New homes sales unexpectedly strong in November

NF Reporter · 12-27-2006, 12:01 PM

Reuters - Sales of new U.S. homes were unexpectedly strong in November and the backlog of unsold homes shrank, according to government data on Wednesday that suggested the worst of the housing slump may be in the past.

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waltky · 08-22-2011, 07:23 PM

Uncle Ferd gonna wait till dey payin' $10,000 to take a house - den he gonna move his fat g/f's in with him an' let `em fix up the place...

In Baltimore, homes for $10,000 — and less
August 20, 2011 - Housing prices continue to fall through much of the region, with some of the most striking examples in city neighborhoods

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Andrew Wells is hoping to buy a Baltimore home for around the cost of an old car: Less than $10,000. Turns out he's in good company. One of every 10 city homes sold during the first half of the year — about 275 in all — fell in that price range. Twice as many sold for under $20,000. Often foreclosures, these properties are usually in bad shape but seem like deals to real estate investors and the occasional hopeful owner-occupier — such as Wells. "I don't have to worry about trying to get a loan," said Wells, 40, a bill-processing technician who works in Annapolis. "That was the purpose of me searching in that price range. I could buy something, pay cash, and I could live in it and renovate at the same time."

Almost exclusively a city phenomenon — very few homes in Baltimore's suburbs sold for less than $10,000 — it's a market that has expanded rapidly. More city homes sold for less than $10,000 between January and June than in all of 2009 and 2010 combined. Dozens of city neighborhoods had at least one such sale this year. As very cheap homes change hands, average sale prices in Baltimore have plummeted. Seventy city neighborhoods saw average prices drop more than 20 percent versus a year ago, according to a Baltimore Sun analysis of data from Metropolitan Regional Information Systems. That's half of the neighborhoods with enough sales to allow for comparison.

Fewer than 10 percent of suburban communities around Baltimore experienced an average price decline that large. Prices in the region dropped 6 percent on average. But with the city's faster-falling prices have come more buyers. Sales rose in more than half of the city's neighborhoods compared with the first six months of last year. Sales rose in fewer than 40 percent of suburban communities. Still, both the city and suburbs have areas where sales are down sharply since the federal tax credit of up to $8,000 for first-time homebuyers expired last summer. The number of homes sold during the first half of this year fell more than 20 percent in one of every five city neighborhoods and suburban ZIP codes, according to the Sun analysis.

Six years since the peak of the housing bubble, the Baltimore region doesn't look as if it has recovered from the slide that followed. The number of homes sold in the first half of the year is down nearly 50 percent from the level in the first half of 2005. Prices still are dropping in most communities. And at least some of the places where prices rose on average this year are actually seeing values fall — but buyers are using their greater purchasing power to get better homes, pushing the average upward.

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Homeowners at risk of foreclosure increasing
8/22/2011 - Number who have missed mortgage payments is back up, likely due to unemployment

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The number of Americans at risk of foreclosure is rising, reflecting the U.S. economy's continued struggles. The Mortgage Bankers Association said Monday that 8.44 percent of homeowners missed at least one mortgage payment in the April-June quarter. That figure, which is adjusted for seasonal factors, rose 0.12 percentage point from the January-March period.

In a normal market, the percentage of delinquent borrowers is about 1.1 percent, according to the trade group. Delinquent mortgages have plummeted from a record high of more than 10 percent of residential mortgages a year ago. But the decline is due partly to delays in foreclosure filings that are backlogged in several state courts, including Florida, New Jersey, Illinois and New York.

The end of a state and federal investigation into faulty foreclosure paperwork will likely lead to increased foreclosures later this year. Analysts say the increase is especially worrisome because it's due mainly to high unemployment, which tends to raise the number of missed payments and foreclosures over time. And once delayed foreclosures are re-started, the economy could suffer a hit.

"The current processing delays mean this will not happen quickly, underlining our view that both the housing market and the economy will remain weak for a few years," said Paul Dales, senior U.S. economist at Capital Economics. The quarterly survey covers nearly 88 percent of primary residential mortgages totaling nearly 44 million loans.

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waltky · 03-01-2012, 01:08 PM

Housing market still swamped with foreclosures...

Foreclosures made up one in four home sales
March 1, 2012: Short sales are rising as banks start to shun foreclosures.

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Homes in some stage of foreclosure accounted for nearly one in four homes sales during the fourth quarter, according to RealtyTrac. During the three months that ended December 31, homes that were either bank-owned or going through the foreclosure process accounted for 24% of all home sales, up from 20% in the previous quarter and down only slightly from a year earlier when foreclosures accounted for 26% of sales, RealtyTrac said. In total, 204,080 distressed properties were purchased during the fourth quarter, down 2% from the year-ago quarter. For all of 2011, foreclosure-related sales were down 2% year-over year to 907,138, accounting for 23% of all home sales.

"Sales of foreclosures in the fourth quarter continued to be slowed by questions surrounding proper foreclosure paperwork and procedures," said Brandon Moore, chief executive officer of RealtyTrac, referring to the delays cause by the robo-signing scandal that broke in late 2010. "Even so, foreclosures accounted for nearly one in every four sales during the quarter and for the entire year." "We expect to see foreclosure-related sales increase in 2012, particularly pre-foreclosure sales, as lenders start to more aggressively dispose of distressed assets held up by the mortgage servicing gridlock over the past 18 months," said Brandon Moore, CEO of RealtyTrac.

Short sales on the rise

Short sales are starting to become the preferred method for banks to dispose of properties in default. In short sales, borrowers who owe more on their mortgages than their homes are worth agree with their bank to sell their homes at the lower market value. In return, the bank agrees to absorb the loss. During the last quarter of 2011, there were more than 88,000 short sales, up 15% compared with a year earlier, according to RealtyTrac. Short sales comprised 10% of all homes sold during the quarter. Meanwhile, sales of bank-owned homes fell 12% year-over-year to 116,000, comprising 13% of all sales during the quarter. "That trend will likely show up in more local markets in 2012 as lenders recognize short sales as a better option for many of their non-performing loans," said Moore.

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Bernanke: Economic recovery 'uneven'
March 1, 2012: Federal Reserve Chairman Ben Bernanke gives his semi-annual report on the economy before Congress this week.

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In day two of Ben Bernanke's semi-annual testimony before Congress, the Federal Reserve Chairman warned lawmakers that their short-term policies could put the recovery at risk. "I think it is important that we keep in mind that the recovery is not yet complete, unemployment remains high, the rate of growth is modest," he told the Senate's Committee on Banking, Housing and Urban Affairs.

As he did a day earlier before the House, Bernanke stressed that January 2013 brings not only the expiration of the Bush tax cuts, the payroll tax cut and extended unemployment benefits, but also the implementation of massive spending cuts to the federal budget. All of these issues hitting at the same time pose a significant risk to economic growth that Bernanke on Wednesday called a "fiscal cliff."

In the same testimony he gave to members of the House, Bernanke called the job market "far from normal" and referred to the recovery as "uneven and modest by historical standards." Yet he made no comments implying the Fed would be considering a third round of asset purchases as a way to stimulate the economy. Since the financial crisis, the Fed has slashed interest rates to zero and initiated two rounds of large-scale asset purchases, known as quantitative easing.

The Fed recently forecast that it plans to keep interest rates near zero until late 2014, and Bernanke repeated that point this week. "I believe monetary policy is set appropriately to help the economy recover," he told the House on Wednesday. The Federal Reserve predicts the economy will grow only 2.2% to 2.7% this year, not much faster than it grew in the second half of 2011.

Bernanke to Senate: Economic recovery 'uneven' - Mar. 1, 2012