California Real Estate Headline Roundup

Posts Tagged ‘real estate investing’

By Bruce Norris .

Freddie Mac’s Monthly Growth Rate for its Portfolio at Five-Year High

Friday, January 30th, 2015

 

 

 

Today’s News Synopsis:

Aaron Norris of the Norris Group gives the news of the week in this week’s real estate headline roundup video.  GDP for the fourth quarter was below expectations at a low 2.6%.  Freddie Mac’s portfolio increased for 2014 and is at a five year high for monthly growth rate.  Interest rates on mortgages dropped below 4% according to the latest FHFA index.

In The News:

Housing Wire“Mortgage interest rates slide in FHFA December Index” (1-29-15)

“Interest rates on conventional purchase-money mortgages decreased from November to December, according to several indices of new mortgage contracts compiled by the Federal Housing Finance Agency.”

DS News“Freddie Mac Portfolio Expands at Highest Monthly Rate in Five Years” (1-30-15)

“Freddie Mac’s mortgage portfolio ended 2014 on a strong note with its highest annualized growth rate for a single month in five years, according to the enterprise’s December 2014 Monthly Volume Summary released Thursday.”

Housing Wire“NAMB applauds regulatory relief from CFPB” (1-30-15)

“The National Association of Mortgage Bankers today praised the Consumer Financial Protection Bureau and its Director Richard Cordray for taking steps to revise mortgage rules designed to facilitate lending in rural and underserved areas.”

Mortgage Professional America“Pending home sales down in December, but still up year over year” (1-30-15)

“Pending home sales stalled in December despite the lowest interest rates of 2014, according to data from the National Association of Realtors.”

OC Housing News - “Will the reflated housing bubble buoy the move-up market?” (1-30-15)

“In past real estate boom and bust cycles, lenders were forced to write down bad loans, foreclose on the houses, and liquidate their inventory for whatever they could get — which is why the bust nearly always overshoots fundamentals to the downside.”

Housing Wire“Initial 4Q GDP estimate comes in well below analyst expectations” (1-30-15)

“Following the third quarter’s upward revised gross domestic product printing at 5%, the GDP for the fourth quarter took a nose-dive, coming in well below analyst expectations at 2.6%.”

Mortgage Professional America“MBA taps Fowler to head lobbying arm” (1-30-15)

“The Mortgage Bankers Association has appointed a new chairman for the Mortgage Actiona Alliance, its government lobbying arm.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

Freddie Mac reported mortgage rates decreased to their lowest levels with 30-year rates at 4.32% and 15-year rates at 3.4%.  Pending home sales decreased 8.7%, the largest decrease since 2010.  The economy saw strong growth in the fourth quarter with the increase in spending and exports.

 

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.

Unemployment Claims Decrease to Lowest in 15 Years

Thursday, January 29th, 2015

 

 

Today’s News Synopsis:

Mortgage rates took a turn this week by showing signs of increase with 30-year rates now at 3.66% and 15-year rates at 2.98%.  Unemployment claims decreased this past week to their lowest in 15 years at 265,000. Homeownership is at its lowest in 20 years, having decreased to 64%.

In The News:

Housing Wire“Freddie Mac: Mortgage rates reverse course, move higher” (1-29-15)

“Mortgages rate finally reversed course and slightly edged higher, the latest Freddie Mac Primary Mortgage Market Survey said.  The 30-year, fixed-rate mortgage averaged 3.66% for the week ended Jan. 29, up from last week’s 3.63%, but still down from 4.32% last year.”

Mortgage Professional America“S&P close to $1.4B deal over shoddy mortgage bond ratings” (1-29-15)

“Standard & Poor’s may complete a $1.37 billion settlement with regulators over accusations it knowingly inflated its ratings of risky mortgage investments during the run up to financial crisis as early as Monday.”

Bloomberg“Jobless Claims in U.S. Plunge to 15-Year Low” (1-29-15)

“The fewest Americans in almost 15 years filed applications for unemployment benefits during a holiday-shortened week that typically makes the data more volatile.”

Housing Wire - “Homeownership hits 20-year low in 4Q14″ (1-29-15)

“The homeownership rate in America hit a 20-year low, dropping to 64% in the fourth quarter of 2014.  This was 1.2 percentage points (+/-0.4) lower than the fourth quarter 2013 rate (65.2%) and 0.4 percentage points (+/-0.4) lower than the rate last quarter (64.4%).”

OC Housing News - “Republican lawmakers warn of housing bubble 2.0″ (1-29-15)

“Nobody wants to see a repeat of the previous housing bubble. Lenders, loanowners, and the politicians that pander to them all celebrate the reflation of the old bubble, but they hope it’s done on stable terms this time around to prevent a major crash.”

Bloomberg - “To Hike Rent, Landlords Swap Plain Walls for Exposed Brick” (1-29-15)

“Depending on your bank account, a three-bedroom apartment in an up-and-coming Brooklyn neighborhood renting for $2,899 a month may seem like a good deal.”

Housing Wire - “Pending home sales see second biggest monthly drop since May 2010″ (1-29-15)

“Pending home sales fell a very steep 3.7% in December, according to the National Association of Realtors.  All major regions experienced declines in December and this was the second worst monthly drop since May 2010.”

