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Real Estate News 2.27.14

Here’s where home prices are about to take off

“FORTUNE — “The time to buy is when there’s blood in the streets.” That quote, attributed to 18th-century financier Baron Rothschild, means that buying when everyone else is panicking is a great idea, as that’s when prices are at their lowest.”

It’s still a lot cheaper to buy than rentIt’s still a lot cheaper to buy than rent

“FORTUNE — Home prices have been rising steadily for more than year, with the most recent Case-Shiller index reading showing the biggest year-over-year increase in nearly a decade. But that doesn’t mean that it is a bad time to buy.”

Freddie Mac profit moves U.S. housing bailout further into black

“(Reuters) – Freddie Mac (FMCC.OB) said on Thursday it will soon send the U.S. Treasury a $10.4 billion dividend after posting a ninth straight quarterly profit, putting taxpayers further into the black on their bailout of the mortgage giant.”

Realtors® Oppose Tax Plan to Limit Mortgage Interest Deduction, Real Estate Provisions

“WASHINGTON (February 26, 2014) – The following is a statement by National Association of Realtors® President Steve Brown…”

Durable goods orders mixed, jobless claims rise

“(Reuters) – Orders for long-lasting U.S. manufactured goods excluding transportation unexpectedly rose last month as did a gauge of business spending plans, but that will probably not change views that factory activity is slowing.”

Foreclosures Climaxing in New York-New Jersey Market: Mortgages

“Feb. 26 (Bloomberg) — The epicenter of the U.S. foreclosure crisis is shifting to New Jersey and New York, threatening a housing rebound in one of the country’s most densely populated areas.”

Camp to Cap Mortgage Benefit While Ending State Tax Break

“A tax plan from House Ways and Means Committee Chairman Dave Camp would further limit the mortgage-interest break and end the deduction for state and local taxes, according to a nonpartisan congressional summary.”

BofA under probe over US housing program, forex

“Bank of America may have a new mortgage problem on its plate, saying on Tuesday that federal investigators are looking into whether the bank violated requirements of a U.S. government housing program.”

WellFargo cuts 700 mortgage jobs

“Wells Fargo & Co. said Wednesday that it is cutting 700 employees, including 203 in the Twin Cities, as demand for mortgages continues to shrink.”

Potential Conflicts Cited For Mortgage Servicer

“New York State’s top banking regulator said he had new concerns about Ocwen Financial, one of the nation’s largest mortgage servicing companies, creating another regulatory headache for the company.”

Senate committee advances repeal of mortgage registration fees

“A bill that would repeal mortgage registration fees moved forward from a Senate committee Wednesday.”

Morgan Stanley offers $275M to absolve bad mortgage bonds

“Morgan Stanley is finalizing a $275 million agreement with the U.S. Securities and Exchange Commission to settle the SEC probe into the bank’s toxic subprime mortgage bond trades going back to 2007.”

Bank earnings are booming, but there’s a big problem

“Commercial banks and savings institutions insured by the Federal Deposit Insurance Corp. posted the 17th quarterly increase since 2009 due to an $8.1 billion decline in loan-loss provisions in the fourth quarter of 2013.”

Federal judge sides with Fannie, Freddie shareholders

“Court of Federal Claims Judge Margaret Sweeney granted the Fairholme Funds motion for discovery against America.”

Institutional investor home buys hit 22-month low

“Institutional investor home sales continue to decline as a portion of all home sales, hitting a 22-month low.”

The key to successfully growing your mortgage lending operation

“The mortgage market is quickly drying up and lender competition is heightening in order attract the remaining drops of business thus making lender relationships more important than ever.”

4 game changers for selling homes this tax season

“New-homes sales reached a five-year high Wednesday morning, showing that buyers are still jumping into the market.”

Lansner: Time to sell real estate?

“If the local real estate market is taking a breather this winter after a fast rebound, should you be thinking of selling?”

Index: L.A.-O.C. home prices up 20.3%, but market is leveling off

“Home prices in the Los Angeles-Orange County area jumped 20.3 percent in December compared with a year earlier, the 18th consecutive month of annual gains, housing figures released Tuesday show.”

