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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 3/3/10

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 2/26/10

Friday, February 26th, 2010

Today’s News Synopsis:

According to the NAR, existing home sales decreased by 7.2 percent in January. The rise in GDP exceeded the median forecast of economists surveyed by Bloomberg. Freddie Mac reports the 30-year FRM increased to a rate of 5.05 percent. A recently proposed plan from the Obama administration would give homeowners an extra 30 days after receiving the HAMP non-approval notice before the foreclosure sale can proceed.

In The News:

NAR - “Existing-Home Sales Down in January but Higher than a Year Ago; Prices Steady” (2-26-10)

“Existing-home sales – including single-family, townhomes, condominiums and co-ops – dropped 7.2 percent to a seasonally adjusted annual rate1 of 5.05 million units in January from a revised 5.44 million in December, but remain 11.5 percent above the 4.53 million-unit level in January 2009.”

CNBC - “Housing Recovery Is Looking A Lot Shakier Than Expected” (2-26-10)

“Even the optimists never expected a traditional housing recovery with unemployment stubbornly high, the consumer balance sheet still in repair mode and credit conditions stingy, but right now there’s palpable worry about momentum—especially given a string of solid months in mid- to late-2009.”

Bloomberg - “U.S. Economy Grew at 5.9% Annual Pace Last Quarter” (2-26-10)

“The U.S. economy expanded at a 5.9 percent annual rate in the fourth quarter, more than the government reported last month, reflecting stronger business investment and a greater contribution from inventories. The rise in gross domestic product, which exceeded the median forecast of economists surveyed by Bloomberg News, marked the best performance in more than six years, the Commerce Department said today in Washington. Inventories added 3.88 percentage points to GDP, more than previously reported, and investment in software and equipment grew at the fastest pace in almost a decade.”

Inman - “30-year fixed punches through 5 percent” (2-26-10)

“Rates on 30-year fixed-rate mortgages broke through the 5 percent mark this week for the first time in three weeks, Freddie Mac said in releasing the results of its weekly Primary Mortgage Market Survey. The 30-year fixed-rate mortgage averaged 5.05 percent with an average 0.7 point for the week ending Feb. 25, up from 4.93 percent last week but down from 5.07 percent a year ago.”

Housing Wire – “As Commercial Real Estate Weakens, Moody’s Considers Action on Related CDOs” (2-26-10)

“The credit rating agency Moody’s Investors Service put a total of $6.2bn of commercial real estate linked CDOs up for possible downgrade today, citing growing concerns over the ability of the underlying assets to continually perform.”

Housing Wire – “BB&T Originations Nearly Doubled in 2009″ (2-26-10)

“BB&T Corp. (BBT: 28.53 +1.06%) said it originated 72,500 mortgages through its retail operation, including 53,500 refinance loans and 19,000 purchase mortgages, a 97% increase from 2008’s origination level. In addition, BB&T said it closed 6,600 loans worth nearly $1.3bn Homeowners Affordability and Stability Plan, as known as the Making Home Affordable program, to help stave foreclosure for distressed borrowers.”

Housing Wire – “Homeowner Estimates as Good as Zillow? Appraisal Academics Think So” (2-26-10)

“When it comes to using the Zillow.com automated valuation model (AVM) to get a free listing price on a house, users may be getting what they paid for, according to a report published by the Appraisal Institute that finds the Web site overestimates the values on homes almost as often as the actual homeowners.”

Housing Wire – “Obama Aims to Prohibit Foreclosure to Give HAMP a Chance” (2-26-10)

“The Obama Administration is drafting a proposal that would prohibit foreclosure on delinquent mortgages until servicers get a chance to evaluate a borrower for the Home Affordable Modification Program (HAMP). According to the presentation to lenders obtained by HousingWire, the Administration would also give borrowers an extra 30 days after receiving the HAMP non-approval notice before the foreclosure sale can proceed.”

Housing Wire – “Republicans Say Government-Led Mortgage Modifications are a Failure” (2-26-10)

“The US Treasury Department launched HAMP in March 2009 to allocate capped incentives to servicers for the modification of loans on the verge of foreclosure. The $75bn program aims to modify 3-to-4m mortgages by the time it expires in 2012. Through January, participating servicers provided 116,000 permanent modifications, an increase from 66,000 in December. In November 2009, the Treasury initially estimated 375,000 permanent modifications by the end of the year.”