DS News - “New FHA Policy Provides Foreclosure Alternative on Reverse Mortgages for Surviving Non-Borrowing Spouse” (1-29-15)

“A new policy issued by the Federal Housing Administration (FHA) on Thursday under its Home Equity Conversion Mortgage (HECM) Program will allow reverse mortgage lenders to delay calling HECMs from a surviving non-borrowing spouse following the death of the last surviving borrower.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

The Mortgage Bankers Association reported a decrease in mortgage applications by 0.2%.  The amount of foreclosure inventory decreased by 31% according to the latest report from CoreLogic.  Federal Reserve Chairman Ben Bernanke’s term term ran out.

 

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.

Copyright: Image from www.flickr.com/photos/lendingmemo/

Mel Watt supportive of 3% Down Mortgage Payments

Wednesday, January 28th, 2015

 

 

Today’s News Synopsis:

In an update from Mel Watt’s meeting before the Congress yesterday, he is in support of 3% down mortgage payments as well as increase access to credit.  The Mortgage Bankers Association reported mortgage applications decreased 3.2% from last week.  More and more homeowners are choosing to live in suburban neighborhoods.

In The News:

DS News“Mortgage Risk Rises, Causing Concerns Over Expansion of Credit Access” (1-27-15)

“The market for federally insured home purchase mortgages grew riskier in December, garnering worry from analysts concerned about the government’s recent efforts to expand mortgage access.”

Mortgage Professional America“More people are moving to suburbia” (1-28-15)

“Although home prices are rising faster in urban neighborhoods, population is growing faster in suburban neighborhoods.  Consumer preferences and the aging of the population are tailwinds for suburban growth; so are falling oil prices if they stay low long-term, according to Trulia.”

Mortgage Bankers Association“Mortgage Applications Decrease in Latest MBA Weekly Survey” (1-28-15)

“Mortgage applications decreased 3.2 percent from one week earlier,according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending  January 23, 2015.”

Bloomberg“Fed Stays Patient on Rates Amid Strong Job Gains, Low Inflation” (1-28-15)

“The Federal Reserve maintained its pledge to be “patient” on raising interest rates and boosted its assessment of the economy and labor market, even as it expects inflation to decline further.”

Housing Wire - “Moody’s: FHA premium cut will increase home sales by 45,000 this year” (1-28-15)

“In the weeks since the Obama administration announced that it was directing the Federal Housing Administration to reduce annual mortgage insurance premiums by 50 basis points, from 1.35% to 0.85%, housing industry observers have each begun to share their prognostications about what the real impact of the FHA’s action will be.”

Mortgage Professional America“Watts defends 3% down payment mortgages” (1-28-15)

“Mel Watt, the director of the Federal Housing Finance Agency (FHFA), defended his efforts to expand credit access as overseer of Fannie Mae and Freddie Mac in a heated, four-hour hearing before Congress Tuesday.”

DS News - “Foreclosure Prevention Effort Exceeds 18,000 in North Carolina” (1-28-15)

“More than 18,000 homeowners in North Carolina have saved their homes as a result of a statewide foreclosure prevention effort, according to a release from the North Carolina Housing Finance Agency (NCHFA).”

OC Housing News - “Are Orange County homebuilders over-supplying the market?” (1-28-15)

“Homebuilding usually leads the economy out of recession. The Great Recession did not end with a building boom largely because of overbuilding during the housing bubble.  A false price signal triggered excessive homebuilding, and it took five years to work off the inventories.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

Both the Standard and Poors and Case-Shiller indices indicated home prices increased by over 13% year-over-year, although month-over-month they decreased slightly by 0.1%.  U.S. loan delinquencies increased slightly by 0.26% month-over-month, although year-over-year they decreased by 9.85%.  Fixed-rate mortgage were becoming less popular with the increase in interest rates, leading to adjustable-rate mortgages gaining more popularity.

 

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.

Copyright: Image from www.flickr.com/photos/119599301@N02/

Four Big Banks to Pay Massachusetts $2.7 Million for Improper Foreclosures

Tuesday, January 27th, 2015

 

 

Today’s News Synopsis:

HUD and U.S. Census Bureau reported sales of new homes increased 11.6% last month and now stand at 481,000.  Twenty cities in the U.S. showed signs of increase for home prices by 4.3% in November.  Four big banks, JP Morgan Chase, Bank of America, Wells Fargo Bank and Citi, will be paying the state of Massachusetts $2.7 million for foreclosing on homes to which they did not hold the right.

In The News:

NAHB“New Home Sales Rise 11.6 Percent in December” (1-27-15)

“Sales of newly built, single-family homes rose 11.6 percent in December to a seasonally adjusted annual rate of 481,000 units, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.”

Bloomberg“Home Prices in 20 U.S. Cities Increased 4.3% in November” (1-27-15)

“Home prices in 20 U.S. cities rose at a slower pace in the year ended in November, a sign the industry struggled to find momentum even amid low mortgage rates.”

Housing Wire - “Redfin: January home prices up, demand at record level” (1-27-15)

“The 2015 housing market is off to a very strong start, according to Redfin, the customer-first real estate brokerage.  Redfin reports home price data early using its proprietary models and projections based on sales in the first three weeks of the month and from its own brokerage activity.”

