Hello there!Hope this finds you well and having lots of fun with food this Thanksgiving. I know I'll be sitting around gorging on wonderful food and having family around. I absolutely look forward to that and hope you get to as well!Thanks for being a part of Team WOWWHEE.com. I really appreciate you. Please let me know what I can do for you or your friends and family for real estate! Meanwhile, here are some interesting news about real estate including what the Governor of California has done for loans. Take care and be happy!
Best regards,
Chun Liu, Real Estate Consultant for life!Team WOWWHEE.com at Keller Williams Coastal Properties(562)961-1409
realtoromy@aol.com www.WOWWHEE.com**********************Down night for real estate rates --------------------------------------------------------------------------------30-year fixed rate at 5.9%; 10-year Treasury yield at 4.07% Tuesday, November 20, 2007
Inman News
Long-term mortgage interest rates moved lower Monday, and the benchmark 10-year Treasury bond yield dropped to 4.07 percent.
The 30-year fixed-rate average dipped to 5.9 percent, and the 15-year fixed rate slipped to 5.46 percent. The 1-year adjustable, however, rose to 5.48 percent.
The 30-year Treasury bond yield was down at 4.48 percent.
Rates and bonds are current as of 7:15 p.m. Eastern Standard Time.
Mortgage rate figures are according to Bankrate.com, which publishes nightly averages based on its survey of 4,000 banks in 50 states. Points on these mortgages range from zero to 3.5.
In other economic news, the Dow Jones Industrial Average tumbled 218.35 points, or 1.66 percent, finishing at 12,958.44. The Nasdaq lost 43.86 points, or 1.66 percent, closing at 2,593.38.
Stock figures are current as of 7:30 p.m. Eastern Standard Time.**********************Home prices rise in 33 states since Sept. 2006 --------------------------------------------------------------------------------FALP study: 19 of 31 top metro areas saw price declines Monday, November 19, 2007
Inman News
Home prices fell in 17 states during the last year, but most states "continue to have stable home values," and a half dozen others even showed moderate price growth, according to a new analysis of repeat sales by First American LoanPerformance.
Home prices in five states -- Wyoming, Utah, North Carolina, Alabama and Maine -- grew at between 5 percent and 10 percent between September 2006 and September 2007, LoanPerformance reported, and at more than 10 percent in Hawaii.
Although most states --33 in total -- saw at least modest price appreciation in past year, the trend has already reversed in some states. Prices have been falling for two months in New York, for example. But the state still makes LoanPerformance's list of 27 states where prices are up between 5 percent and 10 percent, because all of the gains made in the last year haven't been erased.
The findings were included in an announcement of the release of First American's September 2007 LoanPerformance Home Price Index (HPI).
A recent First American CoreLogic report estimated that home prices were falling or not keeping pace with inflation in 247 of 381 metropolitan areas tracked. Prices were falling in 88 markets, and appreciating at less than 3 percent in 159 others, according to First American CoreLogic's fourth-quarter Risk Monitor report. With inflation averaging around 3 percent, homeowners whose properties appreciate at a slower rate experience a decline in value in real terms.
PMI Mortgage Insurance Co., in a recent report gauging the risk of price declines in major markets, estimated that housing affordability -- which improves when income growth outpaces home-price appreciation -- showed gains in 297 of 381 metropolitan statistical areas (MSAs) during the second quarter, or 78 percent of those studied.
First American LoanPerformance's analysis of the top 31 "core based statistical areas" showed prices fell in 19 metro areas, or 61 percent of those studied.
Communities in California and Florida held six of the top 10 spots on the list of areas experiencing the greatest price declines. In Florida, Cape Coral-Fort Myers (-11.49 percent), Miami-Ft. Lauderdale (-8.37 percent), Orlando-Kissimmee (-7.66 percent) and Tampa-St. Petersburg (-7.65 percent) topped the list. In California, Riverside-San Bernardino-Ontario (-13.59 percent) and L.A.-Long Beach-Santa Ana (-8.14 percent) made the top 10.
Many of the top 30 metro areas LoanPerformance says experienced price declines during the past year also show a higher-than-average number of foreclosure filings, according to the most recent numbers from data aggregator RealtyTrac Inc.