Realty Times – “Top Affordable U.S. Housing Markets” (2-26-10)

“The HOI [Housing Opportunity Index] showed that 70.8 percent of all new and existing homes sold in the final quarter of 2009 were affordable to families earning the national median income of $64,000, slightly higher than the previous quarter and near the record-high 72.5 percent set during the first quarter of 2009, according to a press statement from the National Association of Home Builders.”

Realty Times – “Commercial Real Estate Losses Could Reach $1 Trillion” (2-26-10)

“We estimate that between $800 billion and $1 trillion of losses to commercial real estate equity and debt will be realized over the next few years. The annual volume of commercial mortgage maturities is expected to increase each year through 2013, according to Ken Rosen, during the Commission’s first hearing on January 15, 2010.”

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The Norris Group Real Estate News Roundup 2/25/10

Thursday, February 25th, 2010

Today’s News Synopsis:

A CAR survey shows that 67 percent of home sellers chose to sell because of their inability to pay mortgage debt. The FHFA reports that U.S. home prices decreased by 1.2 percent in the fourth quarter. A survey shows that agents and brokers are growing increasingly pessimistic of the future of real estate. According to FHFA, the rate for 30-year FRMs increased to 5.1 percent in January.

In The News:

San Francisco Chronicle – “Newsom plan would defer up-front developer fees” (2-25-10)

“The mayor’s administration says the package of legislation, tentatively set to go before the Board of Supervisors’ land use committee March 15, would cut up-front costs for developers, making it easier to get financing in this recession. Newsom said his proposals would speed up start times on four specific projects by as much as two years, including the second tower in the One Rincon Hill development. Work on the four projects could start in two months, he said.”

CAR - “C.A.R. releases ‘2009-2010 Survey of California Home Sellers’” (2-25-10)

“Changes in family and employment status as well as adjustments to monthly mortgage obligations played significant roles in California’s homeowners’ decisions to sell their homes in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) ‘2009-2010 Survey of California Home Sellers.’ According to the report, 67 percent of all sellers in California did so as a result of difficulties related to meeting their mortgage obligation.”

Bloomberg - “Home Prices Decline 1.2%, Smallest Drop in Two Years” (2-25-10)

“U.S. home prices fell 1.2 percent in the fourth quarter from a year earlier, the smallest loss in two years, as a federal tax credit for homebuyers boosted demand. Prices were down 0.1 percent from the third quarter, the Federal Housing Finance Agency said today in a report. The year- over-year drop was the smallest since a 1.1 percent decline in 2007’s fourth quarter, the Washington-based agency said.”

Inman - “Agents, brokers less rosy on future” (2-25-10)

“Short-term views for the next three to six months deteriorated 2.89 percent, to 5.71, while long-term views for the next 12 to 18 months fell 4.1 percent to 6.32. The survey pointed to expected interest rate hikes, the poor jobs market, and the imminent April 30 deadline (for a home sale to be under contract) for the federal homebuyer tax credit program as participants’ major concerns.”

Housing Wire – “FHFA Mortgage Rate Tracker Posts Increase in January” (2-25-10)

“The average interest rate on conventional 30-year, fixed-rate mortgage (FRM) with a principal of $417,000 or less was 5.1% in January, an increase from 5.05% in December, the FHFA said. The average interest rate on 15-year FRM of $417,000 or less stayed at 4.54% in January.”

Housing Wire – “Delinquent CMBS Triples as Spreads Stabilize” (2-25-10)

“Realpoint reviewed more than $797bn in CMBS pools for the January report. The firm calculated a 5.76% delinquency rate for the pools reviewed, up from 5.22% in December. The rate jumped by more than four times the rate in January 2009, when 1.2% of the reviewed loans fell delinquent. June 2007 held the lowest delinquency rate recorded by Realpoint, at 0.2%.”

Housing Wire – “Bankers Propose Mortgage Forebearance for Unemployed” (2-25-10)

“The program would give incentives to investors and servicers (through Treasury’s TARP) that place unemployed borrowers in a forbearance plan for up to 90 days — a period that can be renewed twice based on borrower’s financial circumstances. This plan would put a borrower in forbearance for up to nine months, at which time (or earlier, at re-employment status) eligibility for a HAMP trial can be determined.”