Los Angeles Real Estate Heats Up With Mogul Money

“Numbers don’t lie. Like box office grosses, home sales reflect economic reality. Per real estate news firm Data Quick, year-over-year residential real estate sales prices are up 18.4% across the Los Angeles area in early 2014 and the inventory of homes and condos for sale remains low. At the upscale end of the market, often in those Los Angeles neighborhoods favored by showbizzers, demand is the strongest, resulting in multiple offers over asking price for contempo properties and select empty lots.’

HUD AND CENSUS BUREAU REPORT NEW RESIDENTIAL SALES IN JANUARY

“WASHINGTON – Sales of new single-family houses in January 2014 were at a seasonally adjusted annual rate of 468,000, according to estimates released jointly today by the U.S. Department of Housing and Urban Development and the Census Bureau.”

The myth of real estate and economic mobility: Americans face lowest geographic mobility in over two generations. Is staying put the new American Dream?

“Americans like to believe that they are movers and shakers and will follow the opportunity wherever it may be. The idea of selling your home and moving across the country for a great new job opportunity seems to be a common notion of how things happen. However the data shows us a very different reality. Americans are largely staying put. We can blame this on negative equity but this trend actually goes back to the 1980s. In fact, American mobility is at all-time record lows. What this means is people are staying put like our golden handcuffed baby boomers. I was thinking about this carefully and I think one major reason for this is the massive subsidies given to homebuyers creates incentives for staying put. Think of California with Prop 13 and the ability to write-off many housing items including interest when being a homeowner. The system is setup to keep people locked in. For a young person in a high cost of living area the best economic option may be to move and start in another state. However the facts point to a very different picture.”

Freddie Mac Prices $1 Billion Reopening of .875% Three-Year Reference Notes® Security

“MCLEAN, VA–(Marketwired – Feb 27, 2014) – Freddie Mac (OTCQB: FMCC) announced today that it auctioned a $1 billion reopening of its .875% three-year USD Reference Notes® security that matures on February 22, 2017. The stop yield for the issue, CUSIP 3137EADT3, was .724%, priced at 100.442508. The bid-to-cover ratio was 4.8 to 1.”

Fixed Mortgage Rates Continue Gradual Climb Higher

“MCLEAN, VA–(Marketwired – Feb 27, 2014) – Freddie Mac (OTCQB: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), showing average mortgage rates mixed with the fixed-rate products moving higher for the fourth consecutive week, while adjustable rate mortgages eased.”

Freddie Mac Announces $1 Billion Reopening of .875% Three-Year Reference Notes® Security

“MCLEAN, VA–(Marketwired – Feb 27, 2014) – Freddie Mac (OTCQB: FMCC) announced today that it plans to launch a $1 billion reopening of its .875% three-year USD Reference Notes® security that matures on February 22, 2017. The issue will price today, Thursday, February 27, 2014, and will settle on Monday, March 3, 2014.”

Freddie Mac Reports Fourth Quarter and Full-Year 2013 Financial Results

“MCLEAN, VA–(Marketwired – Feb 27, 2014) – Freddie Mac (OTCQB: FMCC) today reported its fourth quarter and full-year 2013 financial results and filed its annual Form 10-K with the U.S. Securities and Exchange Commission.”

CFPB Director Calls for Increased Financial Literacy

“For Richard Cordray, the equation is simple: In the Land of the Free and the home of the free market, American citizens should be as informed about and capable of self-governance in their personal finances as they are in the democratic process, especially when it comes to borrowing for a mortgage.”

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Today’s Real Estate News 10.24.2013

Summary:
In today’s news, CNN Money shares about “impact investing,” and how 50% of the country’s foreclosed homes are still being occupied. Reuters reports that jobless claims remain high yet manufacturing is slowing. According to Market Watch, BofA is slashing 3,000 mortgage jobs. CNBC states that 9 banks are being probed on mortgage-backed securities and Fed easing’s effect on mortgage rates. Mortgage apps fall less than a whole percentage according to the UPI. Housing Wire reports that the fed “proposes minimum liquidity requirements” for the big banks. Bloomberg is full of news today sharing that Bank of America’s Countrywide is being held liable for selling thousands of defective loans to Fannie Mae & Freddie Mac, the city of Vallejo is set to sell water-bonds for the 1st time since before it’s 2008 bankruptcy filing, all-cash buyers make up nearly 50% of all home sales and Warren Buffett says that while the housing market has made some headway, it still has a way to go. Dr. Housing Bubble shares the story of how it’s possible that a 932 square foot home can be priced at $895,000.  

