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The Norris Group Real Estate News Roundup 11/7/11

Monday, November 7th, 2011

Today’s News Synopsis:

According to the Realty Times, pending home sales decreased 4.6% last September from the prior month.  CoreLogic reported home prices decreased  1.1% in September for the second month in a row.  Over the past 6 months, foreclosure starts have been increasing steadily for private-label residential mortgage-backed securities.

In The News:

Housing Wire - “CoreLogic home price index down 1.1% for September” (11-7-11)

“Housing prices dipped for the second straight month in September, falling 1.1% from the prior month, according to the CoreLogic (CLGX: 13.88 -1.28%) home price index.”

DS News - “Regulators Seize Lenders in Nebraska and Utah” (11-7-11)

“State and federal regulators have closed the doors on two more community-based lenders in Nebraska and Utah, bringing this year’s tally of failed banks to 87. Mid City Bank, Inc. in Omaha has been closed. It operated five branch locations, with $105.5 million in deposits and assets totaling $106.1 million ”

Realty Times - “Real Estate Outlook: Pending Sales Decline” (11-7-11)

“Pending homes sale declined in September, down 4.6 percent from the month prior. Lawrence Yun, NAR chief economist, said the housing market is being excessively constrained. “A combination of weak consumer confidence and continuing tight lending criteria held back home buyers, even though the private sector added nearly 2 million net new jobs in the past 12 months,” he said.”

NAHB - “Improving Markets Index Expands to 30 Metros in November” (11-7-11)

“The number of improving housing markets continued to expand for a third consecutive month in November, rising from 23 to 30 on the latest National Association of Home Builders/First American Improving Markets Index (IMI), released today.  The list dropped two metros and added nine new ones – Cheyenne, Wyo.; Corpus Christi, Tex.; Davenport, Iowa.; Fort Collins, Colo.; Hinesville, Ga.; Lima, Ohio; Monroe, La.; Tyler, Tex.; and Williamsport, Pa”

Housing Wire – “October bank failures tied to CRE exposure, further risks remain” (11-7-11)

“The 11 U.S. banks that failed in October cratered under the weight of commercial real estate exposure, Trepp LLC said Monday.”

DS News - “Foreclosure Starts Rise as Servicers Process Backlog of Delinquent Loans” (11-7-11)

“Foreclosure starts among private-label residential mortgage-backed securities (RMBS) have been rising toward historic averages over the past six months, which will lead to an influx of distressed properties bringing downward pressure to the housing market, according to recent RMBS Performance Metrics from Fitch Ratings.”

Housing Wire – “White House, agencies cut red-tape for some multifamily housing developers” (11-7-11)

“Government agencies are peeling back a few regulatory requirements in several states to make it easier for developers of federally subsidized multifamily housing to develop properties without having to pay for redundant inspections
and other repetitive guidelines.”

Realtor Magazine - “Hedge Funds Eye Troubled Home Loans” (11-7-11)

“As U.S. banks increase efforts to shed troubled residential mortgage assets, more hedge funds are considering opportunities to buy pools of whole home loans at discount prices.”

Los Angeles Times - “Use of ‘target-date’ funds grows in 401(k) plans” (11-7-11)

“According to a new study, Americans are increasing their use of so-called target-date mutual funds in 401(k) plans, and most people report being satisfied with them.  Among active and knowledgeable investors, use of target funds has nearly doubled to 41% today from 22% in 2005, according to the survey of more than 1,000 people by investment firm AllianceBernstein.”

The Washington Post - “Census data show wealt of older Americans is 47 times that of young adults, widest gap ever” (11-7-11)

“The wealth gap between younger and older Americans has stretched to the widest on record, worsened by a prolonged economic downturn that has wiped out job opportunities for young adults and saddled them with housing and college debt.”

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 10/6/11

Thursday, October 6th, 2011

Today’s News Synopsis:

According to the Orange County Register, home prices in California dropped 6.2% year-over-year in August from last year.  However, for the whole United States home prices dropped .4% month-over-month from July to August, the first drop in prices CoreLogic has reported in four months.  Rates on a 30-year mortgage dipped below 4%, according to Bloomberg.

In The News:

Housing Wire - “3Q house prices up but Clear Capital predicts 2012 dip” (10-6-11)

“Home prices rose nationally 3.5% in the third quarter over the previous quarter, according to the latest home data index from Clear Capital.”

Bloomberg - “30-Year Mortgage Rates in U.S. Fall Below 4%” (10-6-11)

“Mortgage rates in the U.S. fell, sending longer-term borrowing costs below 4 percent for the first time on record, as stricter credit standards and the slowing economy hold back a housing rebound.”

O.C. Register - “Calif. home prices off 6.2%, 7th worst drop” (10-6-11)

“California home prices fell 6.2 percent in the year ending in August, 7th biggest drop among the states, according to new data from CoreLogic.”

