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The Norris Group Real Estate News Roundup 1/28/11

Friday, January 28th, 2011

Resources:

JPMorgan: Annual homes sales must average 5.5 million to absorb liquidations

It’s Official: 2010 is Second-lowest Year on Record for Homebuilding in California 

Ten indicted in California mortgage fraud scheme 

New-home sales increase in December 

Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage rates inch higher, Freddie Mac says

GOP introduces bill to eliminate HAMP

Today’s News Synopsis:

The Commerce Department said GDP growth increased 3.2% in the 4th quarter of 2010. Freddie Mac reports 30-year mortgage  rates averaged 4.8% this week. A representative of the Federal Reserve Bank of New York expects the foreclosure process to continue to weaken the economy for the rest of the year.

In The News:

NAHB - “Remodelers Expect Market Gains During 2011″ (1-28-11)

“The latest National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) edged up to 41.5 in the fourth quarter of 2010, compared to 40.8 in the third quarter. An RMI below 50 indicates that more remodelers say market activity is lower compared to the prior quarter than report it is higher. The RMI has been running below 50 since the final quarter of 2005.”

Housing Wire – “NY Fed official sees foreclosure procees weighing down home prices, construction” (1-28-11)

“While many economists are forecasting continued recovery in 2011, one official at the Federal Reserve Bank of New York expects the foreclosure process to remain a drag on the overall economy.”

Housing Wire – “GDP growth accelerates in 4Q” (1-28-11)

“The Commerce Department said GDP growth rose an inflation-adjusted 3.2% in the final three months of 2010, up from 2.6% growth for the third quarter. Analysts surveyed by Econoday projected fourth-quarter GDP growth of 3.5% with a range of estimates between 2.9% and 5.4%. Economists polled by MarketWatch were also expecting GDP growth of 3.5% for the quarter.”

Housing Wire - “Trepp sees correlation in CMBS payoffs, what’s owed investors” (1-28-11)

“Trepp broke down the eventual fate of the $30.2 billion in CMBS loans that were due to pay off in 2010. It found ‘a tight correlation between a loan’s debt yield and the likelihood that a loan would pay off.’ Analysts found that 28% of the loans with yields of 8% or less managed to pay off. That increased to 43% of loans with debt yields between 8% and 10%, and ballooned to 75% of loans with debt yield higher than 14%.”

Bloomberg - “Mozilo Predicted U.S. Housing Collapse as Fed Overlooked Risk” (1-28-11)

“Former Countrywide Financial Corp. Chief Executive Officer Angelo Mozilo warned as early as 2004 of a possible housing-market collapse while the Federal Reserve overlooked the threat a year later, according to documents released by the Financial Crisis Inquiry Commission.”

Realty Times – “Bond Yields Rise and So Do Mortgage Rates” (1-28-11)

“30-year fixed-rate mortgage (FRM) averaged 4.80 percent with an average 0.7 point for the week ending January 27, 2011, up from last week when it averaged 4.74 percent. Last year at this time, the 30-year FRM averaged 4.98 percent.”

Realty Times - “Property Rights of Unmarried Couples” (1-28-11)

“When a married couple gets divorced, the distribution of their marital property is governed by Domestic Relations law. But, what happens if unmarried property owners call it quits?”

Looking Back:

One year ago, the 30-year fixed-rate mortgage fell by 0.01 percent from the previous week. Research from RealtyTrac showed that California and Florida accounted for 17 of the nation’s 20 worst housing markets. The Federal Reserve declared that the U.S. economywas in recovery.

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

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The Norris Group Real Estate News Roundup 12/20/10

Monday, December 20th, 2010

Today’s News Synopsis:

Bank of America Merrill Lynch stated that house owners may have to default their underwater mortgages in order to take care of their debt.  Last October, pending home sale prices rose 10.4%, according to Realty Times.   Prices on commercial property rose for the second month in a row according to Moody’s Investors Service and are expected to continue to fluctuate, according to Moody’s Investors Service.  According to the National Association of Home Builders/Wells Fargo Housing Market Index, consumer cofidence in newly-built houses declined 4 points from November in the West.   In other news, Moody’s Investors Service reported that prices of commercial property increased 1.3% in October.

In The News:

Housing Wire - “Households likely to deleverage debt with underwater mortgage defaults: Report” (12-20-10)

“Bank of America Merrill Lynch analysts said the most likely way households will deleverage roughly $1 trillion in excess debt is through the default of more underwater mortgages.  Home prices in the Standard & Poor’s/Case-Shiller 20-city index have dropped 28.6% from the peak in the summer of 2006. This has led to more than 10.8 million homes, or 22.5% of the entire U.S. market in negative equity as of the third quarter, according to the analytics firm CoreLogic.”

Realty Times- “Real Estate Outlook: Existing Pending Sales Rise” (12-20-10)

“Existing pending sales may have jumped a staggering 10.4 percent in October, the strongest pace since April of this year, but interest rates are on the rise. According to Frank Notehaft, chief economist for Freddie Mac, investors moved from U.S. Treasury debt to European markets — where improvements are being made to the debt crisis. This in turn caused ‘bond yields to rise and mortgage rates along with them,’ he says.”

