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218-TNG Radio – Leslie Appleton-Young 3-25-11

Friday, March 25th, 2011

Leslie Appleton-Young

Vice President of C.A.R.

(Full Bio)


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This week Bruce is joined again by Leslie Appleton-Young. She is the Vice President and Chief Economist for the California Association of Realtors; a statewide trade organization with over 165,000 members. Leslie directs the activities of the association’s member information groups, she oversees the analysis of housing markets and broker industry trends, member communications and member development activities.  She is well known as a speaker in the California real estate community.

UCLA’s business school has projected that California’s unemployment will remain in the double digits until 2013. This does not surprise Leslie. We are experiencing cyclical job losses, because there are few sectors that have not been impacted. To some extent, our problem is structural. Sending jobs over seas to lower wage countries has been occurring for a long time.

During the downturn of the 90s, there were job losses concentrated in California due to a loss of migration. Leslie does not believe this is our main problem though. Our biggest issues are coming from the restructuring of corporations and businesses. 70% of costs are directly tied to labor, so the easiest way to become more efficient is to use fewer workers.

Leslie is uncertain of the impact that gas prices will have on real estate. Gas affects real estate because it impacts the overall economy. High prices means there will be less discretionary income available for purchasing. The cost of gas also impacts the ability of people to move further out. The UCLA forecast assumed there would be no significant long term reductions in gas supply, and that we would be able to weather the increases, but we do not know that.

Affordability is close to an all time high. The gap between California’s affordability and the U.S.’s affordability is much closer now as well. The California median home price peaked at $594,000, and the U.S. peaked at $230,000, so we were still over twice as expensive. California’s current median is $300,000, and the U.S. median is $170,000, so there is still a big gap between the two.

Bruce believes this all time low for housing affordability is going to give us a boost in migration. The challenge will be to provide job opportunities for the migration.

In a county like Riverside, where it is common to develop 250 to 300 subdivisions every year, there is going to be a huge increase in demand. The inventory that has been bought from lower priced years will be able to increase in value. Bruce notes that Riverside has only developed 10 subdivisions this year.

There has been a significant increase in household size over the last couple years, because families have been moving in with each other to weather the bad economy. Many people who chose to move in with their family will be looking to move once the economy improves, and that will create demand.

In another five years, Leslie believes down payment requirements and interest rates will be significantly higher. Getting rid of Fannie Mae and Freddie Mac will affect us for many years. The private sector will be demanding higher risk premiums to originate.

A number of surveys from Fannie Mae and others show that many people still aspire to own a home. Leslie does not believe this will change. However, financing will become a bigger burden. Leslie does not believe 30 year mortgages will be very popular in the future. Bruce believes that we must be heading towards a lower percentage of home ownership.

In business, when you have an advertising campaign that you know will work, that is called a control piece. The only way you change that control piece is by changing one thing at a time to see if something emerges as better or worse. We had a control piece called a zero down VA loan. This program produced less than 1% foreclosures, and FHA did the same thing for a long time. Unfortunately, we changed everything about how we performed loans within 5 years, and we got a bad result. Bruce does not understand why we won’t go back to the way things were before.

In 2005, the GSE delinquency rate was 7.8%, and the private label delinquency rate was 28.6%. In 2006, GSEs had a delinquency rate of 23.3%, and the private label delinquency rate was 45.1%. For loans originated in 2007, the GSE rate was 14.9%, and the private label rate was 42%. This information must have been overlooked by the people discussing what to do with our financial system in the future. Fannie and Freddie worked until 2005 and 2006 when then decided to get into the subprime and Alt-A market. Bruce is not sure if our sufferings would have been eased much had Fannie and Freddie not gotten involved in subprime lending. If they had not touched subprime, there still would have been a large amount of inventory being overpriced because of the easy financing available at that time. What we did wrong was pretend that it was okay to loan people money based on a stated income and without a down payment.

39% of defaults between 2006 and 2008 were due to home equity borrowing. Leslie does not believe it is healthy for people, as well as the real estate market, to borrow in such a way that they owe more on their home after a year of ownership. Bruce does not totally agree with that, because in the past that behavior was not as simple. Leslie believes it is bad for people to leave themselves no cushion. Bruce agrees with this statement.

In 1934, FHA did 80% LTV loans with 20 year terms. Gradually we went to 30 year terms, and the down payment requirements went to 10, to 5, to even 3%.

