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California Real Estate Headline Roundup

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The Norris Group Real Estate News Roundup 9/24/10

Friday, September 24th, 2010

Today’s News Synopsis:

Attorney General Brown is interfering with Ally Financial’s mass foreclosure operation, and may force the company to cease all foreclosure activity in California. Multiple government agencies have put out statistics on home sales. Freddie Mac’s total mortgage portfolio decreased 5.2% last month. Thirty-day delinquent inventory fell to 9.22%, according to LPS. S&P predicts the current level of shadow inventory will take 40 months to clear.

In The News:

Mortgage Bankers Association – “MBA Testifies on Potential Revisions to The Home Mortgage Disclosure Act (HMDA)” (9-24-10)

“One issue the Fed must keep in mind in determining what data elements to collect is that HMDA requirements should not turn into a safe harbor of allowable credit variables to be considered when making a loan. Freezing credit models into an official sanctioned set of variables would have a deleterious impact on credit availability going forward, limiting the growth of lenders who believe they have a better idea of how to do things. For example, over the years some lenders have come to believe that credit scores are not as important as the number of times a potential borrower has been late with housing-related payments. Some lenders now will simply refuse to make a loan to a borrower who has walked away from a previous mortgage, or appears to be positioning himself or herself for such behavior.”

Office of the Attorney General – “Brown Directs Nation’s Fourth Largest Home Lender to Suspend Foreclosures Until It Proves It Is Complying with the Law” (9-24-10)

“Recent reports indicated that the head of Ally Financial’s document processing team testified he routinely approved and signed foreclosure documents without confirming they were accurate and legally sufficient, as he was required to do. This admitted misconduct raises serious doubts about whether Ally Financial’s practices provide California borrowers facing foreclosure the protections guaranteed by law. Accordingly, Brown is demanding that Ally Financial, the fourth largest home loan institution in the country, demonstrate its compliance with California law or else halt all foreclosure operations in the state. Ally Financial earlier this week suspended evictions of homeowners and foreclosure sales in 23 states”

Mortgage Bankers Association - “MBA Applauds House Passage of National Flood Insurance Program Extension” (9-24-10)

“The Mortgage Bankers Association (MBA) applauded yesterday’s passage of legislation by the House that will extend the National Flood Insurance Program (NFIP) through September 30, 2011. The bill passed the Senate Tuesday and will now go to the President for his signature. Without agreement on an extension, the program was set to expire on September 30, 2010.”

CNN - “No mortgage mods for many of the jobless” (9-24-10)

“Unemployed homeowners cannot count jobless benefits as income when applying for mortgage modifications if they have loans backed by Fannie Mae. That could greatly limit their ability to get a long-term reduction in their monthly payments.”

Los Angeles Times – “New home sales remain at record low in August” (9-24-10)

“New single-family dwellings sold at a seasonally adjusted annual rate of 288,000 units, according to the Commerce Department. That estimate was flat compared with July’s pace, which remained a record low even after being revised up. The August pace was a 28.9% decline from the same month a year earlier.”

Housing Wire – “Census Bureau: August single-family sales fall 28.9% from year earlier” (9-24-10)

“Sales of new single-family homes in August fell 28.9% from a year earlier, according to the Census Bureau and Department of Housing and Urban Development. The Census Bureau said the seasonally adjusted rate of homes sales in August was 288,000, flat with July’s revised rate and well below the 405,000 a year ago. These federal figures are based on pending contracts of home sales.”

Housing Wire – “Freddie Mac mortgage portfolio continues four-month decline” (9-24-10)

“The Freddie Mac (FRE: 0.00 N/A) total mortgage portfolio decreased at an annualized rate of 5.2% in August after a 3.9% drop in June. The portfolio hasn’t seen an increase since April. Mortgage purchases and issuance at the government-sponsored enterprise reached $29.1 billion in August, up from $28.4 billion in July and down 39% from last year. The year-to-date total has reached $236.5 billion.”

