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

Wednesday, March 10th, 2010

Today’s News Synopsis:

The MBA reports that mortgage loan application volume increased by 0.5 percent. The percent of first-time buyers increased to 47 percent in 2009. FHFA is being sued over attempts to secure records of political contributions from Fannie Mae and Freddie Mac. John Burns claims that the real estate market is still in bad shape.

In The News:

Mortgage Bankers Association – “Purchase Applications Increase in Latest MBA Weekly Survey” (3-10-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending March 5, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 0.5 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 1.2 percent compared with the previous week.”

Mercury News – “San Jose council agrees to levy fee on affordable housing developers” (3-10-10)

“The San Jose City Council on Tuesday agreed to amend a city ordinance that for 22 years has given affordable housing developers a pass on paying to build parks. The city now will require those developers to pay 50 percent of the parkland fee that other developers pay. While preserving an incentive to build apartments for lower-income residents, the new agreement will provide the cash-strapped city more money to build or improve parks or trails near housing projects.”

CAR - “C.A.R. releases ‘State of the California Housing Market’ report” (3-10-10)

“Affordable home prices, tax credits for home buyers, historically low interest rates, and a large number of distressed properties prompted many first-time home buyers to enter the market in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) 2009-2010 ‘State of the California Housing Market’ report released today. The percent of first-time buyers increased dramatically in 2009, from 35.9 percent in 2008 to 47 percent in 2009, according to the report. The share of first-time buyers exceeded the long-run average of 38.6 percent and was the highest since 1995, when more than half of all buyers were first timers.”

Housing Wire – “Watchdog Sues FHFA Over Fannie and Freddie Records” (3-10-10)

“A watchdog group is fighting a legal battle with the Federal Housing Finance Agency (FHFA) over attempts to secure records of political contributions made by Fannie Mae (FNM: 1.10 +2.80%) and Freddie Mac (FRE: 1.31 +2.34%) since 2005. Judicial Watch filed its suit after the FHFA denied a May 29, 2009 Freedom of Information Act (FOIA) request, the group said in a press statement. According to the Judicial Watch, the FHFA claimed that while Fannie Mae and Freddie Mac might possess the requested documents, the FHFA was not obligated to release them under FOIA”

Housing Wire – “Housing Gets D+ in Latest John Burns Report Card” (3-10-10)

“The US Housing Market got a grade of D+ in the monthly John Burns Real Estate Consulting (JBREC) report card. The housing supply received a grade of F; steady from last month, albeit at very low levels, JBREC said. New home completions were down, but housing starts were up.”

Housing Wire – “Lend America, VP Ashley Banned from FHA” (3-10-10)

“Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week. The court judgment, issued in New York on March 3, brings to a close a nearly five-month-long ordeal that began in October when the Department of Housing and Urban Development’s (HUD) Mortgagee Review Board issued a notice of violation against Ideal Mortgage Bankers, parent company of Lend America and Lending Key.”

Bloomberg - “Apollo Said to Triple Property Assets With Citi Unit Purchase” (3-10-10)

“Apollo Management LP agreed to buy Citigroup Inc.’s real estate investment unit in a move that will more than triple the value of the private-equity firm’s property assets, a person with knowledge of the deal said yesterday. The purchase of Citi Property Investors will give New York- based Apollo 65 real estate investments in 26 countries with a net asset value of $3.5 billion, said the person, who asked not to be named because the negotiations are private. Apollo’s global head of real estate, Joseph Azrack, helped assemble the portfolio when he led the Citigroup unit from 2004 to 2008.”

Inman - “ZipRealty posts $2.1M Q4 loss” (3-10-10)

“ZipRealty Inc. boosted revenue by 14.6 percent in 2009, to $120.7 million, helping the company trim its annual loss to $12.9 million, down 3.4 percent from 2008. In the final three months of the year, the Emeryville, Calif.-based brokerage company handled 6,355 transactions, a 46.6 percent increase from the same period a year ago.”

Orange County Register - “24% of new South Coast homes: short sales” (3-10-10)

“There are 6,867 total pending sales in all of Orange County. Of those, 4,254 are short sales, 62%. Yet, only 27% of all closed residential resales in February were short sales. Most short sales are simply not closing. They are waiting on lender, or in many cases lenders, approval of the sale. Of the 4,254 pending short sales, only 757 have been pending for less than a month. 1,488 have been pending for over three months. The data does not even capture the short sales where a frustrated buyer walks away after waiting too long.”

