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The Norris Group Real Estate News Roundup 3/12/10

Friday, March 12th, 2010

Today’s News Synopsis:

The FDIC sold $1.8bn of residential mortgage-backed securities. The Federal Reserve bought a total of $10bn worth of mbs. More than 25 percent of the home owners who received trial modifications have been removed from Obama’s program. Approximately 462,000 new unemployment claims were made last week.

In The News:

Housing Wire – “FDIC Details $1.8bn Structured Financing Transaction” (3-12-10)

“The Federal Deposit Insurance Corp. (FDIC) today closed on a sale of notes backed by residential mortgage-backed securities (RMBS) from seven failed bank receiverships. The news of the closing, summarized in an FDIC press release today, marks the first official release of information on $1.8bn of structured notes that roadshowed and priced in recent weeks.”

Housing Wire – “BofA Makes 21,000 HAMP Modifications Permanent” (3-12-10)

“Bank of America (BAC: 16.985 -0.79%) reported 21,000 permanent modifications under the Home Affordable Modification Program (HAMP) through February. The US Treasury Department launched HAMP in March 2009 to provide incentives to servicers for the modification of loans on the verge of foreclosure. BofA faced industry criticism for reporting 98 permanent modifications through November 2009.”

Housing Wire – “Fed MBS Purchases 98% Complete with Another $10bn” (3-12-10)

“The New York Federal Reserve Bank bought another $10bn of agency mortgage-backed securities (MBS) in the week ending March 10 as the $1.25trn program, now 98% complete, winds down to a close. The Fed bought $29.4bn gross of MBS — $4.4bn Freddie Mac (FRE: 1.2801 -1.53%) MBS, $25bn Fannie Mae (FNM: 1.0701 -2.72%) MBS, and no Ginnie Mae MBS. After reporting $19.4bn of MBS sales through the same week, the Fed’s net purchases came to $10bn, level with last week’s agency MBS buys.”

Bloomberg - “More Than 250,000 Borrowers Dropped From U.S. Modification Plan” (3-12-10)

“More than 250,000 of the 1 million borrowers who have received trial loan modifications through the Obama administration’s chief foreclosure prevention plan have either dropped out or been removed from the program through February, the Treasury Department said.”

Inman - “Credit Starvation Fallout” (3-12-10)

“Overall retail sales have risen 6 percent since the pit one year ago, but are still 6.5 percent below 2008. New unemployment claims are still elevated, running 462,000 last week.”

Inman - “NAR: Don’t rein in FHA” (3-12-10)

“FHA insured nearly 30 percent of purchase loans in 2009, including more than half of mortgages taken out by first-time homeowners, and NAR also wants lawmakers to make temporary increases in FHA loan limits in costly housing markets permanent. But rising claims have eroded FHA’s capital reserves below statutory limits, forcing the program’s administrators to tighten underwriting requirements and raise upfront mortgage insurance premiums.”

Orange County Register – “85,000 O.C. real estate jobs gone” (3-12-10)

“In January, Orange County real estate and finance bosses employed 199,200 workers, 24,600 below 2009 levels and 85,100 less than the recent cycle’s peak, by the state Employment Development Dept.’s freshly revised math.”

Looking Back:

One year ago, the MBA reported that commercial and residential mortgage delinquencies increased during the 4th quarter of 2008. Riverside and San Bernardino County were ranked as the 6th highest foreclosure market. U.S. foreclosures increased by 30 percent in one month. Freddie Mac’s statistics showed that 30-year mortgage rates decreased to 5.03 percent.

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The Norris Group Real Estate News Roundup 3/11/10

Thursday, March 11th, 2010

Today’s News Synopsis:

According to the MBA, the delinquency rate for CMBS increased by 1.63 percent during the last half of 2009. Statistics from RealtyTrac show that 2 percent fewer homes entered the foreclosure process in February. Nineteen percent of home listings experienced a price reduction since March 1st.

In The News:

Mortgage Bankers Association – “MBA Report Shows Economic Fallout Continues to Impact Commercial Real Estate Markets/Delinquencies in 4th Quarter 2009″ (3-11-10)

“Between the third and fourth quarters, the 30+ day delinquency rate on loans held in commercial mortgage-backed securities (CMBS) rose 1.63 percentage points to 5.69 percent. The 60+ day delinquency rate on loans held in life company portfolios decreased 0.04 percentage points to 0.19 percent. The 60+ day delinquency rate on multifamily loans held or insured by Fannie Mae rose 0.01 percentage points to 0.63 percent. The 90+ day delinquency rate on multifamily loans held or insured by Freddie Mac increased 0.04 percentage points to 0.15 percent. The 90+day delinquency rate on loans held by FDIC-insured banks and thrifts rose 0.49 percentage points to 3.92 percent.”

LA Times – “Fewer homes enter foreclosure process in February” (3-11-10)

“The number of homes caught up in some stage of the foreclosure process in February fell 2% from the previous month to 308,524, a real estate firm will report Thursday. That number is up 6% compared with the same month a year earlier but marked the smallest year-over-year increase since January 2006, according to RealtyTrac Inc.”

Housing Wire – “Sellers Cut Fewer Listing Prices as Home Price Declines Slow” (3-11-10)

“Fewer US homes for sale experienced listing price reductions this month, according to online real estate market Trulia.com. It’s further indication of a leveling out in listing price declines amid government stimulus to buy homes. A new low of 19% of listings currently on the market experienced a price cut as of March 1, 2010, based on Trulia’s database of live listings. Sellers slashed $21.6bn off of listing prices.”