Housing Wire - “Recent CMBS modifications, sales prompt Trepp to warn investors” (12-20-10)

“Loan modifications and note sales in the commercial real estate space have analysts at Trepp warning investors to be vigilant with their trading. According to the data firm’s latest report, two specific CMBS deals incurred severe losses when they were modified or sold, and wiped out several investor classes.”

San Francisco Chronicle – “U.S. Commercial Property Prices Rise, Moody’s Says” (12-20-10)

“U.S. commercial property prices rose 1.3 percent in October from the previous month, the second consecutive monthly gain, Moody’s Investors Service said. The Moody’s/REAL Commercial Property Price Index climbed 3.2 percent from a year earlier, Moody’s said in a report today.”

Housing Wire – “Commercial real estate investors hungrier for more risk in fourth quarter: PwC” (12-20-10)

“Commercial real estate investors see slight but promising signs in the U.S. economy during the fourth quarter and are more willing to look for riskier buying opportunities going forward, according to the PricewaterhouseCoopers Korpacz Real Estate Investor Survey.”

Fortune – “Riding the unlikely commercial real estate rebound” (12-20-10)

“For years commercial real estate has been billed as the next big train wreck. So why are some investors shouting all aboard?  A slowly recovering economy is part of it, though no one expects to make a quick killing on loans and securities tied to office buildings, hotels, shopping malls and the like. The bigger drivers of this rally are the low rates pushing investors to reach for yield by taking on more risk, and the wide open junk bond market that has allowed lots of companies once left for dead to refinance loans and trudge forth.”

Orange County Register – “Western builder confidence drops” (12-20-10)

“Homebuilder confidence weakened in the West again.”

Housing Wire – “Moody’s expects commercial real estate prices to remain ‘choppy’” (12-20-10)

“The price of commercial property has been fluctuating all year and prices rose for the second-consecutive month in October with a 1.3% increase, according to Moody’s Investors Service.  The ratings agency said the gains in September and October followed significant declines the prior three months. For the first 10 months of the year, prices rose five times and fell five times”

RisMedia – “Foreclosures Intrigue Home Buyers Looking for Deals” (12-20-10)

“In a survey released last week, conducted by Harris Interactive, on behalf of Trulia and RealtyTrac, nearly half, or 49% of U.S. adults admitted they were at least somewhat likely to consider buying a foreclosed property.
That’s up from 45% in May.”

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

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

Thursday, October 14th, 2010

Today’s News Synopsis:

Multifamily lenders provided 40 less financing for apartment buildings in 2009, according to the MBA. RealtyTrac reports bank repossessions and foreclosure auctions hit record levels in the 3rd quarter. Jobless claims rose 2.8% last week, said the Labor Department. A survey shows that 93% of military homeowners have mortgages compared to just 64% of civilians.

In The News:

Mortgage Bankers Association – “MBA Reports 40 Percent Decline in Multifamily Borrowing in 2009 Among Diverse Lenders and Loan Sizes” (10-14-10)

“In 2009, 2,725 different multifamily lenders provided a total of $52.5 billion in new financing for apartment buildings with five or more units, according to the Mortgage Bankers Association’s (MBA) Annual Report on Multifamily Lending for  2009.  The 2009 dollar volume represents a 40 percent decline from 2008 levels.  The most active 122 lenders represented just four percent of active lenders, but 77 percent of the dollar volume lent.  Three-quarters of the active lenders made five or fewer loans over the course of the year.”

Los Angeles Times – “Freddie Mac: Mortgage rates drop again, now at 1951 levels” (10-14-10)

“Mortgage interest rates continue their descent into record territory, with the 30-year fixed-rate loan dropping to an average of 4.19% this week from 4.27% a week earlier, according to the latest Freddie Mac survey of lender offering rates.”

CNN - “Foreclosure auctions hit record as document crisis unfolds” (10-14-10)

“Bank repossessions and foreclosure auctions hit record levels in the third quarter, RealtyTrac said on Thursday. 372,445 foreclosure auctions were scheduled in July, August and September, while 288,345 properties were repossessed by lenders over the same time period.”

Housing Wire – “Jobless claims rise 2.8%; most analysts expected a decline” (10-14-10)

“Initial jobless claims rose 2.8% last week to 462,000, coming in well above most analysts’ estimates. The Labor Department said the seasonally adjusted figure of initial claims for the week ended Oct. 9 increased by 13,000 from the previous week’s revised figure of 449,000.”

Housing Wire – “TARP oversight panel calls for more transparency after conflicts emerge” (10-14-10)

“In its October report, the Congressional Oversight Panel reviewing the program enacted by President Bush two years ago said private businesses operate 91 different contracts worth up to $434 million under the Troubled Asset Relief Program. The program ended a few weeks ago and the Treasury estimates the final cost to be about $50 billion.”