Bruce is concerned that if we lower loan limits, it will cause a significant price drop, and then you will have a continuous negative equity position. Bruce and Leslie hopes the government does not restrict the market too much in this manner. Leslie has noticed that the government’s decisions tend to be imbalanced.

When Bruce bought his first home and mowed the grass for the first time, it made him feel like a man. Being an owner changed the way he felt about himself. It is a big deal, and it is one of the big reasons for why people come to California.

Bruce was very frustrated when the president of MERS was questioned in front of the senate, because not one of the senators read his deposition. If you are going to make a huge decision against a very influential company like MERS, why not take an hour to try and understand the problem?

CAR’s website is www.car.org

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 3/21/11

Monday, March 21st, 2011

Today’s News Synopsis:

Existing home sales dropped 9.6%, according to the NAR. A San Joaquin County investor pleaded guilty to rigging foreclosure auctions, and is now facing a federal prison sentence and $1 million in fines. LPS claims the current mortgage delinquency rate is 8.8%.

In The News:

NAR - “February Existing-Home Sales Decline following Sustained Gains” (3-21-11)

“Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, dropped 9.6 percent to a seasonally adjusted annual rate of 4.88 million in February from an upwardly revised 5.40 million in January, and are 2.8 percent below the 5.02 million pace in February 2010.”

Housing Wire – “California pending home sales spike in February” (3-21-11)

“The California Association of Realtors’ Pending Home Sales Index rose 20.6% in February to 112.1 from 93 in January. The index uses 2008 housing market activity as a baseline because it represents a more normal level of purchases and sales. An index reading of 100 corresponds with activity in 2008.”

Recordnet.com – “Guilty plea in home auction rigging” (3-21-11)

“A San Joaquin County investor pleaded guilty Friday in federal court to charges he illegally rigged bids with others at home foreclosure auctions in Stockton, the U.S. Attorney’s Office in Sacramento reported. Gregory L. Jackson is the sixth defendant so far to plead guilty in the federal probe. He faces a federal prison sentence and $1 million in fines under terms of the negotiated plea deal.”

Orange County Register – “‘Normal’ new-home market is 3-5 years off” (3-19-21)

“We decided to add Southern California (especially the O.C. market) into our business plan since we believe this market has bottomed. In today’s home building market, there is an imbalance between used and new homes in Orange County as a limited amount of new homes have been built over the last five years.”

Orange County Register – “Demand for O.C. homes at 7-month high” (3-21-11)

“Demand, the number of new pending sales over the past month, increased by 225 in just two weeks and now totals 2,982. At the beginning of the year, demand was at 1,856 pending sales. Since then, it has increased by 61%. Last year at this time there were 288 additional pending sales, propped up by the $8,000 first time homebuyer tax credit.”

Housing Wire – “Mortgage delinquency rate drops 18.4% annually: LPS” (3-21-11)

“Out of the 40 million loans evaluated by LPS last month, 8.8% qualified as delinquent (30 days or more overdue). That delinquency rate is down 1.2% from January and 18.4% from February 2010.”

Housing Wire – “Stress tests suggest economy may slide back into crisis: IRA” (3-21-11)

“Recent stress tests conducted by the Federal Reserve suggest the banking industry and economy ‘may be sliding back into crisis’ because of deflation in the housing sector, according to a new report from Institutional Risk Analytics.”

Housing Wire – “Moody’s expects temporary GSE exemption from mortgage risk rules” (3-21-11)

“Analysts at Moody’s Investors Service said Monday regulators may exempt Fannie Mae and Freddie Mac from upcoming mortgage risk retention rules – at least temporarily.”

Housing Wire – “Distressed property sales decline on foreclosure issues facing servicers” (3-21-11)

“Overall, investors stepped up their homebuying game last month even as distressed property sales fell, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. The report shows the HousingPulse Distressed Property Index — a barometer of distressed home sales — fell to 47.3% in February from 49.6% in January.”

Bloomberg – “Treasury to Sell Mortgage-Backed Holdings at Up to $10 Billion Per Month” (3-21-11)

“The U.S. Treasury Department plans to wind down its $142 billion portfolio of mortgage bonds guaranteed by Fannie Mae and Freddie Mac by selling as much as $10 billion per month.”

