rate, which includes not only those without jobs, but also the underemployed, was 16.8% in February, up from 16.5% in January, but down from December’s 17.3%. A year ago, the U-6 unemployment rate was 15%.”

Housing Wire - “Bair: Too Soon to Know How Successful HAMP Will Be” (3-5-10)

“It is true that the numbers of trial and permanent modifications have lagged behind program projections. But at the same time, we saw a slowdown in the pace of new foreclosures in the second half of last year.”

Bloomberg - “Fannie, Freddie Ask Banks to Eat Soured Mortgages” (3-5-10)

“Fannie Mae and Freddie Mac may force lenders including Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co. and Citigroup Inc. to buy back $21 billion of home loans this year as part of a crackdown on faulty mortgages. That’s the estimate of Oppenheimer & Co. analyst Chris Kotowski, who says U.S. banks could suffer losses of $7 billion this year when those loans are returned and get marked down to their true value. Fannie Mae and Freddie Mac, both controlled by the U.S. government, stuck the four biggest U.S. banks with losses of about $5 billion on buybacks in 2009, according to company filings made in the past two weeks.”

Bloomberg - “Fed’s TALF Winds Down With Most Loan Requests in Six Months” (3-5-10)

“The Federal Reserve received the most loan requests in six months from investors for the final round of its program that unlocked the market for asset-backed securities. About $4.1 billion in lending was sought, including $1.8 billion for financing of student-loan securities, the New York Fed said yesterday on its Web site. In total, about $7.1 billion of sales this week were of securities that included eligible classes, according to data compiled by Bloomberg.”

Bloomberg - “Fed Presidents Say Rates Need to Be Low Early in U.S. Recovery” (3-5-10)

“Two regional Federal Reserve Bank presidents, speaking before today’s release of a February report on U.S. jobs, said they believe the central bank should keep rates low until the recovery picks up.”

Inman - “Hitwise: Zillow reclaims No. 2 spot” (3-5-10)

“Zillow eked out a tiny edge over Yahoo Real Estate in February to reclaim its title as the second-most visited real estate site on the Web, according to rankings compiled by Web metrics firm Hitwise. Zillow, which was bumped into third place by Yahoo Real Estate in December, captured 3.43 percent of traffic in the real estate category during February, Hitwise said, compared to 3.4 percent for Yahoo Real Estate. Realtor.com retained its top spot on the Hitwise top 10 list, with 6.67 percent of traffic in the category.”

Looking Back:

One year ago, the Mortgage Bankers Association asked to have the 105 percent LTV limit raised. The MBA observed an increase in delinquencies on mortgage loans. The NAA reported that gross receipts for real estate auctions grew about 1.1.

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The Norris Group Real Estate News Roundup 3/4/10

Thursday, March 4th, 2010

Today’s News Synopsis:

Bruce Norris claims that the government’s aid will not be enough to prevent the U.S. economy from sliding back into recession. The NAR reports that national pending home sales decreased by 7.6 percent in January. According to Trepp, commercial real estate delinquencies decreased in February. The delinquency rate for Fannie Mae loans increased to 5.38% last month.

In The News:

Orange County Register – “Hear why housing will slump again” (3-4-10)

“Norris tells ocregister.com in a podcast interview that he believes that all the government aid that’s going to the housing market won’t be enough to keep real estate — and the entire economy — from sliding back into a second wave of recessionary conditions.”

NAR - “Pending Home Sales Down; Severe Weather Impacting Market” (3-4-10)

“The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in January, fell 7.6 percent to 90.4 from an upwardly revised 97.8 in December, but remains 12.3 percent higher than January 2009 when it was 80.5.”

CBIA - “Metro Regions” (3-4-10)

“Curious about housing numbers for a particular area of the state? This is the place to find all the numbers for an individual area.”

Recordnet.com – “Region’s future bright, experts say” (3-4-10)

“San Joaquin County, as well as the entire San Joaquin Valley, holds tremendous potential for growth even as it struggles to emerge from the recession, a panel of development experts, business and government leaders said Wednesday. The county could see gains of more than 30,000 new jobs in the next three years, paying wages and benefits of $1.5 billion.”