Housing Wire – “COP Cites Missed Opportunities in Federal Bailout of GMAC” (3-11-10)

“GMAC, once the credit arm of General Motors and now the 14th largest bank holding company in the US, could have been placed into bankruptcy and its costly subsidiary operations wound-down, the Panel said.”

Housing Wire – “FDIC Pricing Second Round of ABS” (3-11-10)

“The second round of structured financed notes being issued by the Federal Deposit Insurance Corp. (FDIC) is being priced today. The news comes after the successful launch of the FDIC project to use structured finance as a way to profit from the certain assets of failed banks. It is believed the FDIC is cherry-picking the best performing loans to sell to investors as asset-backed securities (ABS).”

Housing Wire – “Jumbo RMBS Delinquencies Nearing Third Year of Rises” (3-11-10)

“The prime jumbo mortgage market, especially in California and Florida, continues to deteriorate in the residential-mortgage backed securities (RMBS) space, posting rising 60-day or more delinquencies for the 33rd consecutive month, according to Fitch Ratings. And to jumbo market players, the trend is expected to continue for some time.”

Housing Wire – “Weekly Mortgage Rates Dip Again” (3-11-10)

“Freddie Mac’s (FRE: 1.30 -0.76%) weekly survey put the average rate for a 30-year FRM at 4.95% with an average 0.7 origination point for the week ending March 11, down from the previous week when it was 4.97%. A year ago, Freddie’s survey averaged 5.03%.”

Housing Wire – “Storm Brews Over Short Sale Valuations as the Mortgage Market Prepares for HAFA” (3-11-10)

“A storm is brewing between appraisers and broker price opinion (BPO) professionals vying for valuation work for short sales conducted through the Making Home Affordable Foreclosure Alternatives (HAFA) program. The Appraisal Institute — a trade group that represents appraisers — released a public letter it wrote to Treasury Secretary Timothy Geithner on Tuesday, calling for an end of the practice of using BPOs for Making Home Affordable modifications and refinancings, as well as amending the rules for the upcoming HAFA program to require appraisals to determine value for government-incentivized short sales.”

Bloomberg - “REIT Chief Executives See Strengthening Market for Asset Sales” (3-11-10)

“Investors with abundant cash and few deals to chase are driving up commercial property prices, real estate chief executive officers said today.”

Bloomberg - “Apartment Vacancy Rates in U.S. to Decline in 2010, CBRE Says” (3-11-10)

“Apartment vacancies in the U.S., which reached a record high of 7.4 percent in 2009, will fall this year as job losses stabilize and fewer new rental homes enter the market, CB Richard Ellis Group Inc. said. The vacancy rate will decline to 6.8 percent in 2010, the property broker said in a report today. Effective rents, or what tenants pay after concessions, will end the year less than 1 percent down from the fourth quarter of 2009. Rents fell 4.7 percent in the final quarter of last year from a year earlier. “

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The Norris Group Real Estate News Roundup 2/8/10

Monday, February 8th, 2010

Today’s News Synopsis:

The U.S. Treasury Department reported 66,465 permanent loan modifications over 8 months. Delinquencies on prime jumbo loans increased to 10 percent in January. According to Altera Real Estate, distressed property sales increased in Dana Point and Laguna Beach. Unemployment in the U.S. construction industry increased to 24.7 percent in January.

In The News:

California Builder – “2010 Economic Forecast: The Bear Turns Bullish” (2-8-10)

“In April of 2009, we reversed our tune and called for a ‘W,’ which would be an improvement in the market until the tax credit expired. However, with the federal tax credit extended through June for all buyers, and affordability far better than we imagined at the time, the risk of a second leg down has been significantly reduced.”

Housing Wire – “House Committee Investigates HAMP ‘Effectiveness’” (2-8-10)

“The US Treasury Department launched HAMP in March 2009 to allocate capped incentives to borrowers for the modification of loans on the verge of foreclosure. After eight months in the program, the Treasury reported 66,465 permanent loan modifications in December, up from 31,382 permanent modifications in November.”

Housing Wire – “Fitch Says Prime Jumbo RMBS Near 10% Delinquent” (2-8-10)

“The performance of US prime jumbo loan performance within residential mortgage-backed securities (RMBS) slipped again in January as serious delinquencies (60+ days past due) rose for the 32nd consecutive month and edged closer to 10%, according to the latest market commentary from Fitch Ratings.”

Housing Wire – “Monday Morning Cup of Coffee” (2-8-10)

“The editorial argues the $111bn in mortgage losses covered by the Treasury Department was justifiable as an emergency measure to keep the housing market from collapsing entirely. But with continued losses projected in 2011 and 2012, covering the GSEs in perpetuity would cost more than $1.6trn, on top of the national debt of $12.3trn.”

Housing Wire – “BofA Lends $758bn in 2009″ (2-8-10)

“Bank of America (BAC: 14.48 -3.47%) said it extended more than $758bn in credit in 2009, including nearly $180bn in Q409. BofA originated $87bn in first mortgages to fund purchase or refinance loans for more than 400,000 borrowers in Q409. That total includes $23bn in mortgages made to 151,000 low- and moderate-income borrowers. For the year, BofA originated $378bn in first mortgages for more than 1.7m customers, including $87bn in mortgages to more than 561,000 low- and moderate-income borrowers. In Q409, BofA originated $3bn in home equity and reverse mortgage loans, bringing the total for 2009 to $13bn.”