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 3/9/11

Wednesday, March 9th, 2011

Today’s News Synopsis:

Mortgage applications increased 15.5% last week, according to the MBA. UCLA economists predict California’s unemployment rate will remain above 10% until 2013. Freddie Mac’s level of REO properties has grown 145.7% over the past two years. Obama threatened to veto bills terminating the Federal Housing Administration’s Short Refi and the Department of Housing and Urban Development’s Emergency Homeowner Loan Program.

In The News:

Mortgage Bankers Association – “Mortgage Applications Increase in Latest MBA Weekly Survey” (3-9-11)

“Mortgage applications increased 15.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending March 4, 2011.”

Los Angeles Times – “California labor market recovery to go more slowly than predicted, report says” (3-9-11)

“The state’s unemployment rate will remain in double digits until early 2013, according to a report slated for release Wednesday by UCLA’s Anderson School of Management . That’s three months later than the university’s economists forecast in December, as California’s weak housing market continues to weigh on the region’s recovery.”

Housing Wire – “AARP sues HUD over reverse mortgage foreclosures” (3-9-11)

“A reverse or Home Equity Conversion Mortgage allows the borrower, who must be at least 62 years old, to convert a portion of the equity in the home for cash. No repayment is required until the borrower no longer uses the home as a principal residence or does not meet the obligations of the loan, often in the event of death.”

Housing Wire – “Cleveland Fed economist calls for toxic asset bad bank” (3-9-11)

“James Thomson, vice president and financial economist for the Federal Reserve Bank of Cleveland, believes regulators can ease the pain of future financial meltdowns by creating a bad bank to acquire all toxic assets, including underperforming mortgages.”

Housing Wire – “Freddie Mac implores mortgage servicers to reach borrowers early” (3-9-11)

“Freddie announced it will use a new scorecard to measure how its mortgage servicers perform beginning in the third quarter. The change is part of a wider revamp of how Freddie will manage its 1,400 servicing companies and monitor how they put troubled mortgages through the loss mitigation process.”

Housing Wire – “Freddie Mac hires two REO servicers to help handle rising inventory” (3-9-11)

“The partnership is designed to manage expected increases in REO inventory, Freddie Mac said. At the end of February, the GSE said,the level of its REO properties grew 145.7% in just two years. In 2008, REO inventory was 29,346 compared to 72,093 homes in 2010.”

Housing Wire – “Obama threatens to veto bills killing foreclosure programs” (3-9-11)

“The House Financial Services Committee voted last week approving two bills that would terminate the Federal Housing Administration’s Short Refi and the Department of Housing and Urban Development’s Emergency Homeowner Loan Program.”

Bloomberg - “Hotel Purchases Will Soar on Rising Room Rates, Jones Lang LaSalle Says” (3-9-11)

“Hotel rates will gain this year as a recovery in business travel fills more rooms, lodging companies including Marriott International Inc., the biggest hotelier in the U.S., said yesterday in Berlin. Leisure travel is also rebounding after consumers trimmed spending during the recession. Revenue per room in the hotel industry rose worldwide in 2010, according to researcher STR Global.”

Looking Back:

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.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 2/11/11

Monday, February 14th, 2011

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.”\

Looking Back:

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.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 2/9/11

Wednesday, February 9th, 2011

Today’s News Synopsis:

The MBA reports mortgage applications decreased 5.5% last week. Zillow claims national home prices dropped 2.6% during the 4th quarter of 2010. Bernanke and Geithner said the economy is still having trouble, but have strong hope for stable growth.

In The News:

Market Watch – “10 reasons to be bullish on housing” (2-9-11)

“housing follows jobs. Consumer confidence is close to reaching last spring’s high point, the most optimistic the U.S. has felt since 2008. And while hiring hasn’t restarted in earnest, firing has slowed to a drip.”

Mortgage Bankers Association – “Mortgage Applications Decrease as Rates Jump in Latest MBA Weekly Survey” (2-9-11)

“The Market Composite Index, a measure of mortgage loan application volume, decreased 5.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3.9 percent compared with the previous week.”

NAR - “GSE Structures Must Protect Taxpayers and Ensure Mortgage Availability, Says NAR” (2-9-11)

“The House Financial Services Subcommittee will convene today for the first hearing in a series to debate the future of the government-sponsored enterprises, Fannie Mae and Freddie Mac. NAR’s recommended plan is to restructure the entities as government-chartered, non-shareholder owned authorities that protect taxpayers and ensure continued access to affordable mortgages for consumers who are willing and able to assume the responsibilities of the American Dream of home ownership.”

