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?”
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.
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