NAHB - “Number of Improving Housing Markets Nearly Doubles in October” (10-6-11)

“The second edition of the National Association of Home Builders/ First American Improving Markets Index (IMI), released today, shows 23 individual housing markets now qualifying as “improving” under the new gauge’s parameters. This is nearly double the 12 housing markets that made the list last month.”

DS News - “Congress Scrutinizes Federal Housing Programs” (10-6-11)

“Several Federal housing programs came under attack during a hearing Thursday morning titled “The Obama Administration’s Response to the Housing Crisis’.”

Realty Times - “Remodeling Double-dip Offers Opportunity for Homeowners” (10-6-11)

“Remodeling is suffering a double dip in sales, not unlike the double dip in home prices, but just as it’s a good time to buy an affordable home, it’s a good time to budget for and negotiate a home improvement deal.”

Housing Wire – “Homeownership rate at lowest level in 70 years” (10-6-11)

“The U.S. homeownership rate in 2010 fell to the lowest level in 70 years, dropping to 65.1%, down from 66.2% in 2000, according to data from the Census Bureau.”

DS News – “CoreLogic Records First Drop in Home Prices in Four Months” (10-6-11)

“Home prices in the U.S. slipped 0.4 percent between July and August, CoreLogic reported Thursday. It marks the first time in four months the company’s index has recorded a decline.”

Looking Back:

One year ago, the National League of Cities expected city property-tax revenues to decrease 1.8% in 2010. The IMF believed a double-dip in real estate was possible. A new program from HUD allowed delinquent borrowers, who were unemployed or suffering from a severe medical condition, to receive up to $50,000 at a 0% interest rate. The monthly ADP National Employment Report showed the private sector lost 39,000 jobs in September 2010.

For more information about The Norris Group’s California hard money loans or our California Trust Deed investments, visit the website or call our office at 951-780-5856 for more information. For upcoming California real estate investor training and events, visit The Norris Group website and our California investor 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 6/23/11

Thursday, June 23rd, 2011

Today’s News Synopsis:

New homes saw a decline in May of 2.1%, according to NAHB.  Mortgage rates remain at a steady low for the second week straight.  Shadow inventory is decreasing slowly, but is still high for the time being.  In other news, the House Appropriations Committee voted to cut funding for the Consumer Financial Protection Bureau. 

In The News:

Inman - “Mortgage rates hold steady again near 2011 lows” (6-23-11)

“Mortgage rates held steady this week, remaining at or near their 2011 lows for the second week in a row, Freddie Mac said in releasing the results of its Primary Mortgage Market Survey.”

RisMedia - “Shadow Inventory Slowly Fades” (6-23-11)

“The so-called “shadow inventory” of foreclosures—properties in the foreclosure pipeline but not yet listed on multiple listings services—slowly sank over the past year but still amount to five months’ worth of home sales. ”

NAHB - “Builders Back Reauthorization of Flood Insurance Program” (6-23-11)

“The National Association of Home Builders (NAHB) today expressed support for a five-year extension of the National Flood Insurance Program (NFIP) to ensure that the federally-backed flood insurance program remains efficient and effective in protecting flood-prone properties and creates more stability in the housing market”

The Wall Street Journal - “Jobless Claims Move Higher” (6-23-11)

“The number of people filing new claims for unemployment insurance ticked up last week in the latest sign that the U.S. labor market is sputtering amid slower economic growth.”

RisMedia – “MBA Study Shows First Quarter 2011 Mortgage Banker Production Profits Slide as Volume Drops” (6-23-11)

“Independent mortgage banks and subsidiaries made an average profit of $346 on each loan they originated in the first quarter of 2011, down from $1,082 per loan in the fourth quarter of 2010, according to the Mortgage Bankers Association’s (MBA) First Quarter 2011 Mortgage Bankers Performance Report released recently.”

Bloomberg - “Sales of U.S. New Homes Decreased in May” (6-23-11)

“Purchases of new U.S. houses fell in May for the first time in three months, showing the industry is struggling to gain momentum.”

Housing Wire - “Audit says FHFA failed to address consumers’ GSE complaints” (6-23-11)

“The Federal Housing Finance Agency mishandled consumer complaints about Freddie Mac and Fannie Mae, including complaints about possible foreclosure actions, the FHFA Office of Inspector General said in a report this week.”

Housing Wire – “House committee votes to slash CFPB funding” (6-23-11)

“The House Appropriations Committee voted Thursday to cap funding for the Consumer Financial Protection Bureau at less than half of what was originally estimated for the agency”

DS News - “Distressed Sales Drive CRE Prices Down for Fifith Month: Moody’s” (6-23-11)

“Commercial real estate prices (CRE) in the U.S. declined in April by 3.7 percent, according to a new report from Moody’s Investors Service.”

NAHB - “New-Home Sales Decline 2.1 Percent in May, Holding Above First Quarter Average” (6-23-11)

“Sales of newly built, single-family homes declined 2.1 percent to a seasonally adjusted annual rate of 319,000 units in May, according to figures released by the U.S. Commerce Department today.”

