Prices of homes have declined across the nation 28.3% since June 2006, according to the latest LPS home price index.  According to Housing Wire, more people were hired in the mortgage industry than were laid off in the third quarter.  According to Inman, NAR recently admitted overestimating the number of homes sold.

In The News:

DS News - “LPS: Prices Are 28.3% Below Peak in Mid-2006″ (11-14-11)

“National home prices have been on the decline since June 2006 with a few bursts of increases, which Lender Processing Services  (LPS) attributes to seasonal trends. Overall, prices have declined 28.3 percent since their peak in June 2006, according to LPS’ home price index.”

Realty Times - “Real Estate Outlook: Wealth Gap Related to Housing” (11-14-11)

“Housing has always been linked to wealth in one fashion or another, but now the latest indicators from the Pew Research Center show that housing has been one of the prime reasons for ‘divergent wealth trends’.”

Bloomberg - “Home Prices in U.S. May Droop 8%, Pimco’s Simon Says: Tom Keene” (11-14-11)

“U.S. home prices will probably decline an additional 6 percent to 8 percent before bottoming, Pacific Investment Management Co.’s Scott Simon said.”

O.C. Register - “Pending housing deals up in October” (11-14-11)

“The latest Orange County home inventory report from Steve Thomas of ReportsOnHousing.com says that as of Nov. 10  …’Demand, the number of new pending sales over the prior month, continues to bounce around the 2,900 level since mid-September. In the past two weeks it increased by 60 homes and now totals 2,914. … There are 244 additional pending sales this year compared to last year at this time, 8% stronger. This will of course translate to an increase in year over year sales at the end of the year’.”

Realtor Magazine - “Meausured Improvement in Commercial Sectors Expected” (11-14-11)

“Despite sluggish economic growth and continuing concerns over high unemployment and the struggling housing market, the modest but steady improvement in commercial real estate in 2011 is expected to continue into 2012 and 2013, analysts told REALTORS® yesterday.”

Housing Wire - “Mortgage hirings outpace layoffs in 3Q” (11-14-11)

“Hirings in the mortgage industry outpaced layoffs in the third quarter, according to a new report compiled by MortgageDaily.  Total layoffs for the period hit 2,502, compared to 5,404 layoffs in the second quarter. ”

Inman - “NAR acknowledges overestimating home sales” (11-14-11)

“Potential problems with NAR’s benchmarking methodology were first reported by the blog Calculated Risk in January, and further detailed in a report by analysts with CoreLogic that concluded NAR may have overstated home sales by 15 to 20 percent.”

Housing Wire – “BofA mired in billions of mortgage litigation” (11-14-11)

“Bank of America (BAC: 6.025 -2.98%) more than tripled its litigation expenses resolving mortgage problems from Merrill Lynch and Countrywide Financial Corp. in 2011, but they appear to be making at least some progress.”

DS News - “California Expands Its Homeowner Relief Program” (11-14-11)

“California’s Keep Your Home California program is relaxing some of its eligibility restrictions and increasing the amount of assistance it provides struggling homeowners.”

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

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.

Bloomberg reported a 1.2% decrease in pending home sales, while shadow inventory of distressed homes also decreased according to the O.C. Register.  DS News reported fixed mortgage rates are at their lowest, although Basel III has plans that will increase mortgage rates.  Rick Sharga, formerly of RealtyTrac, has left to begin working now for Carrington Mortgage Holdings.

In The News:

Bloomberg - “Pending U.S. Home Sales Decline 1.2% as Lower Prices Fail to Stoke Demand” (9-29-11)

“The number of contracts to purchase previously owned U.S. homes fell in August, a sign that lower prices and borrowing costs are doing little to stoke demand.”

Housing Wire - “FHFA warns Basel III may increase mortgage rates” (9-29-11)

“Basel III will increase capital requirements for big banks, resulting in higher mortgage rates, the Federal Housing Finance Agency said.”

DS News - “Fixed Mortgage Rates Sink to Lowest on Record” (9-29-11)

“Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve’s announcement of “Operation Twist”.”

Inman - “RealtyTrac exec departs to Carrington Mortgage Holdings” (9-29-11)

“Rick Sharga, the RealtyTrac senior vice president who was often the company’s public face in news reports about its widely followed foreclosure reports, has left the company after seven years to take on a similar role with Carrington Mortgage Holdings.”

Los Angeles Times - “Second quarter economic growth revised up as jobless claims fall” (9-29-11)

“The economy grew at an annual rate of 1.3% from April through June, an anemic but slightly better pace than the most recent estimate of 1%, federal officials said Thursday.”

Housing Wire – “CoreLogic sees $7 billion in mortgage fraud” (9-29-11)

“Analysts at CoreLogic (CLGX: 11.07 +0.64%) predicted $7 billion in originated mortgages this year would show some signs of fraud.”

Inman - “NAR forecasts slow economic growth in 2011-12″ (9-29-11)

“A monthly index that gauges pending  sales of U.S. resale homes jumped 7.7 percent year-over-year in August but  dipped 1.2 percent compared to July 2011, the National Association of Realtors  reported today.”

