Discount for foreclosed homes widened in 2010 .

Feb 28, 2011 | No Comments | Sean Mills

LOS ANGELES — The gap between the average sale price of a foreclosed home and that of other properties grew wider last year, giving homebuyers who snapped up bank-owned homes big discounts.
And homebuyers can expect to see more of those bargains this year, because fewer foreclosed homes were sold in 2010 than were taken back [...]

LOS ANGELES — The gap between the average sale price of a foreclosed home and that of other properties grew wider last year, giving homebuyers who snapped up bank-owned homes big discounts.

And homebuyers can expect to see more of those bargains this year, because fewer foreclosed homes were sold in 2010 than were taken back by banks, foreclosure listing firm RealtyTrac Inc. said Thursday.

Buyers who purchased a foreclosed home last year got, on average, a 28 percent discount to a non-foreclosure sale. That’s up from a 27 percent average discount in 2009, RealtyTrac said.

While only a slight increase, the trend suggests a widening price spread between foreclosure sales and other types of residential properties.

Foreclosed homes made up nearly 26 percent of all home sales last year, according to RealtyTrac. That’s down from 29 percent in 2009 but up from 23 percent in 2008.

Traditionally, foreclosures account for less than 10 percent of all home sales.

In all, 831,574 foreclosed properties were sold last year, including those in some stage of foreclosure but not yet taken back by lenders, the firm said.

That’s down 31 percent from 2009 and down nearly 14 percent from 2008.

Sales of homes outside of the foreclosure process declined nearly 19 percent in 2010 from the prior year, according to RealtyTrac.

While the pace of foreclosure sales slowed, lenders stepped up their home repossessions, taking back more than 1 million homes last year.

That deepened the so-called shadow inventory of foreclosed homes that have yet to hit the market. Experts contend that the housing market won’t fully recover until banks find buyers for those properties.

“We need to clear out the inventory if the market is going to come back,” Rick Sharga, a senior vice president at RealtyTrac.

Banks are reluctant to put too many foreclosed homes on the market at once, because they would face booking sizeable losses on the sales.

Generally, about 30 percent of banks’ foreclosure inventory is on the market, Sharga said.

More foreclosure sales, however, would almost certainly send overall home values lower in many markets, because foreclosed homes often sell at a sharp discount to other properties.

Already, housing experts predict home prices will slide another 5 percent this year.

“You could have a scenario where housing prices could be pushed lower,” Sharga said.

Foreclosure sales, like home sales overall, fell sharply in the last three months of the year. Government tax credits earlier in 2010 helped gin up home sales, but pulled forward transactions that would have typically occurred later in the year.

Lenders’ efforts to deal with foreclosure documentation problems and heightened scrutiny in states where courts play a role in the foreclosure process also dampened sales of bank-owned homes.

That slowdown began to ease in December, however, and foreclosure sales spiked 21 percent, the firm said.

Nevada, Arizona and California had the highest percentage of foreclosure sales last year.

Nevada led the nation with foreclosure sales accounting for nearly 57 percent of all home sales, RealtyTrac said. That was down from 67 percent the year before.

Several other states had foreclosure sales that accounted for at least one quarter of all home sales last year: Florida, Michigan, Georgia, Idaho, Oregon, Illinois, Virginia and Colorado.

INLAND (EMPIRE): Foreclosures still dominating home purchases

Feb 27, 2011 | No Comments | Sean Mills

By TIFFANY RAY
The Press-Enterprise
 
Sales of foreclosure properties dropped in the Inland Empire in 2010 from the year before but continued to make up the largest share of the region’s housing market.
In Riverside and San Bernardino counties, 44,714 residential properties in some stage of foreclosure were snapped up by third-party buyers last year. That’s down [...]

By TIFFANY RAY
The Press-Enterprise

 

Sales of foreclosure properties dropped in the Inland Empire in 2010 from the year before but continued to make up the largest share of the region’s housing market.

In Riverside and San Bernardino counties, 44,714 residential properties in some stage of foreclosure were snapped up by third-party buyers last year. That’s down 46 percent from 2009.