Can you make money and feel good about it?
“Want to make money while helping the people around you? Impact investing may have the answer.”

Half of nation’s foreclosed homes still occupied
“Foreclosure sounds like the end of the line, but actual eviction can take months or years — even after the bank has repossessed a home.”

U.S. jobless claims stay elevated, manufacturing slows
“(Reuters) – The number of Americans filing new claims for unemployment benefits fell less than expected last week, but a lingering backlog of applications in California makes it difficult to get a good read of labor market conditions.”

Bank of America to cut 3,000 jobs in mortgage unit
“NEW YORK (MarketWatch) — Bank of America Corp. Inc. BAC -0.25% will cut approximately 3,000 mortgage jobs in the fourth-quarter as it looks to make cutbacks in its expenses, said a person familiar with the matter.”

Jury Finds Bank of America Liable in Mortgage Case
“Updated, 9:20 p.m. | Bank of America, one of the nation’s largest banks, was found liable on Wednesday of having sold defective mortgages, a jury decision that will be seen as a victory for the government in its aggressive effort to hold banks accountable for their role in the housing crisis.”

US task force probes nine banks on mortgage-backed securities
“At least nine banks face investigations by the U.S. Department of Justice into their sales of mortgage-backed securities as part of an effort by the task force that reached the $13 billion pact with JPMorgan Chase, people familiar with the matter say.”

What more Fed easing really means for mortgage rates
“Now that the Fed is expected to keep its foot on the easy money pedal for months to come, don’t expect to see interest rates go much lower.”

U.S. mortgage applications fall less than 1 percent
“WASHINGTON, Oct. 23 (UPI) — U.S. mortgage activity dropped less than 1 percent last week, the Mortgage Bankers Association said Wednesday.”

Fed proposes minimum liquidity requirements for big banks
“For the first time in its regulatory history, the Federal Reserve Board is proposing a rule that would create a standardized, minimum liquidity requirement for banks deemed systemically important.”

BofA’s Countrywide Found Liable for Defrauding Fannie Mae
“Bank of America Corp.’s Countrywide unit was found liable by a jury for selling Fannie Mae and Freddie Mac thousands of defective loans in the first mortgage-fraud case brought by the U.S. government to go to trial.”

Vallejo Water-Bond Deal to Be City’s First Since 2008 Bankruptcy
“Vallejo, the Northern California city that sought Chapter 9 bankruptcy protection in 2008, is set to sell about $19 million in water-revenue bonds next week in its first municipal-debt sale since the filing.”

Families Blocked by Investors From Buying U.S. Homes
“Home purchases by institutional buyers reached a record high in September and all-cash buyers accounted for almost half of sales as investors responded to rising demand from renters.”

Buffett Says Gains in Housing Fall Short of Equilibrium
“Warren Buffett, the billionaire chairman and chief executive officer of Berkshire Hathaway Inc. (BRK/A), said the U.S. housing market has made progress and still has a way to go in recovering.”

The Grand Republic of Santa Monica: 932 square feet for $895,000. How housing built before the Great Depression can fetch wild prices.
“The mania in certain California neighborhoods is so dramatic that my e-mail box is now filled on a daily basis with Real Homes of Genius.  It isn’t as high as it was in 2007 at the apex of the last bubble but I’m seeing some pretty outrageous properties being listed for pipedream prices.  Targeted markets are definitely benefitting from the investor fever.  First, many of the homes being sold are actually being sold for the land.  Given the headline cost plus construction costs this is a very tiny market segment here.  Yet the froth is very obvious in these regions.  Santa Monica is prime Westside housing.  It is hard for anyone outside of the region to understand the crazy prices in Santa Monica.  Even those in the region have a hard time understanding.  Today we’ll focus on this area and pull up a property that only an investor could love.  Welcome to the wonderful Republic of Santa Monica.”

