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Today’s Real Estate News 11.6.2013

Home prices show smallest gain since January
“September home prices showed the smallest monthly increase since January, according to real estate data firm CoreLogic.”

Freddie Mac Prices Transaction to Share Residential Mortgage Credit Risk With Private Investors
“MCLEAN, VA–(Marketwired – Nov 5, 2013) – Freddie Mac (OTCQB: FMCC) today priced a $630 million offering of the Freddie Mac Structured Agency Credit Risk (STACR®) debt notes. This offering represents the company’s second STACR offering in which private sources, and not taxpayers, predominately take the credit risk.”

Freddie Mac Receives CMBS Master and Special Servicer Ratings From Fitch
“MCLEAN, VA–(Marketwired – Nov 5, 2013) – Fitch Ratings today gave Freddie Mac (OTCQB: FMCC) Multifamily an initial commercial mortgage-backed securities (CMBS) master servicer rating of CMS2 and affirmed the existing special servicer rating of CSS2-. The CMS2 rating is the highest initial rating ever assigned by Fitch for a master servicer.”

Does Q3 Uptick in Homeownership Reveal Good News or False Hope?
“The Census Bureau’s announcement Tuesday that the national homeownership rate ticked up slightly in the third quarter of this year has some analysts wondering if this is a turning point for homeownership and others labeling slow household formation as a persistent hindrance to a full housing market recovery.”

September Bucks Forebodings of Decelerating Price Gains
“With recent predictions forecasting a falloff in home price increases over the next year, gains nevertheless continued at a strong pace in September, CoreLogic reported Tuesday in its monthly Home Price Index (HPI) report.”

Housing Market Recovery Rate Indicates Less Volatility than Ever
“Renewed profitability in the real estate market lacks the troublesome “irrational exuberance” that caused problems in the past, according to Wade Micoley, president and CEO of WM Enterprises, Inc., and the online auction house Micoley.com.”

Fannie Mae’s Portfolio Continues to Shrink
“Fannie Mae has released its September book of business, revealing further declines as new business acquisitions came to their lowest level in more than a year.

The mortgage behemoth’s book of business totaled $3.163 trillion as of the end of September, shrinking at a compound annual rate of 1.3 percent.”

FHFA Prohibits Servicer Reimbursement
“The Federal Housing Finance Agency (FHFA) announced Tuesday that it has directed the GSEs to prohibit servicers from being reimbursed for expenses associated with captive reinsurance arrangements. The announcement follows a notice that FHFA published in the Federal Register last March regarding its views on these lender-placed insurance practices and accepting public input. The notice also cited concerns that the practices expose Fannie Mae and Freddie Mac to potential losses as well as litigation and reputation risks.”

Rich investors sitting on a pile of cash
“Some of the richest people around the world think the stock market will continue to go up. So why are they sitting on a big pile of cash?”

Most Metro Areas Show Strong Annual Home-Price Growth
“WASHINGTON (Nov. 6, 2013) – The majority of metropolitan areas in the third quarter experienced robust year-over-year price gains, with the national median price showing the strongest annual growth in nearly eight years, according to the latest quarterly report by the National Association of Realtors®.”

Exclusive: EU to levy record fines on Libor banks: source
“(Reuters) – EU antitrust regulators will levy a record fine of at least 1.5 billion euros on six financial institutions, including Barclays (BARC.L) and Royal Bank of Scotland (RBS.L), for rigging the yen Libor interest rate benchmark, a banking industry source said on Wednesday.”

MBA’s Cosgrove Testifies on Housing Finance Reform
“WASHINGTON, D.C. (November 5, 2013) – Bill Cosgrove, CEO of Union Home Mortgage Corp. and Chairman-Elect of the Mortgage Bankers Association (MBA), testified today before the U.S. Senate Committee on Banking, Housing and Urban Affairs at a hearing titled, ‘Housing Finance Reform: Protecting Small Lenders Access to the Secondary Market.'”

Ally Profit Drops as Lender Absorbs Cost of Mortgage Accord (3)
“Ally Financial Inc. (ALLY:US), the auto finance firm majority-owned by U.S. taxpayers, said third-quarter profit fell 76 percent as the company settled U.S. claims for soured mortgages and stopped making new home loans.”

Bernanke Giving Homebuyers Second Chance With Pledge: Mortgages
“This was supposed to be the year that Herb Harrison found a newer, bigger home to replace his current house in Framingham, Massachusetts. Then, in May, mortgage rates began to rise and he put his hunt on hold.”