Orange County Register – “South coast: short sales, foreclosures up” (2-8-10)

“Most of our south coast cities went against the grain and reflected the opposite of the countywide trend by seeing an increase in distressed properties for sale. Two weeks ago, Dana Point’s percentage of short sales and foreclosures was 24.7%, which has risen just slightly to 24.8%, according to a biweekly report by Steven Thomas of Altera Real Estate. Laguna Beach also saw a slight increase in distressed properties. The percentage of short sales and foreclosures rose from 9% two weeks ago to 9.3%.”

Orange County Register – “1-in-4 U.S. construction workers jobless” (2-8-10)

“The U.S. construction industry’s unemployment rate hit 24.7% in January as another 75,000 American construction workers lost their jobs.”

Realty Times – “Developing Referral Relationships” (2-8-10)

“The primary objective of your first contact, like the objective of any other first sales call to a new prospect, is to book an appointment. The first appointment might take the form of an exploratory session aimed at determining the wants, needs, and desires of the lead, or it might be an appointment to conduct a buyer consultation or listing presentation. The secondary objective of your first contact is to open the door, establish trust and respect, demonstrate your knowledge, and establish your position as a reliable resource.”

Looking Back:

One year ago, the MBA ranked Wachovia as the leading national commercial and multifamily loan servicer. Geithner promised that lenders receiving financial rescue would be required to offer mortgage modifications. A total of 70 banks were shut down within the first month of 2009.

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The Norris Group Real Estate News Roundup 1/14/10

Thursday, January 14th, 2010

Today’s News Synopsis:

According to Freddie Mac, the 30-year fixed mortgage rate fell to 5.06 percent this week. 2.8 million properties received a foreclosure notice in 2009. Interactive Mortgage Advisors is selling $130 billion worth of Ginnie Mae’s servicing portfolio. President Obama is proposing a tax on all companies who received bailout money, which would last until all bailout money is paid back.

In The News:

Chicago Tribune – “Rates on 30-year mortgages drop to 5.06 pct, second straight weekly decline” (1-14-10)

“Rates for 30-year home loans edged lower for the second straight week, a report said Thursday, but remained above last month’s record lows. The average rate on a 30-year fixed mortgage was 5.06 percent this week, down from 5.09 percent a week earlier, mortgage company Freddie Mac said.”

Housing Wire – “Foreclosure Filings Hit New Record in 2009: RealtyTrac” (1-14-10)

“In 2009, a record 2.8 million properties received a foreclosure filing, a 21% jump from 2008 and a 120% increase from 2007, according to online marketplace RealtyTrac, which reported the numbers Thursday.”

Housing Wire – “Barack Wants ‘Responsibility Fee’ to Get Bank Bailout Funds Back” (1-14-10)

“President Barack Obama is proposing a ‘Financial Crisis Responsibility Fee’ to tax large financial institutions that received government funds through the Troubled Asset Relief Program (TARP). The news comes in the midst of reports that the government may earn billions of dollars on bailouts. The proposed fee would last for at least 10 years, until all taxpayer dollars are repaid. The fee would apply to the debt of financial institutions with more than $50bn of consolidated assets.”

Housing Wire - “Congressman Proposes 50% Tax on Wall Street Bonuses” (1-14-10)

“Rep. Peter Welch (D-VT) introduced legislation this week to levy new taxes on yearly employee bonuses at financial institutions receiving assistance from the Troubled Asset Relief Program (TARP). Under the bill, bonuses above $50,000 in either cash or stock would be taxed at a rate of 50%.”

Housing Wire – “BofA Permanent HAMP Modifications Jump from 98 to 3,200 in December” (1-14-10)

“The Bank of America (BAC: 16.82 +1.20%) book of permanent loan modifications under the Home Affordable Modification Program (HAMP) grew from 98 mortgages by the end of November 2009 to 3,200 by January 2010, according a company announcement. In the US Treasury Department’s November progress report, BofA completed 98 permanent modifications from the program’s launch in March 2009 through November. Since then, nearly 3,200 borrowers received a completed HAMP modification, and another 12,000 of the BofA borrowers sent their finally modified loan documents under HAMP to be signed and returned by BofA.”

Housing Wire – “Height-of-Boom Subprime Performance Keeps Getting Worse: Moody’s” (1-14-10)

“The basket of mortgage backed securities that the credit rating agency reviewed for its report deal with loans originated during the recent boom years in housing finance. Moody’s is now projecting cumulative losses of 18.7% for 2005 vintage securitizations, 38.4% for 2006 RMBS and 48.1% for 2007 RMBS.”

Housing Wire – “IMA to Sell $130m Ginnie Mae Servicing Portfolio” (1-14-10)

“Interactive Mortgage Advisors (IMA) is facilitating the sale of a $130m Ginnie Mae bulk servicing portfolio on behalf of an undisclosed seller, an independent mortgage banker, according to an offering obtained by HousingWire. The offering covers 937 loans with a combined principal balance of more than $130m. The loans bear a weighted average interest rate of 6.17% and a weighted average service fee of 0.53%.”

Bloomberg - “Issa Proposes Inspector General for Fannie, Freddie Agency” (1-14-10)

“The companies’ regulator, the Federal Housing Finance Agency, has been without an inspector general for at least 17 months since the Federal Housing Finance Board that oversaw the 12 regional Federal Home Loan Banks was merged with Fannie Mae and Freddie Mac’s former overseer to create FHFA. The companies in that time have been taken over by FHFA and given access to what is now an unlimited amount of emergency Treasury Department funding.”