Mortgage Professional America“7.3 million boomerang home buyers hit the market” (1-27-15)

“The first wave of 7.3 million homeowners who lost their home to foreclosure or short sale during the foreclosure crisis in 2015 are now past the seven-year window they conservatively need to repair their credit and qualify to buy a home, according to RealtyTrac.”

OC Housing News“CFPB launches new mortgage interest rate checker” (1-27-15)

“The more information consumers have, the better decisions they make. When I launched the new system on this site that provides detailed cost of ownership information, I did that to provide consumers more information of higher quality than they can find elsewhere to help them make better housing decisions.”

Housing Wire“CFPB issues confidential supervisory information bulletin” (1-27-15)

“The Consumer Financial Protection Bureau reminded supervised financial institutions, including nonbank companies that may be unfamiliar with federal supervision, of the existing regulatory requirements regarding confidential supervisory information (CSI) on Tuesday.”

Mortgage Professional America - “Four banks to pay millions to Massachusetts” (1-27-15)

“JP Morgan Chase, Bank of America, Wells Fargo Bank and Citi have agreed to pay a total of $2.7 million to the state of Massachusetts after they allegedly foreclosed on homes they didn’t have a right to foreclose on.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

New home sales decreased by 7% in December and were at a seasonally adjusted annual rate of 414,000.  Although, they actually increased 4.5% from December of 2012.  Home prices increased 8.5% year-over-year and 0.3% month-over-month in December.  The FDIC reported the second bank closure of 2014 with the recent closing of the Bank of Union in El Reno, Oklahoma.

 

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.

Copyright: Image from www.flickr.com/photos/werkunz/

Pending Home Sales in California Increase for First Time in Two Years

Monday, January 26th, 2015

 

 

Today’s News Synopsis:

Existing home sales were low this month compared to January, although they are expected to be up from last year.  At the same time, pending home sales increased 2.6%, having increased for the first time in two years.  Mel Watt, director of FHFA will be speaking before the House Committee tomorrow regarding future plans for the GSEs and where they currently stand.

In The News:

Housing Wire“January existing home sales come in flat compared to December” (1-26-15)

“Auction.com projects that existing home sales for January will fall between seasonally adjusted annual rates 4.9-5.21 million annual sales, with a targeted number of 5.06 million.”

Bloomberg“CoreLogic Hires Freddie Mac’s Nothaft as Chief Economist” (1-26-15)

“U.S. home prices rose more than economists estimated in November, a sign job growth is helping to boost housing demand.  Prices climbed 0.8 percent on a seasonally adjusted basis from October, the Federal Housing Finance Agency said in a report from Washington.”

NAHB - “Millennials Seek Smaller Houses, But Won’t Sacrifice Details, Panelists Say” (1-26-15)

“As Millennials begin to enter the home buying market in larger numbers, homes will get a little smaller, laundry rooms will be essential, and home technology will become increasingly prevalent, said panelists during an International Builders’ Show press conference on home trends and Millennials’ home preferences held last week.”

Housing Wire“Moody’s: FHA premium cut a credit positive for HFAs” (1-26-15)

“Last week the White House directed the Federal Housing Administration to reduce annual mortgage insurance premiums by 50 basis points, from 1.35% to 0.85%, and now Moody’s Investors Service says it will be a positive for Housing Finance Agencies.”

Mortgage Professional America - “California pending home sales see first annual increase in nearly two years” (1-26-15)

“Pending home sales in California reported higher on a year-over-year basis for the first time since January 2013, according the California Association of Realtors (CAR).”

Housing Wire“FHFA Director Watt goes before House committee Tuesday” (1-26-15)

“Federal Housing Finance Agency Director Mel Watt will appear Tuesday morning before the House Financial Services Committee entitled ‘Sustainable Housing Finance’.”

Mortgage Professional America - “FHA premium change begins today, here’s what to expect” (1-26-15)

“The 50 basis point reduction for Federal Housing Administration (FHA) mortgage insurance premiums begins today, and the agency expects the high volume of applications will slow down processing times.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Hard Money Loan Closed

Alpine, California hard money loan closed by The Norris Group private lending. Real estate investor received loan for $400,000 on a 3 bedroom, 2.5 bathroom home appraised for $615,000.

Alpine Hard Money Loan closed by the Norris Group

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.

Copyright: Image from www.flickr.com/photos/emilysnuffer/

$140 Million of Delinquent Home Loans Being Sold By Freddie Mac

Friday, January 23rd, 2015

 

 

 

 

 

Sources:

Builder Confidence Holds Steady in January
Mortgage Applications Increase in Latest MBA Weekly Survey

 

Today’s News Synopsis:

Aaron Norris of the Norris Group gives the news of the week in this week’s real estate headline roundup video.  Sales of existing homes increased 2.4% to 5.04 million last month after showing signs of decline the previous month.  $140 million of delinquent home loans are being sold by Freddie Mac.  The housing market is ready for this generation of millennials with the values of homes strong and up 6.8% year-over-year.

In The News:

Housing Wire“Freddie Mac: Hybrid ARMs are ‘hot’” (1-23-15)

“Hybrid adjustable-rate mortgages continue to be the most popular ARM loan product offered by lenders and chosen by borrowers, according to the 31st Annual Adjustable-Rate Mortgage Survey of prime loan offerings from Freddie Mac.”

