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Hello Readers,

We have linked you to 5 great articles pertaining to different areas of today’s real estate market.  Any of these offerings could be used in presentations to potential buyers to update their feelings regarding this market.  Staying positive and Listing properties are Job #1 in this current market.  In Maricopa County last month we closed about as many homes as were listed during the month. So Inventory is still low.

Good Luck this week,

Bob Grove – Equity Title

Housing Crisis to End in 2012 as Banks Loosen Credit Standards

01/24/2012

BY: KRISTA FRANKS

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generation actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

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Hello Real Estate Advocates

The attached article is sure positive news for our real estate market for the next couple of years.  Let’s be sure our potential Buyers out there know that they are going to be in a situation where home sales will continue to improve as for the foreseeable future.

Bob Grove – Equity Title

Fed Extends Expectations for Low Rates Through 2014

01/25/2012

BY: CARRIE BAY

The Federal Reserve said Wednesday that it will hold a key benchmark interest rate near zero through late 2014.

The setting of this federal funds rate – the rate at which banks lend to one another – is one of the most fundamental and principal tools in the central bank’s chest of economic influence.

The Fed has kept the target range for the rate at 0 to 0.25 percent for three years now. The decision by its policy committee members to maintain this range for another three years is testament to just how slow the U.S. economy’s crawl back from the brink of financial ruin is likely to be.

Up until Wednesday, the Fed’s policy statement had indicated the federal funds rate would remain at its current level until mid-2013.

Fed Chairman Ben Bernanke acknowledged that the 2014 projection for keeping the rate so low is not set in stone. The decision to raise the rate before that time would be determined by the pace of economic growth.

“We have to make a best guess,” Bernanke told reporters at a press conference following the Fed’s two-day policy meeting. “Unless there is a substantial strengthening of the economy in the near term, I would think that it’s a pretty good guess that we will be keeping rates low for some time from now.”

The Fed’s policy committee said information it has received since the last meeting in mid-December suggests the economy has been expanding moderately, but that’s not enough.

“To support a stronger economic recovery…the Committee expects to maintain a highly accommodative stance for monetary policy,” according to the committee’s statement.

Members said they expect economic growth over the coming quarters to be modest, and as a result, they anticipate the unemployment rate will decline only gradually.

Projections released by the Fed committee at the conclusion of the meeting show its members are generally anticipating the national unemployment rate to range between 8.2 and 8.5 percent this year.

Strains in global financial markets also continue to pose significant downside risks to the U.S. economic outlook, according to the Fed.

Analysts say the central bank’s assessment of current economic conditions and expectations going forward indicate a third round of ‘Quantitative Easing’ (QEIII) is not out of the question, and in fact very likely this year.

Bernanke and his colleagues have made it a goal to bring more transparency to the nation’s central bank.

“The Committee seeks to explain its monetary policy decisions to the public as clearly as possible,” the Fed’s policymakers said in a statement issued Wednesday.

“Such clarity,” they said, “facilitates well-informed decisionmaking by households and businesses, reduces economic and financial uncertainty, increases the effectiveness of monetary policy, and enhances transparency and accountability, which are essential in a democratic society.”

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Hello Followers<

Looks like the market and the economy are starting to cooperate in the recovery we so desperately need to get this housing market cranking.

Let’s get in step with that and make some hay in 2012.

Bob Grove – Equity Title

Rise in Home Sales Signifies Strengthening Market: Economists

01/20/2012

BY: KRISTA FRANKS

The long-awaited housing recovery is beginning to blossom, according to industry experts taking a look at recent existing-home sales.

While admitting home sales “are still very low,” Paul Dales, chief economist at Capital Economics, says “it is clear that housing recovery is now well underway.”

The evidence: home sales have been on the rise for the past three months, posting a 5 percent increase in December.

Lawrence Yun, chief economist for the National Association of Realtors (NAR), concurs with Dales’ assessment, saying “The pattern of home sales in recent months demonstrates a market in recovery.”

Yun suggests consumers are gaining confidence from “record low mortgage interest rates, job growth and bargain home prices.”

In addition to the 5 percent increase in December, NAR reported a 1.7 percent annual increase in existing-home sales in 2011, a total of 4.26 million homes for the year.