Bloomberg - “Lehman Wins Court Approval to Spend $1.4 Billion to Buy Loans” (1-14-10)

“Lehman Brothers Holdings Inc., the investment bank liquidating in bankruptcy, won a U.S. judge’s approval to spend $1.4 billion to buy loans and mortgages from an insolvent German affiliate, Lehman Brothers Bankhaus.”

Looking Back:

One year ago, the NAR estimated that a homebuyer tax credit could result in 555,000 home sales. Barclay’s Capital claimed that allowing judges to reduce the principal amount on mortgages would not reduce foreclosures. Fannie Mae created a policy allowing people leasing a property to continue occupying their property for a short time after the foreclosure process. PMI Mortgage Insurance estimated that home prices would continue to fall until the 3rd quarter of 2009.

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The Norris Group Real Estate News Roundup 1/13/10

Wednesday, January 13th, 2010

Today’s News Synopsis:

According to the CBIA, condominium sales were 39 percent higher from last year. The MBA’s weekly survey shows that mortgage loan application volume increased by 14.3 percent from last week. Jumbo residential mortgage-backed securities increased to 9.2 percent from December 2008 to December 2009. All but two of the Federal Reserve districts reported increased activity or improved conditions.

In The News:

CBIA - “California New-Home Market Dips Slightly in November, CBIA Announces” (1-13-10)

“The monthly CBIA/Hanley Wood Market Intelligence (HWMI) New-Home Sales and Pricing Report showed that sales in new-home communities of 10 units or more were 4 percent below November 2008, representing a less impressive result than last month’s year-over-year increase, but was nevertheless an improvement from most months in 2009. During November, 1,860 new homes and condominiums were sold in the subdivisions tracked by Costa Mesa-based HWMI, compared to 1,934 in November 2008. Sales of single-family homes were down by 18 percent, while sales of townhomes and “plexes” – duplexes, triplexes, etc. – were up 8 percent and sales of condominiums were 39 percent higher than a year ago thanks to strong sales at projects in the Los Angeles and San Diego areas.”

Mortgage Bankers Association – “Mortgage Refinance Applications Increase While Purchase Applications Remain Flat in Latest MBA Weekly Survey” (1-13-10)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending January 8, 2010.  The Market Composite Index, a measure of mortgage loan application volume, increased 14.3 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 66.0 percent compared with the previous week, which was a shortened week due to the New Year’s holiday.”

San Francisco Chronicle – “State adopts greenest building codes in U.S.” (1-13-10)

“The new code, dubbed Calgreen, will take effect next January and requires builders to install plumbing that cuts indoor water use, divert 50 percent of construction waste from landfills to recycling, use low-pollutant paints, carpets and floorings and, in nonresidential buildings, install separate water meters for different uses. It mandates the inspection of energy systems by local officials to ensure that heaters, air conditioners and other mechanical equipment in nonresidential buildings are working efficiently. And it will allow local jurisdictions, such as San Francisco, to retain their stricter existing green building standards, or adopt more stringent versions of the state code if they choose.”

Housing Wire – “Prime Jumbo RMBS Delinquencies Swell to 9.2%: Fitch” (1-13-10)

“Delinquency of more than 60 days among prime jumbo residential mortgage-backed securities (RMBS) nearly tripled to 9.2% in December 2009, from 3.2% at the end of 2008, according to Fitch Ratings.”

Housing Wire – “GSEs Could Lose $448bn of MBS Guarantee Business, Says Amherst” (1-13-10)

“Losses on the combined credit-guarantee books of government-sponsored enterprises (GSEs) Freddie Mac (FRE: 1.41 +2.17%) and Fannie Mae (FNM: 1.14 +1.79%) could reach 9.6% – or $448bn – according to market analysis by Amherst Securities Group.”

Housing Wire – “Housing Sales Up, Prices Remain Steady: Beige Book” (1-13-10)

“All but two Fed districts reported increased activity or improved conditions, with Philadelphia and Richmond seeing mixed results. In the December 2 edition of the Summary of Commentary on Current Economic Conditions, commonly called the Beige Book, eight districts reported an uptick in their perspectives economy. The book is published eight times a year and is a nationwide economic indicator compiled from the 12 Fed districts.”

Housing Wire – “Government to Earn Billions on Bailouts” (1-13-10)

“The US Treasury Department expects profits of at least $19bn from bank investment programs under the Troubled Asset Relief Program (TARP), according to market commentary Wednesday by the American Bankers Association (ABA). Originally projected to cost $76bn according to the ABA, the outlook for TARP bank programs was updated in December in anticipation of actual profits.”

Housing Wire – “FinestExperts Ranks Top 2010 Real Estate Investment Markets” (1-13-10)

“FinestExpert.com named Dallas-Fort Worth as the hottest real estate investment market for 2010. After analyzing more than 10,000 real estate markets to identify stable, growth-oriented for investors, San Francisco-based FinestExpert.com formed its first top-20 hottest real estate investment market list for 2010.”