CNN - “30% of mortgages are underwater” (2-9-11)

“Home prices dropped 2.6% nationwide during the last three months of 2010, pushing more borrowers underwater, according to a quarterly real estate market survey from Zillow.com.”

Housing Wire – “Bernanke: Lagging real estate drags down investments” (2-9-11)

“During his testimony, the Chairman said while unemployment remains high, evidence of a ‘self-sustaining recovery’ driven by consumer and business spending has surfaced in economic data. He added that real consumer spending grew at an annual rate of 4% in the fourth quarter.”

Housing Wire – “Academics challenge Fed to create real jobs this time around” (2-9-11)

“According to the Labor Department’s Bureau of Labor Statistics, unemployment fell to 9% in January, though many critics point out that number does not include the amount of workers who have had pay scaled back or even those who have given up looking.”

Housing Wire – “Geithner: Weak housing, unemployment stifle economic recovery” (2-9-11)

“U.S. Treasury Secretary Timothy Geithner says the nation’s economic recovery is still plagued by high unemployment and a weak housing market, but he’s confident policy makers will address the nation’s current needs by raising the debt ceiling.”

Looking Back:

One year ago, Altera Real Estate foresaw significant improvement in the Orange County real estate market. National home prices returned to 2004 levels. Forecasters from iEmergent expected approximately $580 billion in mortgage refinancing during 2010.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 1/18/11

Tuesday, January 18th, 2011

Today’s News Synopsis:

19,528 new and resale houses and condos sold in Southern California last month, according to MDA DataQuick. LPS reports the average foreclosure in California and Nevada has been delinquent 461 days. December’s default rates for first and second mortgages were 2.93% and 1.74%.

In The News:

Dr Housing Bubble – “Financially dreaming in California” (1-16-11)

“Over half of Californians with a mortgage spend more than 30 percent of their income on housing costs. By prudent standards this is spending too much on housing. Of course housing pundits would like you to believe that this is somehow okay and justified but the massive amount of people unable to pay their mortgages in the state tells you that many are unable to support their current home”

Los Angeles Times – “Lawyer advises foreclosed clients to break back into their homes” (1-14-11)

“The 58-year-old attorney admits to breaking into homes at least half a dozen times, including one before with the Earls, leaving the clients to squat in their homes while he defends their legal right to possession. His unconventional methods have gotten him fined by a judge in San Diego, arrested in Newport Beach and threatened with contempt — and jail — in Ventura.”

Brisbane Times – “Fed eyed US housing bubble in 2005, didn’t prick” (1-15-11)

“US Federal Reserve staff and policy makers identified a housing bubble in 2005, and failed to alter a predictable path of interest-rate increases to slow down the expansion of mortgage credit, transcripts from Open Market Committee meetings that year show. Led by then-Chairman Alan Greenspan, the FOMC raised the benchmark lending rate in quarter-point increments to 4.25 per cent from 2.25 per cent at the end of December 2004.”

Market Watch – “Housing: U.S. economy’s Achilles’ heel” (1-15-11)

“CIBC World Markets chief economist Avery Shenfeld was even more pessimistic, saying he believes the weak housing sector will be a drag on consumer spending in the second half of the year. Shenfeld said he is forecasting economic growth to average 2.6% in 2011, as consumers will be forced to be cautious as home prices are declining.”

MBA DataQuick – “Southern California Home Sales End 2010 Up from November, Down from ‘09″ (1-18-11)

“Last month 19,528 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was up 20.5 percent from 16,208 in November, but down 12.5 percent from 22,328 in December 2009, according to DataQuick Information Systems of San Diego.”

San Francisco – “Homebuilder sentiment index unchanged in January” (1-18-11)

“The National Association of Home Builders said Tuesday that its monthly reading of builders’ sentiment was unchanged in January at 16, where it’s been since November. While it remains the highest reading since June, any reading below 50 indicates negative sentiment about the market. The index hasn’t been above that level since April 2006.”

Yahoo – “What delays a mortgage foreclosure” (1-18-11)

“according to LPS Applied Analytics, in Jacksonville, Fla. Loans in foreclosure in Florida, New Jersey, Hawaii and Maine have been delinquent more than 500 days, on average, while home loans in California and Nevada have been delinquent 461 and 427 days, respectively. In the two speediest states, Nebraska and Wyoming, loans in the foreclosure process are delinquent by an average of 358 days.”

