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California Real Estate Headline Roundup

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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 2/24/10

Wednesday, February 24th, 2010

Today’s News Synopsis:

The MBA reports that mortgage loan application volume decreased 8.5 percent from last week. According to the Commerce Department, purchases of new single-family homes decreased by 11.2 percent in January. Informa Research Services announced that the average interest rate on 30-year fixed-rate jumbos dropped to 5.79%. Freddie Mac’s net losses for 2009 ended at $25.7bn.

In The News:

Mortgage Bankers Association – “Mortgage Applications Decrease in Latest MBA Weekly Survey” (2-24-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 19, 2010.  The Market Composite Index, a measure of mortgage loan application volume, decreased 8.5 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 7.3 percent compared with the previous week.”

Los Angeles Times – “Jumbo mortgage market is beginning to thaw” (2-24-10)

“Two weeks ago, the average interest rate on 30-year fixed-rate jumbos dropped to 5.79%, a nearly five-year low, according to rate tracker Informa Research Services of Calabasas. It edged up to 5.88% on Tuesday, still very attractive by historical standards. The average is down from well above 7% in late 2008.”

Washington Post - “New home sales hit record low in January” (2-24-10)

“Purchases of new single-family homes dropped 11.2 percent in January from December to a seasonally adjusted annual rate of 309,000, the Commerce Department reported. Sales fell in every region of the country except the Midwest, and the raw number of new homes on the market rose for the first time in nearly three years.”

Inman - “CAR: Home prices up, sales down” (2-24-10)

“Median home prices increased 15 percent year-over-year in January, according to a report by the California Association of Realtors. Closed escrow sales of existing, single-family detached homes fell 10.6 percent year-over-year, to a seasonally adjusted annualized rate of 539,040 units, and fell 3 percent month-to-month, the report said.”

Housing Wire – “The GSEs Might Save Mortgage Rates After the Fed After All!” (2-24-10)

“Fed purchases since January 2009 consumed most of the new pass-through supply coming into the market from Fannie and Freddie (and a chunk of Ginnie’s too); Its demand has been a powerful tractor-beam pulling the spread between pass-through yields and mortgage rates over other high quality debt instruments to historic lows; Removing that demand could allow pass-through yields and mortgage rates to widen dramatically”

Housing Wire – “Backlog of California Homes Declines in January” (2-24-10)

“Nationwide, the credit rating agency Standard & Poor’s (S&P) estimated the “shadow inventory” of bank-repossessed properties, as well as distressed mortgages facing foreclosure, will take nearly three years to clear at the current national sales rate. As for the total amount of homes in the shadow inventory, Amherst Securities places the total at 7m. The Royal Bank of Scotland found 2.7m, and First American CoreLogic counted 1.7m.”

Housing Wire – “Freddie Mac’s Losses Narrow in Q409″ (2-24-10)

“Freddie Mac (FRE: 1.22 +1.67%) posted a loss of $7.8bn, or $2.39 per share, in Q409, bringing the government-sponsored enterprise’s (GSE) total loss in 2009 to $25.7bn. But Freddie said its net worth as of December 31, 2009 was $4.4bn, and no additional funding was required from the Treasury Department under the terms of the purchase agreement for the fourth quarter.”

Housing Wire – “NAR to Congress: Turn Fannie and Freddie into Non-Profits” (2-24-10)

“A trade organization for real estate agents, the National Association of Realtors (NAR) is recommending to Congress that the government-sponsored enterprises (GSEs) Fannie Mae (FNM: 1.02 +2.11%) and Freddie Mac (FRE: 1.22 +1.67%) be converted into non-profit secondary market authorities.”

Bloomberg - “Toll Says Loss Narrowed as Homebuilder Reduced Costs” (2-24-10)

“Toll Brothers Inc., the largest U.S. luxury-home builder, said its first-quarter loss narrowed as costs fell 31 percent. Orders almost doubled. The net loss for the three months ended Jan. 31 shrank to $40.8 million, or 25 cents a share, from $88.9 million, or 55 cents, a year earlier, the Horsham, Pennsylvania-based company said today in a statement. The average estimate of 10 analysts in a Bloomberg survey was for a loss of 29 cents a share.”