Looking Back:

One year ago, homebuilder Hovnanian reported its 10th consecutive quarterly loss. JP Morgan feared that Obama’s mortgage-modification plan would require too many modifications to be made. Broker commissions decreased by 18 percent.

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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 12/21/09

Monday, December 21st, 2009

Today’s News Synopsis:

PMI Insurance Group predicts that 2010 will produce a moderate increase in economic production. According to John Burns Real Estate Consulting, real estate investor activity now exceeds 2005 levels. Moody’s reports that commercial real estate values have decreased by 36 percent from last year. A total of 140 banks have been seized this year.

In The News:

Tennessean - “Glut of shadow properties could hurt housing prices” (12-20-09)

“A supply of 1.7 million homes headed for sale because of foreclosure or delinquency looms over the U.S. housing market, which could dampen progress toward recovery should the Obama administration fail in its efforts to aid struggling homeowners, researchers said.”

Dr. Housing Bubble – “Southern California and the MLS Myth: Why the MLS does not Provide an Accurate Picture of Housing Inventory. Shadow Inventory, Foreclosures, and Fantasy Housing Numbers.” (12-20-09)

“In Southern California last month 20 percent of all buyers went with all cash. Each MLS is geared to local markets but again many argue that the MLS forces membership into the real estate circles.”

San Francisco Chronicle – “Commercial real estate on shaky foundation” (12-20-09)

“while most commercial real estate experts agree that in 2010 there will more loan defaults, scores more bank closures and limited construction lending, many observers do not believe that commercial mortgage defaults will derail the recovery.”

Housing Wire – “Mortgage Insurer Expects Housing Growth in 2010″ (12-21-09)

“PMI Mortgage Insurance Co., of PMI Group (PMI: 2.00 0.00%), does not expect an additional downturn in the US economy in the New Year, and even projects a ‘moderate’ pace of growth in 2010.”

Housing Wire – “Monday Morning Cup of Coffee” (12-21-09)

“According to John Burns Real Estate Consulting, existing home sales volumes are off 30% from the peak and have returned to 1998 levels. Perhaps even more worrying, the research states that existing sales volumes are driven by government initiatives, such as the expanded tax credit, aggressive FHA lending, Freddie and Fannie bailout, and Fed mortgage rate intervention. Additionally, investor activity now exceeds 2005 levels as a percent of total activity.”

Bloomberg - “U.S. Commercial Property Falls to Lowest in 7 Years” (12-21-09)

“Commercial property values in the U.S. declined in October to the lowest level in more than seven years as unemployment reduced demand for apartments, offices and retail space. The Moody’s/REAL Commercial Property Price Indices fell 1.5 percent in October from September to the lowest since August 2002. Prices were down 36 percent from a year ago and are 44 percent below the peak in October 2007, Moody’s Investors Service Inc. said in a statement. ”

DSNews - “Seven New Closures Push 2009 Failures to 140″ (12-21-09)

“The nation’s economic crisis has certainly left its mark on the banking sector this year. These latest institutional seizures push the failed bank tally for 2009 to 140 – an exorbitant increase compared to 25 in 2008, only three in 2007, and none in 2006 and 2005.”

Housing Wire – “More Servicers Bring HAMP List to 99″ (12-21-09)

“The US Treasury Department added 11 new servicers to the Home Affordable Modification Program (HAMP), pushing the total number of participants to 99, according to the latest Troubled Asset Relief Program (TARP) transaction report. Under HAMP, the Treasury allocates capped incentives to servicers for the modification of loans on the verge of foreclosure. Currently, the 99 servicers could receive a potential $27.4bn in capped incentives, but the Treasury plans to spend $50bn on the program.”

Inman - “Short sales show steady growth” (12-21-09)

“National bank and thrift servicers completed 22 percent more short sales during the quarter ending Sept. 30 than during the previous three months, and 127 percent more than the same quarter a year ago, federal bank regulators said today.”