Orange County Register – “‘Shadow Inventory’ of distressed homes shrinks” (9-29-11)

“The hidden market of distressed homes – the so-called “shadow inventory” – is shrinking, but likely will be a drag on the housing market “for an extended period of time,” Santa Ana-based data giant CoreLogic reported this week.”

Bloomberg - “1 in 5 Modified Loans Default Again: Comptroller” (9-29-11)

“One in five homeowners whose mortgages were modified under a program aimed at reducing foreclosures defaulted again within a year after their payments were cut, the U.S. Comptroller of the Currency reported today.”

Looking Back:

The MBA’s weekly survey showed mortgage application volume decreased 0.8%. Fannie Mae’s mortgage portfolio increased 3.8% year over year. Harvey Rosenblum of the Dallas Fed predicted the recovery would be long and slow. Witten Advisors reported more people were moving to multifamily housing.

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.

Lots of numbers in the news today.  The prices of homes decreased in almost 40 out of the 50 states.  Pending home sales also dropped 1.3% for the whole year ending in July according to Realty Times.  However, the good news is home prices did incease .8% month over month in July for the fourth straight month.  Also, Fannie Mae is getting ready to sell one of their large servicing portfolios worth $485 million.

In The News:

Mortgage Bankers Association – “MBA Study Shows Second Quarter 2011 Improvements in Production Profits Among Independents and Subsidiaries, Driven By Heavier Purchase Activity” (8-31-11)

“Independent mortgage banks and subsidiaries made an average profit of $575 on each loan they originated in the second quarter of 2011, up from $346 per loan in the first quarter of 2011, according to the Mortgage Bankers Association’s
(MBA) Second Quarter 2011 Mortgage Bankers Performance Report released today.”

Bloomberg - “S&P Rates Subprime Mortgages Higher than U.S.” (8-31-11)

“Standard & Poor’s is giving a higher rating to securities backed by subprime home loans, the same type of investments that led to the worst financial crisis since the Great Depression, than it assigns the U.S. government.”

Housing Wire – “Another Fannie Mae servicing portfolio goes up for sale” (8-31-11)

“MountainView Servicing Group will help sell a $485 million servicing portfolio of Fannie Mae mortgages.  Nearly all of the loans in the portfolio are fixed rate and primarily located in Illinois. The average delinquency rate on the portfolio is 2.21%. Interest rates average 4.67%, and the average FICO score is 761. The portfolio also carries an average 30-basis-point servicing fee”

DS News - “Home Prices Post Slight Gain for July But Still Below Year-Ago Levels” (8-31-11)

“Home prices rose 0.8 percent during the month of July, marking the fourth consecutive month of increase, according to CoreLogic’s July home price index, released Wednesday.”

Realty Times - “Pending Home Sales Decline” (8-31-11)

“The latest pending home sales numbers reveal that housing is still struggling to recover after a ripple effect of the subprime crisis and the deep recession of 2009. Last month’s decline in pending home sales is more evidence that housing will not recover until access to credit and jobs return and financial markets stabilize.”

Inman - “Unemployment rate drops in nearly 7 of 10 U.S. metros” (8-31-11)

“Jobless rates fell in most U.S. metro areas in July compared to the same month a year ago, according to the latest figures released today from the U.S. Bureau of Labor Statistics.”

Los Angeles Times - “BofA to sell or close another mortgage arm, putting jobs at risk” (8-31-11)

“Bank of America Corp. has put another giant piece of the Countrywide mortgage empire on the auction block — the correspondent lending arm, which buys closed home loans from mortgage bankers, commercial banks and other loan originators.”

O.C. Register - “Home prices decline in 40 states” (8-31-11)

“Homeownership’s a losing proposition in much of America.  Home prices fell in 40 of the 50 states (plus D.C.) in the year ended in July, says real estate tracker CoreLogic from Santa Ana.”

Housing Wire - “Appraisal industry readies for confusing GSE UAD deadline” (8-31-11)

“Appraisers are somewhat confused about the looming Sept. 1 deadline for ensuring appraisal forms prepared for Fannie Mae and Freddie Mac are compliant with certain GSE standards.”

Mortgage Bankers Association - “Mortgage Applications Decrease in Latest MBA Weekly Survey” (8-31-11)

“Mortgage applications decreased 9.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending August 26, 2011.”

Housing Wire – “More borrowers refinance to shorter FRMs with higher monthly payments: CoreLogic” (8-31-11)

“An increasing number people are choosing to pay off their mortgage loans in a shorter time period, according to data provided by CoreLogic. The data shows at 26% of all loans, or 252,600 loans, were refinanced to a 15-year fixed-rate mortgage (FRM), up from 18.5% in 2009 and 16.3% in 2008. In 2007, only 9.4% of loans were refinanced to a 15-year FRM.”

Housing Wire – “Consumer confidence rises in August, but conditions weaken” (8-31-11)

“An improved short-term outlook boosted consumer confidence for the first time in two months in August but the average American’s take on current economic conditions continued to weaken during the month, according to the private research firm The Conference Board. The board’s consumer confidence index for August was 53.5, topping the consensus analysts’ estimate of 50.5, according to Thomson Reuters, and up from a revised July figure of 51.”