Looking Back:

One year ago, the CBIA announced that housing production fell to a record low. Ben Bernanke claimed that 2010 could be a year of recovery, if foreclosures stabilized. Case-Schiller reported that home prices declined at a record pace in the 4th quarter of 2009.

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The Norris Group Real Estate News Roundup 2/16/10

Tuesday, February 16th, 2010

Today’s News Synopsis:

According to MDA Dataquick, the median home price in Southern California decreased by 6 percent from December. CBIA reports that home sales in new communities decreased by 15 percent from last month. John Burns estimates that 5 million houses and condominiums with delinquent mortgages will end up in foreclosure over the next few years. TransUnion reports that mortages over 60 days delinquent increased to 6.89% in quarter four of 2009.

In The News:

NAR - “NAR’s HouseLogic: The Logical Source for Today’s Homeowners” (2-16-10)

“Today the National Association of Realtors® launched HouseLogic, a new, comprehensive consumer Web site about all aspects of homeownership. HouseLogic helps homeowners make smart decisions and take responsible actions to maintain, protect and increase the value of their homes. The free Web site helps homeowners plan and organize their home projects and provides timely articles and news; home improvement advice and how-to’s; and information about taxes, home finances and insurance.”

DQNews - “Southland home sales, median price edge above year-ago level” (2-16-10)

“Southern California home sales eked out a modest gain in January compared with a year earlier but fell sharply – as they normally do – from December. The median price paid rose above the year-ago level for the second consecutive month, but fell 6 percent from December as foreclosures and lower-cost inland markets claimed a higher share of sales, a real estate information service reported. A total of 15,361 new and resale homes closed escrow last month in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was down 31.2 percent from December’s 22,328, but up 0.9 percent from 15,227 in January 2009, according to MDA DataQuick of San Diego.”

CBIA - “California New-Home Market Ends 2009 in Lackluster Condition, CBIA Announces” (2-16-10)

“The monthly CBIA/Hanley Wood Market Intelligence (HWMI) New-Home Sales and Pricing Report showed that sales in new-home communities of 10 units or more were 15 percent below December 2008. While the decline was disappointing, it remains an improvement from most months in 2009 in which year-over-year declines were substantially larger. During December, 1,372 new homes and condominiums were sold in the subdivisions tracked by Costa Mesa-based HWMI, compared to 1,607 in December 2008. Sales of single-family homes were down by 25 percent, while sales of townhomes and ‘plexes’ – duplexes, triplexes, etc. – were off by 5 percent and sales of condominiums were 18 percent higher than a year ago.”

San Francisco Chronicle – “Resale prices steady for San Francisco condos” (2-16-10)

“San Francisco’s median resale condominium prices from November through January stayed steady from the same period a year ago, leading some analysts and real estate agents to conclude that values have settled into a range where they are likely to remain for some time. According to city data analyzed by the Polaris Group, a San Francisco real estate firm that crunches housing numbers, the median price for a resale condo in the city – as opposed to a newly built unit – was $638,000 in the threemonth period ending Jan. 31.”

Wall Street Journal – “Foreclosures Seen Still Hitting Prices” (2-16-10)

“The John Burns study estimates that five million houses and condominiums on which mortgages are now delinquent will go through foreclosure or related procedures that put them on the market over the next few years. That would represent the bulk of the estimated 7.7 million households behind on their mortgage payments.”

Housing Wire – “BofA Makes 12,700 HAMP Modifications Permanent” (2-16-10)

“Bank of America (BAC: 15.16 +4.91%) reported 12,700 permanent modifications under the Home Affordable Modification Program (HAMP) through January, an increase from 3,200 a month earlier. The US Treasury Department launched HAMP in March 2009 to provide capped incentives to servicers for the modification of loans on the verge of foreclosure. Through December, servicers provided 66,000 HAMP permanent modifications.”