Bloomberg - “General Growth Is Biggest Real Estate Fight Since Equity Office” (2-25-10)

“The battle for General Growth Properties Inc., owner of more than 200 U.S. malls from Boston to Los Angeles, is turning into the biggest real estate fight since sale of Sam Zell’s Equity Office Properties Trust. Westfield Group, a Sydney-based property investor with stakes in 55 U.S. retail centers, signed an agreement letting it assess General Growth’s finances, a person familiar with the pact said yesterday. That may put Westfield in position to vie for the bankrupt company’s assets as part of a contest already embroiling Simon Property Group Inc. and Brookfield Asset Management Inc.”

Bloomberg - “Obama May Prohibit Home-Loan Foreclosures Without HAMP Review” (2-25-10)

“The Obama administration may expand efforts to ease the housing crisis by banning all foreclosures on home loans unless they have been screened and rejected by the government’s Home Affordable Modification Program.”

Looking Back:

One year ago, existing home sales decreased by 5.3 percent. The MBA announced that mortgage loan application volume had decreased by 15 percent from the previous quarter. The Obama administration implemented a stress test of 19 banks. Bernanke claimed to be confident of the federal reserve’s ability to prevent inflation.

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The Norris Group Real Estate News Roundup 2/18/10

Thursday, February 18th, 2010

Today’s News Synopsis:

Freddie Mac’s weekly survey shows that mortgage rates dropped this week. According to MDA DataQuick, 4,853 new and resale houses and condos closed escrow last month in the Bay Area. The U.S. Treasury claims that its foreclosure prevention program has cut mortgage payments for approximately 947,000 homeowners. S&P estimates there are approximately 947,000 houses in shadow inventory, which will take nearly 3 years to sell.

In The News:

Market Watch – “Mortgage rates drop” (2-18-10)

“Mortgage rates fell again this week, with the 30-year fixed-rate mortgage dropping to an average 4.93%, according to Freddie Mac’s weekly survey of conforming rates, released on Thursday.”

DQNews - “Bay Area home sales fall; median price up from last year, down from December” (2-18-10)

“A total of 4,853 new and resale houses and condos closed escrow in the nine-county Bay Area last month. That was down 38.0 percent from 7,828 sales in December and down 3.9 percent from 5,050 sales in January 2009, according to MDA DataQuick of San Diego.”

Wall Street Journal – “More Households Benefit From Loan-Mod Program” (2-18-10)

“The U.S. Treasury said its foreclosure-prevention program has cut mortgage payments for about 947,000 households, at least temporarily.”

Inman - “S&P: Shadow inventory to grow” (2-18-10)

“Lenders are likely to add at least 1.75 million homes to their real estate owned (REO) property rolls that will take nearly three years to sell and put pressure on home prices, according to a new report from Standard & Poor’s Financial Services LLC.”

Housing Wire – “California Leads States In HAMP Mortgage Modifications” (2-18-10)

“The Treasury launched HAMP in March 2009 to provide capped incentives to servicers for the modification of loans on the verge of foreclosure. Nationwide, more than 116,000 permanent modifications took place through January, up from 66,000 modifications in December. There are more than 830,000 active trial modifications currently under the program. California led all states with more than 191,000 permanent and active trial modifications through January, according to the Treasury.”

Housing Wire – “House Prices Swing Up to Close 2009, Still Down from 2008″ (2-18-10)

“Radar Logic’s monthly Residential Property Index (RPX), a composite HPI of 25 major US markets, increased 0.2% from November 17 to December 17. It’s the first November to December increase the index has experienced since 2004. Prices increased 1.5% from October to November.”

Bloomberg - “Fed Officials Set Goal of ‘Eventual’ Exit From Housing Finance” (2-18-10)

“Central bankers are planning to eventually remove $1.43 trillion of housing debt from the balance sheet after critics such as Stanford University economist John Taylor accused them of straying beyond monetary policy. Philadelphia Fed President Charles Plosser said yesterday that the Fed’s purchases of housing debt expose it to demands from politicians to support other industries.”