Looking Back

According to Capital Economics, business investment rose 17% during the second quarter of 2010. Multiple forecasters suspected the housing market and the economy were in a double dip. Zillow reported that 18.2% of all O.C. homes sold for a loss. The Case-Shiller 20-city home price index showed prices increased 1% from May to June 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.

Sources:
July sales and price report
Mortgage Rates in U.S. Tumble to Lowest in More than 50 Years
Jobless claims up to 408,000 last week
Realtor.com, Yahoo Real Estate trading places in Web rankings
Mortgage servicers bypass foreclosure delays with more short sales
Case against MERS reaches Supreme Court
Fed to Keep Interest Rates Low until 2013
NAHB Study Finds Loan Limit Declines a Discouraging Prospect for Recovering Housing Market

Today’s News Synopsis:

In this week’s video, Aaron Norris gives the news of the week in the world of real estate and other big events. Despite home sales dropping, it was reported they are actually in better shape this year as sales are up from a year ago.  Two Multiple Listing Services in California, CRMLS and SoCalMLS, will be merging to form the largest firm in the United States.

In The News:

Housing Wire – “Delinquencies on commercial real estate loans fall again in July” (8-19-11)

“Delinquencies for securities backed by commercial real estate loans fell in July for the third consecutive month, according to Fitch Ratings.”

San Francisco Chronicle - “Inflation May Embolden Opponents of Fed’s Moves to Spur Growth” (8-19-11)

“Signs that consumer prices are rising even as the U.S. economy slows maydelay additional moves by Federal Reserve Chairman Ben S. Bernanke to spur growth.”

DS News - “Zillow: Price-to-Income Ratios Still High in Some Markets” (8-19-11)

“While an August report from Capital Economics states that housing values overall are undervalued by 20 percent, Zillow reports that many metro price-to-income ratios are still above their historic averages.”

Rismedia - “Home Sales Down in July but Up Strongly from a Year Ago” (8-19-11)

“Existing-home sales declined in July from an upwardly revised June pace but are notably higher than a year ago, according to the National Association of REALTORS®. Monthly gains in the Northeast and Midwest were offset by declines in the West and South.”

Housing Wire - “Ocwen, Altisource extend ties to keep costs down” (8-19-11)

“Two years after the spin-off, Ocwen Financial Corp. (OCN: 12.57 -1.95%) will extend certain services to Altisource (ASPS: 32.30 -3.29%) for an additional 12 months to minimize costs, according to a filing with the Securities and Exchange Commission.”

Mortgage Bankers Association - “MBA Increases Origination Forecast in 2011, Predicts Greater Drop in Origination Volume in 2012″ (8-19-11)

“The Mortgage Bankers Association’s (MBA) Economic and Mortgage Finance Forecasts released today project $1.1 trillion in residential mortgage origination volume in 2011, roughly $100 billion more than earlier forecasts, as low mortgage rates have brought in higher than expected refinance volume, while purchase volume has been less than anticipated.

Realtor Magazine - “Housing Affordability at Highest in 20 Years” (8-19-11)

“Housing affordability continued to be near record highs in the second quarter, hovering near its highest level in the 20-plus years it has been recorded, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.”

Inman - “2 California MLSs merge to become largest in nation” (8-19-11)

“Visions of a statewide multiple listing service in California are a stepcloser to reality today, with the California Regional Multiple Listing Service Inc. (CRMLS) announcing a merger that will double its size and make it the nation’s largest, with 68,000 participants and subscribers.”

Orange County Register - “August home sales show signs of improvement” (8-19-11)

“For the 22 business days ending August 5 – DataQuick’s latest homebuying report — Orange County saw 2,663 O.C. residences sold — up 4.3% from a year-ago! If the trend continues for the full month of August, this could break O.C.’s 13-month losing streak.”

RisMedia - “Builder Confidence Unchanged in August” (8-19-11)

“Builder confidence in the market for newly built, single-family homes held unchanged at a low level of 15 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for August, released recently.”

Looking Back:

Energy efficiency loans hit the skids as many banks saw the risk outweighing the rewards. A White House-created commission looked at possibly increasing the age for retirement benefits with the backing of AARP. California rates were one of the country’s hottest real estate markets for price increases while a PMI Mortgage Insurance Co. report listed 7 California areas (both northern and southern) that would most likely witness price declines 2011 and 2012.

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.

A top story in the news is mortgage rates for 30-year mortgages are at the lowest they have been in 9 months.  Housing Wire reported that foreclosures are also at a new low, the lowest they have been in almost 4 years.  The California Association of Realtors released data showing that more people, 51%, have been able to afford single-family homes in California with the decrease in prices. 

In The News:

Housing Wire - “Foreclosure activity falls to 44-month low“ (8-11-11)

“Foreclosure activity fell 35% in July compared to last year, hitting a 44-month low, according to foreclosure data firm RealtyTrac.  The number of foreclosure filings – which includes default notices, auctions and bank repossessions – hit 212,764 in July, down 4% from June.”