Housing Wire – “Mortgage Delinquencies Rise for 12th Straight Quarter: TransUnion” (2-16-10)

“Mortgage delinquencies of 60 or more days rose for the 12th straight quarter, hitting a record high 6.89% in Q409, according to market research by credit bureau TransUnion. The rate of deceleration seen in previous quarters in the rise in delinquencies appears ’short lived,’ the credit bureau said. Year-over-year, the delinquency rate is up about 50% from 4.58% delinquent in Q408.”

Housing Wire – “Borrowers Overwhelmingly Pick Fixed-Rate Refinancings in Q4″ (2-16-10)

“Freddie Mac (FRE: 1.23 +0.82%) reported Monday that 95%of refinance loans during the last quarter of last year were of the fixed-rate variety. And while traditional 30-year fixed-rate mortgages are still the most preferred product among refinancings, 15-year fixed-rate mortgages gained favor among borrowers who previously held 30-year fixed-rate mortgages, balloon mortgages and adjustable-rate mortgages (ARMs), the GSE said in a statement.”

Bloomberg - “U.S. Homebuilder Confidence Rises More Than Forecast” (2-16-10)

“The National Association of Home Builders/Wells Fargo index of builder confidence increased to 17, higher than anticipated, from 15 the prior month, the Washington-based group said today. Readings below 50 mean most respondents view conditions as poor. ”

Looking Back:

One year ago, Congress considered making improvements to the $7,500 tax credit under the $789 billion economic stimulus package. A prediction was made that the 5 biggest banks would soon loose over $524 million.

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The Norris Group Real Estate News Roundup 2/8/10

Monday, February 8th, 2010

Today’s News Synopsis:

The U.S. Treasury Department reported 66,465 permanent loan modifications over 8 months. Delinquencies on prime jumbo loans increased to 10 percent in January. According to Altera Real Estate, distressed property sales increased in Dana Point and Laguna Beach. Unemployment in the U.S. construction industry increased to 24.7 percent in January.

In The News:

California Builder – “2010 Economic Forecast: The Bear Turns Bullish” (2-8-10)

“In April of 2009, we reversed our tune and called for a ‘W,’ which would be an improvement in the market until the tax credit expired. However, with the federal tax credit extended through June for all buyers, and affordability far better than we imagined at the time, the risk of a second leg down has been significantly reduced.”

Housing Wire – “House Committee Investigates HAMP ‘Effectiveness’” (2-8-10)

“The US Treasury Department launched HAMP in March 2009 to allocate capped incentives to borrowers for the modification of loans on the verge of foreclosure. After eight months in the program, the Treasury reported 66,465 permanent loan modifications in December, up from 31,382 permanent modifications in November.”

Housing Wire – “Fitch Says Prime Jumbo RMBS Near 10% Delinquent” (2-8-10)

“The performance of US prime jumbo loan performance within residential mortgage-backed securities (RMBS) slipped again in January as serious delinquencies (60+ days past due) rose for the 32nd consecutive month and edged closer to 10%, according to the latest market commentary from Fitch Ratings.”

Housing Wire – “Monday Morning Cup of Coffee” (2-8-10)

“The editorial argues the $111bn in mortgage losses covered by the Treasury Department was justifiable as an emergency measure to keep the housing market from collapsing entirely. But with continued losses projected in 2011 and 2012, covering the GSEs in perpetuity would cost more than $1.6trn, on top of the national debt of $12.3trn.”

Housing Wire – “BofA Lends $758bn in 2009″ (2-8-10)

“Bank of America (BAC: 14.48 -3.47%) said it extended more than $758bn in credit in 2009, including nearly $180bn in Q409. BofA originated $87bn in first mortgages to fund purchase or refinance loans for more than 400,000 borrowers in Q409. That total includes $23bn in mortgages made to 151,000 low- and moderate-income borrowers. For the year, BofA originated $378bn in first mortgages for more than 1.7m customers, including $87bn in mortgages to more than 561,000 low- and moderate-income borrowers. In Q409, BofA originated $3bn in home equity and reverse mortgage loans, bringing the total for 2009 to $13bn.”