Housing Wire – “Military members deeper in mortgage debt than average Americans” (10-14-10)

“More military members are paying a mortgage, and more tend to have larger amounts of credit card debt, when compared to the civilian population. The survey shows just more than half of military respondents (51%) report owning a home, compared with 57% of civilians. Nearly all military homeowners (93%) reported having a mortgage, far greater than the 64% among civilians.”

Housing Wire – “Moody’s: CMBS delinquencies up to 8.24% in September” (10-14-10)

“Moody’s Investors Service said the number of delinquencies within commercial mortgage-backed securities rose 14 basis points last month to 8.24%. Analysts said the increase was the smallest since October 2008 and the represents fourth-straight month of modest growth in the national CMBS delinquency rate. Moody’s said there are now 3,971 delinquent mortgages with a total value of $52.07 billion.”

Housing Wire – “Trepp analysts expect CMBS delinquencies to drop after highest month on record” (10-14-10)

“The percentage of delinquent commercial mortgage-backed securities increased in September to the highest rate ever recorded by CMBS data analytics firm Trepp, up 13 basis points to 9.05%. However, this is the smallest month-over-month increase recorded in 2010, and Trepp analysts expect the rate to dip much further in next month’s statistics.”

Bloomberg - “Mortgage Investors Urge State Attorneys General Not to Punish Bondholders” (10-14-10)

“A hasty and ill-formulated legal settlement may harm the investors of mortgage-backed securities, namely retirees, municipalities, government entities, state pension funds, retirement systems, universities, and charitable endowments. Chris Katopis, the Washington-based trade group’s executive director, said today in an e-mailed statement.”

Looking Back:

One year ago, Citigroup and other banks were held accountable for fraudulent loans which costed them more than $688 million. The Mortgage Bankers Association reported that mortgage loan application volume had decreased by 1.8 percent from the previous week.  JP Morgan Chase approved of trial modifications for 90 percent of its borrowers.

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

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The Norris Group Real Estate News Roundup 10/5/10

Tuesday, October 5th, 2010

Today’s News Synopsis:

The CAR predicts the housing market will require a more lengthy amount of time to recover. Trepp reports CMBS delinquencies increased to 9.05% last month. Zillow claims California’s 30-year mortgage rate decreased to 4.18%.

In The News:

The Press Enterprise – “Forecasters: Inland housing comeback ‘long, bumpy’” (10-5-10)

“While the housing sector has led the nation out of previous recessions, this time it will take longer for housing to revive because of an unprecedented fall in home values that was caused by a crisis in the financial market, the California Association of Realtors said in releasing its 2011 forecast.”

Housing Wire – “ABA: Bank card delinquencies on the decline” (10-5-10)

“Consumer past due balances also generally improved on home equity loans and auto loans. The report defines delinquency as an account that is 30 days overdue. The report looks at credit cards that are issued by banks. Bank card delinquencies fell 26 basis points from 3.88% to about 3.6%, below the 15-year average of just under 4%. It’s also the lowest delinquency rate since the first quarter of 2001.”

Housing Wire – “Trepp: CMBS delinquency rate tops 9% for first time in September” (10-5-10)

“The delinquency rate on commercial mortgage-backed securities surpassed 9% for the first time in September, according to analytics firm Trepp. The rate for loans more than 30-days delinquent has increased steadily the past 12 months to 9.05% last month, up from 4.36% a year ago and 13 basis points higher than 8.92% for August.”

Housing Wire – “Radar Logic sees foreclosure halts dragging down housing recovery” (10-5-10)

“In lieu of the robo-signing scandal that caused states and lenders suspending home foreclosures, many economists are evaluating how this temporary lull in the housing market will affect the economic recovery. Radar Logic analysts said Tuesday they are skeptical that the market will improve in the meantime.”

Housing Wire – “Zillow: 30-year FRMs hit record low at 4.16%” (10-5-10)

“The 30-year, fixed-mortgage rate decreased from a week earlier, setting a new record low at 4.16%, according to the Zillow Mortgage Marketplace weekly update. California’s rate decreased to 4.18% from 4.21%”

Bloomberg - “`Underwater’ Mortgages Threaten Rally in Jumbo Debt, Seer’s Weingord Says” (10-5-10)

“The rally in securities tied to the biggest U.S. home loans probably has gone too far because defaults are set to rise for properties worth less than the mortgages on them, according to hedge-fund firm Seer Capital Management LP.”

Bloomberg - “U.S. Office Rent Decline Slowed in Third Quarter, Reis Says” (10-5-10)

“Actual rents paid by office tenants, known as effective rents, dropped 3.6 percent from a year earlier to an average of $22.05 a square foot, Reis said in a statement today. They were little changed from the second quarter’s $22.06 a square foot.”