DS News - “Integrated Asset Services Shows 2% Price Increase in Second Quarter” (8-11-11)

“Housing prices increased 2 percent over the second quarter of 2011, according to the IAS360 House Price Index compiled by Integrated Asset Servicers, LLC (IAS).  In contrast to the previous quarter, prices rose in all four of the U.S. Census regions.”

Realty Times - “J.D. Power: Satisfaction Comparable Among Real Estate Companies” (8-11-11)

“Both home buyers and home sellers rated RE/MAX highest in J.D. Power’s customer satisfaction report, but not by much, thanks to stiff buyers’ market competition.  Small margins separate the top real estate companies from the many runners up in both the home buyer satisfaction and home seller satisfaction segments of J.D. Power s “2011 Home Buyer/Seller Study”.”

NAHB - “55+ Builders More Optimistic About Multifamily Rentals than New Home Sales” (8-11-11)

“Builders in the 55+ housing market are significantly more optimistic about production and demand for multifamily rental units than they are for sales of single-family homes or multifamily condos, according to the latest 55+ Housing Market Indices that are compiled quarterly by the National Association of Home Builders (NAHB).”

Housing Wire – “Jobless claims hover around 400,000 for third week” (8-11-11)

“Initial jobless last week remained essentially flat with the prior week, hovering around 400,000 for the third week in a row.  The Labor Department said the seasonally adjusted figure of actual initial claims for the week ended Aug. 6 decreased by 7,000 to 395,000 from a slightly revised 402,000 the previous week.”

Bloomberg - “30-Year Mortgage Rates Fall to 9-Month Low” (8-11-11)

“Mortgage rates for 30-year loans in the U.S. declined to a nine-month low as concern grew that the nation’s economy is slowing.  The average rate for a 30-year fixed loan dropped to 4.32 percent in the week ended today from 4.39 percent, according to Freddie Mac. The average 15-year fixed-loan rate fell to 3.5 percent, the lowest on record, from 3.54 percent, the McLean, Virginia-based mortgage-finance company said in a statement.”

Los Angeles Times - “Housing affordability up in California with home price decline” (8-11-11)

“Housing affordability increased in California in the second quarter as prices dropped from the same period a year earlier, a real estate group said Thursday.  Fifty-one percent of California households could afford a single-family home priced at the median, according to the California Assn. of Realtors.”

Rismedia - “Second Quarter Metro Area Prices Mixed with Little Change, State Sales Down” (8-11-11)

“Median existing-home prices declined modestly in the second quarter with 27 percent of metropolitan areas experiencing price gains from a year ago, while state home sales declined from the second quarter of 2010, according to the latest quarterly report by the National Association of REALTORS.”

DS News - “BofA Sells Pool of Servicing Rights to Fannie Mae” (8-11-11)

“Bank of America has sold the servicing rights of 400,000 home loans to Fannie Mae, according to the Wall Street Journal.  According to the Journal, the unpaid principal balance on the loans is $73 billion.   The loans were sold at a price of $500 million.”

San Francisco Chronicle - “S.F. apartment rent rises as vacancy rates fall” (8-11-11)

“Apartment hunting in San Francisco has turned into a competitive sport with hopeful renters swarming open houses and experiencing more rejections than contestants on ‘Survivor’.”

Looking Back:

The MBA’s weekly survey showed mortgage application volume increased by 0.6 percent. The Obama Administration provided the Treasury Department and HUD with $3 billion for aiding homeowners. The NAR reported that most U.S. metro areas experienced a decrease in home prices during the second quarter, and distressed homes accounted for 32 percent of second quarter sales in 2010.

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

Bloomberg reported 30-year mortgage rates are as low as 4.39%, the lowest they have been in 8 months.  Bank of America is being sued again, this time by Walnut Place and other investors who said Countrywide Financial Corp/Bank of America broke agreements regarding residential mortgages.   Mortgage Bankers Association reported a 107% increase from a year ago in commercial and multifamily mortgages.

In The News:

Bloomberg - “U.S. 30-Year Mortgage Rate Declines to Eight-Month Low of 4.39% on Economy” (8-4-11)

“U.S. mortgage rates for 30-year loans plunged to the lowest level in more than eight months as the nation’s economic recovery showed signs of faltering.”

Mortgage Bankers Association - “Second Quarter Commercial/Multifamily Mortgage Lending Up 107 Percent from Last Year; Up 52 Percent from First Quarter 2011″ (8-4-11)

“Second quarter 2011 commercial and multifamily mortgage loan originations were 107 percent higher than during the same period last year and 52 percent higher than  the revised figures for the first quarter of 2011, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.”

DS News - “Foreign Investors Will Not Save U.S. Housing But May Help Some States” (8-4-11)

“The combination of declines in dollar value and home prices is making U.S. homes very affordable for some foreign buyers, according to a Capital Economics report released Thursday.  However, foreign demand is not likely to bring recovery to the American housing market in the near future, according to the report.”

Housing Wire – “Investors charge ahead with another reps and warranties case against BofA” (8-4-11)

“Bank of America (BAC: 8.83 -7.44%) is facing another lawsuit over misrepresentations Countrywide Financial Corp. allegedly made when selling residential mortgages to a Trust in which The Bank of New York Mellon (BK: 23.72 -3.77%) served as Trustee.”