Distressed homes made up 32 percent of sales in December, according to NAR’s existing home sales report for the month. 
Foreclosed home sales closed at about 22 percent below market rate in December, a discount 2 percent higher than that recorded a year earlier.

Investor demand remains steady with 21 percent of homes sold in December going to investors after this category of buyers took 19 percent of purchases in November and 20 percent one year ago.

Cash sales – commonly linked to investors – made up 31 percent of December’s existing-home sales. This rate was 28 percent in November and 29 percent a year ago.

Purchases by first-time home buyers declined in December – both from the previous month and the previous year. First-time home buyers accounted for 31 percent of purchases in December, down from 35 percent in November and 33 percent in December 2010.

Housing inventory is on the decline and fell to its lowest level since March 2005 last month, according to NAR. Approximately 2.3 million homes are available for sale currently.

“The inventory supply suggests many markets will continue to see prices stabilize or grow moderately in the near future,” Yun said.

However, listed inventory is only part of the equation, and according to CoreLogic’s latest numbers, shadow inventory stands at about 1.6 million.

Regardless, Dales believes sales will rise this year. “Housing still won’t contribute much to GDP growth over the next few years, but at least it will no longer subtract from it,” Dales says.

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Hey Readers,

Great article about how interest rates are continuing to drop, what a great time to buy!

Bob Grove -  Equity Title

Mortgage Rates: How Low Can They Go?

01/19/2012

BY: CARRIE BAY

Credit conditions may be tight, but for those who do qualify for a new home loan, the cost of borrowing has never been lower.

Data released Thursday by Freddie Mac shows the average rate for a 30-year fixed mortgage edged down to 3.88 percent (0.8 point) for the week ending January 19, to hit a new all-time low.

The previous record low for the 30-year rate was 3.89 percent, set just the week prior. Last year at this time, the 30-year fixed-rate mortgage was averaging 4.74 percent. It’s now come in below the 4.00 percent mark for seven consecutive weeks.

The 15-year fixed-mortgage rate was the only product included in Freddie Mac’s regular weekly survey to show upward movement, albeit by only one basis point. The

15-year rate rose from 3.16 percent last week to 3.17 percent (0.8 point) this week. A year ago, it was averaging 4.05 percent.

The 5-year adjustable-rate mortgage (ARM) is now averaging 2.82 percent (0.7 point). That reading matches last week’s but is well below the year-ago average of 3.69 percent.

The average rate for a 1-year ARM came in at 2.74 percent (0.6 point) this week, down from 2.76 percent last week. At this time last year, the 1-year ARM was at 3.25 percent.

On the whole, Frank Nothaft, Freddie Mac’s chief economist, described mortgage rates as “nearly unchanged” this week in lieu of a mixed bag of economic data reports.

He points to retail sales on the consumer front, which edged up only 0.1 percent in December, which contrasts the Reuters/University of Michigan sentiment index as it continued to climb in January to the highest reading since February 2011.

“On the business side, industrial production rose 0.4 percent in December, slightly below the market consensus forecast, and the core producer price index rose faster than market expectations,” Nothaft noted.

The home construction sector also experienced positive indicators, Nothaft explained, with builder confidence rising for the fourth consecutive month in January to its highest level since June 2007.

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Hey Fellow Real Estate Industry professionals,

More good news on the housing front and the overall economy.  Please, share the information where ever you can.  Let’[s jump start this market for the good of all.

Bob Grove – Equity Title

Delinquency and Foreclosure Rates Down From a Year Ago: LPS

01/19/2012

BY: CARRIE BAY

Lender Processing Services (LPS) has provided the media with a sneak peek at the results of its mortgage performance data through 2011. 

As of the end of December, the company counted 6,167,000 borrowers behind on their mortgage payments, including those already in the process of foreclosure.

That tally is the culmination of a steady decline over the last year, with both the national delinquency rate and foreclosure rate down when compared to their December 2010 readings.

Delinquencies were unchanged between the months of November and December, but declined 7.7 percent from December 2010. LPS puts the mortgage delinquency rate, including loans 30 or more days past due but not in foreclosure, at 8.15 percent.