Looking Back:

One year ago, California real estate sales decreased by 24 percent within one month. Governor Schwarzenegger rejected an $18 billion proposal for California expense cuts and tax increases. Barney Frank announced plans to release $350 billion from the bank-rescue package. The Federal Reserve bought $308.5 billion in commercial paper and lent $631.8 billion under eight credit programs.

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The Norris Group Real Estate News Roundup 12/15/09

Tuesday, December 15th, 2009

Today’s News Synopsis:

According to MDA DataQuick, home sales decreased by 13.3 percent in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange County. The Federal Reserve plans to leave interest rates at the current record low. Research from Trulia and RealtyTrac shows that 43% of U.S. adults will consider buying foreclosed property. A survey from JBREC shows that 57 percent of home builders expect to receive more revenue in 2010 than 2009.

In The News:

DQNews - “Southland home sales and prices up” (12-15-09)

“A total of 19,181 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 13.3 percent from October’s 22,132, and up 14.7 percent from 16,720 for November 2008, according to MDA DataQuick of San Diego.”

San Francisco Chronicle – “Fed is expected to leave rates at record low” (12-15-09)

“The Federal Reserve is expected to leave interest rates at a record low this week. The big question is whether Chairman Ben Bernanke and his colleagues will hint about when they will reverse course and start boosting rates.”

Wall Street Journal – “Remaking Fannie and Freddie: Six Mistakes to Avoid” (12-15-09)

“While economic theory suggests that duopolies can be highly competitive, there are strong disagreements on whether this applies to Freddie Mac and Fannie Mae.…While additional GSEs would undoubtedly enhance competition, it is important to recognize the trade-off between concerns over excess profits and market liquidity.”

Inman - “Zillow rolls out rental search” (12-15-09)

“One in four people who plan to move in the next three years say they intend to look at both for-sale and rental properties, Rascoff said, citing a poll by Harris Interactive.”

Housing Wire – “Fewer Buyers Consider Foreclosures: RealtyTrac, Trulia” (12-15-09)

“Fewer homebuyers are likely to consider purchasing a foreclosed property in the future, according to a survey conducted by the online real estate companies Trulia.com and RealtyTrac. Conducted in early November, 43% of US adults indicate they are at least somewhat likely to consider purchasing a foreclosed home, a drop from 55% in the same survey conducted in May.”

Housing Wire – “After ‘09 Housing Bottom, Builders Optimistic for ‘10″ (12-15-09)

“While Fitch maintains a negative outlook for US homebuilding in 2010, the John Burns Real Estate Consulting (JBREC) monthly builder survey showed optimism among 264 home building industry executives from public and private companies. The belief that builders will have increased community count, better orders and slightly higher prices has 57% of respondents planning for more revenue in 2010 than in 2009.”

Bloomberg - “Mortgage Originations to Fall 16% in 2010 as Stimulus Ends” (12-15-09)

“Mortgage originations probably will decline 16 percent next year as the homebuyer tax credit expires and the Federal Reserve winds down purchases of mortgage-backed bonds, according to a report by Keefe, Bruyette & Woods Inc.”

Looking Back:

One year ago, the NAHB reported that builder confidence was at an all time low. Zillow estimated that home price reductions would add up to a total of $2 trillion in losses. Research from HomeDex showed that the median price per square foot decreased to $196.

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The Norris Group Real Estate News Roundup 10/16/09

Friday, October 16th, 2009

Today’s News Synopsis:

President of John Burns Real Estate Consulting expects the commercial real estate market to do further damage to residential real estate. New legislation requires swap dealers and major swap participants to register with regulators and requires clearing organizations to provide transaction information to appropriate regulators. GE, MGIC, and Bank of America lost over 500 million in Q3 of 2009.