Housing Wire – “August delinquency inventory falls on highest foreclosure starts since January: LPS” (9-24-10)

“LPS reported 282,528 foreclosure starts last month, up 1% from July and 3.8% higher than the year earlier. The year-to-date foreclosure rate is now 20.4% higher than 2009. Thirty-day delinquent inventory fell to 9.22%, the lowest level in over a year. The percentage was 9.3% in July and 9.7% a year ago. The inventory of 90-day delinquent loans decreased to 8.22%, down from 8.3% in July. The percentage was 8% a year earlier.”

Housing Wire – “$460 billion shadow inventory will take 40 months to clear: S&P” (9-24-10)

“The high pace of residential mortgage defaults has flooded the shadow inventory market with $460 billion in outstanding principal balance, according to Standard & Poor’s second-quarter report on housing liquidation timelines.”

Housing Wire – “JPMorgan to offer $1.1 billion CMBS” (9-24-10)

“JPMorgan is coming to market with $1.1 billion in commercial mortgage-backed securities notes across 13 classes, according to a pre-sale report from Fitch Ratings.”

Housing Wire – “August new home sales scrape bottom, remain flat month-over-month: NAFCU” (9-24-10)

“New homes sales remained flat month-over-month in August at 288,000 annualized units, according to a report released today by the National Association of Federal Credit Unions. Sales are scraping bottom at 28.9% less than one year ago and barely above the record low of 282,000 units in May.”

Housing Wire – “HFA delinquency rate hits record high in S&P report” (9-24-10)

“Delinquencies for housing finance agency loans increased 0.62% in the second quarter to 6.67%, according to a Standard & Poor’s report released today. This is the highest percentage the firm has seen since it started tracking such data in Q2 2006 and up 1.37% from Q209.”

Housing Wire – “White-collar criminals and unemployment income cut from HAMP eligibilty” (9-24-10)

“New guidelines from Fannie Mae and the Treasury Department out this week are restricting the eligible income of borrowers considered for the Home Affordable Modification Program. The mandates will also disqualify criminals convicted of certain white-collar offenses.”

Looking Back:

One year ago, research from the Construction Industry Research Board showed the number of home building permits taken in August was down 5 percent from July. The NAR reported that existing home sales decreased by 2.7 percent from July to August. A study showed that foreclosure prevention laws in California failed to significantly help home owners. The Federal Reserve intended to continue its stimulus plan and would continue to buy mortgage securities.

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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The Norris Group Real Estate News Roundup 4/27/10

Tuesday, April 27th, 2010

Today’s News Synopsis:

The S&P Index shows home prices increased in February. Speculators believe the Federal Reserve will keep interest rates at the current low. The LexisNexis Mortgage Asset Research Institute reports that fraud increased by 7 percent last year. According to the FHFA, the average interest rate for a 30-year fixed-rate mortgage (FRM) of $417,000 or less was 5.09% this month.

In The News:

Business Week – “Home price index shows 1st annual gain in 3 years” (4-27-10)

“Home prices in February posted their first annual increase since the end of 2006, pumped up by a temporary tax credits for homebuyers. The Standard & Poor’s/Case-Shiller home price index released Tuesday eked out a 0.6 percent gain, half the increase analysts had expected. And on a more cautionary note, 11 of the 20 cities tracked by the index showed declines from February last year.”

The Press Enterprise – “Fed expected to keep rates at record lows” (4-27-10)

“Confidence is growing that the economic rebound will strengthen. And to make sure it does, the Federal Reserve is considered certain to hold interest rates at record lows when it meets this week. ”

San Francisco Chronicle – “Mortgage fraud incidents rise 7 pct last year” (4-27-10)

“Incidents of residential mortgage fraud increased last year, a sign that scammers are still targeting the industry despite more diligent efforts to find and report such activity. The number of mortgage fraud reports among loans made in 2009 grew 7 percent, a smaller increase than the 26 percent jump seen the previous year, according to a study released Monday by the LexisNexis Mortgage Asset Research Institute.”