Housing Wire – “Valeo Fund Targets $1trn in Maturing Commercial Mortgages” (3-4-10)

“The private equity firm Valeo Fund is recruiting investors to go after $1trn of commercial mortgages set to mature between 2010 and 2013. The move comes as opportunities are begin to hit the entire commercial market, which has been bracing for struggles.”

Housing Wire – “Commercial Mortgages Showing Signs of a Brighter Road Ahead” (3-4-10)

“The blistering climb of commercial real estate delinquency rates, which crossed the 6% threshold in December, started to slow in February, according to the analytics firm Trepp, which monitors collateral performance on related commercial mortgage backed securities (CMBS). The amount of commercial loans at least 30-days delinquent grew 23 basis points (bps) to 6.72% in February, the smallest increase in six months.”

Housing Wire – “General Growth Gets Extension for Reorganization, Plans NYSE Re-listing” (3-4-10)

“A bankruptcy judge granted mall real estate investment trust (REIT) General Growth Properties (GGP: 1.05 0.00%) a nearly five-month extension period to file a plan of reorganization for the company to exit bankruptcy.”

Housing Wire – “Fannie Single-Family Mortgage Delinquencies Grow to 5.38%” (3-4-10)

“The serious delinquency rate at government-sponsored enterprise (GSE) Fannie Mae (FNM: 1.005 +2.11%) rose nine basis points (bps) to 5.38% in the single-family mortgage book. Its a slight increase from 5.29% last month.”

Housing Wire – “Freddie Says Mortgage Rates Dip Below 5%” (3-4-10)

“Freddie Mac said the average interest for a 30-year fixed-rate mortgage was 4.97% with a 0.7 origination point for the week ending March 4, down from 5.05% one week ago. Last year at this time, the 30-year FRM averaged 5.15%.”

Housing Wire – “Home Prices Continue Climb from 2009 Levels: Clear Capital” (3-4-10)

“US home prices climbed 5% in February from a year ago, despite an incoming wave of REOs that could saddle the market for another three years, according to the Clear Capital Home Data Index. Prices grew on a yearly basis for the first two months of 2010. The 5% uptick in February bested the 2.3% yearly increase in January. However, prices remained unchanged on a rolling quarterly basis.”

Looking Back:

One year ago, the MBA reported that mortgage applications decreased by 12.6 percent within one week. Statistics from First American CoreLogic showed that 20 percent of mortgages were underwater. Radar Logic claimed that foreclosures increased home sales by approximately 7 percent during 2008. Federally regulated banks filed 62,084 reports of suspected mortgage fraud during the mid-summer of 2008.

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The Norris Group Real Estate News Roundup 3/3/10

Wednesday, March 3rd, 2010

Today’s News Synopsis:

Bruce Norris estimated that lenders may lose up to $2.1 to 3.8 trillion before all the bad loans are taken off their books. According to the MBA, mortgage application volume increased from last week. The FHFA reports that Orange County home values increased by 6.38 percent in 2009. Last year, nearly 1,400 lawsuits were filed against lenders by homeowners in foreclosure.

In The News:

Press Enterprise – “Loan losses from home foreclosures could more than double” (3-3-10)

“Lenders who already have realized $1.5 trillion in losses due to home foreclosures could see their losses mount to an estimated $2.1 trillion to $3.8 trillion before all the bad loans are wiped off their books, a Riverside real estate expert told a gathering over the weekend. Bruce Norris, a real estate analyst, investor and principal of the Riverside-based Norris Group, told more than 400 real estate brokers and investors meeting in Costa Mesa Saturday that he had compiled these figures from data and estimates he obtained from ForeclosureRadar.com, Bloomberg Financial, Goldman Sachs, the International Monetary Fund, RGE Monitor and T2Partners.”

Mortgage Bankers Association – “Mortgage Refinance Applications Increase in Latest MBA Weekly Survey” (3-3-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 26, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 14.6 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 15.5 percent compared with the previous week.”

Orange County Register – “O.C.: Hottest U.S. housing market?” (3-3-10)

“Orange County home values — by one FHFA index that derives values from purchase records — rose 6.38% in 2009. That’s tops among the 25 major U.S. markets tracked by this methodology. Yes, O.C. is No. 1! We’re followed by Denver (+5.48%); Houston (+3.71%); and Pittsburgh (+3.26%).”