Housing Wire – “Cancelled Foreclosures Outnumber Sales in California: ForeclosureRadar” (1-13-10)

“The amount of California foreclosure cancellations increased 26.5% in December to 13,243, primarily due to loan modifications. And for the first time this number overtook foreclosures reaching real-estate owned (REO) status, according to ForeclosureRadar, which tracks foreclosure activity in the state. In December, the amount of foreclosures heading back to the banks, REO, dropped 11.9% from the previous month to 12,437. Significant declines in foreclosure discounts by lenders drove the decrease in sales to third parties, according to the report.”

Bloomberg - “Obama to Announce Fee on 20 Banks to Recoup TARP” (1-13-10)

“President Barack Obama will announce tomorrow his intention to impose a fee on roughly 20 of the country’s largest banks and financial institutions to help recoup taxpayer bailout money and trim the federal budget deficit. Obama will outline his proposal to raise as much as $120 billion at 11:45 a.m. local time at the White House, Obama’s press secretary, Robert Gibbs, told reporters. Gibbs said the president’s economic team has worked on a structure to prevent the levy from being passed onto consumers.”

Bloomberg - “Real Estate Bull Laub Sees Unprecedented Workout From Bad Debt” (1-13-10)

“Kenneth Laub has been through three commercial real estate boom and bust cycles during almost five decades as a broker and consultant to corporations such as Hess Corp. and International Paper Co. He says the current downturn will overshadow all of the others, Bloomberg Markets reports in its February 2010 issue.”

Looking Back:

One year ago, the NAHB encouraged congress to use a portion of the $700 billion bailout to increase credit for home purchases, and to stem foreclosures. California lost a total of 144,000 people from 2008 to 2009. Ben Bernanke warned that a fiscal stimulus would not cause an economic recovery. In November of 2008, 4 percent of homes were bought with adjustable rate mortgages.

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The Norris Group Real Estate News Roundup 1/11/10

Monday, January 11th, 2010

Today’s News Synopsis:

The national unemployment rate remained at 10 percent during December. LPS reports that 1 in every 7.5 fell into foreclosure or delinquency during November. According to Fitch Ratings, 2009 commercial delinquency rates ended at 4.71%.

In The news:

Bloomberg - “Shrinking U.S. Labor Force Keeps Unemployment Rate From Rising” (1-9-09)

“An exodus of discouraged workers from the job market kept the U.S. unemployment rate from climbing above 10 percent in December, economists said.”

Housing Wire – “More than 13% of Mortgages Delinquent or Foreclosed in November: LPS” (1-11-09)

“One in every 7.5 homeowners either fell into delinquency or foreclosure as of November 30, 2009, according to the December mortgage monitor report from Lender Processing Services (LPS), a mortgage data provider. The total amount of delinquencies reached a record high 9.97%, a 5.46% increase from the previous month and a 21.29% increase from November 2008. In a sign that homeowners continue their struggle to meet their monthly mortgage payments, loans falling into more severe delinquent categories reached 5.01% through November, compared to 1.52% of loans improved toward a current status.”

Housing Wire – “$47bn of Interest-Only RMBS Loans to Recast This Year, Fitch Says” (1-11-09)

“More than $47bn of collateral backing prime and Alt-A residential mortgage-backed securities (RMBS) is scheduled to recast over the next 12 months from an interest-only (IO) payment to a fully amortizing payment, Fitch Ratings said in market commentary Monday.”

Housing Wire – “Financial, Mortgage Hirings Up as Overall Employment Dips” (1-11-09)

“The DOL’s Bureau of Labor Statistics (BLS) on Friday said the national unemployment rate was 10% in December, unchanged from November. Despite the overall loss, the financial-activities sector gained a net 4,000 jobs in December, the first gain since summer 2007, according to a search of the Bureau of Labor Statistics online database. Jobs increased from November (7,691,000) to 7,695,00 in December.”

Housing Wire – “Q409 Losses on the Way for Banks: Citi” (1-11-09)

“Citigroup (C: 3.63 +1.11%) analysts expect Q409 losses for Morgan Stanley (MS: 32.04 -0.65%), Goldman Sachs (GS: 171.56 -1.58%), Bank of America (BAC: 16.93 +0.89%) and JPMorgan Chase (JPM: 44.53 -0.34%) due to a “substantial” decline in fixed-income, commodities and currencies (FICC) trading, according to a 2010 Outlook report.”

Housing Wire – “CMBS Delinquencies May Double by 2012, Says Fitch” (1-11-09)

“An increase in defaults across property types pushed total commercial mortgage-backed securities (CMBS) delinquencies 42 bps higher, closing 2009 at 4.71% delinquent, according to credit-rating agency Fitch Ratings. The rate of growth in delinquent CMBS looks set to continue in coming years, with a potential peak at 12% in 2012.”

Housing Wire - “Redefault Rates ‘Tragic’, Says Amherst” (1-11-09)

“According to Amherst Securities Group, default and prepayment rates on non-agency, private-label mortgage-backed securities (MBS) were constant in November. However, re-performance rates, where payments return to less than two months delinquent, were down and re-default rates “tragic” in November, according to market commentary provided by the firm.”

Bloomberg - “Fed’s Bullard Says Asset-Purchase Adjustments Main Policy Issue” (1-11-09)

“Federal Reserve Bank of St. Louis President James Bullard said the main challenge for U.S. policy makers will be to adjust the asset-purchase program so as to continue supporting economic growth without stoking inflation. ”

Looking Back:

One year ago, some Realtors forecasted that condo prices would not bottom in 2009. Congressional budget analysts anticipated a $1.2 trillion deficit for 2009.