Looking Back:

One year ago, new home sales decreased by 33 percent in May 2010. The MBA’s weekly survey showed mortgage applications decreased by 5.9 percent the previous week. The Franchise Tax Board announced 80% of the credits for first-time home buyers program in California had been applied for. Borrowers who strategically defaulted were banned from obtaining new mortgages backed by Fannie Mae for seven years from the date of foreclosure.

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

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98-TNG Radio – Mark Fleming 11-29-08

Friday, November 28th, 2008

Mark-Fleming

Mark Flemming

Chief Economist for First American Corelogic

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Bruce Norris is joined this week by chief economist of First American Corelogic, Mark Fleming. First American CoreLogic, Inc. is the nation’s largest provider of advanced property and ownership information, analytics, and solutions.

Mark starts by explaining what Corelogic’s Core Risk Monitor is and what it evaluates. This evaluation tool is used to forecast mortgage default risk areas. The report makes use of house price dynamic trends, economic trends, foreclosure delinquency trends and collateral risk trends. Bruce asks of those trends which is the one that causes the others to follow. Mark says the economic and house price trends are the most important. Issues with price decreases and the ability for people to pay their mortgages continue to create problems.

Bruce asks if the downturn from 1991-1997 in California is following the same model we are seeing today. Mark says it’s slightly different. Mark says in the 90s it was more a function of unemployment. This time around, the house price downward trend is causing more of a problem. The economic downturn is following.

Bruce asks if the core factors are different for different states. Mark says yes but these two primary conditions are key. Mark talks about the Midwest and how their market has changed and reacted.

Bruce asks Mark about his take on affordability and if increasing affordability means less risk. Mark says that increasing affordability means more individuals will be able to enter the market on the demand side and means that inventory will be able to stop the price slides. There are a few steps along the way to get the market really going but affordability is important.

Bruce asks about Corelogic and how much emotions play part in the economy. Mark talks about the emotions to prices and houses and how individuals don’t like to lose. Bruce talks about people and the fear of people not wanting to buy for fear of losses. Mark says that some homes become such a good deal they get back in anyway.

In Corelogic’s report in the 3rd quarter of 2007, Bruce asks how Ohio and Michigan topped the highest risk market but aren’t in this year’s report. Mark says it wasn’t that they improved, other markets got worse. In Corelogic’s 3rd report of 2008, California has 8 of the top 10 riskiest markets and did not appear in their 2007 report. Mark says the price declines got these areas on the list.

Bruce talks about the historic nature of price declines in California and how it’s the worst he’s ever seen. Mark says even nationally it’s bad. What once were the top markets are doing so poorly it’s bringing down the national numbers. California and Florida are seeing large price declines and they are two of the largest markets. Historically, housing recessions are more localized.

Bruce asks about the percentage of houses that are upside down in California. Mark says 28% of loans in California are in the negative equity position. Corelogic only recently started these evaluations so has no idea what happened in the 90s. Corelogic uses market trends and valuation models to figure out home prices and ran data for September for their most recent report they released.

Bruce asks if there are states that are in worse shape compared to California. Mark says Nevada is in the lead with 48% of homeowners owing more on their property then it is worth. The 48% includes investors and anyone with a mortgage is counted. The mortgage stock in Nevada is much younger than California. They didn’t have the time to pay down the mortgage hence the reason they are so upside down. California has many more mature loans.

Bruce asks about unemployment and how it might cause further price declines. Mark says rising unemployment will lead to more foreclosures as more people can’t afford their payments. However, when individuals are in the negative equity position, studies shows mobility decreases and will tend to look locally instead of moving out of state for jobs. Bruce brings up that California is a nonrecourse state and people will find it easier to walk. Mark says it will be interesting to watch the behavior of people in this cycle.

Bruce asks if the bailout will help stem the foreclosure situation. Mark says the more loans that are modified the better we’ll do. Bruce and Mark discuss the moral hazard of re-writing some loans but not others. Mark says this is part of the challenge for those creating these mortgage modification programs.

Bruce says the actually foreclosure data says we’re actually down in foreclosures because of SB1137. Lenders have to go through more steps in the foreclosure process now and data is very misleading at this time. Corelogic says they are ignoring the seeming improvement in foreclosure numbers because of this bottleneck.

Bruce asks if in the model if the percentage of those over encumbered include those that refinanced to get money out of the house. Mark says the report includes all mortgages. For more information, see corelogic.com.

Mark Fleming is chief economist for First American CoreLogic, America’s largest provider of advanced property and ownership information, analytics, and services. Fleming leads the risk management economics and research team, responsible for developing collateral and credit risk models—the basis of the company’s risk management product suite—through monitoring the real estate market, identifying real estate and mortgage market trends, and analyzing the data in light of demographics and the economy.

Prior to First American CoreLogic, Fleming worked for Fannie Mae, developing property valuation models designed to drive collateral assessment applications used in mortgage origination, quality control, and loss mitigation. He has published research on spatial econometrics and presented at many international conferences.

Fleming graduated from Swarthmore College with a BA in economics and holds MS and PhD degrees in agricultural and resource economics from the University of Maryland.

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