Sign On San Diego – “Hefty tax bill may hit those who lost home” (3-3-10)

“With less than six weeks before taxes are due, an estimated 16,000 former homeowners statewide will owe $15 million in extra income taxes this year and $29 million through 2012.”

Mercury News – “Increasing numbers of Californians are suing lenders to avoid foreclosures” (3-3-10)

“In the last five years, the number of foreclosure lawsuits filed in federal court in California has ballooned — like an exploding adjustable-rate mortgage — from only 29 statewide in 2005 to nearly 1,400 last year.”

Housing Wire – “Winter Weather Slows Residential Real Estate Growth: Beige Book” (3-3-10)

“In the January Beige Book, all but two Fed districts reported increased activity or improved conditions, with Philadelphia and Richmond seeing mixed results. Residential real estate markets remained weak or softened further in the New York, Atlanta, and Chicago districts and there was little change in the San Francisco district, the Federal Reserve Board said.”

Orange County Register – “Why loan mods & short sales take so long” (3-3-10)

“Hard to collect all necessary documents from borrower/owner. This may be because the banks never seem to receive the documents until they’ve been faxed in 5 or 6 times. It may be because it takes the borrower/owner or agent some time to respond to requests for documents.”

Inman - “90% of agents down on HAMP” (3-3-10)

“A mere 10 percent of real estate agents think the Obama administration’s Home Affordable Modification Program (HAMP) is reducing foreclosures in their market, according to a survey released Wednesday by real estate media and marketing provider Homes and Land. The company’s Market Pulse Survey Report asked more than 100,000 real estate agents nationwide to participate in a 10-question survey to gauge the state of housing in local markets. Nearly 5,800 agents responded; 51 percent had been a Realtor for more than 10 years. The company conducted the survey in February.”

Looking Back:

One year ago, Citigroup developed a plan which allowed unemployed homeowners to decrease their monthly payment to a minimum of $500. The NAR reported that home sales decreased by 7.7 percent within a month’s time. Bernanke claimed that the federal government needed to increase its fiscal involvement in the banking system. The government launched its $1 trillion TALF program.

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The Norris Group Real Estate News Roundup 3/2/10

Tuesday, March 2nd, 2010

Today’s News Synopsis:

Based on results from a recent poll, 68 percent of U.S. citizens support the government’s involvement in the housing market. Fannie Mae announced plans to buy 150,000 to 200,000 delinquent loans from MBS trusts this month. Economist Jan Hatzius believes that we will not see an interest rate increase any time in the near future. Realtors advise that staging is a critical component of selling a home.

In The News:

NAHB – “Poll Shows Strong Support for Government Housing Initiatives” (3-1-10)

“Americans remain strongly committed to federal support for home buyers, according to a recent survey of U.S. households. Roughly 68 percent of those polled said the government should continue to support housing, and 65 percent believe the government should be doing more to keep families from losing their homes to foreclosure.”

Press Enterprise – “New Homes sip, don’t gulp, water” (3-2-10)

“The study found that homes built in 2009 consume 20 percent less water than homes built in 1990, with each house saving on average over 15,000 gallons a year. Also homes built to 2011 standards will further lower indoor water use by 21 percent, saving another 12,000 gallons a year.”

Housing Wire - “Fannie to Buy up to 200,000 Delinquent Mortgages in March” (3-2-10)

“Government-sponsored enterprise (GSE) Fannie Mae (FNM: 1.00 +1.01%) said Monday it expects to purchase from 150,000 to 200,000 delinquent loans out of single-family mortgage-backed security (MBS) trusts during March.”

Bloomberg – “Home-Price Drop in U.S. Supports Low-Rate Outlook: Chart of Day” (3-2-10)

“A possible relapse in home prices that had Fed policy makers concerned late last year may now be coming to pass, underscoring forecasts by economists such as Jan Hatzius that an interest-rate increase is a long way off.”

Inman – “Real estate Darwinism” (3-2-10)

“Today’s brokers and agents who survive and lead us out of this current mess are going to be those most willing to change. They will share three key attributes: they will be the most competent in their craft, utilize all available technology, and be the most dedicated to customer service. Undoubtedly, these changes will be fundamental. Externally, technology will continue to drive our industry change, and internally, change will be in the form of technology and reduced commissions. Sounds simple, but the transformation to the brokerage of 2020 will be drastic.”