Orange County Register – “South coast: short sales, foreclosures up” (2-8-10)

“Most of our south coast cities went against the grain and reflected the opposite of the countywide trend by seeing an increase in distressed properties for sale. Two weeks ago, Dana Point’s percentage of short sales and foreclosures was 24.7%, which has risen just slightly to 24.8%, according to a biweekly report by Steven Thomas of Altera Real Estate. Laguna Beach also saw a slight increase in distressed properties. The percentage of short sales and foreclosures rose from 9% two weeks ago to 9.3%.”

Orange County Register – “1-in-4 U.S. construction workers jobless” (2-8-10)

“The U.S. construction industry’s unemployment rate hit 24.7% in January as another 75,000 American construction workers lost their jobs.”

Realty Times – “Developing Referral Relationships” (2-8-10)

“The primary objective of your first contact, like the objective of any other first sales call to a new prospect, is to book an appointment. The first appointment might take the form of an exploratory session aimed at determining the wants, needs, and desires of the lead, or it might be an appointment to conduct a buyer consultation or listing presentation. The secondary objective of your first contact is to open the door, establish trust and respect, demonstrate your knowledge, and establish your position as a reliable resource.”

Looking Back:

One year ago, the MBA ranked Wachovia as the leading national commercial and multifamily loan servicer. Geithner promised that lenders receiving financial rescue would be required to offer mortgage modifications. A total of 70 banks were shut down within the first month of 2009.

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The Norris Group Real Estate News Roundup 1/13/10

Wednesday, January 13th, 2010

Today’s News Synopsis:

According to the CBIA, condominium sales were 39 percent higher from last year. The MBA’s weekly survey shows that mortgage loan application volume increased by 14.3 percent from last week. Jumbo residential mortgage-backed securities increased to 9.2 percent from December 2008 to December 2009. All but two of the Federal Reserve districts reported increased activity or improved conditions.

In The News:

CBIA - “California New-Home Market Dips Slightly in November, CBIA Announces” (1-13-10)

“The monthly CBIA/Hanley Wood Market Intelligence (HWMI) New-Home Sales and Pricing Report showed that sales in new-home communities of 10 units or more were 4 percent below November 2008, representing a less impressive result than last month’s year-over-year increase, but was nevertheless an improvement from most months in 2009. During November, 1,860 new homes and condominiums were sold in the subdivisions tracked by Costa Mesa-based HWMI, compared to 1,934 in November 2008. Sales of single-family homes were down by 18 percent, while sales of townhomes and “plexes” – duplexes, triplexes, etc. – were up 8 percent and sales of condominiums were 39 percent higher than a year ago thanks to strong sales at projects in the Los Angeles and San Diego areas.”

Mortgage Bankers Association – “Mortgage Refinance Applications Increase While Purchase Applications Remain Flat in Latest MBA Weekly Survey” (1-13-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending January 8, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 14.3 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 66.0 percent compared with the previous week, which was a shortened week due to the New Year’s holiday.”

San Francisco Chronicle – “State adopts greenest building codes in U.S.” (1-13-10)

“The new code, dubbed Calgreen, will take effect next January and requires builders to install plumbing that cuts indoor water use, divert 50 percent of construction waste from landfills to recycling, use low-pollutant paints, carpets and floorings and, in nonresidential buildings, install separate water meters for different uses. It mandates the inspection of energy systems by local officials to ensure that heaters, air conditioners and other mechanical equipment in nonresidential buildings are working efficiently. And it will allow local jurisdictions, such as San Francisco, to retain their stricter existing green building standards, or adopt more stringent versions of the state code if they choose.”

Housing Wire – “Prime Jumbo RMBS Delinquencies Swell to 9.2%: Fitch” (1-13-10)

“Delinquency of more than 60 days among prime jumbo residential mortgage-backed securities (RMBS) nearly tripled to 9.2% in December 2009, from 3.2% at the end of 2008, according to Fitch Ratings.”

Housing Wire – “GSEs Could Lose $448bn of MBS Guarantee Business, Says Amherst” (1-13-10)

“Losses on the combined credit-guarantee books of government-sponsored enterprises (GSEs) Freddie Mac (FRE: 1.41 +2.17%) and Fannie Mae (FNM: 1.14 +1.79%) could reach 9.6% – or $448bn – according to market analysis by Amherst Securities Group.”