But despite the drop, foreclosure properties continued to represent more than half of all homes sold — 52 percent in Riverside County and 54 percent in San Bernardino County. In 2009, foreclosures represented 68 percent of home sales in Riverside County and 69.5 percent in San Bernardino County.

In California, foreclosure sales dropped 42 percent in 2010 and represented 44 percent of all residential sales, the third highest percentage among states.

Foreclosure properties can include properties owned by banks or in some stage of foreclosure, including those in default or scheduled for auction.

Sales of nonforeclosure homes were down across the U.S., too, but only by 19 percent.

James Saccacio, RealtyTrac’s CEO, said in a news release that a bloated supply of foreclosure properties and weak demand from homebuyers are keeping foreclosures high as a percentage of home sales. They are also keeping foreclosure prices low, he said.

The average selling price for a foreclosure property in Riverside County last year was $196,331. That was 18 percent less than the average selling price for a nonforeclosure home. San Bernardino County’s average selling price for foreclosed properties was $164,952, a discount of 24 percent from a conventional sale.

Daren Blomquist, a spokesman for RealtyTrac in Irvine, said Inland Empire sales have declined more dramatically than in other parts of the country, in part, because the market has hit a saturation point. The large supply of Inland foreclosure properties has also contributed to a smaller discount for homebuyers, he said, boosting prices for foreclosure properties and depressing conventional-sale prices because those sellers must compete in a market in which foreclosures are dominant.

Michael Novak-Smith, who specializes in selling bank-owned properties for Re/Max Results in Moreno Valley, said home sales and showings are down across the board, and he doesn’t see any big recovery on the horizon until credit loosens up. “It’s just really tough to get a loan,” he said.

The Government’s Housing Subsidies Are Screwing Families And Homeowners, Says Peter Schiff

Oct 19, 2010 | No Comments | Sean Mills

It is hard to read, watch or listen to the news as it seems to be the same old items rehashed.  My own personal econimist, Mr. Havins, says it best when he tells the  market is a very perfect place once everyone in government gets out of it and lets it find its equalibrium.  Come [...]

It is hard to read, watch or listen to the news as it seems to be the same old items rehashed.  My own personal econimist, Mr. Havins, says it best when he tells the  market is a very perfect place once everyone in government gets out of it and lets it find its equalibrium.  Come on people wake up and get mad about this before it is too late to do something. – Sean

Most pundits argue that the government needs to stem the tide of foreclosures–to avoid a flood of houses hitting the market all at once and, thereby crushing house prices. The government needs to do everything it can to stimulate the housing market, these folks say, or the renewed decline of the housing market will take the economy down with it.

Peter Schiff, president and chief global strategist of Euro Pacific Capital, disagrees.

Schiff believes that the government should exit the housing market completely and let prices fall to a natural level. In other words, says Schiff, the government should stop subsidizing mortgage rates with quantitative easing, stop using taxpayer-funded losses at Fannie Mae and Freddie Mac to lubricate the mortgage market, and stop enacting things like the homebuyer tax credit to encourage people to buy houses.

But won’t this wallop the housing market? Won’t this cause many homeowners to go even deeper “underwater” and thus become more likely to just walk away. Won’t this lead to even more foreclosures?Yes, says Schiff. And that’s the point. This country needs more foreclosures, not fewer. We need to clear the market of “shadow inventory” consisting of houses owned by people who never should have bought them in the first place and return to fair pricing.

Artificially pumping buying online up house prices is not doing underwater homeowners any favors, Peter Schiff says. The problem is that, thanks to the crazy mortgages of the bubble years, today’s homeowners were often able to buy houses they can’t afford. And now these houses are millstones around their owners’ necks.Keeping house prices artificially high is also hurting new homebuyers, Schiff points out — by making it more expensive to buy (and forcing people to borrow more money to do it). In many cases, this punishes responsible people who have been saving up money to buy a house and rewards those who spent beyond their means.