Inman - “CIVIX sues Trulia for alleged patent infrigement” (8-4-11)

“A company that holds several patents on location-based Internet search techniques has sued listings portal Trulia, claiming the company infringed on two of them.”

Mortgage Bankers Association - “MBA Backs Menendez/Isakson Bill to Extend Loan Limits” (8-4-11)

“David H. Stevens, President and CEO of the Mortgage Bankers Association (MBA) today supported the introduction of S. 1508, the Homeownership Affordability Act of 2011, a bill that will allow the Federal Housing Administration (FHA), Government Sponsored Enterprises (GSE) and the Veterans Administration (VA) to insure home loans at their current maximum levels until December 31, 2013.”

DS News - “Mortgage Rates Drop to Lowest of the Year” (8-4-11)

“Freddie Mac released the results of its weekly rate survey Thursday, showing mortgage rates have dropped sharply over the past few days amid falling bond yields and signs of a weaker-than-expected economy.”

Housing Wire - “Mortgage insurance stocks roiled by jittery market” (8-4-11)

“The stock value of major mortgage insurers plummeted with the Dow Jones Thursday, with The PMI Group (PMI: 0.4101 -53.40%) dropping more than 50%.”

Realty Times - “‘Robo-Signing’ Moves into New Mortgages, Refinancing” (8-4-11)

“Make sure your mortgage documents are signed by qualified mortgage industry employees who’ve verified your documents and aren’t forging someone else’s signature.  Nearly a year after federal regulators imposed a moratorium on foreclosures to stop “robo-signing” and other questionable foreclosure procedures, robo-signing behavior continues to flourish.”

Inman - “Market Leader aquires SharperAgent” (8-4-11)

“Market Leader says it’s acquired Denver-based SharperAgent and that the two companies “will immediately begin working together” on an integrated software platform for franchisors and real estate brokerages providing lead generation, customer relationship management, social media and blogging integration, online and offline marketing, agent and office websites, and other tools.”

Los Angeles Times- “California attorney general subpoenas CitiGroup over mortgage practices” (8-4-11)

“California State Atty. Gen. Kamala D. Harris has subpoenaed CitiGroup Inc. and its banking subsidiary, CitiBank, ordering the two entities to answer questions regarding the selling and marketing of mortgage-backed securities in the Golden State, a person familiar with the investigation said.”

Rismedia - “Real Estate Trends for the Last Half of 2011 and Beyond” (8-4-11)

“Jason Hartman, creator of the Complete Solution for Real Estate Investors™, discusses current trends in real estate and economist forecast in his “The Investment Real Estate Forecast” report. With the first half of 2011 in the rear view, Hartman’s forecast explains in detail that current government policy is tilted in exactly the opposite direction of factors needed—as monetary expansion and skyrocketing debt continue to finance spending initiatives having little to no impact on the fundamental tenants of innovation and productivity driving long-term economic growth.”

Looking Back:

One year ago, mortgage application volume increased 1.3 percent the week of August 2, 2010, according to the MBA. Large home builders, such as PulteGroup and DR Horton, were claiming a quarterly profit. Analysts expected total payrolls to decline in official Census data which was due Friday, August 6. The American Bankruptcy Institute expressed concerns that consumer bankruptcies might total 1.6 million in 2010.

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

Andrew Waite

Founder and Publisher, Personal Real Estate Investor Magazine

(Full Bio)

This week Bruce is joined by Andrew Waite. Andrew is the founder and publisher of Personal Real Estate Investor Magazine, which debuted in 2003. He has authored a total of nine magazines, is a recognized expert, and is extensively published in sales and marketing automated processes, sports marketing, and sponsorship.

In 2003 when his magazine debuted, his company had just sold a technology investing magazine in New York, closed on September 10, 2001. After September 11 occurred, Andrew and his partners had to think what to do because of the impact September 11 had on technology investing and since they had investments in real estate. They discovered that despite the fact that the stock market had been severely impacted by both the .com crisis and September 11, their real estate investments had not been affected. They decided to go find the national magazine on real estate. At that time they didn’t understand anything about the market dynamics, so they asked the usual questions such as whether the 300 national brands were interested in real estate investors and were they supporting that market with large media buys. On the other side, they asked who is the logical newspaper or magazine that has a list of subscribers that will lend themselves to real estate investment. Andrew went to do his research and at first could not find a thing. He started looking around and tried to list the 300 companies he knew it would take to justify the launch of and budget for a national magazine. He found four magazines that had some national footprint that were interested in real estate investors. He went back to his two business partners in New York and told them his problem of not being able to find either classes of people listed above, but in Phoenix alone there were a group of people spending about $3 million a month on real estate advertising. So he didn’t really understand what was going on with that. The statement that is now made is that real estate is local, unlike the traded assets, stock bonds, funds, etc., which is not traded on a national exchange but rather a very inefficient one-to-one process in local markets of the world of traded assets, which is regulated by the FCC, FINRA, and other interested parties. The world of real estate is regulated, if at all, by the local department of real estate and practice standards within the NAR. Andrew and his partners found it was a major structural difference in the real estate business and the subset notice known as real estate investing that could not be kept compared to the world of investing from retail or an institutional point of view at a national level.