Housing Wire – “Housing Sales Up, Prices Remain Steady: Beige Book” (1-13-10)

“All but two Fed districts reported increased activity or improved conditions, with Philadelphia and Richmond seeing mixed results. In the December 2 edition of the Summary of Commentary on Current Economic Conditions, commonly called the Beige Book, eight districts reported an uptick in their perspectives economy. The book is published eight times a year and is a nationwide economic indicator compiled from the 12 Fed districts.”

Housing Wire – “Government to Earn Billions on Bailouts” (1-13-10)

“The US Treasury Department expects profits of at least $19bn from bank investment programs under the Troubled Asset Relief Program (TARP), according to market commentary Wednesday by the American Bankers Association (ABA). Originally projected to cost $76bn according to the ABA, the outlook for TARP bank programs was updated in December in anticipation of actual profits.”

Housing Wire – “FinestExperts Ranks Top 2010 Real Estate Investment Markets” (1-13-10)

“FinestExpert.com named Dallas-Fort Worth as the hottest real estate investment market for 2010. After analyzing more than 10,000 real estate markets to identify stable, growth-oriented for investors, San Francisco-based FinestExpert.com formed its first top-20 hottest real estate investment market list for 2010.”

Housing Wire – “Cancelled Foreclosures Outnumber Sales in California: ForeclosureRadar” (1-13-10)

“The amount of California foreclosure cancellations increased 26.5% in December to 13,243, primarily due to loan modifications. And for the first time this number overtook foreclosures reaching real-estate owned (REO) status, according to ForeclosureRadar, which tracks foreclosure activity in the state. In December, the amount of foreclosures heading back to the banks, REO, dropped 11.9% from the previous month to 12,437. Significant declines in foreclosure discounts by lenders drove the decrease in sales to third parties, according to the report.”

Bloomberg - “Obama to Announce Fee on 20 Banks to Recoup TARP” (1-13-10)

“President Barack Obama will announce tomorrow his intention to impose a fee on roughly 20 of the country’s largest banks and financial institutions to help recoup taxpayer bailout money and trim the federal budget deficit. Obama will outline his proposal to raise as much as $120 billion at 11:45 a.m. local time at the White House, Obama’s press secretary, Robert Gibbs, told reporters. Gibbs said the president’s economic team has worked on a structure to prevent the levy from being passed onto consumers.”

Bloomberg - “Real Estate Bull Laub Sees Unprecedented Workout From Bad Debt” (1-13-10)

“Kenneth Laub has been through three commercial real estate boom and bust cycles during almost five decades as a broker and consultant to corporations such as Hess Corp. and International Paper Co. He says the current downturn will overshadow all of the others, Bloomberg Markets reports in its February 2010 issue.”

Looking Back:

One year ago, the NAHB encouraged congress to use a portion of the $700 billion bailout to increase credit for home purchases, and to stem foreclosures. California lost a total of 144,000 people from 2008 to 2009. Ben Bernanke warned that a fiscal stimulus would not cause an economic recovery. In November of 2008, 4 percent of homes were bought with adjustable rate mortgages.

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The Norris Group Real Estate News Roundup 12/23/09

Wednesday, December 23rd, 2009

Today’s News Synopsis:

Homebuilders pulled 46 percent fewer permits from November of last year. According to the Mortgage Bankers Association, mortgage application volume decreased by 10.7 percent from last week. Freddie Mac purchased 13 percent fewer mortgage purchases from the previous month. Equifax reports that HELOC originations fell 36 percent from one year ago.

In The News:

CBIA - “Housing Production Posts Decrease in November, CBIA Announces” (12-13-09)

“According to statistics compiled by the Construction Industry Research Board (CIRB), homebuilders pulled permits for 2,540 total housing units in November, down 12 percent from October, and down 46 percent from November 2008. Permits for single-family homes totaled 1,710, down 20 percent from the previous month, but up 18 percent from the same period last year, while multifamily permits totaled 830, up 9 percent from October but down 74 percent from a year ago.”