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The Norris Group Real Estate News Roundup 1/7/10

Thursday, January 7th, 2010

Today’s News Synopsis:

Home equity delinquencies increased to 4.3 percent of all accounts. Many construction companies reported an increase in profit during the 4th quarter of 2009. REIS Inc. reports that U.S. apartment vacancies rose to 8 percent last quarter. According to Freddie Mac, mortgage rates decreased to 5.09 percent from last week.

In The News:

Housing Wire – “Lennar Posts Quarterly Profit, Expects $320M Tax Refund” (1-7-09)

“Miami-based homebuilder Lennar (LEN: 15.70 +14.60%) reported net earnings of $35.6m, $0.19 per share, for its fiscal year fourth quarter that ended Nov. 30 and said it will receive a tax refund of $320m as a result of legislation that temporarily allowed companies to recoup losses from taxes paid in profitable years.”

Housing Wire – “Invesco Mortgage Capital Planning Another Share Sale” (1-7-09)

“Seeing a growing appetite for deals from investors, Invesco Mortgage Capital (IVR: 22.37 -2.10%), a real estate investment trust (REIT), plans to offer 7m shares of its common stock for sale in order to fund the acquisition of residential and commercial mortgage-backed securities (RMBS and CMBS) and leveraged mortgage loans.”

Housing Wire – “Delinquency Grows in Home Equity Loans, Lines of Credit: ABA” (1-7-09)

“Housing-related loans continued to show stress. Home equity loan delinquencies hit another record in the quarter, jumping 29 bps to 4.3% of all accounts. Home equity lines of credit rose 20 bps to 2.12% of all accounts. Mobile home delinquencies increased to 3.63% of all accounts, from 3.53% the previous quarter.”

Housing Wire – “Beazer to Offer 18m Shares, $50m in Convertible Debt” (1-7-09)

“Beazer Homes (BZH: 5.06 +6.08%) will issue new common stock and convertible subordinate debt, the Atlanta-based homebuilder said in a pair of Securities and Exchange Commission (SEC) filings. According to the filings, Beazer will issue 18m shares of common stock and $50m in convertible subordinate debt which will convert to stock shares in 2013.”

Bloomberg - “Job Growth Erodes as Housing Bust Pushes Mobility to Record Low” (1-7-09)

“Some households are staying put because they owe more on their mortgages than their properties are worth; others have trouble selling houses in depressed areas, economists say. The S&P/Case-Shiller composite index of home prices in 20 U.S. metropolitan areas was down 29 percent in October from its July 2006 peak.”

Bloomberg - “Principal Cuts on Lender Menus as Foreclosures Rise” (1-7-09)

“While interest-rate reductions or extending loan terms reduce homeowners’ monthly payments, they don’t give much comfort to borrowers who owe more on their homes than their properties are worth. Borrowers who don’t have equity in their homes are more likely to hand over the keys when they run into trouble.”

Bloomberg - “Lennar Leads Builders Higher on Report of Unexpected Profit” (1-7-09)

“Lennar Corp. led U.S. homebuilders higher after the company reported an unexpected quarterly profit as it took advantage of a tax change in the way it accounts for land sales. A Standard & Poor’s measure of 12 home construction companies rose as much as 5.4 percent, the most since November. Lennar climbed as much as 13 percent. KB Home, M/I Homes Inc., Toll Brothers Inc. and D.R. Horton Inc. all gained.”

Bloomberg - “Mortgage Rates on 30-Year U.S. Loans Fall to 5.09%” (1-7-09)

“Mortgage rates in the U.S. fell for the first time in five weeks, lowering borrowing costs and offering a boost to potential buyers. The rate for 30-year fixed U.S. home loans fell to 5.09 percent for the week ended today from 5.14 percent, mortgage finance company Freddie Mac said. Rates hit a record low 4.71 percent the week of Dec. 3. This week’s average 15-year rate was 4.50 percent, Freddie Mac said in today’s statement. ”

Bloomberg - “Record U.S. Apartment Vacancies Force Landlords to Cut Rents” (1-7-09)

“U.S. apartment vacancies rose to a record 8 percent in the fourth quarter and rents fell the most in three decades as unemployment cut demand, according to Reis Inc.”

Looking Back:

One year ago, the Mortgage Bankers Association reported that mortgage applications were decreasing. Statistics from Default Research showed that foreclosures and defaults had significantly increased across California. Apartment rents fell and vacancy rates increased to a 4 year high. Freddie Mac reported that mortgage rates fell for the 9th week in a row.

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The Norris Group Real Estate News Roundup 12/18/09

Friday, December 18th, 2009

Today’s News Synopsis:

DQNews reports that a total of 35,860 new and resale houses and condos were sold in California during November. The median selling price for Bay Area homes fell by 0.8 percent last month. According to First American Corelogic, approximately 1.7 million homes are in shadow inventory. Deutsche Bank expects that U.S. home prices will decrease another 10 percent.

In The News:

DQNews - “California November Home Sales” (12-17-09)

“An estimated 35,860 new and resale houses and condos were sold statewide last month. That was down 13.1 percent from 41,280 in October, and up 11.5 percent from 32,163 for November 2008. A decline in sales from October to November is normal for the season. California sales for the month of November have varied from a low of 25,578 in 2007 to a peak of 60,326 in 2004, while the November average is 40,377. MDA DataQuick’s statistics go back to 1988.”