In The News:

Housing Wire – “BofA Loses $1bn as Net Loss on Home Loans Widens” (10-16-09)

“Bank of America (BAC: 17.26 -4.64%) lost $1bn or $0.26 per share during Q309, compared to a profit of $1.2bn during Q308. But company year-to-date income through Q309 was $6.5bn, compared with $5.8bn during the same period of 2008. BofA paid $1.2bn in preferred dividends for the quarter, including $893m in dividends to the US government”

Housing Wire – “BarCap Expects $2bn of CMBS TALF Requests” (10-16-09)

“Researchers at Barclays Capital (BarCap) expect the October facility date for a government loan program to receive an uptick of requests over the last subscription date. The October 21 Term Asset-Backed Securities Loan Facility (TALF) for commercial mortgage-backed securities (CMBS) will likely see an increase in subscription volume over last month, BarCap said in a research report Friday”

Housing Wire – “MGIC Loses $971m on Increasing Delinquencies” (10-16-09)

“MGIC Investment Corp. (MTG: 6.42 -12.30%) posted a $517.8m net loss in Q309, compared to losses of $115.4m in Q308 and $184.6m in Q209. The net loss for the first nine months of 2009 was more than $1bn, compared to a net loss of $250m during the same period of 2008.”

Housing Wire – “John Burns Sees Distressed CRE’s Dual Effect on Housing” (10-16-09)

“The pain felt in the distressed commercial real estate (CRE) sector will affect the residential mortgage industry on two fronts. The affects range from banks’ disposition of residential assets to a reluctance to lend to the residential sector at all, according to commentary Friday by John Burns Real Estate Consulting. The consulting firm indicated banks may need to dispose of residential assets to concentrate on commercial real estate distress as it continues to pressure the banks. This should have the affect of creating land-buying opportunities at low prices and sparking a bit of recovery, the firm said”

Housing Wire – “Investor Coalition Says No to Interest-Only Mods” (10-16-09)

“The Mortgage Investors Coalition called on the Treasury Department to reject a proposal to offer distressed borrowers interest-only payments for a certain length of time as part of the terms of a Making Home Affordable Modification Program (HAMP) workout. The coalition said a proposal being formed by large banks to allow borrowers the option to make interest-only payments as part of a new HAMP workout plan fails to address the issue of negative equity. Such a proposal is not in the best interest of the housing industry and consumers, said the coalition, a recently formed trade group of asset managers holding more than $100bn in residential mortgage-backed securitizations (RMBS) on behalf of pension funds, college endowments and other investors.”

Housing Wire – “House Moves on Financial Regulatory Reform” (10-16-09)

“The legislation passed Thursday requires swap dealers and major swap participants to register with regulators and requires clearing organizations to provide transaction information to appropriate regulators. The bill also provides for public disclosure of aggregate data on swap trading volumes and positions in a way that protects the business transactions and market positions of individuals”

Housing Wire – “GE Real Estate Revenue Falls 46% from 2008″ (10-16-09)

“Revenue from General Electric’s (GE: 16.08 -4.23%) real estate division for the first nine months of 2009 declined 46% compared to 2008, the company said in its Q309 report. GE Capital Real Estate, which creates real estate debt and equity investment funds for institutional investors as well as finances commercial real estate transactions through commercial mortgages in North America, lost $538m in Q309, compared to profit of $244m in Q308. Year-to-date losses through Q309 were $948m.”

Housing Wire – “Calif. Bank Mod Program Beats Redefault Average” (10-16-09)

“Due to the modifications, overall loan delinquencies dropped as of Sept. 30, 2009, compared to peak levels. Loans 30 to 59 days delinquent fell to $70.6m, 55% lower than the $157.5m on January 31, 2009. Loans 60 or more days delinquent decreased to $16.8m, or 95% lower than the $431.3m on Feb. 28, 2009. Loans in foreclosure fell 38% to $281.8m from $456.2m on June 30, 2009.”

Bloomberg - “MGIC Declines After Posting Ninth Consecutive Loss” (10-16-09)

“MGIC Investment Corp., the largest U.S. mortgage insurer, fell 12 percent as the company’s quarterly loss quadrupled after a record number of homeowners failed to meet mortgage payments.”

Inman - “Pig-in-a-python economics” (10-16-09)

“Long-term rates rose again this week, the 10-year Treasury note and mortgages continuing the spurt that began last Friday, to 3.46 percent and just shy of 5.25 percent, respectively.”

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The Norris Group Real Estate News Roundup 10/7/09

Wednesday, October 7th, 2009

Today’s News Synopsis:

New housing regulations set for 2010 will increase the required down payment for FHA loans to 5 percent. According to John Burns Real Estate Consulting, home prices will likely decrease again as delayed REOs hit the market. Both the NAR and the MBA are in favor of extending the first time home buyer tax credit, and have expressed their concerns to Congress. A survey from the California Association of Realtors shows that 46 percent of California Realtors use some sort of social networking website in their work. Another article focuses on vacancies in the market.