Fannie, Freddie Ordered to End Reimbursements for Force-Placed Insurance
“The Federal Housing Finance Agency told Fannie Mae and Freddie Mac to end reimbursements to mortgage servicers for expenses related to captive reinsurance arrangements.”

As US Economy Plods and Pay Lags, Companies Profit
” Look at the U.S. economy and you’ll notice an unusual disconnect.

The economy is being slowed by a tight job market, scant pay raises and weak business investment. Yet corporate profits are reaching record highs and fueling record stock prices.”

US planned layoffs rise in October: Challenger report
“The number of planned layoffs at U.S. firms rose 13.5 percent in October on cuts in the pharmaceutical and financial sectors, a report on Wednesday showed.”

Regions Discloses HUD Subpoena Related to Mortgages
“Regions Financial Corp. (RF), Alabama’s biggest bank, received a subpoena from the U.S. Department of Housing and Urban Development tied to the origination of mortgages backed by the Federal Housing Administration.”

Two heavyweight Fed papers argue for stronger policy action
“Nov 5 (Reuters) – Two of the Federal Reserve’s top staff economists make the case in new research papers for more aggressive action by the U.S. central bank to drive down unemployment by promising to hold interest rates lower for longer.”

BofA CEO: Housing Market ‘Fairly Stable’
“Bank of America Corp.BAC +0.22% Chief Executive Brian Moynihan said the U.S. housing market is “fairly stable” at a Wall Street Journal event in New York Wednesday.”

CORONA: Realtors’ home, a decoy for Nigerian rental scam
“Rental scams are mounting in the Inland region, as Heather Stevenson, a real estate broker and team leader for Prudential California Realty, can attest.”

How Federal Reserve and banking policy is accelerating income disparity: Financial obligations ratio soars for renters while declining for homeowners. Problem is, we have less homeowners.
“Current housing policy has been a major windfall for large institutions and investors.  Banks enjoyed a continuous stream of good years as rates slowly dragged down and people became serial refinancers.  Good way for banks to earn fees courtesy of the Fed’s QE maneuvering.  However the results have been negative for the large number of working and middle class Americans.  Many of you have encountered investors bidding prices up on properties here in your own backyard but this trend is nationwide.  In some areas the bidding has been more aggressive (i.e., San Francisco) but overall, the nation has seen a big jump in home values.  However new data continues to highlight how this current policy is really benefitting a small group of Americans.  While rental vacancy rates reach decade lows, homeownership rates are also reaching multi-decade lows.  Not hard to do when a large portion of the market is coming from the investor crowd.”

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Today’s Real Estate News 11.5.2013

Banks offering mortgages with only 5% down payments
“Good news for homebuyers who don’t have a lot of cash on hand: Banks are offering loans with down payments of just 5%.”

Why the jobs picture is brighter than you think
“FORTUNE — As the U.S. unemployment rate falls, skepticism grows about any real improvements in the job market.”

Bahrain’s Investcorp buys $250 mln worth of U.S. real estate assets
“Nov 5 (Reuters) – Bahrain-based Investcorp said on Tuesday that it has acquired a group of offices and retail properties in the United States for $250 million.”

UPDATE 1-U.S. homeownership rate holds near 18-year lows
“Nov 5 (Reuters) – Homeownership in the United States held near 18-year lows in the third quarter, suggesting the housing market was still struggling to overcome challenges brought on by the recession.”

Deals of the day- Mergers and acquisitions
“Nov 5 (Reuters) – The following bids, mergers, acquisitions and disposals were reported by 1100 GMT on Tuesday.”

Eminent Domain Battle Shifts to Another California City
“Sorohan, Mike–Nov. 5, 2013
Popping up like a Hydra, the latest battle over use of eminent domain to seize underwater mortgages has shifted to Pomona, Calif., a city of 150,000 residents outside Los Angeles.”

Few Banks Easing Mortgage Standards in Response to Higher Rates, Fed Says
“Most U.S. banks have maintained their existing lending standards on residential loans in recent months despite rising interest rates and softer demand for mortgages, a Federal Reserve survey found.”

Mortgage originations could fall 32 percent next year
“Mortgage originations in the U.S. could fall 32 percent next year from 2013 levels, according to the Mortgage Bankers Association.”

How Bank-Defeated ‘Plain-Vanilla’ Requirements Live On
“Before there was much talk about “qualified mortgages,” “living wills” and the “Volcker Rule,” the two words that perhaps scared bankers the most were ‘plain vanilla.'”