Housing Wire – “Focused on Dodd-Frank, SIFMA sees GSE reform down the road” (1-18-11)

“Substantial reform of Fannie Mae and Freddie Mac remains one or two years away according to a conference call hosted by the Securities Industry and Financial Markets Association. The reason for this is mainly logistics. Reform of the government-sponsored enterprises will need to wait while the rest of the financial services industry begins to put forth its interpretation of the otherwise wide-reaching Dodd-Frank Act.”

Housing Wire – “Mortgage defaults decline in December” (1-18-11)

“For mortgages, the data shows a turnaround in month-on-month behavior. December’s monthly default rates for first and second mortgages stand at 2.93% and 1.74% respectively. In November mortgage defaults were on the rise, with default rates for first and second mortgages at 3.05% and 1.80% respectively.”

Housing Wire – “Fannie Mae, Freddie Mac to consider new fee structure for mortgage servicers” (1-18-11)

“Servicers are currently paid a minimum servicing fee that is part of the mortgage rate, which the FHFA said, is not ‘optimal’ for the best work on nonperforming mortgages for either the borrower or the government-sponsored enterprises. The FHFA said the new structure will improve servicing for borrowers, reduce the financial risk of the servicers and give the GSEs more flexibility when managing the loans.”

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 1/4/11

Tuesday, January 4th, 2011

Today’s News Synopsis:

Nearly 5% of Freddie Mac’s single-family mortgages are seriously delinquent. The FOMC chose to keep the federal funds target rate between 0 to 0.25%. Office buildings added 2.5 million square feet of occupied space in the 4th quarter, according to REIS. The U.S. Bureau of Labor Statistics reports jobless rates rose in 49% of all U.S. metro areas.

In The News:

Yahoo - “10 resourceful real estate tips for 2011″ (1-4-11)

“If your home has been on the market far too long, there’s a good chance you’re not facing market realities. The value of your home isn’t what the tax assessor says it is, or the sum on that two-year-old appraisal you have filed away. It’s not what a similar-size home that sold across town. It’s what a buyer is willing to pay today.”

Housing Wire – “Freddie Mac’s seven facts about the foreclosure process” (1-4-11)

“Freddie owns or guarantees 12.4 million single-family mortgages, and roughly 500,000 are seriously delinquent, roughly 10% of all serious delinquencies in the industry. However, Freddie reported $13.5 billion in homes that were already repossessed through foreclosure, adding $6.8 billion in the third quarter.”

Housing Wire – “FOMC minutes show little motivation to change QE2, ZIRP” (1-4-11)

“At its Dec. 14 meeting, the FOMC chose to keep the federal funds target rate at next to nothing – 0% to 0.25% — as it has for two full years now, and maintained plans to reinvest principal payments from its securities holdings into about $75 billion of long-term Treasury securities each month through the end of the second quarter.”

Housing Wire - “BofA pact represents 44% of total Fannie repurchase claims” (1-4-11)

“Fannie Mae said the agreement reached with Bank of America regarding repurchase requests on mortgages sold to the GSE by Countrywide Financial Corp. addresses about 44% of the $7.7 billion in repurchase claims the company had outstanding with all of its seller servicers as of Sept. 30.”

Housing Wire – “Amherst finds mortgage market underestimates looming defaults” (1-3-11)

“Mortgage-backed securities analysts at the fixed income dealer took a look at $1.3 trillion in outstanding nonagency mortgages from a year ago to see how they’re doing as of November 2010. They found that the $485 billion of nonperforming loans, those more than 60 days delinquent, dropped to $414 billion through either modification or liquidation.”

Bloomberg - “U.S. Office Market Has First Gain in Occupied Space Since 2007, Reis Says” (1-4-11)

“Office buildings added 2.5 million square feet (232,000 square meters) of occupied space in the fourth quarter, compared with a loss of 14 million square feet a year earlier, Reis said in its report. It was the first rise in net absorption since the fourth quarter of 2007.”