Foreclosures declined by 1.3 percent from November to December and are 1.0 percent below the level reported at the end of 2010. By LPS’ calculations, the national foreclosure inventory rate is 4.11 percent.

Of the 6,167,000 mortgages going unpaid in the United States, LPS says 2,066,000 are in foreclosure. The remaining 4,101,000 haven’t made it that far down the pipeline, even though 1,792,000 are 90 or more days delinquent.

States with the highest percentage of non-current loans, combining delinquencies and foreclosures, included Florida, Mississippi, Nevada, New Jersey, and Illinois as of the end of December.

The lowest percentage of non-current loans can be found in Montana, Wyoming, South Dakota, Alaska, and North Dakota.

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Hello Readers,

The interest rates for Mortgages continue to fall, making home ownership the most affordable it has been ever.

Let’s get those Buyers making offers and save this housing industry, 

Bob Grove -  Equity Title

Mortgage Rates Break Record Lows

01/12/2012

BY: CARRIE BAY

With property values across the country at depressed levels and interest rates dancing around historical lows for months now, housing affordability has hit an all-time high. That affordability inched even higher this week, as mortgage interest rates broke through their previous record lows to fall further still.

Freddie Mac says all loan products covered in its regular weekly market survey eased to set new all-time lows for the week ending January 12, 2011.

The average rate for the 30-year fixed mortgage has been below 4.00 percent for six consecutive weeks now. This week, it dropped to 3.89 percent (0.7 point), down from 3.91 percent last week. Last year at this time, the 30-year rate averaged 4.71 percent.

The 15-year fixed-rate mortgage this week averaged 3.16 percent (0.8 point), falling from 3.23 percent last week. A year ago at this time, the 15-year fixed mortgage averaged 4.08 percent.

Adjustable-rate mortgages (ARMs) also declined to hit new record lows. The 5-year ARM is now averaging 2.82 percent (0.7 point), down from last week’s average of 2.86 percent. This time last year, the 5-year ARM was 3.72 percent.

The 1-year ARM averaged 2.76 percent (0.6 point) this week, compared to 2.80 percent last week. Dial back 12 months, and the 1-year ARM came in at 3.23 percent.

Freddie Mac’s chief economist Frank Nothaft notes that declines appeared across all loan products even with news of mixed indicators in the labor market.

“Although the economy added 1.6 million jobs in 2011, which was the most since 2006, the unemployment rate remained historically elevated. The 2009 to 2011 period had the highest three-year average unemployment rate since 1939 to 1941,” according to Nothaft.

He adds that “the Federal Reserve indicated in its January 11th regional economic review that most industries saw limited permanent hiring at the end of last year.”

Freddie Mac’s weekly mortgage rate survey is based on data gathered from 125 lenders – including thrifts, credit unions, commercial banks, and mortgage companies – from across the country.

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Good Afternoon,

Please follow the link below for 5 great reasons to purchase a home in 2012 by Jonathan Slappey!!

Thank You,

Bob - Equity Title

Click Here: http://www.quickenloans.com/blog/top-5-reasons-buy-home-2012

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Hello Followers,

Let’s spread the word on this issue.  We have to fight to protect the entire housing industry from any sideways movement.

Bob Grove–Equity Title

http://blogs.wsj.com/developments/2012/01/11/poll-dont-tread-on-my-mortgage-interest-deduction/

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Hello Followers,

It looks like we are finally putting America back to work, see the attached article.  That is great news for the housing market, working people can afford to buy houses instead of paying rent.

What are your thoughts on all the recent news?

Bob Grove -  Equity Title

Unemployment Rate Falls to 8.5%

01/06/2012

BY: CARRIE BAY

The nation’s unemployment rate continues to trend down. It slipped to 8.5 percent during the month of December as the economy added 200,000 new jobs, the U.S. Department of Labor said Friday morning.

The reported rate is down from 8.6 percent in November. The change in total nonfarm payroll employment for November was revised downward from +120,000 to +100,000. October’s data was revised upward from +100,000 to +112,000.

December’s results were better than expected, with the consensus forecast among analysts looking for the rate to

inch up to 8.7 percent and net job growth over the month to tally 150,000.