Looking Back:

One year ago, the Commerce Department reported that housing construction decreased by 16.8 percent in January. The MBA’s weekly survey showed that mortgage application volume had increased. CAR statistics showed that 59 percent of the California population could afford a home.

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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 2/10/10

Wednesday, February 10th, 2010

Today’s News Synopsis:

The MBA reports that mortgage application volume decreased by 1.2 percent from last week. According to the NAHB, there were approximately 234,000 homes for sale at the end of 2009. Statistics from Zillow show that the national median price was $186,200 in Q409 of 2009. The total number of FHA-insured single-family mortgages in default reached 531,671 in Q409 of 2009.

In The News:

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

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 5, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 1.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.6 percent compared with the previous week.”

Wall Street Journal – “Spec Houses Rise as Builders Bet on Buyers Before Tax Credit Ends” (2-10-10)

“Houses typically take between four and six months to build, so the window to start construction is closing quickly. And current inventory is low. At the end of 2009, there were 234,000 homes for sale, the lowest level since April 1971, according to the National Association of Home Builders. It’s difficult to measure the total number of spec homes nationwide. But according to a survey conducted by John Burns Real Estate Consulting, based in Irvine, Calif., home builders have about three finished homes with no buyer per community. That’s up slightly from 2.8 finished homes in November but much lower than the peak of six finished homes in July 2008.”

Mercury News – “Bay Area home prices may drop, real estate firm warns” (2-10-10)

“The median estimated value of all Santa Clara County homes at the end of the fourth quarter was $568,401, up a fraction from $564,360 in the third quarter, Zillow reported. In San Mateo County, prices have already begun to fall. The median estimated value of all homes was $635,264 in the fourth quarter, down 0.68 percent from $639,600 in the third quarter. Home values fell in San Mateo County from September through December, Zillow said, after four months of increases from May through August.”

Housing Wire – “Zillow Warns on Double Dip in House Prices” (2-10-10)

“The Zillow Home Value Index put the national median price at $186,200 in Q409, a 5% decrease from Q408. Compared to Q309, prices declined 0.5% during the last quarter of 2009. The index is a measure of median home values of all single-family residences, condominiums and cooperatives, both on the market and not for sale. Q409 marked the 12th consecutive quarter of year-over-year declines, Zillow said.”

Housing Wire – “Defaults on FHA Mortgages Pass 9 Percent” (2-10-10)

“The default rate in the single-family FHA portfolio reached 9.12% in Q409, climbing from 6.82% in Q408, according to the Federal Housing Administration December monthly report. The total number of FHA-insured single-family mortgages in default reached 531,671 in Q409, a 66% increase from 319,741 in Q408. In that same period, modifications on FHA-backed loans increased 54% to 23,973 in Q409.”

Housing Wire – “Feds Outline Mortgage Securities Exit Strategy” (2-10-10)

“And according to Federal Reserve chairman Ben Bernanke, a series of policy wind-down methods are being tested. The Fed may first drain excess reserves built up over many months through extraordinary asset-purchase programs, and then begin to raise interest rates. Or the Fed could pursue both options simultaneous to facilitate a quicker exit. Ultimately, economic developments will determine the exit process.”

Housing Wire – “Freddie Mac Will Buy Out 120-Day Delinquent Mortgages” (2-10-10)

“Government-sponsored mortgage securitizer Freddie Mac (FRE: 1.24 +3.33%) said today it will buy ’substantially all’ mortgages delinquent by at least 120 days from the company’s related fixed-rate and adjustable-rate mortgage (FRM and ARM) Participation Certificate (PC) securities. Freddie said the loan purchases will show up in the PC factor report published after March 4, 2010. The corresponding principal payments on affected PCs will pass through to FRM and ARM PC holders on March 15 and April 15, respectively.”

Housing Wire – “Option ARMs Don’t Measure Up in HAMP: BofA” (2-10-10)

“Of all mortgage collateral sectors, pay-option adjustable-rate mortgages (ARMs) are the least modifiable under a federally-subsidized modification program, according to research Monday by Bank of America Merrill Lynch (BofAML). Researchers found that, in general, collateral with higher delinquencies see higher modification rates. But despite the wave of option ARMs set to recast monthly payments over the next several years, these types of loan fall in ‘the least modifiable sector’ under the Home Affordable Modification Program (HAMP) because of their failure to measure up to eligibility requirements and net present value (NPV) test requirements.”