Bloomberg - “Fed May Buy More Assets Buys to Spur U.S. Growth, Pimco Says” (10-5-10)

“Pimco, which runs the world’s biggest mutual fund, estimates U.S. gross domestic product growth will be in a range of 1.5 percent to 2 percent for the next year, versus 1.7 percent that the Commerce Department reported for the second quarter. Inflation will slow to a band of 0.75 percent to 1.25 percent, McCulley said in his report. The figure was 1.4 percent in August from the year before, Commerce Department data show.”

Looking Back:

One year ago, First American CoreLogic expected about 10 percent of all U.S. mortgages to adjust over the next few years. FHA planned to reduce the maximum lending amount that seniors could receive for reverse mortgages. Consumers were claiming that Wells Fargo was guilty of cutting their credit lines for no apparent reason. Whitehouse spokesman Robert Gibbs confirmed that president Obama was in favor of extending the first time home buyer tax credit.

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

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The Norris Group Real Estate News Roundup 9/7/10

Tuesday, September 7th, 2010

Today’s News Synopsis:

According to SiteSelection, California is experiencing a loss in total migration. FHA will now permit lenders to give more borrowers refinanced loans backed by the government. Trepp reports the delinquency rate for commercial mortage-backed securities increased to 8.92%. Zillow claims mortgage rates increased to 4.27% last week.

In The News:

Telegraph - “No defence left against double-dip recession, says Nouriel Roubini” (9-5-10)

“Dr Roubini said the US growth rate was likely to fall below 1pc in the second half of the year, despite the biggest stimulus in history: a cut in interest rates from 5pc to zero, a budget deficit of 10pc of GDP, and $3 trillion to shore up the financial system.”

Philly - “U.S. housing value down at least $4 trillion” (9-5-10)

“Since the real estate boom ground to a painful close about 31/2 years ago, the nation’s housing stock has shed from about $4 trillion to $7.1 trillion in value. The amount depends on who’s counting. A study by Equifax Inc. and Moody’s Analytics Inc. says the downturn began in early 2007 and cost $4 trillion through March. The Federal Reserve says the downturn began in the fourth quarter of 2006 and cost $7.1 trillion through March.”

CNBC - “Housing Woes Bring New Cry: Let Market Crash” (9-5-10)

“When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve. ‘Housing needs to go back to reasonable levels,’ said Anthony B. Sanders, a professor of real estate finance at George Mason University.”

Orange County Register – “More people leave California than arrive” (9-5-10)

“In California, the number of outbound moves by the 700 or so moving companies in the movers.com network increased 10.3%, while incomers rose 9.4%. In terms of population changes, New York lost 33% more people than it gained, while Texas gained 50% more people than moved out, SiteSelection says.”

San Francisco Chronicle – “Gov’t launches plan to help ‘underwater’ borrowers” (9-7-10)

“Starting Tuesday, the Federal Housing Administration will permit lenders to give these borrowers refinanced loans backed by the government. The lenders will be required to forgive at least 10 percent of the original mortgage amount. Investors who have control over the mortgages as part of their large portfolios will select which borrowers are invited to participate.”

Housing Wire - “Bank deposit balances shrink for first time since ’92″ (9-7-10)

“For the first time since 1992, bank deposit balances fell in the first half of the year. Deposits decreased 0.4% for the six months between January and June to $7.69 trillion from nearly $7.7 trillion, and the yields on the deposits fell to less than 1%, according to analysis from Market Rates Insight.”

Housing Wire – “Credit score gaps narrow for FHA loans: Quality Mortgage Services” (9-7-10)

“The credit score gap for 2010 loans through the Federal Housing Administration fell 43 points from 2006 levels, according to Quality Mortgage Services. The mortgage quality-control services firm said its data show the average credit score of FHA loans ranked as excellent in 2006 was 665 whereas the average score of a loan ranked fair was 603 for a gap of 62 points. For FHA loans originated so far this year, the firm’s data show excellent loans have average credit scores of 707 while fair loans average scores are 688 for a difference of 19 points.”

Housing Wire – “New Fed limits on yield spread premium protects mortgage servicers from defaults: Moody’s” (9-7-10)

“The new restriction prohibits a loan originator’s compensation (similar to a commission) from being based on a yield spread premium; effectively, the difference between the interest rate required by a lender and the rate the borrower actually accepts. It is essentially another another step towards borrower protection, just as Fannie Mae’s prohibition on appraisal cutting became effective last week.”

Housing Wire – “CMBS delinquencies accelerate toward 9% in August: Trepp” (9-7-10)

“After two months of moderated growth in delinquent loans backing commercial mortgage-backed securities (CMBS), the delinquency rate in August increased 21 basis points to 8.92%, according to the analytics firm Trepp. It’s an increase from the 8.71% measured in July and another new record. The August delinquency rate is more than double the 4.03% rate a year ago. Since the beginning of 2010, the delinquency rate has increased more than 200 bps.”

Housing Wire – “Zillow: 30-year, fixed rate inched up to 4.27% last week” (9-7-10)

“The 30-year, fixed mortgage rate inched up last week to 4.27% from its nadir of 4.26% the week prior, according to the Zillow Mortgage Marketplace weekly update. California’s current rate of 4.26% is down from 4.28% last week and 4.3% the week prior.”