Bloomberg - “Wall Street Banks Preparing $4 Billion of Commercial Mortgage-Bond Sales” (1-4-11)

“Deutsche Bank and UBS are teaming up to issue as much as $2.5 billion in commercial mortgage-backed securities linked to loans on office buildings, shopping malls and hotels in what would be the largest offering of its kind since the market froze in June 2008, according to a person familiar with the deal. JPMorgan plans to sell $1.5 billion in similar debt, a person familiar with that sale said.”

Inman - “Broker launches first-time-buyer education site” (1-4-11)

“A Portland, Ore.-based real estate broker has launched a national homebuyer education website. FearlessHomebuyer.com walks first-time homebuyers through the real estate transaction process, from deciding whether or not to buy, to obtaining financing, to estimating fix-up costs.”

Inman - “Jobless rates rise in 49% of U.S. metros” (1-4-11)

“Metropolitan areas in California continue to register the highest unemployment rates in the nation, according to the latest figures released today from the U.S. Bureau of Labor Statistics. Of the 13 metros with unemployment rates above 15 percent in November, 11 were in California.”

Looking Back:

One year ago, forty percent of national home sales were foreclosures or short sales. Economists and real estate experts were complaining that Obama’s $75 billion foreclosure prevention program had damaged the market. The CIRB reported that builder permits for single-family houses fell 3.5 percent. According to The Institute for Supply Management, most companies showed an increased rate of expansion in December 09.

For m ore information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 12/16/10

Thursday, December 16th, 2010

Today’s News Synopsis:

6,111 new and resale houses and condos were sold in the Bay Area last month, according to MDA DataQuick. Freddie Mac reports the 30-year mortgage rate has rose again to 4.83%. Statistics from CoreLogic show home prices declined 3.93% in October from July. Three members of congress introduced a bill which may put an end to the use of MERS by GSEs.

In The News:

DQNews - “Bay Area November Home Sales, Median Price Down from a Year Ago” (12-16-10)

“A total of 6,111 new and resale houses and condos were sold in the nine-county Bay Area last month. That was down 0.2 percent from 6,122 in October and down 11.2 percent from 6,878 in November 2009, according to MDA DataQuick of San Diego.”

NAHB - “Housing Starts Rise 3.9 Percent in November” (12-16-10)

“Nationwide housing starts rose 3.9 percent in November to a seasonally adjusted annual rate of 555,000 units from an upwardly revised number in the previous month, according to newly released data from the U.S. Commerce Department. This marked the first upward movement in new-home production since August, and was entirely attributable to a nearly 7 percent gain in single-family home building.”

Housing Wire – “Government guarantee expected for one-third of MBS in 2011″ (12-15-10)

“Government-backed bond issuer Ginnie Mae’s share of mortgage-backed securities issuance should reach 32% in 2011, continuing a steady growth seen after the financial crisis of 2008, Deutsche Bank analysts said.”

Housing Wire – “Jobless claims down slightly to 420,000″ (12-16-10)

“The Labor Department said the seasonally adjusted figure of actual initial claims for the week ended Dec. 11 fell by 3,000 from the previous week’s upwardly revised figure of 423,000.”

Housing Wire – “Freddie Mac: mortgage interest rates rose again last week” (12-16-10)

“The government-sponsored enterprise said its primary mortgage market survey showed the average rate for a 30-year, fixed mortgage rose to 4.83% for the week ending Thursday from 4.61% a week earlier. The rate is now at the highest level since May. The average rate for a 15-year, fixed mortgage increased to 4.17% from 3.96% the prior week, according to the Freddie Mac survey.”

Housing Wire – “Home prices down for third straight month: CoreLogic” (12-16-10)

“Home prices declined 3.93% in October from the previous three months, the third straight report of declines as any hope for a recovery in early 2011 begins to fade, according to data from CoreLogic (CLGX: 18.26 +1.00%).”

Housing Wire – “Bill aims to end GSE affiliation with MERS” (12-16-10)

“Three congressional representatives recently introduced a bill into the House that would gradually phase out the use of Mortgage Electronic Registration Systems, commonly called MERs, within the government-sponsored enterprises as well as Ginnie Mae.”

Housing Wire – “Foreclosure inventories rise as delinquencies drop in November: LPS” (12-16-10)

“Lender Processing Services (LPS: 30.03 -0.23%) said the delinquency rate for loans that are 30 or more days past due, but not in foreclosure was 9.02% in November, down nearly 3% from October and down 15.6% from November 2009.”

