The news media has been throwing out negative news on the housing market, and I’m guilty of reporting it in this column. I am reminded that the market is NOT that bad – I am staying busy in the business, and this isn’t the early 1990s. I’m going to make an effort to at least find some positive news as I continue to relay the current news that affect your home (or your future home).
Positive Fact: 30% of homeownership is free-and-clear. (M.Lush, 12/21)
SoCal is NOT THE WORST: Battered by a declining manufacturing base, low or no population growth and low demand for housing, Michigan and Ohio rank No. 1 and 2 on mortgage finance company Fannie Mae's list of states with the largest credit losses through Sept. 30. In contrast, California had $30 million in write-offs and Florida had $21 million. (AP, 12/17)
Riverside County remains the fastest-growing county in California, although its population growth rate is declining, partially due to the housing slow-down. (Riverside Press-Enterprise, 12/20)
Fresno area real estate agents offer tours of properties in foreclosure, and there are plenty available: roughly 12 percent of those listed for sale, or about 500. (Fresno Bee, 12/20)
Foreclosure Rate Improves over prior month – Foreclosures nationally declined 10 percent in November compared with October, but were up nearly 68 percent compared with November 2006, according to RealtyTrac, a foreclosure sales and data company. The national foreclosure rate in November was one filing for every 617 households. Nevada continued to register the nation's top state foreclosure rate for the 11th straight month. A total of 6,694 foreclosure filings were reported in the state for the month, up 1 percent from the previous month and up 167 percent from November 2006. (RealtyTrac, Reuters, 12/19)
The Fed developed new rules to prevent mortgage mess from happening again, restricting lenders from penalty for paying off early, eliminate no-doc loans, and force lenders to make sure borrowers set aside some funds for taxes and insurance. Ed Smith, with California Association of Mortgage Brokers, says it’s identical to H.R. 3915, which passed the U.S. House of Representatives, and a similar one that passed the Senate and is now in compromise committee. (KNX-AM, 12/18)
On Friday, December 14, 2007, the U.S. Senate voted 93 to 1 to pass S. 2338, the FHA Modernization Act, which will reform the Federal Housing Administration (FHA). A conference committee will now meet to resolve differences between this bill and the one passed by the House of Representatives earlier this year. (Personal Email from CAR, 12/17)
President George W. Bush signed legislation into law on Thursday that will ease the tax burden for home owners who have had debt forgiven on a mortgage due to a foreclosure, short sale, or deed in lieu of foreclosure. The bill — Mortgage Forgiveness Debt Relief Act — has been supported by NAR since the 1990s. (AP 12/18)
Mortgage Applications Fall as Rates Rise - Applications for home mortgages fell 19.5 percent to 653.8 last week compared with the previous week on a seasonally adjusted basis, according to the Mortgage Bankers Association weekly mortgage applications survey. On an unadjusted basis, the index decreased 21.3 percent, but was up 1.7 percent compared with the same week a year ago. The Refinance Index decreased 27.3 percent, while the Purchase Index decreased 10.6 percent. The decrease could have been triggered in part by rising interest rates: 30-year fixed-rate mortgages increased to 6.18 percent from 6.07 percent; 15-year fixed-rate mortgages increased to 5.78 percent from 5.72 percent; 1-year ARMs increased to 6.48 percent from 6.31 percent. (Mortgage Bankers Association, 12/19)
November Home Sales in CA - Home sales decreased 36.2 percent in November in California compared with the same period a year ago, while the median price of an existing home fell 11.9 percent. (CAR, 12/21)
Sales of new homes in the U.S. fell in November, signaling no end to the housing recession that threatens to stall economic growth, economists said before a report this week. Purchases fell to an annual pace of 718,000 from 728,000 in October, according to the median forecast of economists surveyed by Bloomberg News. The 716,000 pace reached in September was the lowest since 1996. The real-estate slump, already the deepest in 16 years, shows no sign of abating as discounts fail to lure buyers and inventories swell. The risk that the slowdown will spread through the entire economy is prompting business to rein in orders for new equipment, a separate report may also show. (Bloomberg, 12/23)
How is your monthly mortgage payment? The typical monthly mortgage payment that Southland buyers committed themselves to paying was $2,111 last month, down from $2,198 the previous month, and down from $2,281 a year ago. Adjusted for inflation, the current payment is 3.6 percent lower than the spring of 1989, the peak of the prior real estate cycle. It is 15.4 percent below the current cycle's peak in June last year. (DQNews.com, 11/14)
Federal regulators are investigating whether mortgage lender Washington Mutual Inc. pressured Santa Ana-based First American Corp. to inflate home appraisals. (LA Times, 12/21)
A December reading of U.S. homebuilders' sentiment remained at a record low for the third straight month. The National Association of Home Builders said Monday its housing market index, which gauges builders' perceptions of conditions and expectations for home sales over the next six months, came in at 19 in December. The number was at the lowest level since the index began in January 1985. Upswing in building activity expected by second half of next year. (AP, 12/17)
California November 2007 Home Sales - A total of 25,578 new and resale houses and condos were sold statewide last month. That's down 0.98 percent from 25,832 for October, and down 38.8 percent from 41,809 in November 2006. Last month's sales made for the slowest November in DataQuick's records, which go back to 1988. On a year-over-year basis, sales have declined the last 26 months. The median price paid for a home last month was $414,000, down 2.4 percent from $424,000 the prior month, and down 11.9 percent from $470,000 for November a year ago. The median peaked last March/April/May at $484,000. Price declines are greatest in inland areas such as the Central Valley and Riverside County, which absorbed spillover activity during the housing boom. Prices in some core metro areas are off by a few percent. (DQNews, 12/21)
Southland prices fall again, sales perk up – Southern California home sales bucked the seasonal norm in November and rose slightly over October, thanks to bargain shopping and an uptick in new-home sales. But it remained a chilly market by historical standards: Sales were the slowest for a November in at least 20 years and the median sale price posted a record 10.3 percent year-over-year decline. A total of 13,173 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in November. That was up 2 percent from 12,913 sales in October, and down 42.7 percent from 23,005 in November last year, according to DataQuick Information Systems. Last month's sales were the lowest for any November in DataQuick's statistics, which go back to 1988. The previous low was in November 1992, when 15,446 homes sold. November has averaged 22,749 sales over the last 20 years. The number of single-family houses that resold in November was about even with October, while condo resales fell 6 percent. The sales are based on the number of escrows that closed each month. (DQNews, 12/18)
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