The Norris Group Blog

Today’s News Synopsis:

A CAR survey shows that 67 percent of home sellers chose to sell because of their inability to pay mortgage debt. The FHFA reports that U.S. home prices decreased by 1.2 percent in the fourth quarter. A survey shows that agents and brokers are growing increasingly pessimistic of the future of real estate. According to FHFA, the rate for 30-year FRMs increased to 5.1 percent in January.

In The News:

San Francisco Chronicle – “Newsom plan would defer up-front developer fees” (2-25-10)

“The mayor’s administration says the package of legislation, tentatively set to go before the Board of Supervisors’ land use committee March 15, would cut up-front costs for developers, making it easier to get financing in this recession. Newsom said his proposals would speed up start times on four specific projects by as much as two years, including the second tower in the One Rincon Hill development. Work on the four projects could start in two months, he said.”

CAR - “C.A.R. releases ’2009-2010 Survey of California Home Sellers’” (2-25-10)

“Changes in family and employment status as well as adjustments to monthly mortgage obligations played significant roles in California’s homeowners’ decisions to sell their homes in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) ’2009-2010 Survey of California Home Sellers.’ According to the report, 67 percent of all sellers in California did so as a result of difficulties related to meeting their mortgage obligation.”

Bloomberg - “Home Prices Decline 1.2%, Smallest Drop in Two Years” (2-25-10)

“U.S. home prices fell 1.2 percent in the fourth quarter from a year earlier, the smallest loss in two years, as a federal tax credit for homebuyers boosted demand. Prices were down 0.1 percent from the third quarter, the Federal Housing Finance Agency said today in a report. The year- over-year drop was the smallest since a 1.1 percent decline in 2007’s fourth quarter, the Washington-based agency said.”

Inman - “Agents, brokers less rosy on future” (2-25-10)

“Short-term views for the next three to six months deteriorated 2.89 percent, to 5.71, while long-term views for the next 12 to 18 months fell 4.1 percent to 6.32. The survey pointed to expected interest rate hikes, the poor jobs market, and the imminent April 30 deadline (for a home sale to be under contract) for the federal homebuyer tax credit program as participants’ major concerns.”

Housing Wire – “FHFA Mortgage Rate Tracker Posts Increase in January” (2-25-10)

“The average interest rate on conventional 30-year, fixed-rate mortgage (FRM) with a principal of $417,000 or less was 5.1% in January, an increase from 5.05% in December, the FHFA said. The average interest rate on 15-year FRM of $417,000 or less stayed at 4.54% in January.”

Housing Wire – “Delinquent CMBS Triples as Spreads Stabilize” (2-25-10)

“Realpoint reviewed more than $797bn in CMBS pools for the January report. The firm calculated a 5.76% delinquency rate for the pools reviewed, up from 5.22% in December. The rate jumped by more than four times the rate in January 2009, when 1.2% of the reviewed loans fell delinquent. June 2007 held the lowest delinquency rate recorded by Realpoint, at 0.2%.”

Housing Wire – “Bankers Propose Mortgage Forebearance for Unemployed” (2-25-10)

“The program would give incentives to investors and servicers (through Treasury’s TARP) that place unemployed borrowers in a forbearance plan for up to 90 days — a period that can be renewed twice based on borrower’s financial circumstances. This plan would put a borrower in forbearance for up to nine months, at which time (or earlier, at re-employment status) eligibility for a HAMP trial can be determined.”

Bloomberg - “General Growth Is Biggest Real Estate Fight Since Equity Office” (2-25-10)

“The battle for General Growth Properties Inc., owner of more than 200 U.S. malls from Boston to Los Angeles, is turning into the biggest real estate fight since sale of Sam Zell’s Equity Office Properties Trust. Westfield Group, a Sydney-based property investor with stakes in 55 U.S. retail centers, signed an agreement letting it assess General Growth’s finances, a person familiar with the pact said yesterday. That may put Westfield in position to vie for the bankrupt company’s assets as part of a contest already embroiling Simon Property Group Inc. and Brookfield Asset Management Inc.”

Bloomberg - “Obama May Prohibit Home-Loan Foreclosures Without HAMP Review” (2-25-10)

“The Obama administration may expand efforts to ease the housing crisis by banning all foreclosures on home loans unless they have been screened and rejected by the government’s Home Affordable Modification Program.”

Looking Back:

One year ago, existing home sales decreased by 5.3 percent. The MBA announced that mortgage loan application volume had decreased by 15 percent from the previous quarter. The Obama administration implemented a stress test of 19 banks. Bernanke claimed to be confident of the federal reserve’s ability to prevent inflation.