Mortgage Bankers Association – “Mortgage Applications Decrease in Latest MBA Weekly Survey” (12-23-09)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 18, 2009.  The Market Composite Index, a measure of mortgage loan application volume decreased 10.7 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 10.9 percent compared with the previous week.”

Housing Wire – “BofA Sues MGIC Over Unpaid Insurance Claims” (12-23-09)

“Bank of America’s (BAC: 15.18 -0.98%) Countrywide Home Loans unit sued Mortgage Guaranty Investment Corp. (MTG: 5.7798 -9.12%) over allegations the Wisconsin-based mortgage insurer denied millions of valid claims.”

Housing Wire – “Freddie Buys 7% More Refi Mortgages in November” (12-23-09)

“Mortgage giant Freddie Mac (FRE: 1.3295 -1.52%) reported $27.9bn in mortgage purchases and issuances in November, a 13% drop from $32.1bn in October, according to a monthly summary of the agency’s portfolio.”

Housing Wire – “HUD Delays New FHA Appraiser Guidelines” (12-23-09)

“According to an FHA memo obtained by HousingWire, the January 1, 2010 implementation of Mortgagee Letter (ML) 2009-28 (download here) won’t take affect until February 15, 2010. The new FHA regulations are similar to those implemented by the government-sponsored enterprises (GSEs) to ensure appraiser independence with the Home Valuation Code of Conduct (HVCC).”

Housing Wire – “Equifax: HELOC Origination Down 36%” (12-23-09)

“Origination of new home equity lines of credit (HELOC) accounts is down 36% from year-ago levels, Equifax (EFX: 31.28 -0.26%) said. There were 75,600 HELOC accounts originated in September 2009, down from 117,800 in September 2008, according to the Atlanta-based credit bureau’s most recent monthly credit trend report, derived from Equifax’s nearly 200m US consumer credit files.”

Bloomberg - “U.S. Economy: Spending and Incomes Climb, New-Home Sales Drop” (12-23-09)

“American consumers’ spending and incomes climbed in November, indicating the biggest part of the economy is poised to strengthen as the labor market recovers. Purchases rose 0.5 percent as households took advantage of discounts on autos and electronics, figures from the Commerce Department showed today in Washington. The gain was smaller than anticipated as unseasonably warm weather depressed utility use. Another report showed new-home sales unexpectedly fell as potential buyers were discouraged by the scheduled expiration of a tax credit. The tax break was later extended.”

Bloomberg - “General Growth Has Deals to Restructure $11.6 Billion of Debt” (12-23-09)

“General Growth Properties Inc., the second-largest U.S. mall owner, has won approval from creditors and a federal court to restructure loans totaling $11.6 billion, according to a lawyer.”

Looking Back:

One year ago, existing home sales fell 8.6 percent from October to November. Mortgage default filings against homeowners decreased for the first time in 3 years. Moorlach predicted that 10 municipal bankruptcies would occur in 2009. The U.S. economy shrank by 0.5 percent from the previous month.

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The Norris Group Real Estate News Roundup 10/1/09

Thursday, October 1st, 2009

Today’s News Synopsis:

The NAR’s Pending Home Sales Index shows that sales increased by 6.4 percent in August. Research from Deutsche Bank Securities shows that 26 percent of borrowers owe more than their home is worth. A $250,000, four-bedroom, 1700 square feet, three-bathroom house in Los Angeles made the nation’s list of most searched for homes. A survey shows that realtors are in favor of expanding the $8,000 dollar tax credit. Regulation Z changes are now in effect. FHA first-time borrowers may see hike in down payment requirements according to new legislation introduced.  Realtors are also interested in expanding first-time tax credit to repeat buyers. Does that mean investors? One could only be so hopeful.

In The News:

NAR - “Record Streak Continues for Pending Home Sales” (10-1-09)

“The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in August, rose 6.4 percent to 103.8 from a reading of 97.6 in July, and is 12.4 percent above August 2008 when it was 92.4. The index is at the highest level since March 2007 when it was 104.5.”