Realty Times – “Focusing on the Median Price Can Be Misleading” (3-2-10)

“Many observers have noted that the rise in the median does not necessarily indicate a rise in prices in general. Rather, it is reflective of more activity at higher price ranges than had been experienced in the recent past. In many market areas, for the past year to year and-a-half the greatest activity – practically frenzy in some areas – has been at the bottom of the price ranges. This is not a surprise. Smaller condominiums and starter homes were generally what constituted the first wave of foreclosures on loans that never should have happened. More recently, though, the number of sales has increased in higher price ranges. As the effects of high unemployment and a staggering economy spread throughout the land, there are more sales – many of them distressed sales – of larger homes, ones that people expected to live in a long time.”

Realty Times – “Sellers: Staging is a Must” (3-2-10)

“As a seller, you want your home to make a positive first impression. In order to do this, you repair, clean, and strategize marketing for your open houses, but home staging takes it one step further. It allows the buyer both the mental space to imagine their own belongings in the rooms and the ability to get excited about the life they could have in your home.”

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The Norris Group Real Estate News Roundup 3/1/10

Monday, March 1st, 2010

Today’s News Synopsis:

California officials may be implementing new builder fees. Home sales generated $934 million from last year. Fannie mae lost 15.9 billion dollars during quarter 4 of 2009. Warren Buffet predicts the residential real estate market will begin to recover in 2011.

In The news:

Sacramento Bee – “Back-seat Driver: Sacramento proposes new-building fees for road projects” (3-1-10)

“Sacramento city officials today will propose a fee on new buildings – including up to $6,250 per single-family house – to help pay for $710 million in transportation projects over the next two decades.”

Orange County Register – “Best Jan. for real estate agents in 3 years” (3-1-10)

“Home sales generated $934 million, up 20.9% from January 2009, when sales generated $717 million. The lowest amount of revenue was generated in January 2008, when home sales totaled $670 million.”

Wall Street Journal – “Bid to Curb Mortgage Tax Break Falters” (3-1-10)

“President Barack Obama’s latest budget proposal, released in February, includes a provision that would shrink deductions for mortgage interest, real-estate taxes, charitable contributions and other items for married couples with annual incomes of more than $250,000, or individual filers earning more than $200,000. Under the proposal, such taxpayers would save 28 cents of tax liability for every $1 of mortgage interest or other eligible expenses, down from 35 cents now.”

Housing Wire – “A Dark Day for the Mortgage Industry” (3-1-10)

“the MBA, along with committee input from Fannie Mae, Freddie Mac (read: government) and others, are now pushing the U.S. Treasury to extend taxpayer-funded forbearances to unemployed owner-occupants. I say “taxpayer-funded” for a reason, as you’ll see. Under the MBA proposal, unemployed borrowers would be asked to make nominal payments equal to 31% of whatever their remaining income is – which for many millions of Americans without savings would be 31% of their unemployment benefits, not nearly enough to cover their usual mortgage. In exchange for whatever they can afford, borrowers would receive forbearances for up to 9 months – with the servicer continuing to advance full principal and interest to investors the entire time.”

Housing Wire – “Fannie Seeks $15bn of Aid After Quarterly Loss” (3-1-10)

“Government-sponsored entity (GSE) Fannie Mae (FNM: 0.99 0.00%) on Friday reported a $15.2bn net loss for Q409, narrowed slightly from a $18.9bn net loss in the previous quarter. The quarterly loss resulted in a net worth deficit of $15.3bn as of Dec. 31, 2009, according to the earnings statement”

Bloomberg - “Buffett Says U.S. Housing Will Recover by Next Year” (3-1-10)

“Billionaire Warren Buffett said the U.S. residential real estate slump will end by about 2011, predicting that’s how long it will take demand for homes to catch up with the supply. ”

Bloomberg - “General Growth Aims for Oct. 5 Exit Plan Confirmation” (3-1-10)

“General Growth Properties Inc., bankrupt owner of more than 200 U.S. malls from Boston to Los Angeles, aims to confirm a reorganization plan by Oct. 5, after taking 60 days to consider proposals that compete with one from Brookfield Asset Management Inc.”

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