Orange County Register – “O.C. on track for fewest mortgages in a decade” (9-7-10)

“The Pomona-based Real Estate Research Council of Southern California reported that the number of loans issued to buy or refinance Orange County homes fell 23% to 46,195 during the first half of 2010. In the first half of 2009, lenders recorded just over 60,000 ‘trust deeds,’ or home loans.”

Looking Back:

One year ago, nearly one-third of those who obtained home loans during the boom years of 2005 and 2006 couldn’t get one. The eight-county Sacramento region counted more than 42,000 foreclosures from 2007 to 2009. A report showed that 20 percent of Californians were unemployed.

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

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

Monday, August 2nd, 2010

Today’s News Synopsis:

Alan Greenspan expressed concern that a decrease in home prices might cause the U.S. to slip back into recession. The Census Bureau estimates the homeownership rate will fall to 62% in 2012. Moody’s reports strategic delinquencies are falling on jumbo mortgages. Construction spending remained relatively flat with just a 0.1 percent increase last month.

In The News:

Bloomberg - “Greenspan Says Drop in Home Prices Might Bring Back Recession” (8-1-10)

“Former Federal Reserve Chairman Alan Greenspan said the slowing economic recovery in the U.S. feels like a ‘quasi-recession’ and the economy might contract again if home prices decline.”

Los Angeles Times – “Builders’ pricing strategies are aimed at creating sales urgency” (8-1-10)

“The first bump occurs when ground is broken for the project. Then builders up the ante when the streets go in, and again when the model homes begin to take shape. Prices go up for a fourth time with the big opening splash.”

USA Today – “Homeownership rate continues to slide” (8-2-10)

“Fresh projections say the rate could plummet to about 62% as early as 2012 and almost certainly by the end of the decade. Homeownership rates haven’t been that low since they hit 61.9% in 1960. The share of households that own their homes has been sliding since the housing bubble burst in 2006. The rate fell again in the second quarter of this year to 66.9% — the lowest since 1999 — from a peak of 69.4% in 2004, the Census Bureau says.”

Mercury News – “June construction activity rises 0.1 percent” (8-2-10)

“Construction spending rose 0.1 percent in June, the Commerce Department reported Monday. While that was better than the decline economists had forecast, the government sharply revised down its estimate of activity in May to show a drop of 1 percent rather than the 0.2 percent dip initially reported.”

Housing Wire – “Strategic Defaults Falling on Jumbo Mortgages, Relative to Smaller Loans: Moody’s” (8-2-10)

“According to a weekly credit report from Moody’s Investors Service, jumbo mortgage delinquencies, in this case delinquencies on mortgages over $1m, are almost equal to mortgage delinquencies for smaller mortgages. The agency monitors the risk of default across mortgages that are bundled into bonds and sold as residential mortgage-backed securitizations.”

Housing Wire – “2010 CMBS Modifications Outnumber the Last 2 Years Combined: Trepp” (8-2-10)

“As delinquency increases begin to slow, modifications on CMBS loans are accelerating, according to the analytics firm, Trepp. Further, halfway through 2010, modifications have already passed the amount done in 2008 and 2009 combined. The rate of modifications is set to triple the rate in 2009. In the first seven months of 2010, there have been modifications done on $12.1bn worth of CMBS loans, a 37% increase from the $8.8bn done in all of 2009 and more than four times the $354m modified in 2008, according to Trepp.”

Housing Wire – “Government Refi Wave Could Cost GSE Bondholders $350bn: KBW” (8-2-10)

“Recent record-low mortgage rates have sparked fears amongst investors that a government-driven refinancing wave would boost prepayment speeds back to 2003 levels. According to KBW, there is a cost to such a policy shift, contrary to what supporters of action have said. The agency mortgage-backed securities (MBS) market trades a premium of almost seven basis points. If all borrowers refinanced into the current mortgage rates, roughly $350bn would transfer from bondholders to borrowers, equaling $75bn annually.”

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

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The Norris Group Real Estate News Roundup 4/1/10

Thursday, April 1st, 2010

Today’s News Synopsis:

California citizens planning to buy within the next 3 months may be able to take advantage of both a state and federal tax credit. The Commerce Department reports that construction spending decreased by 1.3 percent across the United States. The delinquency rate for CMBS loans increased to 7.61% in March. The delinquency rate for single family mortgages increased to 4.08 percent in February.

In The News:

San Francisco Chronicle – “Good timing could reap double tax credits” (4-1-10)

“Some home buyers in California could get a federal tax credit worth up to $8,000 plus a new state credit worth up to $10,000 if they time their purchase just right over the next three months. But double-dipping will be tricky and won’t come without risks.”

Mercury News - “Construction spending at lowest point since 2002″ (4-1-10)

“The Commerce Department reported Thursday that spending on construction projects around the country fell by 1.3 percent to a seasonally adjusted annual rate of $846.23 billion. That was the lowest level since November 2002.”