Fed in no rush to cut bond buys, top policymakers say
“(Reuters) – The Federal Reserve should scale back its asset purchases only when the U.S. economy shows clearer signs of improvement and even then it should act slowly, one senior central banker said on Monday, while two others stressed there is no need to rush.”

Morgan Stanley Says AIG May Sue Over Mortgage-Linked Investments
“Morgan Stanley (MS), the sixth-largest U.S. bank by assets, said it may be sued by American International Group Inc. (AIG) over mortgage-backed securities that the insurer purchased before the financial crisis.”

National vacancy rate edges up 8.3% in 3Q
“National vacancy rates in the third quarter 2013 hit 8.3% for rental housing and 1.9% for homeowner housing, the Department of Commerce’s Census Bureau announced.”

Ally’s Net Income Declines 76% as Mortgage Costs Linger
“Ally Financial Inc. (ALLY), the auto finance firm majority-owned by U.S. taxpayers, said third-quarter profit fell 76 percent as the company settled U.S. claims for soured mortgages and stopped making new home loans.”

Will We Face A Mortgage Shortage In 2014?
“People assume that mortgages will always be available but what if that’s wrong? Could  there be a mortgage shortage in the near future, a time when financing shelves  are bare?”

Pennsylvania Housing Affordable
“Editor’s Note: In the October 2013 issue of the Foreclosure News Report, we asked Brian A. Hudson, the Executive Director and CEO of the Pennsylvania Housing Finance  Agency, to pen a “My Take” column and bring us up to speed on what the state is  doing to foster affordable housing. Here’s a short excerpt from Hudson’s  column.”

Analysts Say Double-Digit Appreciation Will Come to an End by 2014
“National home prices were up 10.1 percent year-over-year in the second quarter, but price appreciation is expected to fall out of the double-digits, reaching 5.4 percent by the beginning of next year, according to the CoreLogic Case-Shiller Home Price Indexes.”

Despite Bankruptcy, Detroit’s Housing Market Thrives
“The city that previously made national headlines for its failing economy and bankruptcy filing is now in the spotlight for its rapidly rebounding housing market. Detroit topped two lists of highest-performing housing markets in the past week—one from Realtor.com and one from Clear Capital.”

Activity from Homebuyers Picks Up in Aftermath of Shutdown
“Homebuyers shook off their fears and returned to the market in force following the re-opening of the government in October, according to data presented by Redfin’s Research Center.”

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Today’s Real Estate News 10.25.2013

Summary:

Today, MSN Money forecasts a “major” rent hike. Fortune explains that employers are to be blamed for American workers lack of skills in today’s workplace. The Mortgage Bankers Association sent a letter to federal regulators which “urged federal regulators to adopt a proposal that aligns their proposed definition of a Qualified Residential Mortgage with the Consumer Financial Protection Bureau’s definition of a Qualified Mortgage/Ability to Repay.” According to BusinessWeek, U.S. lawmakers & regulators are questioning whether or not to lower the “size of mortgages” guaranteed by the government and Citigroup is selling its’ mortgage servicing rights. Chicago Tribune reports this week’s mortgage rates. Consumer sentiment in the nation has fallen, says CNBC. The Housing Wire reports that the FHA Commissioner is urging the government to act as a “backstop” to private capital and Fidelity Financial has altered its’ terms for its’ Lender Processing Services acquisition. According to Reuters, JPMorgan, Deutsche Bank & Creidt Suisse are going to be marketing Blackstone’s home-rental bond for the first time, EVER. Bloomberg reports that the slowdown in exporting will hurt the world’s economy. Press Enterprise shares that home equity to regaining its’ ground in the Inland Empire and that loans are growing for CVB Financial Corp., Citizens Business Bank’s holding company. According to Forbes, China claims $2.31 TRILLION in new home loans from September 2012 – September 2013. UT San Diego reports that San Diego ranks 2nd on the least affordable housing market list.

Get ready for a major rent hike

“The price of renting is rising and competition is growing for apartments, condos and houses. Rents rose 7.6% nationally in the last five years, The Wall Street Journal says. In some cities they’re up 10%.”

American workers are way behind: Blame U.S. employers

“FORTUNE — To listen to some companies, American workers fall glaringly short of sophisticated computer and other necessary skills in today’s workplace.”

MBA Letter Urges QRM, QM Alignment

“The Mortgage Bankers Association strongly urged federal regulators to adopt a proposal that aligns their proposed definition of a Qualified Residential Mortgage with the Consumer Financial Protection Bureau’s definition of a Qualified Mortgage/Ability to Repay.”

