Today’s News Synopsis:
Million dollar home sales in California increased by 21%, according to MDA DataQuick. Freddie Mac reports mortgage rates increased over 5% this week. The Treasury said half of all renters spend over 33% of their income on housing.
In The news:
DQNews - “First Gain in Golden State Million-Dollar Home Sales Since ’05″ (2-11-11)
“Last year 22,529 Golden State homes sold for $1 million or more. That was up 21.0 percent from 18,621 in 2009 and the highest since 2008, when 24,436 homes sold for $1 million-plus, according to San Diego-based DataQuick Information Systems. Million-dollar sales peaked in 2005 at 54,773, after which they declined each year through 2009.”
Los Angeles Times – “Obama administration releases plan for overhauling mortgage market, calls for phasing out Fannie Mae and Freddie Mac” (2-11-11)
“The 32-page plan calls for phasing in an increase in the down payment requirement for loans guaranteed by Fannie and Freddie to 10%, while reducing the maximum size of mortgages they can back — a move that would affect Southern California and other high-cost areas.”
CNN - “Mortgage rates break 5%” (2-11-11)
“The national average interest for a 30-year, fixed-rate mortgage surpassed 5% for the first time since May 2010, according to Freddie Mac’s Primary Mortgage Market Survey.”
Housing Wire – “Treasury report advocates slashing GSE jumbo loan ceiling” (2-11-11)
“Reducing conforming loan limits at Fannie Mae and Freddie Mac will help reduce the GSEs’ dominance in the mortgage market by driving jumbo mortgage financing back to the private sector for financing, the U.S. Treasury said in its ‘Reforming America’s Housing Finance Market’ report on Friday.”
Housing Wire – “FHA could replace Fannie, Freddie in rental housing market” (2-11-11)
“Half of all renters spend more than one-third of their income on housing, and 25% spend more than half of their income. For every 100 extremely low-income American families, 32 adequate rental homes are affordable for them, according to the Treasury white paper.”
Housing Wire – “Higher GSE guarantee fees may increase cost of homeownership” (2-11-11)
“The GSEs currently provide 95% of housing finance in the U.S.; any reductions of their involvement in supporting mortgages mean interest rates will have to go up to induce private lending”
Housing Wire – “SEC brings fraud charges against three former IndyMac executives” (2-11-11)
“The Securities and Exchange Commission charged three former IndyMac senior executives with securities fraud Friday.”\
According to the NAR, home sales increased in 32 states from the 3rd quarter of 2009. Statistics from the CBIA show that the construction industry currently provides only one sixth of the jobs it provided in 2005. Some speculate that Fannie and Freddie’s purchasing of debt could get rid of all mortgage debt within a year. RealtyTrac reports that foreclosure filings increased by 15 percent from last year.
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