Housing Wire – “State HFAs Submit Proposals to Spend $1.5bn Hardest Hit Fund” (4-27-10)

“Three of the five state Housing Finance Agencies (HFAs) receiving $1.5bn from the Treasury Department through the Hardest Hit Fund released proposals on how they would spend the money. In March, the Treasury cleared the HFAs of states where house prices dropped 20% from the peak to submit proposals to use the funds from the Troubled Asset Relief Program (TARP).”

Housing Wire – “FHFA Sees Interest Rates Dip, Hover Around 5% in March” (4-27-10)

“The average interest rate for a 30-year fixed-rate mortgage (FRM) of $417,000 or less was 5.09%, down from 5.13% one month ago. The average rate for a 15-year FRM of $417,000 or less was 4.57%, down from 4.65%. The FHFA measured interest rates on loans that closed between March 25 and 31. Since the rate is typically determined 30 to 45 days prior to closing, the report depicts market conditions prevailing in mid- to late-February, the FHFA said.”

Housing Wire – “Fannie Extends REO Discount Deadline” (4-27-10)

“Fannie Mae (FNM: 1.21 -3.20%) extended its seller assistance incentive on all of its HomePath properties this week. In February, Fannie began providing a 3.5% discount to buyers of its REO properties listed as part of its HomePath division. The discount can be used for closing cost assistance or the buyer’s choice of appliances.”

Housing Wire – “Goldman’s Tourre Denies Misleading Investors in Subprime RMBS CDO” (4-27-10)

“An executive at embattled Goldman Sachs (GS: 153.04 +0.66%) denied before a Senate panel today that he misled investors in a synthetic collateralized debt obligation (CDO) tied to the performance of subprime residential mortgage-backed securities (RMBS). The Securities and Exchange Commission (SEC) is charging investment bank Goldman and the executive director of its structured products group trading, Fabrice Tourre, for allegedly making misleading statements about the CDO transaction, ABACUS 2007-AC1.”

Bloomberg - “‘Tourists’ May Leave Real Estate as Rates Rise, Sternlicht Says” (4-27-10)

“If interest rates head higher, ‘you will see a pause that will take a lot of capital out,’ he said. Corporate bonds may benefit, according to Sternlicht. A rebound in the real estate market is being hampered by weak demand and commercial-mortgage-backed financing that declined 95 percent last year from its record level in 2007. Vacancies in the first quarter rose to the highest level since at least 2000 at the nation’s biggest malls, and climbed to a 16-year peak at office buildings, research firm Reis Inc. said earlier this month. “

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The Norris Group Real Estate News Roundup 3/30/10

Tuesday, March 30th, 2010

Today’s News Synopsis:

According to the Standar & Poor Index, national home prices decreased by 0.7 percent from last year. Fannie Mae and Freddie Mac estimate that mortgage rates will rise less than a quarter of a percentage point in the next three months. Interest rates on conventional 30-year FRMs increased to 5.13% in February. The US Treasury Department will allocate $600 million to HFA for foreclosure prevention programs in California, Florida, Arizona, Michigan and Nevada.

In The News:

Google - “Home prices post smallest annual decline in 3 yrs” (3-30-10)

“Home prices showed the smallest annual decline in almost three years in January, indicating there are surprising areas of strength in the housing market. The Standard & Poor’s/Case-Shiller 20-city home price index fell just 0.7 percent from last year on a seasonally adjusted basis. The index reading of 146.32 was almost in line with analysts expectations, according to a survey by Thomson Reuters.”

Bloomberg - “Cheap Mortgages May Last as Investors Replace Fed” (3-30-10)

“The Federal Reserve’s completion this week of its program to buy $1.25 trillion in mortgage bonds probably won’t mean significantly higher U.S. home loan rates as investors return to the market, replacing the Fed. Fixed mortgage rates likely will rise less than a quarter of a percentage point in the next three months, the smallest increase for the second quarter since a drop in 2005, according to estimates by Fannie Mae and Freddie Mac. The gain would add about $30 to the monthly payment for a $250,000 mortgage.”