Bruce said he just bought one of Andrew’s magazines at a Borders store, and Andrew wondered why no one else has reached out and gotten any footprint in the local Borders or Barnes and Noble stores, in airport stores, or other kinds of bookstores. At first they decided to start selling in Phoenix, Arizona because back in 2003 the market was booming and because it was a mid-price point market that attracted people outside the state like Californians. It was also a Sunbelt state with a lot of production housing and a destination for both tourists and capital. By chance they launched in Phoenix, and then what they found was the poll factor, meaning people who bought the magazine then subscribed to it when they were out of the state, and the people at the newsstands showed that they were selling so well and their rate exceeded Time Magazine and Cosmo. They were asked by other paper sellers if they consider expanding to California and to the rest of the United States. All in all, the market pulled them through, and they found that there was a very interesting dichotomy in the market. The DIY real estate investor makes up about 5% of the market. What they found was the interest for the remaining 95% is in performing assets that are packaged, presented to them, and managed at a portfolio level by people they can trust. This business is continuing to expand at an incredible rate.

In his publisher’s letter, Andrew talked about how a lot of people with their current investment strategy are destined for destitution. Real estate is different from traded assets, so you shouldn’t try to apply a traded assets lens to real estate because you will get crazy, non sequitur responses from places like Case-Shiller. They look at real estate data and try to wrap it in the convenience of a national number. Clearly, this is not the way it works. What Andrew found was as soon as you start granulating the market, looking at individual markets, and taking it into neighborhoods, you’re stock-picking for real estate investment properties is a pretty logical process; but most people have never looked at it this way. In the real estate industry, the traditional owner-occupied seller and big sales brands have always found real estate investors a problem because they ask lots of questions and mistake due diligence for indecision and questions. As a result, they marginalize real estate investors as not a particularly productive client. There is a lot or reasons why real estate investors are marginalized in this way, and these reasons create opportunity for the astute real estate investor.

It seems the astute real estate investor would have a hard time turning the reigns over to a group. If you step back and look at the traditional real estate agent selling what they claim to be investment-rate real estate to an investor, they say, “Here is this wonderful property that is going to generate $1,000 a month in rent,” you see that the investor makes his decision based on those representations. He then buys the property and hands it to a referral property manager who immediately sits down and asks who told them it would earn $1,000 a month. They say it will actually only earn about $750 a month and that they bought in the wrong neighborhood. Consequently, what are found are the effective property managers who understand rentable and attractive property profiles tend to be a better source of selection intellect than a realtor who is transactional and commission driven. The opposite is also true. A conscientious realtor who does know everything there is to know and does a good job, but then passes off a valued client to a poor property manager loses that relationship and the potential for recurring or repeat business. What is being found is a number of companies who have realized that just sitting, taking a property, doing the renovation for a client, and then renting it, the revenue and returns is very low and the risk is much higher. When they actually control the process from expectation creation through property selection, through property preparation, lease-up, and finally performance, then it is a much easier purchase for a retail investor who is looking to be treated like they would at a Merrill-Lynch and a cash management account. In this case, it’s a property management account or real estate management account. If you think in terms of the 5% of the market that is acquainted with do-it-yourself real estate investment, it’s probably never going to go across and relinquish all control and management to a property management or a real estate management company. Why it is attractive to the retail investor is when you can deliver an 8, 10, 11, or 15% true net yield, all of a sudden when you take indexed inflation into account you see that this particular investment asset becomes a very competitive asset against a traded asset. We see on the financial advisor side that they are losing clients to the real estate space. Andrew was invited to speak at the First Innovative Real Estate Conference, and he shared the stage with Nick Edwards, who is the advisor’s advisor. He was saying to the other clients/advisors that if they’re attracting clients on the basis of providing them protection of the principal in downturns, then that’s not good because you’re still going to treat them poorly. What we are now confronted with the volume of boomers is they will be driven into destitution because the assets we strongly believe in tips and reaps. Funds, bonds, and equities just don’t have any inflation indexing in them to speak of, whereas residential real estate is completely inflation-indexed, both on the income side and the appreciation side. When you look at these buyers who have no background in real estate investment or renovation personal management, you see their heads are not even turned by the option because they have lives, careers, and families. If you’re an effective real estate investor, it’s not very long before you go full-time or at least give up your weekends because you’re doing it yourself.

One of the vehicles good for the busy professional is trust deed investments. The Norris Group has $40 million of people’s money involved in trust deeds, and some of them are now financing long-term rentals for our investors. The investor with the trust deed is getting a 9% yield, and the Norris Group charges 9.9% to the California investor who is getting rentals that cash flow almost twice the payment. This is a true pre-tax net yield, and there is no tax benefits involved. Andrew watches both the funds play out and direct ownership. In the direct ownership, there are some other models that are beneficial because even though it is managed transparently, the tax status is as if they were doing it themselves.