Riverside-San Bernardino, for example, had the third-highest rate of foreclosure filings per household in the nation -- one filing per 43 homes -- according to RealtyTrac. The rate of foreclosure filings per household exceeded the national average of one filing per 196 homes in Phoenix, Miami, L.A., Orlando, Tampa, Cleveland, Washington, D.C., Detroit, Miami and Atlanta.
Metro areas where prices fell in the last year but the rate of third-quarter foreclosure filings was below the national average included Boston, St. Louis, Minneapolis and Philadelphia.
Foreclosure filings include default notices, notices of auction sales and bank repossessions, and the number of filings may exceed the number of homes in foreclosure because some properties are subjected to more than one filing.
One-year price changes, top 31 metro areas:
Metro area Percent changeRiverside-San Bernardino-Ontario, CA -13.59Cape Coral-Fort Myers, FL -11.49Las Vegas-Paradise, NV -9.80Phoenix-Mesa-Scottsdale, AZ -8.49Miami-Fort Lauderdale-Miami Beach, FL -8.37Los Angeles-Long Beach-Santa Ana, CA -8.14Orlando-Kissimmee, FL -7.66Tampa-St. Petersburg-Clearwater, FL -7.65Cleveland-Elyria-Mentor, OH -7.39Washington-Arlington-Alexandria, DC-VA-MD-WV -6.65Boston-Quincy, MA -4.97New York-Northern New Jersey-Long Island, NY-NJ-PA -3.78Detroit-Warren-Livonia, MI -3.46St. Louis, MO-IL -2.10Miami-Miami Beach-Kendall, FL -1.59Minneapolis-St. Paul-Bloomington, MN-WI -1.55New York-White Plains-Wayne, NY-NJ -0.87Atlanta-Sandy Springs-Marietta, GA -0.40Philadelphia, PA -0.05Chicago-Naperville-Joliet, IL-IN-WI 0.06San Francisco-Oakland-Fremont, CA 0.68Dallas-Fort Worth-Arlington, TX 1.27Houston-Sugar Land-Baytown, TX 2.46Portland-Vancouver-Beaverton, OR-WA 2.83Charlotte-Gastonia-Concord, NC-SC 3.70Seattle-Tacoma-Bellevue, WA 4.25Austin-Round Rock, TX 4.83San Antonio, TX 4.85Raleigh-Cary, NC 5.55Salt Lake City, UT 6.06Honolulu, HI 14.79 Source: First American LoanPerformance****************Economist: Odds rise for economic recession --------------------------------------------------------------------------------Oil prices may determine whether 'hard landing' lies ahead Monday, November 19, 2007
By Glenn Roberts Jr.Inman News
SAN FRANCISCO -- There is a 45 percent chance that the U.S. economy will spiral toward recession in 2008, as real estate foreclosures and gasoline costs continue to escalate, economics professor Ken Rosen said in a presentation today.
Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at University of California, Berkeley, said that if gasoline prices exceed $4 a gallon and oil prices top $100 a barrel, "it's a pretty sure thing that a hard landing rather than a soft landing (will) happen."
He advised attendees of an annual Real Estate and Economic Symposium, organized by the center, to plan for the worst.
Home prices may already have fallen about 5 percent to 7 percent nationally, and those price declines may represent only about half of the declines still ahead. New-home prices may fall about 25 percent in some markets.
"It all goes back to the fact that we had a bubble in housing created by bad lending practices," he said.
While the volume of foreclosures is relatively small thus far, Rosen said that the foreclosure rate may not peak until 2009.
Barring a major intervention to restructure mortgages for those facing foreclosure, Rosen expects the foreclosure rate for subprime mortgages to rise from a current level of about 8 percent to as high as 20 percent to 25 percent, with lower-risk alt-A foreclosures peaking at about 15 percent and the foreclosure rate for prime mortgages reaching 3.5 percent to 4 percent.
The subprime market will be a bad investment for some time, Rosen said, as it had grown to an unsustainable level of about 22 percent of the overall mortgage market in 2005 and 2006.
"Do not go into that (subprime) business," Rosen said. "The market share in subprime should be about 5 percent. Do not catch that falling knife."