Housing Wire – “FHFA Sees Mortgage Rates Level with February 2009″ (3-30-10)

“Conventional mortgage rates continued to rise in February, according to the Federal Housing Finance Agency’s (FHFA) monthly rate report (download here). The average interest rate entered on a conventional 30-year fixed-rate mortgage (FRM) of $417,000 or less ticked up 3 basis points (bps) in February to 5.13%, from 5.1% in January.”

Housing Wire – “Treasury Releases Additional $600m to Five New State Housing Finance Agencies” (3-30-10)

“The US Treasury Department will expand the Hardest Hit Fund for state Housing Finance Agencies (HFAs) by allocating $600m to five additional states. The Treasury launched the initial $1.5bn through the fund to prevent foreclosures and stabilize local housing markets where prices have dropped at least 20% from their peak. California, Florida, Arizona, Michigan and Nevada are each working on plans to fund principal-forgiveness, unemployment and second-lien reduction programs.”

Orange County Register – “Builder raises new O.C. home prices” (3-20-10)

“According to DataQuick’s latest stats, month ended March 8, builders sold in Orange County 101 homes, up 26% in a year as median selling price rose 6% to $523,500. Builder prices for local new homes are 39% below their February ‘05 top.”

Realty Times – “Mortgage Rates Rise Ahead of Fed MBS Exit, 30-yr to 4.875″ (3-20-10)

“FreeRateUpdate.com research shows 30-yr fixed mortgages are available today at 4.875 percent to well-qualified consumers paying a standard .07 to 1 point origination. Today’s rate is slightly higher (+0.125) than what’s been obtainable for most of March. It’s not just the 30-yr fixed rate that’s up, as a result of a decline in mortgage-backed securities prices late last week, conventional mortgage rates are up on almost every program.15-yr fixed mortgages, previously available at 4.125 with standard origination, are available today at 4.25. 5/1 adjustable rate mortgages, previously available at 3.625, are now at 3.75.”\

Realty Times – “Weekend Do-it-Yourself Projects” (3-20-10)

“Spring is here at last, and like many other homeowners you may be looking for simple do-it-yourself projects to spruce up your home or to increase its value. Keep reading to get ideas on a few weekend updates and upgrades that are sure to be worth your while.”

Looking Back:

One year ago, analysts predicted a 10 percent drop in O.C. office rent rates. An FHA spokesman claimed that 7.5 percent of HFA loans were seriously delinquent. In February of 2009, nearly 250,000 homeowners received either mortgage modifications or repayment plans from their lenders.

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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 10/20/09

Tuesday, October 20th, 2009

Today’s News Synopsis:

RealtyTrac’s Rick Sharga believes that approximately 450,000 to 500,000 repossessed properties have not yet been placed on the market. Default notices in California have decreased by 10.3 percent from the previous quarter and have increased by 18.5 percent from last year. The Commerce Department reports that housing and apartment construction increased by .5 percent from last month.

In The News:

RealtyTrac – “The Case of the Missing REO Inventory” (10-20-09)

“With foreclosure activity breaking records nearly every month, where are all the REOs? It’s a fair question. In normal market situations, a bank will repossess a home and usually process it through to a listing agent to put on the MLS within 30 days. In a relatively short period of time, virtually every marketable REO property finds itself listed for sale on the local MLS. Today, that’s simply not the case; it’s likely that between 450,000 and 500,000 properties repossessed over the past year are still not on the market. And with buyers hungry for housing bargains, and agents and brokers champing at the bit ready to sell the properties, it begs for a reasonable answer.”

Broker Universe – “FHA Changes May Make HVCC and AMCs Easier to Swallow” (10-20-09)

“However, Mr. Stern believes appraisal management companies are hiring appraisers based on price – appraisers who have little knowledge of local market conditions. ‘I don’t think it’s fair that AMCs are hiring the cheapest appraisers,’ he said. Lenders One, the National Association of Realtors and appraiser groups are hoping new appraisal policies recently adopted by the Federal Housing Administration will correct some of the problems associated with HVCC and AMCs.”