Mortgage Professional America“Borrowers will pay the price for low down payments” (1-23-15)

“Home buyers who want to put down less than 20% for jumbo mortgages backed by Fannie Mae and Freddie Mac are being asked to buy private mortgage insurance (PMI) by some lenders.”

Housing Wire“Existing-home sales recover after last month’s tumble” (1-23-15)

“Existing home sales recovered after last month’s drastic tumble, increasing 2.4% to a seasonally adjusted annual rate of 5.04 million in December from 4.92 million last month, the National Association of Realtors’ newest housing report said.”

Mortgage Professional America“Housing market is primed for millennials in 2015″ (1-23-15)

“Owners of the country’s lowest valued homes emerged from 2014 in a stronger position than previous years, with home values up 6.8% year-over-year.”

Bloomberg“Freddie Mac Selling $410 Million of Delinquent Home Loans” (1-23-15)

“Government-backed mortgage company Freddie Mac (FMCC) is selling $410 million of deeply delinquent U.S. home loans in its second sale of the debt.”

Housing Wire“Zillow, Trulia merger expected to get FTC go-ahead” (1-23-15)

“The stocks of Zillow (Z) and Trulia (TRLA) are soaring on the expectation that the Federal Trade Commission is going to give a merger of the two online real estate listing services the go-ahead.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

Sales of existing homes increased by 9.1% to 5.09 million in 2013, putting them at their highest level since 2006.  Home prices also increased slightly by 0.1% month-over-month in November, the smallest increase in two years.  Freddie Mac reported fixed mortgage rates decreased again for the second week in a row with 30-year rates at 4.39% and 15-year rates at 3.44%.

 

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.

Copyright: Image from www.flickr.com/photos/nikcname/

Image Sources:

www.flickr.com/photos/lendingmemo/
www.flickr.com/photos/59937401@N07/
www.flickr.com/photos/greatvalleycenter/
www.flickr.com/photos/68751915@N05/
www.flickr.com/photos/blatantworld/

 

Supreme Court Hears Both Sides of Argument For and Against Disparate Impact Rule

Thursday, January 22nd, 2015

 

 

Today’s News Synopsis:

Mortgage rates decreased again to decreased again to lows not seen before with 30-year rates now at 3.63% and 15-year rates at 2.93%.  Home prices saw a 0.8% gain in November, exceeding expectations.  The Supreme Court has heard both sides of the argument for and against the disparate impact rule and is currently in the process of making a decision.

In The News:

Housing Wire“Freddie Mac: Mortgage rates fall to new lows” (1-22-15)

“Mortgage rates remained on their downward trajectory, falling to new lows amid declining bond yields and oil prices, the latest Freddie Mac Primary Mortgage Market Survey said.”

Bloomberg“Home Prices Beat Estimates With 0.8% Gain in November” (1-22-15)

“U.S. home prices rose more than economists estimated in November, a sign job growth is helping to boost housing demand.  Prices climbed 0.8 percent on a seasonally adjusted basis from October, the Federal Housing Finance Agency said in a report from Washington.”

DS News - “U.S. Supreme Court Hears Arguments For, Against ‘Disparate Impact’ Claims; Decision Pending” (1-22-15)

“Now that the U.S. Supreme Court has heard arguments both for and against the controversial ”disparate impact” rule in housing, stakeholders on both sides are awaiting the Court’s decision as to whether or not disparate impact claims can be made under the Fair Housing Act.”

Mortgage Bankers Association“MBA Education Launches Mortgage Banking Bound” (1-22-15)

“MBA Education today announced the launch of Mortgage Banking Bound, a program designed to educate college students about the mortgage banking industry and job opportunities in the loan-process cycle.”

Bloomberg“Resurgent Housing Seen Cushioning U.S. From World Woes: Economy” (1-22-15)

“Real estate developer Crescent Communities in Charlotte, North Carolina, expects to sell 1,000 new homes this year across the Southeast U.S. and Texas, double the number of two years ago.”

Housing Wire“Fannie Mae: Economy pulls housing out of doldrums” (1-22-15)

“Driven by strengthening private domestic demand, economic growth is expected to accelerate modestly this year and drag last year’s unspectacular housing activity upward, according to Fannie Mae’s Economic & Strategic Research Group.”

Mortgage Professional America - “Wells Fargo, JP Morgan are the CFPB’s latest targets” (1-22-15)

“The Consumer Financial Protection Bureau (CFPB) and the Maryland Attorney General took action against Wells Fargo and JPMorgan Chase for an illegal marketing-services-kickback scheme they participated in with Genuine Title, a now-defunct title company.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

Mortgage applications saw a 4.7% increase from the previous week according to the Mortgage Bankers Association.  According to the latest Fitch ratings, mortgage volume, delinquencies, and shadow inventory were all expected to decrease while home price gains were expected to slow down.  Foreclosure activity decreased drastically and was at its lowest in 8 years.  The number of default notices filed was down from 10.8% at 18,120.

 

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.

Copyright: Image from www.flickr.com/photos/terencewei/

Housing Starts Exceed Expectations for Fourth Straight Month

Wednesday, January 21st, 2015

 

 

Today’s News Synopsis:

The Mortgage Bankers Association reported an increase in mortgage applications by 14.2%.  Housing starts increased 4.5% month-over-month and exceeded expectations for the fourth straight month.  Demand for multifamily homes is expected to stay strong this year with the increase in demand according to the latest NAHB report.