December marks the sixth consecutive month of 100,000-plus job gains and the first such stretch employers have been able to string together since 2006.

The number of long-term unemployed – those jobless for 27 weeks or more – was little changed in December at 5.6 million and accounted for 42.5 percent of the unemployed.

The unemployment rate has declined by 0.6 percentage point since August, according to the Labor Department. At 8.5 percent, the rate ended 2011 at its lowest level in nearly three years.

Over the 2011 calendar year, nonfarm payroll employment rose by 1.6 million, up sharply from the 940,000 jobs added in 2010.

Employment in the private sector rose by 212,000 in December and by 1.9 million over the year.

Government employment changed little over the month but fell by 280,000 over the year.

The national unemployment rate averaged 8.9 percent in 2011, compared to 9.6 percent in 2010.

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Hello Followers,

Are we all off to a fast start for 2012,

Take a look at  the attached article, more great news for those Buyers who don’t want to be the only ones in the marketplace.  Many transactions going through the short sale process right now, including one I am trying to purchase.   Keep this article for those reticent buyers, who think the world might really end in 2012.

Bob Grove -  Equity Title

Pending Home Sales Highest in Over a Year-and-a-Half

01/04/2012

BY: CARRIE BAY

Pending home sales continued to rise in November, reaching their highest level in 19 months, the National Association of Realtors (NAR) reported late last week.

The trade group’s index of signed sales contracts jumped 7.3 percent between October and November and is 5.9 percent above its level a year earlier. The last time the index was higher was in April 2010 as buyers rushed to beat the deadline for the homebuyer tax credit.

James Frischling, president and co-founder of NewOak Capital, says the latest results are likely to feed the view that there is a recovery going on in the housing market.

“This was an unexpected jump-up, with every region showing gains including a 15 percent increase out west, which has been the hardest hit area since the housing bubble burst,” Frischling noted.

Despite the strong gains atypical of the season, Frischling remains cautious. He says with contract cancellations above 30 percent, Realtors are keenly aware that it’s premature to conclude a housing recovery is underway based on November’s strong pending sales report.

Lawrence Yun, NAR’s chief economist, agrees that contract failures have been running unusually high.

“Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage,” he said.

Still, Yun described November sales activity as “doing reasonably well in comparison with the past year.”

“The sustained rise in contract activity suggests that closed existing-home sales, which are the important final economic impact figures, should continue to improve in the months ahead,” Yun added.

According to Frischling, the overarching question is whether there are a sufficient number of buyers to absorb the supply of homes which will inevitably hit the market.

With the foreclosure pipeline still growing and over 6 million borrowers behind on their mortgage payments, he says the inventory of homes available for sale will continue to build up, putting downward pressure on home prices and holding back any meaningful recovery.

“Yet with the rental market on fire, an improving jobs picture, and with interest rates being so low, the spike in contracts signed was a welcomed way to finish the year,” Frischling said. “The follow-through on these pending home sales will tell whether the positive factors facing the housing market outweigh the negative and if this market has finally turned the corner.”

NAR acknowledged last month that it over-estimated actual sales closings for existing homes, going back to 2007. The trade group has adjusted sales and inventory figures for the last four years downward by 14.3 percent, citing discrepancies between sales reported by multiple listing services (MLSs) and sales included in its U.S. Census benchmark.

Pending home sales, however, are not affected by the recently published re-benchmarking of existing-home sales, according to NAR, namely because the pending sales index uses a different methodology based directly on contract signings and is adjusted for seasonality.

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Hello Readers and Happy New Year

Good news from the Experts, they say we will have low interest rates through 2012, see the attached article.

Have a happy and productive 2012.  Good Luck to all of you.

Bob Grove – Equity Title

Low mortgage rates likely to continue through 2012, experts say

But with high unemployment and home prices still falling in many areas, analysts say there is little chance for a housing recovery.

By E. Scott Reckard, Los Angeles Times

January 3, 2012

The mortgage market told a sad story throughout 2011: record low rates, but few people taking advantage of them to buy homes.

The likely scenario in the new year, according to many analysts, is more of the same. Although the Federal Reserve has pledged to keep rates low through 2013, the experts say high unemployment and home prices that are still falling in many areas provide little incentive for stressed-out consumers to surge back into the housing market.