Lastly, Schiff says, we need to do away with the cult of homeownership that has taken over the country in recent decades. There’s nothing wrong with renting, Schiff says. In most cases it’s far cheaper than owning. Until recently, Schiff observes, he was a renter himself.

(By the way, if you’re thinking about walking away from your mortgage, here are some things to consider)

Source article

Nearly Two-Thirds of Delinquent Mortgages Untouched:

Oct 19, 2010 | No Comments | Sean Mills

 A good friend of my sent me this from cfo-newsletter@emailblitz.com . -Sean
New Study – Three years into the foreclosure crisis, with just over a third of distressed homeowners working with their servicer’s loss mitigation departments, the State Working Group says it anticipates hundreds of thousands of foreclosures will occur later this year unless improvements are made [...]

 A good friend of my sent me this from cfo-newsletter@emailblitz.com . -Sean

New Study – Three years into the foreclosure crisis, with just over a third of distressed homeowners working with their servicer’s loss mitigation departments, the State Working Group says it anticipates hundreds of thousands of foreclosures will occur later this year unless improvements are made in foreclosure prevention efforts.

 According to a new report from state attorneys general and bank supervisors from across the country, more than 60 percent of homeowners with seriously delinquent loans are still not involved in any form of loss mitigation with their servicer.

 The consortium of state regulators and chief attorneys also found that recent modifications that significantly reduce the principal balance of the loan have a lower rate of redefault compared to loan modifications overall, suggesting that servicers should strategically increase their use of principal reduction modifications to maximize prospects for success.

  Student Housing:

Focusing on financials:

 Currently Student Housing Developers see 65 percent loan to value as the norm in the student-housing market, and that most investors are looking for a 9 percent yield, although 8.5 percent is probably more reasonable.

 As for the structure of the new development deals, the personal guarantees have gone up,  he said. Seemingly the biggest hang-up with any of the groups, whether it’s a high net worth individual or a fund, is that the banks want real liquid order antibiotics online assets put against the loan.

 

A more recent investment trend in the student-housing market is: more people gravitating away from funds toward direct investing. People want more control, they want more influence. They want to move away from investing in closed-in vehicles where they lose all control of the money.

 Finance Execs Expect More Distressed Opportunities in 2011

What’s the word on the street? More distressed acquisition opportunities will come to the multifamily market next year, while the dearth of Class A assets trading hands will likely continue.

 

Forecasting Deals
While the wave of distressed auctions that many expected hasn’t yet materialized, investors are increasingly optimistic that next year will be different. Nearly 62 percent of those surveyed expect more distressed acquisition opportunities to be unearthed in 2011.

Table 1. Asset types expected to be available in 2011.
Distressed properties	61.9%
Class B	39.2%
Value-add	34.5%
Class C	33.3%
Niche (student, seniors, etc.)	24.4%
Class A	22%
None of the above	4.7%

Many feel that it’s just a matter of time before all of those short-term, interest-only CMBS loans made at the peak of the market finally come due. And balance-sheet lenders can only extend-and-amend for so long—as banks slowly return to health, they’ll be able to take greater losses as they clear their balance sheets of distressed notes.

 

Throughout 2010, Class A assets in strong locations inspired bidding wars so heated that most players walked away shaking their heads at the size of the winning bid. That feeding fenzy will likely continue: More than three-quarters of respondents (78 percent) believe there will be fewer stabilized Class A assets hitting the market next year.

Market Upsides Distressed Markets with the Most Upside.
South Florida	27%
Southern California	25%
Phoenix	11%
Atlanta	10%
Las Vegas	10%

Cost-Cutting Continues
Renegotiating vendor contracts and fighting tax judgments continue to be among the most popular cost-cutting strategies employed by firms. More multifamily firms also plan to pass utility costs on to residents and use software to automate business processes than they did last year.

  Linda Shea/ Managing Partner

CFO Capital Partners

“We Bring Experience to the Meeting”

 437 FoxTract Road, Bridgeport, NY 13030

O: 315.633.9653 * EFax: 775.248.6603

Linda@CFOCapitalPartners.com

GMAC Mortgage Statement on Independent Review and Foreclosure Sales

Oct 19, 2010 | No Comments | Sean Mills

Funny no one is denying the homeowners were late, seriously late/delinquent, on their payments of the homes in question but somehow it is there god given rights to stay in the homes.  People always want the rules to apply when the rules benefit them.  How about this…you can’t pay the mortgage do the right thing move [...]