Bloomberg - “Builders Probably Began Work on More U.S. Houses Following October Plunge” (12-16-10)

“Housing starts climbed 6 percent to a 550,000 annual rate, according to the median estimate of 76 economists surveyed by Bloomberg News. Work slumped in October to the slowest pace since April 2009’s record low. Building permits, a proxy of future construction, may have also increased.”

Bloomberg - “Banks Push Fed to Curb Borrowers’ Right to Rescind Mortgages” (12-16-10)

“Mortgage firms are pressing the Federal Reserve to curb homeowners’ right to invalidate loans based on flawed documents — a right consumer groups say is one of the few weapons borrowers have to battle unfair lending.”

Bloomberg - “U.S. Foreclosure Filings Drop to Two-Year Low Amid Lender Delays” (12-16-10)

“A total of 262,339 U.S. properties received default or auction notices or were seized in November, down 21 percent from October and 14 percent from a year earlier, RealtyTrac said in a report today. Those were the biggest monthly and annual declines since the Irvine, California-based data company began reports in January 2005. One in every 492 households got a filing.”

Looking Back:

One year ago, the Wall Street Journal reported that people were increasingly willing to abandon mortgage payments for becoming renters. Housing starts climbed almost 9%. The FDIC offered some reprieve from securities accounting rules for the next year. The Bureau of statistics released their real earnings report stating that average hourly earnings fell by .5%.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor event calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 200 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 12/07/10

Tuesday, December 7th, 2010

Today’s News Synopsis:

UCLA economists expect unemployment to remain above 10% until the end of 2012. TransUnion predicts the national mortgage delinquency rate could fall below 5% in 2011. A survey from RealtyTrac shows 60% of Americans believe housing will not recover for another 2 years. According to HOPE NOW, 1.54 million permanent mortgage modifications were completed in the first 3 quarters of this year.

In The News:

The Press Enterprise – “Economic recovery to stay muted” (12-7-10)

“Unemployment in California should start to decline next year but is likely to remain above 10 percent until the end of 2012, an economic forecast released today found. The quarterly forecast from UCLA’s Anderson School of Management suggests that the state will see something in 2011 that has been lacking for more than two years: job growth.”

Wall Street Journal – “U.S. Mortgage Delinquency Rate Could Fall to 5% in ’11″ (12-7-10)

“The percentage of U.S. consumers who are delinquent on their mortgages could fall to about 5% by the end of 2011, from an expected 6.2% at the end of this year, according to a leading credit bureau. Even so, the proportion of consumers who are 60 or more days overdue on their mortgages would still be sharply higher than the historical range of 1.5% to 2%, according to TransUnion LLC, which analyzed about 27 million randomly selected consumer records from its database.”

Housing Wire – “JPMorgan sees GSE prepayment rates slowing in January” (12-7-10)

“The prepayment speeds on Fannie 15-year mortgages increased 5% last month from October, while Freddie prepayments climbed 8%, according to JPMorgan.”

Housing Wire – “Private mortgage modifications reach 1.5 million to date, 125,000 in October” (12-7-10)

“Hope Now, a private sector mortgage alliance, said the mortgage industry has completed more than 1.54 million permanent loan modifications for homeowners from January through October, as foreclosure suspensions affected foreclosure sales and starts.”

Housing Wire – “American homebuyers suffer from a crisis of faith: survey” (12-7-10)

“A housing conference call organized by real estate listing websites, Trulia and RealtyTrac, revealed 48% of potential homebuyers in America have lost faith in the ability of the mortgage industry and 24% percent lost faith in the ability of the government to manage said market.”

Bloomberg – “Half of Americans Say Home Recovery at Least Two Years Away” (12-7-10)

“Almost six in 10 U.S. adults say a housing recovery is at least two years away, and more than a third say flawed lender practices are partially to blame, according to a survey by Trulia Inc. and RealtyTrac Inc.”

Orange County Register – “Chapman says prospects dim for housing” (12-7-10)

“Although Chapman University foresees modest price gains and increased homebuilding in Orange County next year, lingering problems from the housing bust will continue to dog the market. The number of homes for sale will be large, defaults and foreclosures will grow and consumer anxiety will be high, according to Chapman University’s 2011 economic forecast.”

Looking Back:

One year ago, the MBA reported that delinquency rates increased during the third quarter for most mortgage investor groups. Bernanke claimed the recovery would continue for at least a year, but that the U.S. still had  some trouble to overcome. Six banks were shut down Friday, which would cost the FDIC a total of $2.384billion.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor event calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 200 podcasts in our free investor radio archive.