Regulators Weigh Reductions in Size of U.S.-Guaranteed Mortgages

“Lawmakers and regulators are debating whether it’s time to shrink the size of mortgages that the U.S government will guarantee, five years after they first boosted loan limits in response to the financial crisis.”

Citigroup Selling Mortgage Servicing Rights as Banks Retreat

“The U.S. mortgage market’s largest lenders are pulling back amid looming regulations and a drop in refinancing that fueled record profits last year.”

Mortgage rates dip to 4-month low

“Mortgage rates hit their lowest levels in four months this week, Freddie Mac said Thursday, as speculation grew that the Federal Reserve will continue its bond-buying stimulus plan through the end of the year.”

Consumer sentiment slides in October on government shutdown

“U.S. consumer sentiment dropped in October to its lowest level since the end of last year as consumers worried Congressional dysfunction and the resulting partial federal government shutdown would hurt growth, a survey released on Friday showed.”

FHA Commissioner: Government should act as backstop to private capital

“Housing finance reform needs to be the government’s top priority as Washington D.C., goes back to work in the wake of the government shutdown, FHA Commissioner Carol Galante said Thursday.”

Fidelity National Financial adjusts terms of LPS acquisition

“Residential mortgage services provider Fidelity National Financial Inc. (FNF) has adjusted the terms of its planned acquisition of Lender Processing Services (LPS).”

Banks set to roadshow Blackstone home-rental bond

“NEW YORK, Oct 24 (IFR) – Deutsche Bank, Credit Suisse and JP Morgan will begin marketing the first-ever bond backed by US home-rental cashflows, a US$500 million trade for private-equity giant Blackstone, next Wednesday.”

Export Slowdown Threatens World Economy

“When HSBC Holdings Plc’s economists from around the world recently pooled their forecasts, virtually all had a similar source of growth in mind for the region they monitored: exports.”

REAL ESTATE: Equity regaining lost ground in Inland marketplace

“Price appreciation in 2013 has thrown life preservers around more homes in Riverside and San Bernardino counties; fewer homeowners struggling to regain lost ground”

BANKING: CVB Financial net earnings, loans grow

“CVB Financial Corp., the holding company for Citizens Business Bank, has announced net income of $24.2 million for the third quarter, or 23 cents per diluted share.”

China Real Estate Lending Tops $2.3 Trillion

“China’s home lending is larger than the entire economy of India. The housing boom there has no bounds, growing 19% year-over-year in September to a total of $2.31 trillion in new home loans, according the Central Bank of China. That’s nearly 25% China’s GDP and more than India’s $1.8 trillion GDP recorded in 2012. It might look like a lot of money, but considering China’s 1.35 billion population, the total housing debt is around $1,700 per person, or 27% of average per capita income.”

SD 2nd least affordable housing market

“San Diego County ranks as the second least affordable housing market, according to a 25-city survey by Income.com.”

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Today’s Real Estate News 10.17.13

Summary:
According to CNN Money, the government shutdown cost the U.S. economy $24 billion. Reuters states that Washington is the “biggest risk” to the nation’s economy. The LA Times reports that SoCal’s housing market is slowing, reports this week’s mortgage rates, a former BofA employee has allegedly taken $1 million in bribes to alter short sale transactions & BofA “outpaces other banks in mortgage settlement compliance.” The Housing Wire shares that the U.S. housing market took only a minor hit as a result of the government shutdown & that flippers are backing away due to a decline in real estate turnover.
CNBC reports that Ben Bernanke, Federal Reserve Chair, won’t be required to testify in AIG case yet.

Shutdown took $24 billion bite out of economy
“The United States may have dodged an economic catastrophe by raising the debt ceiling and opening the government, but it didn’t emerge from the political debacle unscathed.”

Analysis: Washington becomes the biggest risk to the U.S. economy
“(Reuters) – Consensus may be hard to find in Washington these days, but many corporate executives and economists seem to agree on one point: the biggest risk to the world’s largest economy may be its own elected representatives.”

Southern California housing market slows after torrid rebound
“Southern California home buyers have apparently had their fill of bidding wars, home shortages and double-digit price hikes.”

Freddie Mac: Mortgage rates higher amid crisis; 30-year at 4.28%
“Fixed mortgage rates rose early this week amid the debt crisis, Freddie Mac’s latest survey showed, with lenders offering the 30-year home loan at an average of 4.28%, up from 4.23% a week earlier.”

Former BofA employee accused of taking bribes to rig short sales
“A former Bank of America Corp. employee who had dealt with delinquent mortgages has been arrested on federal charges of accepting more than $1 million in bribes to allow homes to be sold far below their market value.”