Funny no one is denying the homeowners were late, seriously late/delinquent, on their payments of the homes in question but somehow it is there god given rights to stay in the homes.  People always want the rules to apply when the rules benefit them.  How about this…you can’t pay the mortgage do the right thing move out with deed in lieu of foreclosure. -Sean

MINNEAPOLIS (Oct. 12, 2010) – GMAC Mortgage is committed to preserving the integrity of the foreclosure process and in that spirit has engaged several leading legal and accounting firms to conduct independent reviews of its foreclosure procedures in each of the 50 states.  In addition, foreclosure sale files nationwide receive an additional review by a specialized team to ensure that: home preservation procedures have been fully followed; the timing and substance of the foreclosure is appropriate; and the file itself is in good order and complies with all laws and requirements of the state of jurisdiction.

Foreclosure is a very serious matter and only implemented when all other home preservation options have been fully exhausted.  We are taking these additional steps to restore confidence in the process, which is critical for the stability of the home and mortgage industry.  

In addition to the nationwide measures, the review and remediation activities related to cases involving judicial affidavits in the 23 states continues and has been underway for approximately two months.  As each of those files is reviewed, and remediated when needed, the foreclosure process resumes.  GMAC Mortgage has found no evidence to date of any inappropriate foreclosures.  

GMAC Mortgage is committed to working through this matter diligently and encourages borrowers with questions to contact a customer service representative at 866-304-4682 or loan.assist@gmacm.com.  Additional information Buy Amoxil can be found by visiting www.gmacmortgage.com.  

Source article

Fed’s Dudley: 3 million excess vacant housing units

Oct 19, 2010 | No Comments | Sean Mills

Jist of the article is hard to miss, especially seeing what the title is. -Sean
From NY Fed President William Dudley: Regional Economy and Housing Update
[L]et’s consider the slow housing recovery. Housing market activity—both new construction and sales—remains depressed. On the construction side, total housing starts are running at just 600,000 units per year (seasonally-adjusted) in [...]

Jist of the article is hard to miss, especially seeing what the title is. -Sean

From NY Fed President William Dudley: Regional Economy and Housing Update

[L]et’s consider the slow housing recovery. Housing market activity—both new construction and sales—remains depressed. On the construction side, total housing starts are running at just 600,000 units per year (seasonally-adjusted) in recent months. This is up from 530,000 units at the trough in the first quarter of 2009 but it is still extremely low by the standards of the last 50 years. In fact, the rate of new construction is so low that there is barely any net growth in the U.S. housing stock these days.

One reason why so little housing is being built is that many existing homes stand vacant. We estimate that there are roughly 3 million vacant housing units more than usual. And more vacancies are added daily as the foreclosure process moves homes from families to mortgage lenders. This stock of vacant homes will shrink when fewer are foreclosed upon and more of these homes are sold or rented out.

On the sales side, even though low mortgage interest rates and falling home prices have together boosted housing affordability to its highest level in 40 years, the current pace of sales is quite sluggish. Impediments to home sales include tight lending standards, a weak job market and continued uncertainty regarding the future path of home prices. The large decline in home prices that occurred between 2006 and 2008 is also important. This decline reduced the amount of equity that owners have in their homes, making it difficult for people to come up with the funds needed to “trade-up” and move into better homes.

In addition, the steep decline in home prices put many families at risk of mortgage delinquency and, ultimately, losing their homes to foreclosure. With lower home prices, many families now owe more on their mortgage than their home is worth. This means that they cannot refinance or sell their homes easily if they experience a financial crisis, such as a job loss or a serious illness. Recent developments on foreclosures have been mixed. While RealtyTrac reports that foreclosure completions in the United States exceeded 100,000 for the first time in September, it is important to remember that foreclosure is a lengthy process in most states. Our data indicate that, in recent quarters, borrowers are becoming less likely to fall behind on their mortgages, so fewer households are now entering the foreclosure process. At the same time, though, major lenders have acknowledged serious problems in the processes they have used to repossess homes and announced moratoria on new foreclosures. Taken together, these developments suggest that the situation in housing remains uncertain for the foreseeable future.