DQNews - “Bay Area home sales and median price top last year again” (12-18-09)

“The median price paid for all new and resale houses and condos that closed escrow in the nine-county Bay Area last month was $387,000. That was down 0.8 percent from $390,000 in October but up 10.6 percent from $350,000 in November 2008, according to MDA DataQuick of San Diego.”

NAR - “Four out of 10 Recent Buyers Relied on FHA Loans, Says NAR” (12-18-09)

“According to the most recent Realtors® Confidence Index, 39 percent of recent buyers purchased a home with a Federal Housing Administration-insured loan. Realtors® who took part in the November survey also reported that the number of first-time home buyers continued to climb to 51 percent.”

Housing Wire – “Moody’s See Decelerating Jumbo Declines Around Falling House Prices” (12-18-09)

“During a revision of Moody’s Investors Service loss projections for U.S. prime jumbo residential mortgage backed securities (RMBS) issued between 2005 and 2008, the credit rating agency finds that the growth in new delinquency levels beyond the Q210 is expected to decline. On average, Moody’s is now projecting cumulative losses of 3.8% for 2005 securitizations, 8.0% for 2006 securitizations, 10.9% for 2007 securitizations and 12.3% for 2008 securitizations, reported as a percentage of original balance.”

Housing Wire – “Months Later, Thornburg Servicing Portfolio to Sell” (12-18-09)

“Similarly, now-bankrupt Thornburg Mortgage left behind significantly more valuable assets months after the credit crisis took its toll on the ultra-prime jumbo mortgage lender. One of these assets — a $11.1bn of residential loan servicing rights portfolio — is going up for sale by Interactive Mortgage Advisers (IMA) as part of the sale of assets under Thornburg’s bankruptcy.”

Housing Wire – “Deutsche Sees House Prices Falling Another 10 Percent” (12-18-09)

“Today, Deutsche Bank researchers say these predictions will likely become a reality, with the total peak-to-trough decline of US home prices hitting nearly 40%. In the current outlook, they say home prices will drop a further 10 to 12% from current levels.”

Housing Wire – “TenantAccess Helps Handle Shadow Inventory” (12-18-09)

“After FirstAmerican Corelogic found 1.7m homes in the shadow inventory, TenantAccess will offer a range of programs to manage this backlog of residential foreclosures.”

Orange County Register – “Is Irvine still a buyer’s market?” (12-18-09)

“While the inventory of resale homes continues to dwindle in Irvine and multiple offers above asking price aren’t rare, America’s Safest City remains a buyer’s market, according to Altos Research’s Market Action Index.”

Orange County Register – “South O.C.’s $1 million-plus short sales” (12-18-09)

“Here’s how it breaks down – There are currently a total of 32 homes in south coast cities that are short sales priced at $1 million or higher: 10 in Laguna Beach, 11 in Dana Point and 12 in San Clemente. These are situations where the homeowner is taking a loss on their home by selling it for less than they owe on the loan. However, there are a total of 198 foreclosures in these cities – 27 in Laguna Beach, 56 in Dana Point and 115 in San Clemente.”

Looking Back:

One year ago, median home prices in the Bay Area sunk to an 8-year low. The FDIC reported that bank reserves were falling behind on the number of bad loans they held. The Federal Reserve bought $2.4 billion in debt from Fannie Mae and Freddie Mac.

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The Norris Group Real Estate News Roundup 11/10/09

Tuesday, November 10th, 2009

Today’s News Synopsis:

According to the NAR, existing home sales increased by 11.4 percent in the second quarter. The Treasury Department reports that 20 percent of borrowers have signed up for a loan modification. A poll from Reuters shows that economists expect the unemployment rate to reach 10.5 percent next year.

In The News:

NAR - “Existing-Home Sales Surge in Many States in Third Quarter, Metro Prices Moderating” (11-10-09)

“Total state existing-home sales, including single-family and condo, increased 11.4 percent to a seasonally adjusted annual rate1 of 5.30 million units in the third quarter from 4.76 million units in the second quarter, and are now 5.9 percent above the 5.01 million-unit pace in the third quarter of 2008″

Los Angeles Times – “Fewer banks tightened lending standards last quarter, Federal Reserve says” (11-10-09)

“Demand for most types of loans weakened at a smaller number of banks than in the second quarter, the Fed also said Monday in its quarterly Senior Loan Officer survey. For prime residential mortgages, a larger number of banks reported stronger demand, the central bank said.”

San Francisco Chronicle – “Housing plan reaches 1 in 5 borrowers” (11-10-09)

“As of the end of October, more than 650,000 borrowers, or 20 percent of those eligible, had signed up for trials lasting up to five months, the Treasury Department said Tuesday. The modifications reduce monthly payments to more affordable levels.”

Housing Wire – “Sen. Dodd Reveals New Financial Reform Proposal” (11-10-09)

“The bill, drafted by committee chairman Chris Dodd (D-Conn.), would create the Consumer Financial Protection Agency, which provides consumers information when they shop for mortgages, credit cards and other products. The agency would prohibit hidden fees, abusive terms and deceptive practices.”

Housing Wire – “House Prices Down Nearly 1% from August: Altos Research” (11-10-09)

“A market composite of housing prices compiled by Altos Research was down 0.4% from September to October and down 0.9% from August. The composite of 10 major housing markets put home sales prices at $501,377 in October, down from $503,401 in September and $506,180 in August.”