The credit crunch "is substantial in residential real estate and it's spreading to commercial real estate," Rosen said.
Credit losses related to the mortgage mess and rising foreclosures could top $400 billion, he said, with about $50 billion to $60 billion in losses already announced. "There's a lot more to come."
Rosen takes issue with those market analysts who say they didn't see any of this coming.
"For these people to say it's unanticipated ... it happens every decade. There's no surprise to this at all," Rosen said.
The securitized system for mortgage financing that the nation had relied upon for the past four or five years, if it doesn't reopen, could prolong the credit crunch "for a lot longer than we think," Rosen said.
The stock market has already been taking hits for the credit problems and anticipated rise in foreclosures, he said.
U.S. job creation and the resilience of the global economy are still sustaining the U.S. economy, though Rosen said that is subject to change.
The dollar has been dropping in value against other major currencies, leading some nations to diversify investments away from the U.S. dollar, and the United States has a huge trade imbalance, he noted.
Because of the rising value of the euro against the U.S. dollar, the nation is effectively "on sale" for Europe and some Asian markets, Rosen said.
The rising stock market in China has created a speculative bubble for that nation's economy, he said. "I really do think China is in a bubble stage. When it bursts, I don't know."
A market decline in China could spell more troubles for the U.S. and the global economy, he said.
Income distribution has become skewed in the United States, Rosen said, and he expects that individual and capital taxes will be rising -- no matter the rhetoric that candidates may offer in this election year. Also, inflation will likely rise, he said.
"Our industrial base has been decimated," Rosen said, noting that Michigan, once strong in manufacturing, is in a recession. "I worry that a lot of central cities in the Midwest are dying."
Southern California, too, is in a recession or at the edge of recession. The fall of the subprime market hit hard in Orange County, Calif., a base of operations for some subprime lenders, he said.
Miami and Las Vegas are among the markets reeling from speculative real estate investments and a subsequent rise in foreclosures.
While New York City has been strong economically, Rosen said he expects a lot of layoffs and cutbacks by financial firms hit hard by the credit crunch.
Rising oil prices highlight a need for the U.S. to reduce dependence on foreign oil, Rosen said. "We have to get away from our dependence on oil."
"We have become addicted to cheap oil. We've become addicted to cheap Chinese goods," he said, though the economy will dictate change. "We're going to have to have a lower relative standard of living compared to the rest of the world, a different quality of life for the next generation."*********************Four servicers agree to streamline California workouts --------------------------------------------------------------------------------Governor says plan based on FDIC chief's proposal Wednesday, November 21, 2007
Inman News
Four companies that service 25 percent of outstanding subprime loans in California have agreed to streamline the loan modification process to allow some borrowers with adjustable-rate mortgages to avoid interest rate resets.
California Gov. Arnold Schwarzenegger said a voluntary agreement with Countrywide Financial Corp., GMAC Mortgage, Litton Loan Servicing and HomeEq Servicing is modeled after a proposal put forward by Federal Deposit Insurance Corporation chief Sheila Bair.
Bair, citing a report by Moody's Investor Services that servicers were engaging in workouts on less than 1 percent of troubled subprime loans, last month urged them to embark on a program of wholesale conversions of adjustable-rate mortgages into fixed-rate loans when borrowers are in danger of default.
In an interview published in today's Wall Street Journal, U.S. Treasury Secretary Henry Paulson said he expects a “significantly bigger” number of mortgage defaults in 2008, and said he is encouraging servicers to develop criteria that would enable large numbers of borrowers to qualify for better terms.
"We're never going to be able to process the number of workouts and modifications that are going to be necessary doing it just sort of one-off," Paulson told the Journal.
Schwarzenegger, who said 500,000 Californians with subprime loans face interest rate resets in the next two years, said loan modifications "can save tens of thousands of people from being added to the foreclosure lists" but “does not involve a government subsidy or bailout."
California had the second-highest rate of foreclosure activity in the nation during the third quarter, second only to Nevada, according to data aggregator RealtyTrac Inc. Half of the 10 metropolitan areas with the highest rate of foreclosure activity during the third quarter were located in California, RealtyTrac said in another report.****************