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The Norris Group Real Estate News Roundup 11/8/10

Monday, November 8th, 2010

Today’s News Synopsis:

The NAR reports FHA, Fannie Mae and Freddie Mac account for over 90% of the mortgage market. New California building codes, known as CALGreen, will be enforced on January 1st. Richard Fisher of the Dallas Federal Reserve believes the low interest rates are doing little to stimulate the economy. Fannie Mae acquired 85,340 REO properties in the 3rd quarter.

In The News:

Los Angeles Times – “Shared homeownership could mean paying your neighbors’ bills” (11-7-10)

“The Community Assns. Institute trade group recently reported that more than half of the nation’s 310,000 community associations are struggling with ‘serious’ or ‘severe’ financial woes. Some 59% of association managers reported that more than 3% of homes in their community groups were vacant, the study said, because the owners either had walked away from their mortgages or were unable to rent the homes. Some 65% of associations reported that more than 5% of their homeowners were delinquent on their monthly assessments.”

NAR - “Qualified Buyers Should Have Access to Credit, Say REALTORS®” (11-8-10)

“Currently, FHA, Fannie Mae and Freddie Mac account for more than 90 percent of the mortgage market. Lenders refuse to make loans unless FHA will insure them or the GSEs will buy them. Stricter FHA and GSE underwriting rules eliminate many buyers with credit scores as high as 750, and lenders are imposing credit overlays of their own, restricting the availability of credit.”

The Daily Journal – “Cities preparing for building standards to get more green” (11-8-10)

“Come Jan. 1, cities throughout California will be required to enforce the new California Green Building Standards Code, or the CALGreen Code. Finalized earlier this year by California’s Building Standards Commission and the Department of Housing and Community Development, the guidelines represent the first statewide mandatory green building code for newly constructed buildings in the nation.”

Housing Wire – “QE2 gives green light for yield in MBS” (11-8-10)

“Analysts said the decision by the Federal Reserve to purchase another $600 billion of Treasury securities ‘gives the green light for yield’ in mortgage-backed securities, and the central bank may consider purchasing MBS if spreads widen significantly.”

Housing Wire – “Fed adviser worries greater mortgage disclosures put borrower privacy at risk” (11-8-10)

“The Federal Reserve is working on proposals forcing lenders to submit more detailed mortgage loan information to the government, but regulators are juggling the need for more transparency and how that information could cost borrowers their privacy.”

Housing Wire – “Dallas Fed president: low interest rates won’t spark demand” (11-8-10)

“The environment of exceedingly low interest rates is great for banks, according to Richard Fisher, President of the Federal Reserve Bank of Dallas, but is doing little to help the overall economy get back on track.”

Housing Wire – “Monday morning cup of coffee” (11-8-10)

“Fannie Mae acquired 85,340 REO properties in the third quarter, up 23.9% from the amount acquired in the previous quarter, according to its quarterly financial statement released Friday.”

Bloomberg - “First-Time Mortgage Defaults in U.S. Rise for 1st Time in Year” (11-8-10)

“First-time defaults rose to 1.1 percent of previously ‘always performing’ mortgages based on payments due in September, up from 1 percent the prior month, according to a report from the Austin, Texas-based securities firm.”

Bloomberg - “Majority of Property Investors Plan Purchases as Prospects Rise” (11-8-10)

“Sixty percent of respondents said they plan to make commercial property purchases in the next year, mainly in their home markets, according to the report released by the Seattle- based adviser. Those looking abroad favor Hong Kong, Singapore, Sydney, London, New York, Washington, Chicago and San Francisco, the survey showed.”

Bloomberg - “U.S. Household Debt Shrank 0.9% in Third Quarter, Fed Says” (11-8-10)

“Consumer indebtedness totaled $11.6 trillion at the end of September, down $110 billion, or 0.9 percent from the end of June, according to the New York Fed’s quarterly report on household debt and credit. Households have slashed about $1 trillion from outstanding consumer debts since the peak in the third quarter of 2008, the New York Fed said.”

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor event calendar. You’ll also find our award-winning real estate radio show on KTIE 590am at 6pm on Saturdays or you can listen to over 170 podcasts in our free investor radio archive.

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