Housing Wire – “Fitch Sees Prepayment Rate Near 7% for ‘04 Subprime RMBS” (11-10-09)

“Fitch’s ‘04 vintage subprime RMBS price index dropped 16.7% in the most recent month of data, while the overall subprime RMBS price index showed only a ‘marginal’ monthly fall. The ‘04 vintage loss erased the small monthly gains among ‘05, ‘06 and ‘07 vintages.”

Bloomberg - “Toll Brothers Revenue Declines Less Than Estimated” (11-10-09)

“Toll Brothers Inc., the nation’s largest luxury homebuilder, announced fourth quarter revenue that beat analysts’ estimates. The shares gained. Revenue dropped to $486.6 million in the quarter ending Oct. 31 from $698.9 million a year earlier, the Horsham, Pennsylvania-based builder said in a statement. Twelve analysts in a Bloomberg survey predicted an average of $373.5 million in revenue.”

Bloomberg - “PennyMac’s Kurland Plans New Effort in Mortgages” (11-10-09)

“PennyMac Mortgage Investment Trust, the buyer of troubled housing debt, expects to start purchasing newly issued loans and packaging them into bonds by the middle of next year, Chief Executive Officer Stanford Kurland said. The new initiative would be run by Private National Mortgage Acceptance Co., the manager of Calabasas, California- based PennyMac, Kurland said in an interview. Private National Mortgage, which he also heads, is working to enter the business as well.”

CNBC - “Jobless Rate to Hit 10.5%, Keeping Fed in Box: Poll” (11-10-09)

“Unemployment in the United States will shoot to 10.5 percent by the middle of next year, constraining the Federal Reserve’s ability to raise interest rates, according to economists surveyed by Reuters.”

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The Norris Group Real Estate News Roundup 10/29/09

Thursday, October 29th, 2009

Today’s News Synopsis:

Moody’s estimates that prices will continue to decline until Q3 of 2010. According to Freddie Mac, interest rates on 30-year fixed rate loans have increased to 5.03 percent. The U.S. Census Bureau reports that the number of vacant properties rose to 18.7 million, but the homeownership rate has maintained at 67.6 percent.

In The News:

San Francisco Chronicle – “Economy growing but recovery could be at risk” (10-29-09)

“Federal support for spending on cars and homes drove the economy up 3.5 percent from July through September. But the government aid — from tax credits for home buyers to rebates for auto purchases — is only temporary. Consumer spending, which normally drives recoveries, is likely to weaken without it.”

Housing Wire – “House Price Declines Weigh on Alt-A, Jumbo RMBS Ratings: Moody’s” (10-29-09)

“Moody’s Investors Service on Thursday said it will begin taking ratings actions in Q409 as needed to account for updated assumptions underlying US residential mortgage-backed securities (RMBS) loss projections. The loss projection revisions come as Moody’s expects house prices to continue to decline to a Q310 trough. Based on recent loan loss severities, the rating agency will increase its projected lifetime loan losses for pools backing US Jumbo, Alt-A, Option ARM and subprime RMBS issued from ‘05 to ‘08.”

Housing Wire – “Sallie Mae To Lose $95M on Mortgage, Real Estate Sale” (10-29-09)

“Student loan giant SLM Corp. (SLM: 10.20 +1.09%) will recognize a loss of as much as $95m on the sale of mortgages and real estate-related assets this quarter, according to a Securities and Exchange Commission (SEC) filing.”

Housing Wire – “CIT Gets Second Private Capital Bailout” (10-29-09)

“CIT Group Inc. (CIT: 0.9146 -13.72%), a commercial lender offering financing to small and medium businesses, this week expanded an existing $3bn senior secured credit facility to obtain $4.5bn in new credit.”

Housing Wire – “Freddie Sees Weekly 30-Year Fixed Rate Pass 5%” (10-29-09)

“Freddie Mac’s (FRE: 1.2901 +11.22%) weekly survey put the 30-year fixed-rate mortgage (FRM) interest rate at 5.03% with an average 0.7 point for the week ending Oct. 29, up from 5% in the previous week. A year ago, the rate was 6.46%.”

Bloomberg - “U.S. Home Vacancies Rise to 18.8 Million on Defaults” (10-29-09)

“The number of vacant properties, including foreclosures, residences for sale and vacation homes, rose from 18.4 million a year earlier and 18.7 million in the second quarter, the U.S. Census Bureau said in a report today. The record high was in the first quarter, when 18.95 million homes were vacant. The homeownership rate, meaning households that own their own residence, stood at 67.6 percent.”

Bloomberg - “BlackRock, T. Rowe Price Seek Fed Loans to Buy Bonds” (10-29-09)

“Mutual funds run by companies including BlackRock Inc. and T. Rowe Price Group Inc. have begun buying bonds through a $1 trillion government lending program after a June regulatory ruling cleared the way.”

Bloomberg - “PHH Targets Realogy for Mortgages, Keeps Merrill, New CEO Says” (10-29-09)

“PHH, the fourth-largest U.S. originator of mortgages directly to consumers, can win a greater share of Realogy customers because more than 130 lenders have failed since 2007 and remaining rivals keep changing underwriting rules, Selitto said in an interview Oct. 27. Merrill Lynch contributed 21 percent of 2008 originations at PHH and was sold in January to Bank of America, which has its own mortgage unit.”

Orange County Register – “UCLA sees 16% home-price gain in 2010″ (10-29-09)

“Double-digit housing appreciation will return to Orange County next year, with the median home price rising somewhere from 15.9% to 16.6%, UCLA economists forecast in a report released today.”

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