In The News:

Housing Wire – “FHA Confusion Surrounds Mortgage Finance Regulation Change” (10-7-09)

“As new housing finance regulations take effect and even more are set for the beginning of 2010, a number of questions have arisen on the impact to Federal Housing Administration (FHA)-insured loans. A bill that calls for an increase to the down payment requirement for FHA loans from 3.5% to 5% would also prohibit borrowers from including closing costs in the principal of the mortgage.”

Housing Wire – “Startup Wholesale Lender Tops $1bn Origination Volume” (10-7-09)

“NetMore America, a two-year-old wholesale and retail mortgage lender based in Walla Walla, Washington, announced it funded more than $1bn in loans during the fiscal year ending on Sept. 30. The company, which operates a wholesale channel in 22 states that accounts for 60% of its business, as well as retail branch system with 18 locations. Netmore said its origination business is 40% purchase loans and 60% refinancings, split evenly between Federal Housing Administration (FHA) loans and government-sponsored enterprise (GSE) mortgages.”

Housing Wire – “REO Module Added to Portfolio Management Software” (10-7-09)

“San Diego-based servicing software developer xplair Technology updated its Web-based mortgage portfolio management platform, illumair Management System (iMS). The illumair platform connects financial institutions and investors with servicers and loss mitigation agents, where all parties can access comparative analytics, risk metrics and interactive charts on the mortgages that comprise a portfolio.”

Housing Wire – “Delayed REO Sales will Drive Down House Prices, Says John Burns” (10-7-09)

“Despite recent projections that the housing market reached its trough and will recover in as little as 24 months, observers should expect a second leg down in what may shape up to be a “W”-shaped recovery, according to John Burns Real Estate Consulting.”

NAR - “Homebuyer Tax Credit Best Tool for Sustaining Housing Recovery, Says NAR” (10-7-09)

“The best available tool for sustaining the still-fragile housing market is the $8,000 homebuyer tax credit, and it is essential that Congress extend the credit into 2010, the National Association of Realtors® testified at a hearing of the U.S. House Small Business Committee today.”

Mortgage Bankers Association – “Mortgage Applications Increase in Latest MBA Weekly Survey; Third Consecutive Week 30-Year Fixed Rates Below Five Percent” (10-7-09)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending October 2, 2009. The Market Composite Index, a measure of mortgage loan application volume, increased 16.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index also increased 16.4 percent compared with the previous week.”

Bloomberg - “U.S. Office Vacancies Reach Five-Year High of 16.5%, Reis Says” (10-7-09)

“U.S. office vacancies rose to a five- year high in the third quarter, as job losses deepened and employers abandoned space in the recession, property research firm Reis Inc. said. Vacancies climbed to 16.5 percent from 13.7 percent in the year since Lehman Brothers Holdings Inc. filed for bankruptcy, New York-based Reis said in a report. Effective rents, the amount actually paid by tenants, fell 8.5 percent, the biggest year-over-year drop since 1995.”

Bloomberg - “Starwood Makes Winning Corus Bid in Jostle for Loans” (10-7-09)

“A group led by Starwood Capital LLC and TPG beat out seven other bidders to buy the assets of failed lender Corus Bankshares Inc. as investors vie to acquire commercial real estate loans at a fraction of their face value. The winning consortium, which also includes Perry Capital and WLR Lefrak, paid 60 cents on the dollar, the Federal Deposit Insurance Corp. said yesterday. The group will spend $554.4 million for a 40 percent managing stake in a company set up by the FDIC to hold $4.5 billion in mostly condominium loans, while the regulator will keep a 60 percent holding. ”

CAR - “C.A.R. releases ‘Use of Technology Survey’” (10-7-09)

“Forty-six percent of California REALTORS® surveyed report they use some type of social networking Web site to stay on top of trends in their business, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) annual ‘Use of Technology Survey,’ released today at Tech Tuesday. The most popular social networking site among REALTORS® surveyed was LinkedIn (34 percent), followed by YouTube (13 percent) and MySpace (12 percent).”