In April the National Real Estate Investors Summit was held, which culminated with a trip to Washington D.C. and meeting with legislature. They conducted an investor provider leadership summit, so they took their vendor side clients and told them they needed to understand what was going on at a legislative level. There are good resources in that space, one being the National Association of Real Estate Investors and American Rental Property Owners and Landlords Association. He told the clients they need to get alongside the people in the aforementioned organizations, and one of the benefits would be their lobbying enterprise. The National Association of Real Estate Investors typically picks on a particular subject, whether it be financing or the current Safe Act. There is a lot of unforeseen consequences coming out of this mess, and you can tell the whole thing was assumed that anybody providing money or had access to real estate was going to be predatory lender. They completely missed the boat on it, but the impact is obviously very negative for creative financing any way, shape, or form where there is money left in the deal by the investor to make the deal happen. On the other side, there is also an attempt to put feed governance into long-term contracts whereby any future transfer generates a fee for a Wall Street entity. There has been a huge movement to prevent any transfer covenants or transfer fees creating fees for HOAs or developers who transfer the package fees and try to sell them as funds to investors much like CDOs or other derivative style transactions. This is pretty much being shut down in all but about twenty states now. There are about 30 states that have come back at an AG and Department of Real Estate level and said they were going to forbid any kind of transfer taxes.

At this point, there is no difference between a speculator and an investor since it is far too nuanced for them. They are still running on the five-year old definition. When Andrew first launched his magazine, their title was Personal Real Estate Investor Magazine, and is still called this to this day. If he had another shot at doing his magazine, he would probably soften the investor title because it is designed for the DIY investor who has no shame or embarrassment in calling himself a real estate investor. Andrew was encountering people who said they don’t deal investors and had several anti-investments clauses in their buy/sell agreements and would not speak highly of them. He said he and his business partners would go talk to a Del Webb or a KB, and they would go through a whole conversation and only to hear from the company that they don’t deal with investors and had these investors’ clauses so you couldn’t sell within a year. The meeting would go nowhere, but at the end of the meeting the companies would say with pride that they were investors too. They were buying their own stock and were speculating on company housing stock. These were huge SEC violations, which they were not recognizing. So Andrew was getting from the companies that they did not like investors, yet they were ones themselves. What he found was that when you did the analysis, there were a lot of people investing in real estate that weren’t showing up to the local REIA clubs, but they were holding one or two houses that they accumulated either as a matter of inheritance or a relocation that had not sold. They realized that to them it worked, they were doing okay, and the buy and hold model they had fallen into was a good idea. Andrew spoke with Real Trans president Steve Murray, who was one of the best real estate analysts in the country from a practice point of view, and he said they should work out how big a portion of the market real estate investment makes up. They put together a study and had Harris Interactive do the quantitative analysis. They asked 44,000 people in the last quarter of 2007 if they had bought a home, why they brought the property, and whether they were a first-time occupant, if it was a move-up, second home, or intentional investment. Twenty-eight percent came back and said they were buying it as an intentional investment. If you took the size of the market in that year, it was running about 2.4 million transactions, and 28% of them were people buying for investment purposes. It was a $320 billion market.

The National Association of Realtors runs a poll of about 1,000 realtors, and they ask them what proportion of their sales was made to investors. Andrew said he does not really like this question because it assumes ahead of time that people define themselves as investors. That’s why instead Andrew and Steve asked them why they bought the house. NAR found it was round about 20%, 19% the year before and 25% in previous years, so both NAR and Andrew’s own research were all in the same ballpark. Judging by NAR’s poll size and the types of questions they ask that they are probably missing a number of people. They also tended to use validation from a lending point of view, asking questions such as whether the property was owner-occupied or an investment. The problem was back in 2006 and 2007 people were lying through their teeth over these statements. Everything NAR does tends to downplay the numbers, so Andrew and Steve were very comfortable saying that in 2008 about 28% of the market was intentional investments.

Andrew will be holding an event called the Investor Provider Leadership Summit on September 30 which he said will be on the provider side because he said he wants to make an industry out of real estate investment sales, providers, and service leaders. Andrew said his goal with the magazine is to be the magazine of record for the real estate investment industry as it speaks to individuals and not to the institutional market because from those numbers the market is huge. You can check out more on the event at www.personalrealestateinvestormag.com.

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.

Bloomberg reported an increase of 8.26% in pending sales for existing homes.  Bank of America and RMBS investors have reached a settlement in their recent suit regarding a loss of money for investors.  Mortgage applications saw a decrease of of 2.7%, according to the Mortgage Bankers Association.  Ally Financial has been subpoenaed by Federal Regulators in hopes to obtain information connected to a current investigation by the Justice Department.

In The News:

Bloomberg - “Pending Sales for U.S. Existing Homes Rise 8.2%” (6-29-11)

“More Americans than forecast signed contracts in May to buy previously owned homes, signaling the residential real estate market may be rebounding from a slump earlier in the year.”

Housing Wire - “Bank of America settles with RMBS investors for $8.5 billion“ (6-29-11)

“Bank of America (BAC: 11.175 +3.28%) agreed to pay $8.5 billion to investors who lost money on soured residential mortgage-backed securities that were assumed by the banking giant after it acquired Countrywide Financial Corp.”