"I think there may be a little bit of an uptick in units sold," said Doug Duncan, vice president and chief economist at mortgage finance giant Fannie Mae. "But home prices will probably be down again, so the total dollars spent on purchases is likely to be pretty close" to 2011.

Freddie Mac, the other big government-backed mortgage company, had predicted two years ago that lenders would write $1.8 trillion in home loans in 2011. They later revised that estimate to just over $1 trillion.

In the end, home lending last year totaled $1.3 trillion, down from $1.7 trillion in 2010 and an all-time high of nearly $3.3 trillion in 2005.

Last year's better-than-expected finish had nothing to do with home purchases. Instead, a decline in 30-year fixed mortgage rates to historic lows of less than 4% triggered a massive wave of refinancings.

As last year began, Freddie Mac expected applications for home-purchase loans to make up two-thirds of all mortgage demand by the end of 2011. As it turned out, about 4 in 5 mortgage applications in December were from homeowners wanting to refinance, according to the Mortgage Bankers Assn.

Little wonder why. Lenders were offering 30-year fixed-rate mortgages to solid borrowers at an average of 3.95% last week, the ninth consecutive week of rates at or below 4%, Freddie Mac said. (The survey covers loans up to $417,000 with borrowers paying less than 1% of the amount in upfront lender fees.)

That wrapped up a year of record lows. In 1981 and 1982, the average 30-year mortgage carried an interest rate of more than 16%, and the typical rate was above 8% as recently as 2000, Freddie Mac said. The average last year was 4.45%. Freddie Mac economists are predicting an average of 4.5% for 2012, increasing to 5.4% in 2013 — still phenomenally low by historic standards.

But in the long-suffering economy, "remarkably low rates are not enough," said Michael Fratantoni, an economist for the Mortgage Bankers Assn. He noted that many homeowners can't even take advantage of the opportunity to refinance because of "lack of equity in their properties, poor credit and a weak job market."

With lending standards still tight and demand for home loans waning, Morgan Stanley analysts titled their housing outlook for 2012 "The Year of the Landlord."

"While we had forecast lower prices [for 2011], we did hold out some hope that at the very least transactions would pick up slightly from 2010 levels," said the report from a team led by analyst Oliver Chang.

"However, it proved to be too optimistic a prediction," the report said. "Not only did total home sales fail to rise, but also mortgage applications for purchase continued to fall — indicating that not only is tight mortgage credit limiting demand, but even the desire to buy a home continued to wane."

Analysts aren't universally pessimistic: "Housing has hit the bottom and has begun to heal slowly," said Cal State Channel Islands professor Sung Won Sohn, a former top economics advisor to the White House and Wells Fargo & Co.

Although large numbers of foreclosures and other distressed home sales are keeping housing prices from rising, the inventory of new homes is at a 49-year low, setting the stage for a rebound, Sohn said in his 2011 housing forecast.

"On balance," he said, "the increased demand for rental housing, higher rents and multifamily starts should encourage home builders and boost confidence on the part of the potential home buyers. Despite the high level of foreclosures, house prices should stabilize and even rise slightly toward the end of 2012."

But any recovery will be slow given the extreme damage inflicted by the housing boom and bust, warned Duncan, the Fannie Mae economist.

"I tell people we're five years through a 10-year adjustment," he said. "Not until year 10 will we return to the traditional rate of housing starts."

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Happy Holidays, Readers

Check out this article we linked to here.  Surprise, Surprise, Existing home sales rose in November! It seems we may get into a nice moving market in 2012

Enjoy your Holiday Season.

Bob Grove – Equity Title

Existing-Home Sales Rise in November

12/21/2011

BY: CARRIE BAY

Existing-home sales rose again last month, according to data released Wednesday by the National Association of Realtors (NAR).

That assessment, however, is coming off of lower sales numbers than previously thought, reflecting revisions to NAR’s data going back to 2007. The trade group has adjusted sales and inventory figures for the last four years downward by 14.3 percent, signaling the housing crisis has run even deeper that earlier assumptions.