Bloomberg - “California House Prices Forecast to Rise in 2010, Realtors Say” (10-7-09)

“The median price for detached, single-family homes in the most populous U.S. state likely will rise 3.3 percent to $280,000 next year, the California Association of Realtors said in its annual housing forecast, issued today. The number of sales will probably drop 2.3 percent to 527,500, following an estimated 23 percent increase this year.”

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The Norris Group Real Estate News Roundup 10/2/09

Friday, October 2nd, 2009

Today’s News Synopsis:

Interthinx’s employment and income fraud index decreased  by 33 percent from Q2 of 2008 to Q2 of 2009. Real estate expert John Burns believes that the new short sale incentive program will be helpful in clearing up excess inventory. According to the American Bankruptcy Institute and National Bankruptcy Research Center,  U.S. consumer bankruptcies passed 1 million during the first 9 months of 2009. The U.S. government could lose nearly 80 percent of its $2.33 billion investment in CIT, should the company choose to exchange its debt.

In The News:

Housing Wire – “First American Studies Neighborhood Spread of Delinquency” (10-2-09)

“With the delinquency rates of prime and subprime mortgages trending upward across the nation, individual markets show different patterns of where those delinquencies gather within the city limits. A study by First American CoreLogic examines the spatial distribution of serious mortgage delinquencies across neighborhoods in the 30 largest US cities. Five patterns emerge from the data.”

Housing Wire – “Risk Retention May Backfire in Down Market, Says IMF” (10-2-09)

“The return of activity to private-label securitization markets will be a crucial part of economic recovery, but going forward, new measures must be put in place to ensure the markets positively contribute to financial stability and sustainable economic growth, according to the International Monetary Fund’s (IMF) Global Financial Stability Report.”

Housing Wire – “Mortgage Fraud Declines: Interthinx” (10-2-09)

“Mortgage fraud may be on the decline, according to the latest results of a quarterly index. Interthinx’s employment and income fraud index decreased 33% in Q209 from Q208, according to the latest Interthinx Mortgage Fraud Risk Report. Interthinx said the decline is due in part to lenders increased use of the Internal Revenue Service’s (IRS) 4506-T income verification form.”

Housing Wire – “$2,500 Incentive Will Spur Short Sales, Says John Burns” (10-2-09)

“A Treasury Department spokeswoman confirmed an incentive program for servicers that pursue short sales is on its way, according to John Burns Real Estate Consulting. The subsidy program will provide $1,000 to the servicer and $1,500 to the seller in each short sale transaction for a total incentive of $2,500 per short sale, the spokesperson told the consulting firm. This strategy should help ‘clear excess inventory,’ according to market commentary by John Burns Real Estate.”

Housing Wire – “2008 Mortgage Data Illustrates 31% Drop in Originations” (10-2-09)

“Mortgage lending data from 8,388 US financial institutions covered by the Home Mortgage Disclosure Act (HMDA) showed a decline in both lenders and originations in 2008 from levels seen in 2007. The data, released this week by the Federal Financial Institutions Examination Council (FFIEC), illustrate a 3% decrease in the number of reporting institutions and loans, primarily reflecting a large decline in the number of independent mortgage companies. Warehouse mortgage funding continued to dry up at the same time, a problem that led to the recently proposed legislation that aims to support and facilitate increased warehouse credit capacity for qualified lenders.”

Bloomberg – “U.S. Consumer Bankruptcies Top 1 Million, Group Says” (10-2-09)

“U.S. consumer bankruptcies rose past 1 million through the first nine months of the year, the highest since 2005 changes to bankruptcy laws. Personal bankruptcies totaled 1,046,449 for the period, according to the American Bankruptcy Institute and National Bankruptcy Research Center. For the first nine months of 2005, the figure was 1.35 million.”

Inman - “Turbulence seen for reverse mortgages” (10-2-09)

“A reverse mortgage, which is available only to those 62 and older, allows homeowners to use the equity that has built up in a residence. In effect, the homeowner gets a loan in the form of a lump sum or multiple payments. Repayment, with interest, is deferred until the owner dies, or goes into aged care, and the home is sold. Or, in a worst-case scenario, if the homeowner fails to pay property taxes or homeowners insurance.”