The Federal Reserve actively encourages efforts to find viable alternatives to foreclosure, like loan modifications, or deeds in lieu. We also support due process and access to legal counsel for homeowners facing foreclosure, for instance through legal aid programs. At the same time, it is important that foreclosures that properly comply with state and federal law can ultimately take place, as this is a necessary part of the adjustment that will eventually return us to more normal conditions in the housing market.

At present, the extent of the documentation problem and its wider ramifications are still uncertain. In conjunction with the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, the Federal Reserve is therefore seeking to establish the facts through a review of the foreclosure practices, governance and documentation at the major bank mortgage servicers. We want to ensure that the housing finance business is supported by robust back-office operations—for processing of new mortgages as well as foreclosures— so that buyers of homes and investors in mortgage securities have full confidence in the process. We are monitoring developments closely in order to evaluate any potential impact on the housing market, financial institutions and the overall economy.For those in the New York / New Jersey area, much of Dudley speech is on the regional economy and housing market. 

From NY Fed President William Dudley: Regional Economy and Housing Update

[L]et’s consider the slow housing recovery. Housing market activity—both new construction and sales—remains depressed. On the construction side, total housing starts are running at just 600,000 units per year (seasonally-adjusted) in recent months. This is up from 530,000 units at the trough in the first quarter of 2009 but it is still extremely low by the standards of the last 50 years. In fact, the rate of new construction is so low that there is barely any net growth in the U.S. housing stock these days.

One reason why so little housing is being built is that many existing homes stand vacant. We estimate that there are roughly 3 million vacant housing units more than usual. And more vacancies are added daily as the foreclosure process moves homes from families to mortgage lenders. This stock of vacant homes will shrink when fewer are foreclosed upon and more of these homes are sold or rented out.

On the sales side, even though low mortgage interest rates and falling home prices have together boosted housing affordability to its highest level in 40 years, the current pace of sales is quite sluggish. Impediments to home sales include tight lending standards, a weak job market and continued uncertainty regarding the future path of home prices. The large decline in home prices that occurred between 2006 and 2008 is also important. This decline reduced the amount of equity that owners have in their homes, making it difficult for people to come up with the funds needed to “trade-up” and move into better homes.

In addition, the steep decline in home prices put many families at risk of mortgage delinquency and, ultimately, losing their homes to foreclosure. With lower home prices, many families now owe more on their mortgage than their home is worth. This means that they cannot refinance or sell their homes easily if they experience a financial crisis, such as a job loss or a serious illness. Recent developments on foreclosures have been mixed. While RealtyTrac reports that foreclosure completions in the United States exceeded 100,000 for the first time in September, it is important to remember that foreclosure is a lengthy process in most states. Our data indicate that, in recent quarters, borrowers are becoming less likely to fall behind on their mortgages, so fewer households are now entering the foreclosure process. At the same time, though, major lenders have acknowledged serious problems in the processes they have used to repossess homes and announced moratoria on new foreclosures. Taken together, these developments suggest that the situation in housing remains uncertain for the foreseeable future.

The Federal Reserve actively encourages efforts to find viable alternatives to foreclosure, like loan modifications, or deeds in lieu. We also support due process and access to legal counsel for homeowners buy drugs online facing foreclosure, for instance through legal aid programs. At the same time, it is important that foreclosures that properly comply with state and federal law can ultimately take place, as this is a necessary part of the adjustment that will eventually return us to more normal conditions in the housing market.