NAR’s latest monthly report shows sales of previously owned homes increased 4.0 percent to an annual rate of 4.42 million in November from 4.25 million in October, and are 12.2 percent above the 3.94 million-unit pace in November 2010.

Total housing inventory at the end of November fell 5.8 percent to 2.58 million existing homes available for sale, which represents a 7.0-month supply at the current sales pace, down from a 7.7-month supply in October.

The national median existing-home price was $164,200 in November, down 3.5 percent from a year ago.

Distressed homes – foreclosures and short sales typically sold at deep discounts – accounted for 29 percent of November’s sales (19 percent were foreclosures and 10 percent were short sales), compared with 28 percent in October and 33 percent in November 2010.

Although re-benchmarking resulted in lower adjustments to several years of home sales data, NAR says the month-to-month characterization of market conditions did not change.

Lawrence Yun, NAR’s chief economist, says November’s report indicates more people are taking advantage of the buyer’s market.

“Sales reached the highest mark in 10 months and are 34 percent above the cyclical low point in mid-2010,” Yun said. “We’ve seen healthy gains in contract activity, so it looks like more people are realizing the great opportunity that exists in today’s market for buyers with long-term plans.”

NAR also stressed that there were no revisions to home prices or month’s supply.

“From a consumer’s perspective, only the local market information matters and there are no changes to local multiple listing service (MLS) data or local supply-and-demand balance, or to local home prices,” Yun said.

A divergence developed over time between sales reported by MLSs and sales determined by a U.S. Census benchmark, with the variance beginning in 2007, NAR explained. The trade group cited growth in MLS coverage areas from which sales data is collected and geographic population shifts as reasons for the divergence.

“It appears that about half of the revisions result solely from a decline in for-sale-by-owners (FSBOs), with more sellers turning to Realtors to market their homes when the market softened,” according to Yun. “The FSBO market was overwhelmed during the housing downturn, and since most FSBOs are not reported in MLSs, national estimates of existing-home sales began to diverge based on previous assumptions.”

NAR’s says its 2010 benchmark shows there were 4,190,000 existing-home sales last year, rather than the 4,908,000 sales previously projected.

Revisions covering 2007 through 2010 are expected to have a “minor impact” on future revisions to Gross Domestic Product (GDP), according to NAR.

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Foreclosure Filings Down 3%, RealtyTrac Reports

12/14/2011

Foreclosure activity slipped 3 percent in November when compared to the previous month, but filings at various stages of the process showed starkly different movements, according to RealtyTrac’s latest market report.

Scheduled auctions hit a nine-month high following the default surge that began in August. At the same time, RealtyTrac says REO activity is at a 44-month low.

Total foreclosure filings – reported on 224,394 U.S. properties in November – are down by double-digits from a year ago, but RealtyTrac doesn’t view the numbers as the making of a trend.

James Saccacio, co-founder of RealtyTrac, says the 14 percent year-over-year decline in filings last month is the smallest annual decrease recorded over the past year, and he points out that some bellwether states such as California, Arizona, and Massachusetts actually posted increases in foreclosure activity from November 2010.

“Despite a seasonal slowdown similar to what we’ve seen in each of the past four years, November’s numbers suggest a new set of incoming foreclosure waves, many of which may roll into the market as REOs or short sales sometime early next year,” Saccacio said.

Default notices (NOD, LIS) were filed for the first time on a total of 71,730 U.S. properties in November. Foreclosure auctions (NTS, NFS) were scheduled on 96,540 properties during the month, and lenders repossessed (REO) a total of 56,124 homes.

Nevada posted the nation’s highest foreclosure rate for the 59th straight month. Filings rebounded 3 percent in November from a 45-month low in October, when a new law was passed altering the foreclosure process in the state. One in every 175 Nevada housing units had a foreclosure filing last month, more than three times the national average.

Scheduled trustee’s sales in California hit a 10-month high in November, helping the state maintain the nation’s second highest foreclosure rate. A total of 26,509 trustee’s sales were scheduled in California last month, up 14 percent from November 2010 – the first year-over-year increase in scheduled foreclosure auctions in the Golden State since March 2010.

Arizona foreclosure activity increased on a year-over-year basis in November for the first time since October 2010. With filings up 4 percent from a year earlier, Arizona posted the nation’s third highest foreclosure rate for the fifth month in a row.