Reuters - “CIT debt swap could cost U.S. more than $1.8 billion” (10-2-09)

“If CIT Group (CIT.N) exchanges its debt under an offer aimed at averting a bankruptcy filing, the U.S. government could lose nearly 80 percent of its $2.33 billion investment in the troubled commercial lender. A likely $1.8 billion loss would be another black eye for the United States’ Troubled Asset Relief Program. A government official said last week that TARP has saved the financial system from collapse, but fell short of some of its other goals.”

Looking Back:

One year ago, the MBA reported that its Government Purchase Index decreased by 14.1 percent. Mark Finerman of Greenwich Capital began to raise 3 billion dollars for a fund to make senior property loans. A study from Radar Logic showed that home prices had dropped in 24 of 25 major metropolitan markets in the United States.

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55-TNG Radio – John Burns 2-16-08

Friday, February 15th, 2008

 

John-Burns

John Burns

President, John Burns Real Estate Consulting

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Bruce Norris is joined this week by builder consultant and founder of John Burns Real Estate Consulting, John Burns. Bruce and John discuss how busy John has been consulting investors and builders who have never experienced a downturn, what industries these new investors are coming from and if it’s cyclical, if builders had a chance to do it over what they might choose to do differently, land shortages, debt strategies of builders, options versus cash, land value decrease in California, portfolio deals, supply of homes the builders are currently holding, construction starts, how lending has changed the game, who the typical buyer is in 2008, the possibility of builders constructing smaller homes, if the cities like that idea, why do builders repeat the same mistakes, are those in trouble the old or new companies, Northern versus Southern California market, affordability changes in the coming years, if affordability will help the housing market, if any of the FED actions will come to the rescue, how the freezing of foreclosure won’t change anything, how interest rates might help, the California employment picture for 2008 and its effect on housing demand, recession in California, migration, presidential elections and possible tax law changes, the state of the commercial industry, commercial foreclosures in 2008, and the new loan limits proposed by the FED.

Prior to founding the Company, John Burns was at KPMG Peat Marwick for 10 years, where he was a Senior Manager in the Real Estate Consulting group. He was also a Principal and Vice President for four years at a national consulting firm, where he completed custom consulting assignments and developed several market monitoring subscription products for the 75 largest housing markets in the United States.

John Burns is a frequent speaker, and has been quoted as an expert by CNN, ABC World News Tonight, The Wall Street Journal, The Associated Press, USA Today, Bloomberg, The Los Angeles Times, The Washington Post, Builder magazine, and others. He designed and authored a weekly e-mail received by more than 25,000 industry participants, and authored the U.S. Housing Markets publication. He also created and edited several highly successful market research subscription reports.

John has a M.B.A. from the University of California, Los Angeles and a B.A. in economics from Stanford University. He is also a Certified Public Accountant. He is a full member of the Urban Land Institute and a board member of the Building Industry Association.

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12-TNG Radio – John Burns 4-21-07

Saturday, April 21st, 2007

 

John-Burns

John Burns

President, John Burns Real Estate Consulting

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The conversation continues as John Burns and Bruce talk about the subprime industry and the affects on prices and the consumer. Hear also how builders are adjusting prices and coping with the changes. Will all inventory be affected?

Prior to founding the Company, John Burns was at KPMG Peat Marwick for 10 years, where he was a Senior Manager in the Real Estate Consulting group. He was also a Principal and Vice President for four years at a national consulting firm, where he completed custom consulting assignments and developed several market monitoring subscription products for the 75 largest housing markets in the United States.

John Burns is a frequent speaker, and has been quoted as an expert by CNN, ABC World News Tonight, The Wall Street Journal, The Associated Press, USA Today, Bloomberg, The Los Angeles Times, The Washington Post, Builder magazine, and others. He designed and authored a weekly e-mail received by more than 25,000 industry participants, and authored the U.S. Housing Markets publication. He also created and edited several highly successful market research subscription reports.

John has a M.B.A. from the University of California, Los Angeles and a B.A. in economics from Stanford University. He is also a Certified Public Accountant. He is a full member of the Urban Land Institute and a board member of the Building Industry Association.

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