At present, the extent of the documentation problem and its wider ramifications are still uncertain. In conjunction with the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, the Federal Reserve is therefore seeking to establish the facts through a review of the foreclosure practices, governance and documentation at the major bank mortgage servicers. We want to ensure that the housing finance business is supported by robust back-office operations—for processing of new mortgages as well as foreclosures— so that buyers of homes and investors in mortgage securities have full confidence in the process. We are monitoring developments closely in order to evaluate any potential impact on the housing market, financial institutions and the overall economy.For those in the New York / New Jersey area, much of Dudley speech is on the regional economy and housing market.

Source Article

Home Tax Credit a Costly Failure

Apr 28, 2010 | No Comments | Sean Mills

From David Kocieniewski at the NY Times: Home Tax Credit Called Successful, but Costly
Though the Treasury Department and the real estate industry have termed the program a success, helping 1.8 million people buy homes, many tax policy experts say it has been singularly cost-ineffective: most of the $12.6 billion in credits through end of [...]

From David Kocieniewski at the NY Times: Home Tax Credit Called Successful, but Costly

Though the Treasury Department and the real estate industry have termed the program a success, helping 1.8 million people buy homes, many tax policy experts say it has been singularly cost-ineffective: most of the $12.6 billion in credits through end of February was collected by people who would have bought homes anyway or who in some cases were not even eligible.

There is no question this program was very costly. And why is the Treasury confusing activity with accomplishment? Sure sales briefly surged, but were new households formed? How many new jobs were created?

“We were happy in our apartment, but $8,000 was just too much to pass up,” said [Mr. James Green, a student at Purdue University], 29, who shopped furiously with his wife for two months before signing a contract in March to buy a three-bedroom ranch.

“We bid on a couple places that didn’t work out,” he said, “but we always made sure we had a backup plan because we didn’t want to miss the deadline for the credit. And when we finally agreed to a contract, it was this huge relief.”

For every home buyer like the Greens, real estate agents say there are at least three others who collected the credit even purchase antibiotics online though they would have bought without it. That means for each new buyer who was truly lured into the market by the credit, the federal government paid more than $30,000.

This is very optimistic – the ratio was probably 5-to-1 for the initial credit and even higher for the extension. But this shows two failures of the tax credit: 1) the high cost, and 2) it was just moving people from apartments to homes and didn’t reduce the excess housing inventory (yes, rentals count as housing inventory too).

“The tax credit helped to stanch the price declines, which had substantial benefit for the entire economy,” said Mark Zandi at Moody’s Economy.com.

And this has been the policy – support asset prices by limiting the supply (all the foreclosure delays), and pushing demand (low mortgage rates and the tax credit). This has helped the banks significantly, and Zandi argues this has boosted confidence. Maybe … but I’m not convinced that supporting house prices above the market clearing level to help the banks and boost consumer confidence makes sense. I think targeting jobs – and therefore household formation – would have been a far more cost effective program.

Source Article

Prices Fell .64 Percent in February, But Gained 1.43 Percent In Last Year

Apr 28, 2010 | No Comments | Sean Mills

I come across so much information in my research and as i have been so busy as of lately I have not posted much of anything.  I will just keep doing it regardless of the feedback.-Sean

Prices fell .64% in February, but increased 1.43% compared to a year earlier, according to new Case Shiller data, with [...]

I come across so much information in my research and as i have been so busy as of lately I have not posted much of anything.  I will just keep doing it regardless of the feedback.-Sean

Prices fell .64% in February, but increased 1.43% compared to a year earlier, according to new Case Shiller data, with the gain representing a significant positive change.

The Case Shiller 10-City Index would fall 7.68% over 12 months if the February fall continued, but the data on the direction of values point in many different directions. Prices for all of 2009 were flat, but have fallen 30% since values peaked in June 2006. The year-over-year increase is a new and positive pattern, but there are many negative trends to consider.

Most analysts for property values (and all assets including stocks) are naturally positive, which calls into question a positive zeitgeist now attached to property values. It is however unambiguously positive that both the 10-City and 20-City index registered a simultaneous annual gain in February — which was last seen in DECEMBER 2006 (more than THREE years ago).