DQNews - “California Mortgage Defaults Trend Down Again” (10-20-09)

“A total of 111,689 default notices were sent out during the July-through-September period. That was down 10.3 percent from 124,562 for the prior quarter, and up 18.5 percent from 94,240 in third quarter 2008, according to San Diego-based MDA DataQuick”

Cleveland - “Feds to probe ‘walkaways’ by some mortgage lenders” (10-20-09)

” Federal investigators will scrutinize the practice of lenders or mortgage companies walking away from homes they have foreclosed on. The U.S. Government Accountability Office plans to delve into these so-called bank walkaways – something some consider an alarming trend in the foreclosure crisis”

Wall Street Journal – “Home-Buyer Credit Is Focus of Inquiry” (10-20-09)

“The Internal Revenue Service is examining more than 100,000 suspicious claims for the first-time home-buyer tax break, another sign of potential trouble for the soon-to-expire program. The measure, adopted in February as part of the economic-stimulus bill, gives first-time buyers an $8,000 tax credit in an effort to boost sales and stimulate the moribund housing market. The program is set to end Nov. 30, but housing-industry leaders are lobbying Congress to extend it.”

Washington Post – “Small firms, home buyers to get a boost” (10-20-09)

“Under the program, the Treasury, along with mortgage financiers Fannie Mae and Freddie Mac, will buy the bonds used by housing finance agencies to fund mortgages, which can carry an interest rate that is a percentage point lower than loans made by private lenders. Called HFAs, these agencies have been strapped during the financial crisis because investors have been unwilling to buy their debt. The federal government is now attempting to play the role of the investors.”

Los Angeles Times – “Fewer home-building permits signal weakness ahead” (10-20-09)

“At the same time, the Commerce Department said Tuesday that construction of new homes and apartments rose 0.5 percent last month to a seasonally adjusted annual rate of 590,000 units. That was a weaker showing than the 610,000 economists had expected.”

NAR - “Housing Tax Credit Working, So Keep Momentum Going, NAR Urges Congress” (10-20-09)

“‘The data on the present home buyer tax credit show that the credit has had its intended impact—sales have jumped in recent months to a projected 5.1 million for the year and housing inventory has been trimmed, thus stabilizing home prices noticeably,’ Phipps said. He also pointed out that each home sale generates approximately $63,000 in additional economic activity, providing a tremendous economic boost to the national economy”

Mortgage Bankers Association – “MBA Testifies on State of Housing Market” (10-20-09)

“Whenever I am asked when the housing market will recover, I explain that the economy and the housing market are inextricably linked. The number of people receiving paychecks will drive the demand for houses and apartments and the recovery will begin when unemployment stops rising. Since September 2008, we have lost 5.8 million jobs in the US, more than five times the number the previous year.”

Housing Wire – “Fitch Projects More RMBS Re-Defaults as HAMP Disappoints” (10-20-09)

“Servicers of residential mortgage-backed securities (RMBS) continue to increase loss mitigation resolutions, including a significant push in the number of loan modifications, according to a report from Fitch Ratings. As of September 2009, roughly 10% of all RMBS loans and 25% of all subprime loans received at least one modification. A year ago, servicers modified only 3% of all loans, and 7% of subprime loans, according to the report.”

Housing Wire – “Servicers Prefer Foreclosure, Says NCLC” (10-20-09)

“Mortgage servicers have found it cheaper to foreclose on homeowners than offer loan modifications, according to a new report from the National Consumer Law Center. The report points out servicers in charge of modifying distressed loans are separate from the lenders, who have packaged the loans and sold them in pieces or pools to other banks and investors.”

Housing Wire – “HUD Notes Alleged FHA Violations at Lend America” (10-20-09)

“The 12 alleged violations the HUD board said Ideal Mortgage Bankers made against FHA range from submitting false certifications and failing to document the borrower’s income and creditworthiness, to approving loans that did not meet the FHA’s minimum credit requirements and closing a loan with an excessive mortgage broker fee paid to an approved FHA loan correspondent.”

Orange County Register – “Investors grab bigger share of auctioned foreclosures” (10-20-09)

“Investors bought 278, or 39%, of the 718 houses and condos sold at auctions, known as trustee’s sales, in Orange County last month, reports ForeclosureRadar.com.”

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