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Today’s Real Estate News 10.18.2013

Summary:
According to CNN Money, more budget cuts are on the horizon for the nation while the current $80 Billion budget cuts has already hurt the economy. Realtor shares an interesting fact in time for Halloween, most people are willing to purchase so-called haunted homes. LA Times reports that home prices & sales are cooling down in the Bay Area. Market Watch (Wall Street Journal) shows SunTrust Bank Inc.’s 3Q earnings have fallen 82% as a result of a settlement agreement. The Housing Wire reports that stocks are rising as a result of investor reaction to the “government deal,” JPMorgan Chase has donated $250 million in free & discounted homes across the nation & Vice President of Coastal States Mortgage Corp., Patrick Mansell, was sentenced to a 5 year prison term as a result of pleading guilty to “conspiracy to commit wire fraud” against Fannie Mae & Freddie Mac. According to Bloomberg, states are closing in on companies who are improperly labeling employees as contractors in order to evade employee taxes, overtime pay, insurance & pay fair wages to workers. CNBC reports that high-end flipping is increasing in popularity among investors & the Labor Department will be releasing the September jobs report this coming Tuesday. Time’s Business & Money section put out an article regarding the drag that student loans are on the economy.

Spending cuts are hurting economy
“If you thought this year’s cuts to preschoolers, senior meals and medical research were bad, get ready for more.”

Survey: Most People Open to Buying a Haunted House
“More than half of home buyers are open to buying a haunted house, according to realtor.com’s 2013 Haunted Housing Report. Also, 35 percent of the nearly 1,400 people who took the survey say they have lived in a haunted home.”

Bay Area home market cools, prices and sales fall
“Home prices and sales fell last month in the Bay Area as the tech-rich region mirrored a cooling trend elsewhere within the state.”

SunTrust Banks net down 82% on higher expenses
“SunTrust Banks Inc.’s STI +0.53% third-quarter earnings fell 82% as the regional bank posted higher expenses resulting from a recent settlement agreement.”

Housing stocks rise as investors react to government deal
“The HW 30 – a composite of housing and mortgage finance stocks – rose nearly 1% Thursday as the government reopened, allowing agencies like the Federal Housing Administration to return to the business of handling FHA loans.”

A Common Trait that Silicon Valley, Las Vegas, and New York all Share. Hint: It’s not the Weather
“On average, for every $1 billion increase in stock value of companies in a given area, the median sale price of nearby homes increases by $4,400. That doesn’t sound like much, until you consider an area like Silicon Valley, home to 45 publicly traded companies in this study, and about $1.1 trillion in valuation. When the aggregate stock value of these companies goes up, about three months later, home prices begin to rise at a corresponding rate. This means that an increase in stock value of just 1 percent for these Silicon Valley companies could lead to an increase of median sale price of more than $48,000.”

JPMorgan Chase donates $250 million free, discounted homes
“JPMorgan Chase (JPM) has donated or sold at a discount more than $250 million in corporate-owned homes to community associations, municipalities, veteran groups and nonprofit housing providers across the country.”

Mortgage executive gets five years for defrauding Fannie, Freddie
“A federal judge sentenced Patrick Mansell, 68, of Boca Raton, Fla., to five years in prison and three years subsequent supervised release after he pled guilty to conspiracy to commit wire fraud. His alleged violation occurred when Mansell took part in a scheme to defraud the government-sponsored enterprises, Fannie Mae and Freddie Mac.”

States Clamping Down on Workers Mislabeled as Contractors
“When construction slowed during the recession, some companies hired workers and wrongly designated them as independent contractors to avoid paying insurance, taxes, fair wages and overtime.”

Investors high on high-end house flips
“Rising home prices and short supply have investors setting their sights on a new real estate play.”

September jobs report coming on Tuesday
“The Labor Department said on Thursday that it would release its report on September employment on Tuesday, as it provided a fresh schedule for some economic data that had been postponed due to a partial government shutdown.”

Student Loans Are Becoming a Drag on the US Economy
“The housing recovery remains on track. But high levels of student debt threaten to hang over the residential real estate market for many years, acting as a drag on both household formation and higher prices.”