Housing Wire – “Spiking CMBS Delinquencies May Collapse Mid-Sized Banks in 2010: Trepp” (4-1-10)

“According to a report from the analytics firm Trepp, spiking delinquencies in CMBS could cause bank failures to increase as much as 30% in 2010. The delinquency rate for loans in commercial mortgage-backed securities (CMBS) spiked to 7.61% in March from 6.72% in February, according to the report.”

Housing Wire - “Freddie’s Single-Family Mortgages Grow to 4.08% Delinquent” (4-1-10)

“Delinquent mortgages continue to mount at government-sponsored enterprise (GSE) Freddie Mac (FRE: 1.26 -0.79%). The delinquency rate of Freddie’s single-family mortgages grew 5bps from January to 4.08% in February. That’s up almost double from 2.13% at the same time last year. The delinquency rate among multifamily mortgages grew 2bps to 0.17%.”

Housing Wire – “Shrugging Off Critics, Private Equity Says Defaults Remain Below Projections” (4-1-10)

“Private equity-backed companies seem to be pulling through the financial crisis in better shape than other comparable business, especially issuers of speculative grade or high-yield debt offerings, according to a study from the Private Equity Council (PEC). The study measured the annualized default rate for more than 3,200 private equity-backed companies acquired between 2000 and 2009 and held through 2008 to 2009, which is where the PEC bracketed the recession. The default rate for those companies reached 2.8% in that time, compared to 6.2% for other firms.”

Bloomberg - “California Hotel Foreclosures Climb as Unemployment Cuts Travel” (4-1-10)

“Hotel foreclosures in California climbed 27 percent in the first quarter from a year earlier as unemployment cut business travel. Foreclosures, including the 469-room Los Angeles Marriott Downtown, rose to 79 properties from 62 in the first three months of 2009. Defaults increased 6.5 percent to 327, Irvine, California-based Atlas Hospitality Group said in a statement. The company specializes in selling hotels.”

Reuters - “Data boosts self-sustaining recovery hopes” (4-1-10)

“Initial claims for state unemployment benefits slipped 6,000 to 439,000 in the week ended March 27, the Labor Department said. The data, which mirrored market expectations, offered few clear hints on Friday’s job figures because it covered a week outside the survey period for the March employment report. The four-week moving average of new claims, considered a better measure of underlying labor market trends, fell 6,750 to 447,250, the lowest level since September 2008.”

Inman - “Residential construction spending dips” (4-1-10)

“The rate of spending on private residential construction dropped 2.1 percent in February compared to January, and was down 3.8 from January 2009, the U.S. Census Bureau reported today. The seasonally adjusted annual spending rate has plunged 62.9 percent from a peak of $676.4 billion in March 2006 to its latest level of $250.8 billion in February 2010. This rate is a projection of a monthly spending total over a 12-month period, adjusted to account for typical seasonal fluctuations in construction activity.”

Inman - “A changing role for real estate agents” (4-1-10)

“A good Realtor is so much more than a home-finder or a chauffeur. As I work with informed, tech-savvy consumers, I can clearly see the value that I add for them. It comes down to experience. Most people buy a few or maybe only a couple of homes in their lives. It is my experience that makes the buyers I work with comfortable with making the largest purchase of their lives. They don’t need to be sold a home, they need help finding the right one and they need to buy it with confidence.”

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The Norris Group Real Estate News Roundup 3/4/10

Thursday, March 4th, 2010

Today’s News Synopsis:

Bruce Norris claims that the government’s aid will not be enough to prevent the U.S. economy from sliding back into recession. The NAR reports that national pending home sales decreased by 7.6 percent in January. According to Trepp, commercial real estate delinquencies decreased in February. The delinquency rate for Fannie Mae loans increased to 5.38% last month.

In The News:

Orange County Register – “Hear why housing will slump again” (3-4-10)

“Norris tells ocregister.com in a podcast interview that he believes that all the government aid that’s going to the housing market won’t be enough to keep real estate — and the entire economy — from sliding back into a second wave of recessionary conditions.”

NAR - “Pending Home Sales Down; Severe Weather Impacting Market” (3-4-10)

“The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in January, fell 7.6 percent to 90.4 from an upwardly revised 97.8 in December, but remains 12.3 percent higher than January 2009 when it was 80.5.”

CBIA - “Metro Regions” (3-4-10)

“Curious about housing numbers for a particular area of the state? This is the place to find all the numbers for an individual area.”

Recordnet.com – “Region’s future bright, experts say” (3-4-10)

“San Joaquin County, as well as the entire San Joaquin Valley, holds tremendous potential for growth even as it struggles to emerge from the recession, a panel of development experts, business and government leaders said Wednesday. The county could see gains of more than 30,000 new jobs in the next three years, paying wages and benefits of $1.5 billion.”