In The News:

Housing Wire“Housing starts up but permits post lowest growth since mid-2011″ (1-21-15)

“Building permits dropped for the second month in a row, down 1.9% in December and missing expectations of a 0.6% rise. Permits posted a year-over-year increase of just 1%, the weakest growth since mid-2011.”

Bloomberg“One-Family Home Gain Brightens U.S. Housing Outlook: Economy” (1-21-15)

“Builders broke ground in December on the most single-family homes in almost seven years, propelling an unexpectedly large gain in U.S. housing starts that signals construction will contribute more to economic growth in 2015.”

NAHB - “Multifamily Housing Set to Remain Strong in 2015 as Demand from Renters Continues” (1-21-15)

“The multifamily market has had strong demand in recent years and is set to remain that way in 2015 despite certain headwinds that could affect the industry, said panelists during a press conference at the National Association of Home Builders (NAHB) International Builders’ Show (IBS) in Las Vegas.”

Mortgage Bankers Association“Mortgage Applications Increase in Latest MBA Weekly Survey” (1-21-15)

“Mortgage applications increased 14.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 16, 2015.”

Housing Wire“President Obama: No more housing initiatives” (1-21-15)

“Concrete housing initiatives were absent from President Obama’s State of the Union speech Tuesday night, although he made several references to the improving economy, and indirectly praised the Consumer Financial Protection Bureau.”

NAHB“55+ Housing Market One of the Most Robust Segments of the Market in 2014, Experts Say” (1-21-15)

“The 55+ housing market fared quite well in 2014, and 2015 should be no different, according to industry experts at a press conference held today at the National Association of Home Builders (NAHB) International Builders’ Show (IBS) in Las Vegas.”

OC Housing News - “Mortgage insurance companies sue former homeowners” (1-21-15)

“Whenever a purchase or refinance transaction amount exceeds 80% of the value of a property, the lender will force the borrower to purchase private mortgage insurance — not for the borrower’s benefit, but for the banks benefit.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

Looking Back:

The DuPage National Bank in Chicago was recently closed, marking the first bank closure of 2014.  Many in the industry were opposed to the news lending rules put into effect by the CFPB despite their efforts to lower the default and foreclosure risk and make mortgage-lending easier.  Competition was getting fierce with the continued decreases in mortgage originations, community banks being the most competitive.

 

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.

Copyright: Image from www.flickr.com/photos/greatvalleycenter/

Housing to Be Main Focus in Next State of the Union Address

Tuesday, January 20th, 2015

 

 

Today’s News Synopsis:

The NAHB reported builder confidence decreased by one point and now stands at 57.  Obama’s next State of the Union Address is expected to focus on issues regarding housing, including increases in taxes.  Freddie Mac said they expect housing to see a brief increase in 2015, although it is not known for how long.

In The News:

NAHB“Builder Confidence Holds Steady in January” (1-20-15)

“Builder confidence in the market for newly-built single-family homes declined one point to 57, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index released today. This marks the third straight month that the index has hovered in the upper 50s range.”

Housing Wire“Obama State of the Union to touch on housing, focus on tax hikes” (1-20-15)

“Tonight is the second-to-last State of the Union for President Obama, and for the first time in four years the speech will touch on housing.  Overall, it’s expected Obama will announce a number of initiatives that will be virtually dead-on-arrival in the new, Republican-controlled House and Senate, including $320 billion in new tax hikes on the investments, capital gains, and dividends, as well as proposals for what the White House calls free community college and mandatory paid sick leave.”

Mortgage Professional America - “MetLife CEO: We’re not too big to fail” (1-20-15)

“Time and time again we hear of regulators targeting large financial corportations to pay up for shoddy mortgage deals during the run-up to the financial crisis. Now, it seems the tables have turned.”

DS News - “Four Banks Reach $2.7 Million Settlement With Massachusetts AG Over Foreclosure Violations” (1-20-15)

“Four national banks agreed to pay a combined $2.7 million in penalties to resolve claims that they unlawfully foreclosed on properties in Massachusetts, according to an announcement from Massachusetts Attorney General Martha Coakley.”

Housing Wire“There’s no more room for appraisal fraud” (1-20-15)

“Mortgage fraud has tumbled over the last year as increased regulation pushes the bad seeds out of the industry, the U.S. Department of the Treasury Financial Crimes Enforcement Network’s FinCEN report said. However, the situation that the appraisers are left with does not look too bright, according to one expert.”

OC Housing News“Has the OC Housing market peaked for this cycle” (1-20-15)

“The deflating housing bubble trapped millions of borrowers underwater with mortgages they couldn’t afford. The federal reserve helped lenders and borrowers by lowering borrowing costs from 6.5% to 3.5%; the policy benefited everyone by making the absurd prices of the housing bubble relatively affordable.”

Mortgage Professional America“More homeowners are remodeling again” (1-20-15)

“U.S. households are unhappy with their current living situations and they’re planning on doing something about it.  The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a record-high result of 60 in the final quarter of 2014.”