Substantial monthly increases in foreclosure activity in Utah and Georgia lifted those states’ foreclosure rates into the nation’s top five in November. Utah’s foreclosure rate ranked No. 4 thanks to a 74 percent monthly increase in foreclosure activity. Georgia saw a 23 percent increase in filings, giving it the No. 5 spot.

Other states with foreclosure rates ranking among the top 10 were Michigan, Florida, Illinois, Ohio, and South Carolina. South Carolina cracked the top 10 for the first time since RealtyTrac began issuing its report in 2005.

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Good Morning on this rainy day in Arizona

Clear Capital gives us a ray of sunshine today about the stability of the market

Let’s stay positive and make things happen in this buyer’s market.

Bob -  Equity Title

Housing Market Sees Signs of Stability: Clear Capital

12/09/2011

The housing market may be stabilizing as house prices and REO saturation rates show little change on a quarterly and yearly basis, according to Clear Capital’s most recent Home Data Index.

Nationally, prices rose just 0.3 percent while REO saturation rate was relatively unchanged at 24.6 percent over the most recent quarter, according to Clear Capital data ending in November. Clear Capital measures housing data on a rolling quarter, which compares the most recent four months with the previous three.

“With only a one percent drop in national home prices since January and virtually no change in prices over the last six months, strong evidence suggests the big swings that many market participants are accustomed to could become a thing of the past,” said Dr. Alex Villacorta, director of research and analytics at Clear Capital.

Villacorta also reiterated a point he and other analysts made at a panel discussion a few days ago at the Five Star MPact Conference and Expo: Market data must be granular to be effective.

“Although many of the nation’s major markets are experiencing no significant movement in prices, there are still several micro markets that are underperforming the overall market due to high levels of REO saturation,” Villacorta said in the Home Data Index.

He continued: “As lien holders continue to process their foreclosures and the flow of REOs continue to come to market, it will be critical for industry participants to ensure they understand the micro economic nature of specific markets.”

Over the recent quarter, prices changed by less than one percentage point in three of four U.S. regions, while the Midwest demonstrated a price increase of 1.2 percent.

The West was the only region to post a decline, falling 0.8 percent over the quarter. This decline is slightly lower than the quarterly price decline reported last month in the region – 1 percent.

“As this improvement comes at the beginning of the winter slow down, it suggests the stubborn quarter-over-quarter and year-over-year declines seen consistently in the hard hit region may be easing,” stated Clear Capital’s report.

The Northeast posted a 0.5 percent increase for the quarter, and the South posted a 0.2 percent increase.

While price changes did not vary drastically from region to region, they also did not vary widely from market to market.

The difference between the No. 1 highest performing market – Washington D.C. – and the 15th highest performing market – Cleveland, Ohio (1.7 percent) was just 3.1 percent.

However, the difference between the top and bottom ranked markets on the list of 15 lowest performing markets was much greater. In the No. 1 spot, Atlanta posted a 9.7 percent decline, while Dallas, at No. 15, posted a 0.4 percent decline.

Atlanta’s decline is likely the result of a decrease in transactions and an increase in distressed properties.

In keeping with Villacorta’s assertion that some markets are underperforming due to high REO saturation rates, Atlanta’s REO saturation rate is 42.8 percent, significantly higher than the national rate of 24.6 percent.

Also notable, Florida, which has seen a 59.1 percent decline in prices since their 2006 peak, has seen a 12 percent decline in REO saturation over the past year.

Additionally, four Florida metro markets – all of which experienced high foreclosure rates and sharp price declines over the past two years – held positions on the list of 15 highest performing markets for the second month in a row. Orlando, Tampa, Jacksonville, and Miami are now seeing rising prices.

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Hello Readers,

Interesting article regarding the rebuild and stabilization of neighborhoods,  Seems a wise guide to follow.

Bob – Equity Title

Experts Advocate Stabilizing Neighborhoods with Short Sales

12/05/2011

BY: CARRIE BAY

“Foreclosures are going to go up before they go down,” according to Craig Nickerson, president of the National Community Stabilization Trust.