Prices Fell .64 Percent in February, But Gained 1.43 Percent In Last Year

April 27, 2010

tags: New Observations Forecast of Property Values

by Michael David White

Prices fell .64% in February, but increased 1.43% compared to a year earlier, according to new Case Shiller data, with the gain representing a significant positive change.

The Case Shiller 10-City Index would fall 7.68% over 12 months if the February fall continued, but the data on the direction of values point in many different directions. Prices for all of 2009 were flat, but have fallen 30% since values peaked in June 2006. The year-over-year increase is a new and positive pattern, but there are many negative trends to consider.

Most analysts for property values (and all assets including stocks) are naturally positive, which calls into question a positive zeitgeist now attached to property values. It is however unambiguously positive that both the 10-City and 20-City index registered a simultaneous annual gain in February — which was last seen in DECEMBER 2006 (more than THREE years ago).

Cipro alt=”" width=”600″ height=”440″ />

Clouding any and every forecast on property values should be record delinquencies of 15% of all mortgages outstanding, unemployment at just under 10%, and a mortgage market of exceptionally high risk which has been abandoned by all private money sources. About 13.6 million homeowners have no equity or negative equity and therefore have no current wealth to protect by making their mortgage payment. Real estate prices would fall flat on their face without government mortgage money which represents nine of ten new mortgage dollars.

New Observations has previously forecast a fall in values in 2010 of 13 percent based on an average of four major property price indexes. In a separate analysis of a 120-year time series, we forecast a total fall still ahead in the national market of 22% and a total fall from peak-to-trend of 49 percent. Radical government intervention may stop these forecasted falls.

The Case Shiller monthly changes and annual changes for individual cities and for the composite indexes are listed above.

Check Calculated Risk for a good chart of rising and falling property prices and unemployment. Cool charts here on many of the cities covered by Case Shiller. Wall Street Journal on Case Shiller update.

***

PRINT — Prices fell .64% in February, but increased 1.43% compared to a year earlier

Please forward questions, corrections, and reactions to comments below or send me an email. Please send an email if you would like to take out a new mortgage.

Source Article

Freddie Mac: “Potential Large Wave of Foreclosures”

Feb 24, 2010 | No Comments | Sean Mills

Another fine calculated risk article.-Sean

“We start 2010 with some early signs of stabilization in the housing Buy Cipro market, with house prices and home sales likely nearing the bottom sometime in 2010. We expect that low mortgage rates, relatively high affordability and the homebuyer tax credit will help continue to fuel the recovery. Still, [...]

Another fine calculated risk article.-Sean

“We start 2010 with some early signs of stabilization in the housing Buy Cipro market, with house prices and home sales likely nearing the bottom sometime in 2010. We expect that low mortgage rates, relatively high affordability and the homebuyer tax credit will help continue to fuel the recovery. Still, the housing recovery remains fragile, with significant downside risk posed by high unemployment and a potential large wave of foreclosures.”
Freddie Mac Chief Executive Officer Charles E. Haldeman, Jr.

The quote is from the Freddie Mac Q4 earnings release:

Read More » »

Foreclosure picture bleak, unemployment wreaking havok

Jan 19, 2010 | No Comments | Sean Mills

Does this surprise anyone?  Do you need to be a rocket scientist to figure this out?  I guess you do with all the buy antibiotics without prescription mis-information floating around. -Sean
A record 3 million U.S. homes will be repossessed by lenders this year as high unemployment and depressed home values leave borrowers unable to [...]

Does this surprise anyone?  Do you need to be a rocket scientist to figure this out?  I guess you do with all the buy antibiotics without prescription mis-information floating around. -Sean

A record 3 million U.S. homes will be repossessed by lenders this year as high unemployment and depressed home values leave borrowers unable to make their house payment or sell, according to a RealtyTrac Inc. forecast.

Last year there were 2.82 million foreclosures, the most since RealtyTrac began compiling data in 2005. More than 4.5 million filings are expected this year, including default or auction notices and bank seizures, said Rick Sharga, senior vice president for the seller of default data and forecasts based in Irvine, Calif. There were 3.96 million filings in 2009.