Housing Wire - “Freddie Mac: Housing to get boost in 2015 but it won’t last” (1-20-15)

“Freddie Mac says it expects mortgage rates to hover around 4% through mid-2015, and while there are some of the positive tailwinds buoying the economy at the start of the year, some may not stick around for long.”

 

Bruce Norris of The Norris Group will be presenting his newest talk 2015: Proceed with Caution on Saturday, January 31.

Bruce Norris of The Norris Group will be speaking at OC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Tuesday, February 3.

Bruce Norris of The Norris Group will be speaking at SDIC FIBI presenting How to create a $100,000 Payday Per Deal in 2015 on Thursday, February 5.

 

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.

Copyright: Image from www.flickr.com/photos/blatantworld/

Harry Dent Joins Bruce Norris on the Real Estate Radio Show #417

Friday, January 16th, 2015

 

 

Harry-Dent

Author and Economist

(Full Bio)

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Bruce Norris is joined this week by Harry Dent. Harry is the found of Dent Research and Economic Forecasting Firm. They specialize in demographic trends, and his mission is to help people understand change using years of hand-on business experience. Mr. Dent offers unprecedented and refreshingly understandable tools for seeing the key economic trends that will affect your life, business, and investments over the rest of your lifetime. He has authored many books, including The Great Boom Ahead, and his latest book The Economic Cliff. He is also editor of the free newsletter Economy and Markets.

Bruce has a lot of respect for Harry Dent. There are two main things he does that take guts. One is that his titles leave no doubt as to where he stands, and he has been both a bull and a bear when he thought it was appropriate. This is something not everybody does. Bruce asked how he got into demographics. This is something that is very unusual for someone to take on, and he did it early in his life. Harry said it was not from taking economics courses. He came out of Harvard Business School as a consultant with one of the top 100 companies. He started seeing how the baby boomers were changing things. There were so many of them, but he really got it when he started doing the same type of strategic consulting to new ventures who were almost exclusively to young baby boomers who were coming along and starting new trends. They ended up driving our whole economy from 1983 to 2007.

A couple years later he found there was a direct correlation between a 46 year lag on the birth index and booms and busts in the economy. This is when the average household spends the most money in their lives. He got into this through consulting and trying to help his clients see changes coming. He ended up finding it was really the key to macroeconomics as well. One of the statements in his book says that people do predictable things as they age. This appeals to Bruce because this makes sense to him. As he has grown up from a young adult getting married, he can see his peers finding themselves doing very similar things. Harry has a lot of categories he looks at and says when you are most likely to peek at whatever product you want to mention. The macro is age 46 for the average person, and for the most affluent it is age 53. This is right now, so there will be some surprises next year as well as on car sales.

We can look at baby cribs all the way to nursing homes and everything in between, there are things we spend on different things in our life. It is not just the macro economy, but we can see which sectors of the economy are likely to do best at times. Even in downturns there will be sectors like health care, travel, and financial planning that will continue to do better than other categories, even when he sees a downturn for the next several years.

In real estate they would take a look at a large participant, even hedge funds, who came in to an area and bought or made an offer on everything in sight. They would be considered market makers where they could change the market in whatever way they did. The baby boom generation has been that market maker. Whatever age they have been in has been the dominant thing that was sold or invested. The thing that made it easier for Harry to discover how important they were was how many there were. That generation was so much larger in magnitude than the Bob Hope generation before them. Even those who talk about the Echo Boom or Millennials coming behind them don’t realize it is not the same magnitude of increase. When you count all the immigrants who came more into the baby boom generation, there are still more peak baby boomers than millennials.
This is the first time in history we are going to see a generation smaller, but the baby boom was an outsized generation. Someone called them earlier a pig moving to a python. They exaggerate everything, including the boom, the bubble, and now this downturn. The government will have to keep printing trillions of dollars to offset the natural slowing. Older people not only don’t borrow money, they pay down their loan. They don’t buy durable goods, especially automobiles after this year, and they spend less on just about everything, even food. He can tell when people eat the most calories and weigh the most, and that is age 60. It is no wonder that weight watchers and weight loss places are doing so well right now. The baby boomers are at their heaviest now and into the next 7-8 years.

Obviously we are not the only country with a baby boom generation. In 1989 Harry wrote Our Power to Predict in which he talked about Japan’s baby boomers. In this book they predicted Japan would take a big fall in the 90s while the US, Europe, and other countries had the greatest boom in history. Nobody saw this combination happening. Some people in the early 90s like John Templeton did see a boom, but they saw it more on the globalization trend while Harry saw it more on the global demographic trend. However, there was nobody who saw that Japan was going to crash because their baby boom came much earlier than the US and Europe. It is demographics that allows you to see around the corner.

There is expected to be two surprises over the next two years for the global economy. One is that Germany will continue to disappoint and has a deeper slowdown in demographics than Japan did in the 90s. China is the only emerging company that is going to see their workforce and demographic trends slow down modestly over the next decade and then rapidly after that. Everybody thinks China will grow forever and Germany will hold up the European unit. Neither are going to happen. When the T-bill started getting very low, Bruce started poking around and found out Germany’s ten-year T-bill was at .44%. This was something he did not expect.