Housing Wire – “Valeo Fund Targets $1trn in Maturing Commercial Mortgages” (3-4-10)

“The private equity firm Valeo Fund is recruiting investors to go after $1trn of commercial mortgages set to mature between 2010 and 2013. The move comes as opportunities are begin to hit the entire commercial market, which has been bracing for struggles.”

Housing Wire – “Commercial Mortgages Showing Signs of a Brighter Road Ahead” (3-4-10)

“The blistering climb of commercial real estate delinquency rates, which crossed the 6% threshold in December, started to slow in February, according to the analytics firm Trepp, which monitors collateral performance on related commercial mortgage backed securities (CMBS). The amount of commercial loans at least 30-days delinquent grew 23 basis points (bps) to 6.72% in February, the smallest increase in six months.”

Housing Wire – “General Growth Gets Extension for Reorganization, Plans NYSE Re-listing” (3-4-10)

“A bankruptcy judge granted mall real estate investment trust (REIT) General Growth Properties (GGP: 1.05 0.00%) a nearly five-month extension period to file a plan of reorganization for the company to exit bankruptcy.”

Housing Wire – “Fannie Single-Family Mortgage Delinquencies Grow to 5.38%” (3-4-10)

“The serious delinquency rate at government-sponsored enterprise (GSE) Fannie Mae (FNM: 1.005 +2.11%) rose nine basis points (bps) to 5.38% in the single-family mortgage book. Its a slight increase from 5.29% last month.”

Housing Wire – “Freddie Says Mortgage Rates Dip Below 5%” (3-4-10)

“Freddie Mac said the average interest for a 30-year fixed-rate mortgage was 4.97% with a 0.7 origination point for the week ending March 4, down from 5.05% one week ago. Last year at this time, the 30-year FRM averaged 5.15%.”

Housing Wire – “Home Prices Continue Climb from 2009 Levels: Clear Capital” (3-4-10)

“US home prices climbed 5% in February from a year ago, despite an incoming wave of REOs that could saddle the market for another three years, according to the Clear Capital Home Data Index. Prices grew on a yearly basis for the first two months of 2010. The 5% uptick in February bested the 2.3% yearly increase in January. However, prices remained unchanged on a rolling quarterly basis.”

Looking Back:

One year ago, the MBA reported that mortgage applications decreased by 12.6 percent within one week. Statistics from First American CoreLogic showed that 20 percent of mortgages were underwater. Radar Logic claimed that foreclosures increased home sales by approximately 7 percent during 2008. Federally regulated banks filed 62,084 reports of suspected mortgage fraud during the mid-summer of 2008.

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

Tuesday, February 2nd, 2010

Today’s News Synopsis:

The NAR’s index  shows that pending home sales increased by 1 percent in December. According to the MBA, commercial and multifamily mortgage loan originations increased by 15 percent during the 4th quarter of 2009.  The FHA reports that borrower delinquencies increased by 6.5 percent from the previous year. Fannie Mae is offering a 3.5 percent discount to all people who buy REO properties.

In The News:

NAR - “Pending Home Sales Stabilize, Remain Above Year-Ago Levels” (2-2-10)

“The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in December, increased 1.0 percent to 96.6 from 95.6 in November, and remains 10.9 percent above December 2008 when it was 87.1. In November, the monthly index had fallen by 16.4 percent from surging activity in preceding months.”

Mortgage Bankers Association – “MBA Study: Originations of Commercial and Multifamily Mortgages Increased in Fourth Quarter 2009″ (2-2-10)

“Fourth quarter 2009 commercial and multifamily mortgage loan originations were 12 percent higher than during the same period last year and 15 percent higher than during the third quarter of 2009, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.”

Washington Post – “Rising FHA default rate foreshadows a crush of foreclosures” (2-2-10)

“About 9.1 percent of FHA borrowers had missed at least three payments as of December, up from 6.5 percent a year ago, the agency’s figures show.”

Housing Wire – “First American Offers Appraiser Reviews of BPOs” (2-2-10)

“First American Valuation and Property Solutions – the Dallas-based subsidiary of the First American Corporation (FAF: 30.68 +1.86%) – added appraiser reviews of broker price opinion (BPO) reports to its new property valuation offering. The move to add appraiser reviews allows firms without on-staff appraisers to outsource BPO verification operations – a trend sources say is catching on.”

Housing Wire – “HUD 2011 Budget Drops to $41.6bn on Higher FHA Premiums” (2-2-10)

“The US Department of Housing and Urban Development (HUD) budget proposal for 2011 dipped 5% below the budget in 2010 to $41.6bn after raising annual Federal Housing Administration (FHA) insurance premiums by 50 bps to 2.25% earlier this month.”

Housing Wire – “CMBS Performance Slides Again: Trepp” (2-2-10)

“The rate of 30-plus-day delinquency in commercial mortgage-backed securities (CMBS)reached a new record high of 6.49% in January, according to commercial real estate data provider Trepp.”