Bloomberg - “Leaving Affordable Mortgage May Become Winning Gambit” (10-1-09)

“In the U.S., 26 percent of borrowers owe more than their home is worth, said Karen Weaver, global head of securitization research for New York-based Deutsche Bank Securities. In parts of California, Florida and Nevada, it’s as high as 75 percent.”

Inman - “30-year fixed rate below 5% again” (10-1-09)

“Rates on 30-year fixed-rate mortgages for borrowers with good credit fell below 5 percent this week for the first time since May, Freddie Mac said in releasing the results of its Primary Mortgage Market Survey.”

Inman - “Lenders want one set of rules” (10-1-09)

“A draft bill floated by Rep. Barney Frank, D-Mass., would create an agency along the lines of the proposal put forward by the Obama administration in June, while attempting to address some lending-industry concerns. Unlike the Obama administration’s proposal, for example, Frank’s bill would not give the agency the power to require that lenders offer ‘plain vanilla’ mortgages.”

Orange County Register – “Property tax revenues flat nationwide” (10-1-09)

“The Census Bureau’s quarterly count of state and local government collections nationwide of taxes shows property-related taxes (that on land and structures) as well as personal propert levies) for the second quarter at $81.86 billion — the largest slice tracked by Census — and flat vs. a year ago.”

Realty Times – “Title, Escrow Services Necessary” (10-1-09)

“Title companies are hired, in part, to issue title insurance protection for home buyers and lenders. Lenders require the service to protect them against loss resulting from claims by others against your new home. The title company investigates the title to make sure it is clear of any encumbrances, such as liens or judgments, forgeries or fraud and any other title anomalies and then issues a policy to protect you from any claims that turn up later. Because title searches are conducted each time the home changes hands or, perhaps, during a refinancing, the searches rarely turn up title claims, but you have to pay for the search.”

Los Angeles Times – “Long Beach property joins the list of most-searched-for U.S. homes online” (10-1-09)

“Priced at $250,000, the four-bedroom, three-bathroom house with 1,768 square feet on 0.15 acres (6,650 square feet) continues to make the list.”

Housing Wire – “Regulation Z Changes Are Here” (10-1-09)

“The Federal Reserve’s new Regulation Z statutes went into effect Thursday, after more than a year of preparations by the mortgage industry. Regulation Z is a truth in lending regulation meant to protect consumers who buy higher-priced mortgages — those loans with annual percentage rates (APR) above the average prime offer rate for a comparable transaction by at least 1.5 percentage points for first mortgages or 3.5 percentage points for second mortgages.”

Housing Wire – “GSE REO Portfolio Near 100,000″ (10-1-09)

“Freddie’s portfolio is nearly 35,000 properties, while Fannie’s is closing in on double that figure at nearly 64,000. While the rate of growth in the two portfolios has declined, Freddie acknowledges it expects to experience further losses from REO properties.”

Housing Wire – “Realtors Favor Expansion of Tax Credit to Repeat Buyers” (10-1-09)

“Realtors indicated in a recent survey the first-time homebuyer tax credit up to $8,000 has had a significant impact on spurring consumer interest in getting into the housing market. Some even called for an expansion of the program past its current expiration date and to homeowners that do not yet qualify.”

Bloomberg - “FHA Borrowers May Need Bigger Down Payments in Bill” (10-1-09)

“Legislation introduced in the U.S. House of Representatives would require higher down payments from borrowers seeking federally backed loans as lawmakers try to prop up the Federal Housing Administration’s insurance fund.”

The Atlantic – “OCC Report Shows Mortgage Modification Trend And Woes” (10-1-09)

“As the chart below shows, in the first quarter of 2009 principal reduction was only used 3.1% of the time. In the second quarter, however, that percentage increased to 10%. That’s a pretty drastic increase, with one-in-ten modifications now reducing principal.”

Looking Back:

One year ago, FHA was given $300 billion dollars for a new foreclosure prevention program. The MBA’s weekly survey showed that mortgage applications had decreased by 28.4 percent from the prior year. Warren Buffett invested $3 billion dollars into General Electric. Foreclosures tripled in Los Angles during the third quarter.

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