Realty Times - “Case-Shiller Index Indicates Home Value Boost” (6-29-11)

“According to the latest S&P/Case-Shiller Home Price Index, April experienced a seasonal boost in home prices. Both the 10- and 20-City Composites were up 0.8% and 0.7% month over month, the first rise in eight months.”

Mortgage Bankers Association - “Mortgage Applications Decrease in Latest MBA Weekly Survey” (6-29-11)

“Mortgage applications decreased 2.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending June 24, 2011.”

Los Angeles Times - “KB Home posts second-quarter loss” (6-29-11)

“Los Angeles home builder KB Home widened its loss in its second quarter as the housing market stalled and the company continued to suffer the fallout from the bankruptcy of a Las Vegas development.”

RisMedia - “Brokerage Veteran Louis Farina Joins Jordan Baris, Inc. Rentals” (6-29-11)

“Louis Farina has taken the reins and is running Jordan Baris, Inc. Rentals. Farina has an extensive background as the former owner of Signature Homes and Estates in Morris County, an award winning manager running a large office for a franchise and as a top producing Realtor.”

Housing Wire - “Early-stage mortgage delinquencies drop to 3-year low” (6-29-11)

“The amount of mortgages in the earliest stage of delinquency at the end of March dropped to the lowest level since the first quarter of 2008, federal banking regulators said.”

Realtor Magazine - “Fannie to Fine Lenders for Foreclosure Delays” (6-29-11)

“Mortgage servicers who have delayed the foreclosure process for delinquent borrowers may now get fined. Fannie Mae announced it will retroactively fine mortgage servicers for failing to process severely aged loans in foreclosure, HousingWire reports.”

DQ News - “Las Vegas Metro Area May Home Sales” (6-29-11)

“Las Vegas region home sales held at a five-year high last month, rising modestly from both April and a year earlier as sales of distressed properties continued to account for nearly 70 percent of the resale market.”

Housing Wire – “Regulators subpoena Ally Financial in mortgage probe” (6-29-11)

“Federal regulators subpoenaed Ally Financial Inc. this month, asking the lender for documents tied to mortgage deals and information related to a Justice Department investigation.”

Looking Back:

One year ago, Standard & Poor claimed U.S. home prices rose 0.8 percent in April 2010. According to the MBA, independent mortgage bankers and subsidiaries made an average profit of $1,135 on each loan they originated in 2009. Congress debated over legislation that would eliminate the HVCC in 90 days if passed. The House voted 409-5 to extend the closing deadline for the tax credit to Sept. 30 2010.

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

MDA DataQuick reports 35,202 houses and condos were sold in California during April. New home construction decreased 10.6% in April, according to the Commerce Department. Notice of default filings decreased 25.8% in March.

In The News:

MDA DataQuick – “California April Home Sales” (5-17-11)

“35,202 new and resale houses and condos were sold statewide last month. That was down 3.3 percent from 36,417 in March, and down 6.1 percent from 37,481 for April 2010. California sales for the month of April have varied from a low of 27,625 in 1995 to a high of 71,638 in 2004, while the average is 44,359.”

Mercury News - “Construction of new homes plummeted in April” (5-17-11)

“Builders broke ground on 10.6 percent fewer new homes last month from the previous month. The seasonally adjusted rate fell to 523,000 homes per year, the Commerce Department said Tuesday. That’s less than half the 1.2 million homes per year that economists consider a sign of a healthy market.”

NAR - “NAR Member Survey Shows Focus on Training, Commitment to Profession” (5-17-11)

“The typical NAR member has 12 years of experience; nine out of 10 say they are certain they will remain in the business.”

Bloomberg - “Home Depot Profit Meets Analyst Estimates” (5-17-11)

“Home Depot Inc. (HD), the largest U.S. home-improvement retailer, said first-quarter profit rose 12 percent, meeting analysts’ estimates, as operating expenses fell faster than sales.”

Housing Wire – “Foreclosure filings drop across most of the West Coast” (5-17-11)

“California saw the number of notice of default filings fall 25.8% between March and April, while notice of trustee filings fell 10.9%. When compared to last year, notice of default filings in California plummeted 28% and notice of trustee sale filings dropped 31.2%. In addition, foreclosure sale cancellations increased 27% in April when compared to the previous month.”

Housing Wire – “Appeals Court rules in favor of ratings agencies in securitization cases” (5-17-11)

“The 2nd Circuit Court of Appeals in New York ruled in favor of the nation’s largest credit ratings agencies in a recent decision, saying the firms cannot be held liable ‘as underwriters or control persons’ in litigation stemming from the securitization of mortgages.”

Housing Wire – “BofAML survey reveals bleak assessment of global financial conditions” (5-17-11)

“A mere 10% of fund managers expect global financial conditions to improve over the next 12 months, according to the May Bank of America Merrill Lynch survey. Last month, BofAML said more than a quarter of fund managers surveyed felt the world economy would strengthen and about 58% were optimistic in February.”

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.