BofA outpaces other banks in mortgage settlement compliance
“Bank of America Corp. moved faster than Wells Fargo & Co., JPMorgan Chase & Co. and Citigroup Inc. in satisfying its obligations to assist troubled borrowers under last year’s $25-billion national mortgage settlement, according to the agreement’s monitor.”

Housing recovery took a minor hit during government shutdown
“While the housing forecast remains mostly unchanged, the contentious negotiations that led to Congress temporarily raising the debt ceiling may have a lingering impact on consumer confidence in the housing market.”

Home flippers back away as real estate turnover activity declines
“Home flipping activity dipped 13% from the same period a year ago, with 32,993 single-family home flips recorded in the third quarter of 2013, RealtyTrac reported Thursday.”

Bernanke won’t have to testify in AIG case—for now
“Federal Reserve Chairman Ben Bernanke does not have to testify in the multibillion-dollar lawsuit by the former chief of American International Group against the United States over the insurer’s 2008 bailout, a federal appeals court said on Wednesday.”

Jobless Claims in U.S. Fall Less Than Forecast on California
“More Americans than forecast filed applications for unemployment benefits last week as California continued to work through a backlog, indicating it will take time to gauge the impact of the federal shutdown.”

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Today’s Real Estate News 10.15.2013

Summary:

Today in real estate, the LA Times shows that Citigroup posts a $3.2-billion profit even with the mortgage decline in the market. The NY Times reports that while many want Jamie Dimon, JPMorgan Chase Chairman & Chief Executive, fired, investors, analysts, board members and regulators don’t want him fired.  Central banks are preparing for a U.S. Default, should it occur. The Wall Street Journal reports that home prices & home sales are now slowing down in the “Bust-and-Boom Markets.” Lawmakers are asking financial institutions to be cooperative with federal employees who have been furloughed due to the government shutdown. The Housingwire informs us that multifamily loans are hitting the market and that Citigroup is preparing for a “refi burnout.”

Citigroup posts $3.2-billion profit amid slump in mortgages, trading
“NEW YORK — Citigroup Inc.’s third-quarter earnings disappointed Wall Street analysts as the bank reported a sharp slowdown in mortgage and bond-trading revenue.”

The Bloodlust of Pundits Swirls Around Jamie Dimon
“Jamie Dimon should be fired.

That seems to be the conclusion of some in the pundit class about JPMorgan Chase’s chairman and chief executive. Writers, editors and bloggers have made it clear that they want his scalp: “NOW Are We Allowed Talk About Firing Jamie Dimon?” the Huffington Post blared after news that the bank set aside $23 billion to pay legal fees and fines last week. “I have trouble wrapping my head around the positive aspects of paying a multibillion-dollar fine,” an article on TheStreet.com said of the prospect of an $11 billion settlement with the Justice Department.”

Central Banks Gaming Out U.S. Default as Deadline Nears
“Central banks have begun making contingency plans on how they would keep financial markets working if the U.S. defaults on the world’s benchmark debt.”

Home Sales, Prices Slowing in Bust-and-Boom Markets
“The sharp home-price rally in some of the hardest-hit housing markets is likely to fade in the coming months amid a pullback in investor purchases and steady increases in the number of homes listed for sale.”

Lawmakers call for banks to rescue federal employees
“Lawmakers urged financial institutions to work proactively with borrowers facing financial distress because of the government shutdown. For three weeks, federal employees have been out of the job without pay.”

Performing multifamily loans hit the market
“A great deal of activity is surfacing in the multifamily sector in the form of nonperforming loan sales this week.”

Citigroup prepares for refi burnout
“As investors anticipate the release of Citigroup’s (C) third-quarter earnings, analysts are predicting declining mortgage lending activity for the bank.”

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A sweet spot for move-up buyers?

“The peak home-selling season may have ended, but there some buyers are just getting started: those looking to sell a home and trade up. Is now a good time for these buyers to start their search? And what does this uptick in move-up buyers mean for the market?”

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Tony’s take on the Government Shutdown (VIDEO)

Tony catches up with us from Smith River and shares his opinion on two real estate news articles he read today. The first article headline read “Sold! Auction.com Looks to Revolutionize Selling Real Estate” put out by CommercialObserver.com and the second article, “U.S. Government Shutdown Threatening Housing Recovery” written by BusinessWeek.com.  Tony talks about how the government shutdown is affecting our office and how it directly affects those seeking loans.