Housing Wire - “Fannie Gives 3.5% REO Discount” (2-2-10)

“Fannie Mae (FNM: 1.02 -0.97%) will provide a 3.5% discount to those purchasing a real-estate owned (REO) property listed as part of its HomePath division, according to a company notice.”

Bloomberg - “D.R. Horton Climbs Most in 10 Months on Profit Gain” (2-2-10)

“D.R. Horton Inc., the second-largest U.S. homebuilder by revenue, climbed the most in 10 months after the company reported its first quarterly profit since 2007 on sales and profit margins that exceeded analysts’ estimates.”

Bloomberg - “U.S. Vacancy Rate Increases as Banks Seize More Homes” (2-2-10)

“The homeowner vacancy rate increased to 2.7 percent from 2.6 percent in the third quarter, the U.S. Census Bureau said in a report today. There were 2.09 million empty properties on the market, up from 1.99 million, according to the report.”

Inman - “First-timers are fastest-growing segment” (2-2-10)

“First-time homebuyers not only account for the largest share of home sales in many markets, but represent the fastest-growing segment of home sales in nearly half of those markets, brokers surveyed by Inman News report. Second homes and move-up homes, on the other hand, are the most rapidly shrinking segment of their business, brokers responding to the survey said.”

Looking Back:

One year ago,  a $5 billion increase in mortgage debt investment by foreign banks was noted by Morgan Stanley. San Francisco analysts predicted that condominium prices in the SF area would significantly decrease. Obama exclaimed that he would require banks receiving bailout money to increase lending to borrowers.

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The Norris Group Real Estate News Roundup 12/02/09

Wednesday, December 2nd, 2009

Today’s News Synopsis:

The MBA’s weekly survey shows that mortgage applications increased by 2.1 percent from the previous week. Trepp reports that overall delinquency rates for commercial mortgage-backed securities increased to 5.65 percent. According to ADP Employer Services, 169,000 jobs were cut last month.

In The News:

Mortgage Bankers Association – “Mortgage Applications Increase in Latest MBA Weekly Survey” (12-2-09)

“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 27, 2009, which was a shortened week due to the Thanksgiving holiday.  The Market Composite Index, a measure of mortgage loan application volume, increased 2.1 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 29.3 percent compared with the previous week.”

Housing Wire – “Hotel Default Raises CMBS Delinquency, Trepp Says” (12-2-09)

“The overall delinquency rate among commercial mortgage-backed securities (CMBS) rose 85 bps to 5.65% in November, from 4.8% a month earlier, according to a monthly report by CMBS and commercial mortgage information provider Trepp.”

Housing Wire – “FHA is ‘Not the Next Subprime’: HUD’s Donovan” (12-2-09)

“The capital reserve ratio at the FHA, which ensures approved lenders against default-related losses, recently plunged below the congressionally-mandated 2% minimum. HUD aims to strengthen the capital position at FHA by enforcing standards and cutting down on lenders that violate FHA’s standards, most recently this week with the withdrawal of Lend America’s FHA approval.”

Bloomberg – “General Growth Wins Interim Approval of Debt Plan” (12-2-09)

“General Growth Properties Inc., the second-largest U.S. mall owner, won preliminary court approval of the outline of its plan to restructure $9.7 billion of mortgage debt owed on 92 shopping centers and office buildings.”

Bloomberg – “ADP Says U.S. Companies Cut Estimated 169,000 Jobs” (12-2-09)

“An estimated 169,000 jobs were eliminated last month, the fewest since July 2008, according to data from Roseland, New Jersey-based ADP Employer Services today. The figures were forecast to show a decline of 150,000 jobs, according to the median estimate of 32 economists in a Bloomberg survey.”

Orange County Register – “Appraisers see O.C. home prices off 15%” (12-2-09)

“Orange County values (from reviews of 39 homes) are falling at a 15% annual rate. That’s up slightly from the 14% rate of loss in year ended in April! The appraisers put losses in northern O.C. at a 20.9% annual rate; off in central O.C. at a 17.7% annual rate; and southern/beach falling at a 9% annual rate.”

Inman – “Corcoran promoting new iPhone app” (12-2-09)

“Corcoran’s iPhone app can use the smart phone’s Global Positioning System (GPS) satellite capabilities to display apartments, condos and open houses near the user’s location. It also allows for customized searches, displaying full screen photos of properties listed for sale or rent with Corcoran. Users can choose to be notified of new listings and open houses, and the app will also deliver information about local restaurants, nightlife and shopping.”

Realty Times – “Realtor Organization Opposed FHA Anti-Flipping Rule” (12-2-09)

“proponents of the CAR motion argued that, in the current environment, the effect of the anti-flipping rule was actually to harm potential FHA buyers and to shut them out of the real estate market.”

Looking back:

One year ago, some economists expected to see a bottom in housing prices after the 2nd quarter of 2009, while others claimed that prices would not bottom until 2011 or 2012. Radar Logic reported that Sacramento had the biggest home price decline of all the major cities the company analizes. TransUnion found that 3rd quarter delinquencies increased the most in San Francisco and Los Angeles.

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