Harry can see the issues with Germany since people do not understand the difficulties in their economy. They are going to be running deficits in the future, but Japan is down there in those low ranges where they have the highest debt ratios of any major country in the world as well as the fastest aging population. Germany will have a rapid, almost as rapidly in aging population, but they do not have anywhere near the debt problems and real estate bubbles that Japan had and has. China has the greatest bubble of any country in history since their government drove their economy, has overbilled everything, and has pushed people from urban to rural areas 2 to 3 times as fast as any other country.

Harry is predicting that over the next several years is that China will go down hard. There will not be a soft landing in China because he has never seen such a mismanaged economy. They have 20% of condos empty, 30-40% access capacity in all their major industries. There are so many bridges, roads, and railways to nowhere, empty malls and offices, and it is the biggest disaster in history. You have 220 million unskilled people being forced out of their farms and into these cities. They cannot even go back to their farms because they have been paved over with empty condos. China will go down as the greatest economic disaster in history, and he feels badly for the 220 million people who are going to be trapped.

Bruce wondered why they did this, and Harry said there was a little secret they discovered in their demographic insight. The way most countries grow and develop is by urbanizing and industrialization. Even today in third world countries like India, Brazil, and China we can measure that when you simply move someone who is uneducated and without skills into the city their income doubles and more often triples. This is the fastest way to increase your GDP.
China wanted to do this even faster, and the only way they could move people that fast is to build things for nobody. That is what all these empty condos and malls are. China is thinking one of these days they will meet them; but if you look at their demographics with a shrinking workforce for the next several decades, they will not need all these empty structures. They build enough for the rest of the rural population to move to cities in the next to 10-15 years, even if they move at the same rate they did in the past. This is something that will never happen.

Since they overbuilt everything, China does not need more infrastructures. They have to come to a point to where they stop building for nobody. When they do that, they will have massive unemployment, real estate prices will collapse, and more. This is why this is the biggest disaster in modern history. We do not even know of a real estate bubble compared to China’s. Their real estate bubble takes up seven times since 2000’s. Ours a little bit more than doubled with the real estate problems we have had.

Bruce said there is an interesting side effect to this. Bruce spoke up in Northern California, and one of the audience members said he had bought a million dollar home in San Jose. In two years it was worth $2 million. He was going to hold onto it until it was worth $7 million. He thought this was a lot of expectation for one house. He then told Bruce he was from Shanghai, and that is what happened there. Not only do you bring the money that came from that transaction, but you also bring the expectation as well as the carelessness. Harry said he wanted to see the $2 million home as it probably looks closer to a trailer than a mansion. In another example, two homes that were bought for $50 and sold for $500 were barely livable.

When Japan had the boom during the 80s, that also had ramifications for our country in some assets. Bruce said he was more familiar with what it did to real estate. However, they brought their money here. It was just like the Chinese. They are the ones buying the largest percentage of homes in Southern California as well as Vancouver, London, Toronto, San Francisco. It is the same thing all over again. They make a fortune on their real estate bubble, then they take those profits and reinvest them into key leading cities, especially where there are good English-speaking schools. This includes California, New York, London, Singapore, and Australia. If they stopped buying at the edge, then there was nobody left to buy.

A year ago a condo went for $13,000 per square foot. This is $120 million for a 7700 square foot condo in downtown Manhattan. This will probably be worth $10-$15 million before it is all over with an 80-90% drop. A similar thing could happen in Shanghai because they have bubbled up more. They do not have the income there. Even in California and the US there will likely be another drop in real estate in the next few years, and it is going to be worse than the last one. It will go lower, and as usual the places that will do the best are the apartments in the sweet spot of the demographic cycle for the next generation. As fewer and fewer people have confidence in prices going up to be able to obtain a loan, apartments are likely to do well. This is especially the case with high-end homes such as mansions.
In Northern Tampa, Florida they are in a little trophy area. It got hit on a lag last time, but they did not think it would go down any harder than where all the sports stars did. Things that bubble up the most go down. They just had a 30,000 square foot marble French mansion that was on the market for $24 million for years, and it finally sold for $5 million.

When the Japanese boom ended, Bruce wondered what happened to the investments they made outside the country. Bruce asked if they were leverage investments or if they owned most of it free and clear when they bought. Harry said he does not think they always had it free and clear, but they were overextended by using their profits from their real estate in Japan, which had bubbled up dramatically. When all your real estate assets start to collapse, you have to sell some to cover others. You are more likely to sell your foreign real estate than you domestic. Bubbles feed on bubbles. The government makes money cheaper than it should be, they guarantee loans, banks lend with no money down, and everybody just keeps going.

The illusion with real estate has always been that it is the one thing that cannot go down. Everybody knows stocks go down, they just don’t think it will happen to them in their timeframe. They often think a bubble happened for a different reason than it did. Anybody alive today has not seen real estate go down substantially until 2008. Some high-end sectors in California got hit in the early 90s and Texas got hit with the oil crash in the 80s. However, overall we have seen real estate go up all our lives because the first middle class emerged during World War 2 and just started buying real estate like crazy and people qualified for mortgages for the first time. The baby boom then followed them. We do not understand real estate.

Robert Schiller showed this with his longer term analysis that if you adjust for inflation and the size and quality of the house, homes are not appreciating assets. This does not mean you cannot make money on them because they generate income from rents and can save you the mortgage for rents. However, they are not appreciating assets. Stocks averaged 7% over long period of time adjust for inflation, but homes do not. Gold is the worst. You cannot even get income off this, and when you adjust for inflation over hundreds of years, gold does not appreciate and is not an appreciating asset.