Orange County Register – “Expect more price cuts on high end homes” (2-10-10)

“Data from 2009 MLS sales for Laguna Beach show that last year started out extremely slow. February 2009 recorded a record low of only 6 residential properties sold for the entire month. By contrast, buying activity picked up enough by year end that December was the highest single month of sales since May 2006.”

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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 2/5/10

Friday, February 5th, 2010

Today’s News Synopsis:

According to First American CoreLogic, 12 percent of mortgages in Sacramento, El Dorado, Placer and Yolo were seriously distressed in December. ZipRealty reports the national home inventory increased by 2.9 percent last month. The Department of Labor announced that the unemployment rate decreased to 9.7% in January. The FTC proposed a new rule which would prohibit third-party mortgage companies from charging upfront fees for foreclosure rescue and modification services.

In The News:

Sacramento Bee – “12% distress rate seen for region’s mortgages” (2-5-10)

“Twelve percent of mortgages in Sacramento, El Dorado, Placer and Yolo counties were seriously distressed in December, the newest warning that trouble is not abating, according to Orange County-based market analyst First American CoreLogic.”

The Washington Post – “Official says Fed might buy more mortgage-backed securities” (2-5-10)

“The Federal Reserve would consider reopening its program to support the mortgage market if interest rates spiked or the economy showed new weakness, Federal Reserve Bank of New York President William C. Dudley said in two new interviews. The Fed is buying $1.25 trillion in mortgage-backed securities in its effort to prop up the economy but has said it will end those purchases March 31.”

Inman - “For-sale inventory rises in January” (2-5-10)

“Monthly for-sale home inventory increased in January for the first time in 18 months, according to a report by national real estate brokerage company ZipRealty. The number of homes for sale increased 2.9 percent from December, an additional 15,818 homes, to a total of 567,265 single-family homes and condominiums listed in 27 metropolitan areas across the country. December saw 2009’s greatest fall in month-to-month inventory, down 4.83 percent.”

Housing Wire – “HUD Connects Sustainable Housing With Job Creation” (2-5-10)

“The new HUD initiative comes as the US unemployment rate lingers near historic highs. The unemployment rate dropped slightly to 9.7% in January from recent 10% highs, according to the US Department of Labor.”

Housing Wire – “Beazer Posts Quarterly Profit After $101m Tax Refund” (2-5-10)

“Homebuilder Beazer Homes (BZH: 4.16 +1.22%) reported income of $44.5m, or $1.09 per share, in its fiscal year first quarter that ended on December 31, 2009. It’s the second consecutive profitable quarter for the Atlanta-based builder. In its fiscal year Q409 that ended Sept. 30, Beazer reported a $35.3m profit. In the year-ago quarter, Beazer reported a loss of $79.2m.”

Housing Wire – “FTC Rule Bans Up-Front Fees on Mortgage Modifications” (2-5-10)

“The Federal Trade Commission proposed a new rule to prohibit third-party mortgage companies from charging upfront fees for foreclosure rescue and modification services. The FTC brought 28 cases against companies that charge a fee, promising the borrower a modification from the lender. The cases allege these companies never provided the services promised and that they misrepresent their affiliation with the government and other housing assistance programs, including the Home Affordable Modification Program (HAMP).”

Housing Wire – “Fed MBS Purchases 94% Complete with Another $12bn” (2-5-10)

“The Fed bought a total of $17.6bn in mortgage-backed securities (MBS) – $5.6bn Freddie Mac (FRE: 1.16 0.00%) MBS, $9.3bn Fannie Mae (FNM: 0.97 -1.02%) MBS and $2.7bn Ginnie Mae MBS, according to a summary of purchases. The New York Fed also sold $5.6bn of MBS in the same week, bringing the net purchases to $12bn, the same as last week.”

Realty Times – “Housing Affected by Demographic Trends” (2-5-10)

“The Urban Land Institute predicts there will be two major changes beginning in this new decade in our country that will affect the housing market. The first is that home appreciation will slow. The report predicts annual appreciation of 1 percent to 2 percent. The second change is that the record-high U.S. homeownership rate will decline from 69 percent to 62 percent.”

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