“This will be the peak year, and the main reasons are unemployment and house prices that have stabilized way below mortgage amounts,” Kenneth Rosen, chairman of the University of California’s Fisher Center for Real Estate and Urban Economics in Berkeley, said in an interview.

Government and lender efforts to keep people in their homes are failing to relieve the worst foreclosure crisis since the Great Depression. Unemployment was 10 percent in December, unchanged from the previous month, while the so-called underemployment rate that includes part-time workers and discouraged workers rose to 17.3 percent from 17.2 percent, the Labor Department said Jan. 8.

U.S. lenders permanently modified 31,382 mortgages, or 1 percent, of the 4 million loans targeted under the Obama administration’s foreclosure prevention plan through November, the U.S. Treasury Department said last month. Fewer than half of the 3.2 million homeowners estimated as eligible for mortgage relief by the Treasury actually qualify, according to Herb Allison, assistant secretary for financial stability.

“The government doesn’t have their act together on housing,” Rosen said. “They seem to be pussy-footing around. We need a much more robust effort.”

Obama’s loan-modification program is “destined to fail” because it doesn’t confront the problem of negative equity that is driving foreclosures, Laurie Goodman, senior managing director at Amherst Securities Group LP, told Congress Dec. 8. Homeowners with negative equity, where a property is worth less than the loan, have little incentive to keep paying the mortgage and will “strategically default,” Rosen said.

More than 728,000 borrowers have already received an average $550 reduction in monthly payments, giving them “a second chance to stay in their homes,” she said.

An $8,000 first-time homebuyer tax credit and a $200 billion lifeline to keep mortgage buyers Fannie Mae and Freddie Mac solvent are among the administration’s efforts to date that have supported the housing market, she said.

“Modifications will not be the solution for all homeowners and will not solve the housing crisis alone,” Reilly said.

The number of homeowners with negative equity totaled 10.7 million, or 23 percent, at the end of the third quarter, according to a Nov. 24 report by First American CoreLogic, a Santa Ana, Calif.-based real estate research firm.

Home prices probably fell 13 percent in 2009 to a median of $172,700, following a drop of 9.5 percent the previous year, Walt Molony, a spokesman for the National Association of Realtors, said in an interview. Prices are down 26 percent from the July 2006 peak.

Defaults among prime borrowers are likely to accelerate, adding to a “huge” inventory of properties that banks possess and haven’t yet put on the market, according to Robert Shiller and Karl Case, who created the S&P/Case-Shiller Home Price Index. In September, Goodman estimated that 7 million homes were already in foreclosure or likely to be seized.

The housing market is weighed down by a “a massive supply of delinquent loans” that will end up in foreclosure this year, James Saccacio, RealtyTrac’s chief executive officer, said in a statement Friday.

The end of the government’s tax credit for first-time buyers, scheduled to expire in the spring, and the end of the Federal Reserve’s $1.25 trillion purchase of mortgage bonds, may add to housing woes, Rosen said.

A total of 2,824,674 U.S. properties got at least one foreclosure filing in 2009, a 21 percent jump from the prior year and more than double the number in 2007, RealtyTrac said.

About 2.2 percent of households received a filing last year, according to the company, which sells default data collected from more than 2,200 counties representing 90 percent of the U.S. population.

December filings increased 15 percent from a year earlier to 349,519, the 10th straight month the tally surpassed 300,000. Foreclosures in the fourth quarter jumped 18 percent from the same period in 2008 and fell 7 percent from the third quarter.

Nevada had the highest foreclosure rate for the third straight year in 2009, with more than 10 percent of households receiving at least one filing. December filings fell 22 percent from a year earlier and rose 27 percent from November.

Arizona had the second-highest rate for the year as more than 6 percent of households got a filing. Florida was third at 5.93 percent, followed by California at 4.75 percent and Utah at 2.93 percent, RealtyTrac said.

The other states among the 10 highest rates were Idaho at 2.72 percent, Georgia at 2.68 percent, Michigan at 2.61 percent, Illinois at 2.5 percent and Colorado at 2.37 percent.

source article