Stocks are good for long-term appreciation, and real estate is good if you buy good things and rent out a positive cash flow just like we learned in monopoly. Gold only does well when inflation is roaring, like in the 60s and 70s when everyone thought it would protect them. Gold got slammed in the 2008 crash and did not protect people. We keep saying it will keep going down and will get slammed again. Harry said he could see gold at $250 to $400 within the next several years. He thinks it could even be worth $700 within two years.

Harry’s book The Great Boom Ahead was published in 1992. There were a lot more books that were very bearish and sold a lot more than his did. His sold from 1995 on, but from ’92-’93, you had The Great Reckoning, Bankruptcy Nightmares, The Great Depression. The Depression books were selling, and everybody was saying the US had seen better days. We said the opposite that Japan was going to take over the world. The US was just coming into its baby boom, and Japan was just getting ready to peak and go down. In addition, their whole real estate and stock bubble was going to collapse. It is pretty obvious if you look at it, but people extrapolate trends.

We have been doing this with China, which has grown between 8 and 10% for the last couple decades. People have been predicting China will be the biggest economy in the world, and they are not. They are going to slow unbelievably and have the biggest Depression in history, possibly much worse than ours. With our demographics, we have a substantial echo boom generation, not larger than the baby boom but it almost replaces it. Europe does not have this as much, but Japan and all of East Asia and China do not have this. Down the road we will look okay, and a lot of the country’s people say it will do great and we will stay just like Japan did in the 90s. If you just look at demographics, you would have known that it was impossible for Japan to overtake the US economy unless they made three times as much money per capita as we do. They are good, but they are not that good.

Another book Harry wrote was The Great Depression Ahead in 2009. At one time he felt this was the likely outcome and that it would probably already be in full swing. Bruce asked what happened that prevented the outcome he thought was going to occur. The book was written in late October 2008 in the midst of the worst of the crisis and was written several months before that. They predicted twenty years ago that 2008 would be the beginning of the slowdown of the baby boomers and the bursting of a big bubble market. However, he did not even remotely consider that for the first time in history, central banks around the world would not only put interest rates at zero, but they would throw $10-$12 trillion in cold, hard artificial cash into the economy.

Central banks always lower interest rates, and governments always run some extra deficits as well as spend extra money to help. However, this has never even remotely happened. What they have done is refueled the bubble. In other words, in 1929 the bubble burst and all types of debts went bad. Banks went under and depositors lost money, but debt deleveraged substantially. We went from 200% debt to GDP down to 60%, which made our economy stronger long-term. This included housing, commodities, and the cost of living went down. This made the economy stronger and the standard of living better over time. However, it was a depression and debt deleveraging, and this was always the most painful thing that could happen to the economy. This is what we expected would happen.

It did not happen because governments stepped in, and now we are saying we have had 5-6 years of them pumping up the bubble and there is more income inequality than ever. Stocks are more overvalued than ever and there is more debt than we had before the last bubble even though some consumer debt deleveraged. Corporate debt is higher, and companies have been borrowing money at nothing to buy back their stock and make their earnings better than they are. Speculators are taking money and levering up 30-50-1. This is why oil is bubbling up and crashing again just like last time. All the central banks kept the bubble going and kept the imbalances.

We are going to have to deal with this debt and deal with these bubbles. Unless they deflate, the next generation has no chance of affording a house, no chance of investing for retirement, and no chance of having anywhere near the standard of living we had. We are going to have to go through this, and we are seeing that everything is cracking. They tried to hold it together in Europe, and we said no because things get worse. They are not able to hold it together, and things are going to get worse. China’s bubble is starting to crack, prices are starting to fall, developers are discounting up to 40%. This is something they have never done in China and is against the Holy Grail. They sell overvalued real estate to affluent investors who do not rent out because there is no rental market in China. If you do not own at least 300 square feet, you have no chance of getting a date or anything. It is not a rental society, so they just leave these things empty.

This is what makes it so dangerous over there. The whole thing is a bubble, and bubbles always burst. The greater the bubble, the greater the burst, and the greatest bubbles happen in the hottest cities. All these people Harry knows in New York, LA, San Francisco, Sydney, and London think these are the places that cannot go down. Instead, these are the ones history proves go down the worst before they finally burst. The intervention definitely prevented a much worse scenario that would have unfolded in California real estate. Even given that we went from $600,000 to $250,000, and it took less than 18 months to accomplish that.

When they stopped foreclosing on properties and stopped putting that inventory in the MLS, you had a RESPA in all the policies that came in between that. Had they foreclosed on everyone who stopped making a payment, it would not have been comfortable to see what had happened. At the end of the day you have to look at that and say it did prevent a great depression only to say that what is next may not be any more pleasant but is what will be discussed. Harry said it can only be worse. If you take more of a drug to keep from coming down, you are only going to crash harder. That is what life says.

If you want to check out Harry Dent’s materials, check him out on his website at www.harrydent.com. They have a free daily newsletter and high content that is very educational. Www.dentresearch.com is where you can learn more about the company and all they do as well as their methods and broad array of services. Tune in next week as Bruce continues his discussion with Harry Dent, author and economist.

Harry Dent Radio Show

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.