Nickerson says estimates put foreclosure tallies at 850,000 this year, as high as 1.5 million in 2013, and then back to the levels we’re at today by 2015.

With all these distressed properties potentially making their way to an already stressed marketplace, Nickerson, along with a panel of industry professionals at the inaugural MPact Conference advocated for bulk short sales.

The panel discussion centered around neighborhood stabilization initiatives and HUD’s $7 billion program created to facilitate the rehabilitation of properties in communities challenged with high levels of foreclosures and property vacancies – aptly named the Neighborhood Stabilization Program (NSP).

“Foreclosure prevention by itself is not going to [be the] cure” for the housing crisis, Hala Farid, deputy director of Citigroup’s Office of Homeownership Preservation, told those attending the standing-room-only session.

Farid says Citi is devising a procedure where NSP program participants will have access to escalated points of contact to expedite the short sale process in support of neighborhood stabilization efforts.

Francis Martinez Myers, president of Employee Transfer Corporation (ETC) and ETCREO Management, said the industry is “on the cusp” of utilizing short sales as a viable means of stabilization, “but it’s not without its challenges,” she added.

“Lenders have to be aggressive about offering pre-approved listing prices for short sale properties,” according to Myers. She says having pre-approvals in hand would help facilitate transactions for bulk short sales.

Myers described the size and magnitude of this crisis as unprecedented. “I feel like we are in a five-alarm fire and we are still negotiating over which kind of garden hose we’re going to use … If we’re not careful and not aggressive, it’s going to be very difficult to get through this,” she said.

“Holistically we’re not doing enough fast enough,” according to Myers. Just “selling one house at a time, means 10 years from now we’ll still be here having this conversation,” Myers said.

She spoke of the advantages of tailoring services that are geared toward investors and nonprofit groups to facilitate bulk purchases of short sale properties.

Myers says her organization is working on a pilot initiative which aggregates available short sales in the market, pools together properties meeting investors’ and nonprofits’ qualifications, and lines them up for inspection.

Tyler Smith, VP of Wells Fargo’s REO disposition team, noted that managing investor participation with communities’ neighborhood stabilization efforts “can sometimes be a conflict of interest.”

According to Jerome Devadoss, manager of alternative dispositions for Fannie Mae’s REO sales operation, it’s important to engage community-minded investors to work alongside local nonprofits toward neighborhood stabilization, whether it’s through short sales or any other loss mitigation strategy.

Jim O’Donnell, manager of the West Coast REO Revitalization Program at Chase, says his company is exploring ways to facilitate short sales to nonprofit organizations. Chase is looking to make short sales and distressed portfolios part of its “First Look” program.

Short sales are increasingly making their way into the conversation as a practicable solution to support neighborhood stabilization.

Eric Will, senior REO sales director for Freddie Mac’s HomeSteps division, said “knowledge around this [short sale] space is growing. We know it needs to be done.”

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Good News on the Jobs front, a key to recovery in housing!

Unemployment Rate Drops to 8.6%

12/02/2011

BY: CARRIE BAY

The nation’s unemployment rate fell to 8.6 percent during the month of November, as employers added 120,000 new jobs to their payrolls, the U.S. Department of Labor said Friday.

By the government’s calculations, the unemployment rate declined by 0.4 percentage point from 9.0 percent reported in October to hit its lowest level since March of 2009.

Analysts at IHS Global Insight were expecting the economy to add 125,000 new jobs last month, but the rate to hold at 9.0 percent.

Earlier this month, IHS published the graphic here to the left, illustrating its projections of how long it will take each state to return to peak levels of employment.

Employment assessments for both October and September were revised upward. The Labor Department says total nonfarm payroll employment rose by 210,000 jobs in September rather than the 158,000 previously reported. October’s numbers were revised from 80,000 new jobs to 100,000.

Still, the 72,000 more jobs than previously thought over past months isn’t enough to cut the unemployment rate by four basis points. Ed Delgado, CEO of the Five Star Institute says the sharp drop in the rate can be explained by a large chunk of the unemployed falling off the grid.

As those who’ve been unemployed for extended periods become ineligible to claim unemployment benefits, they are no longer counted as part of the Labor Department’s unemployed population, Delgado explains.

The Labor Department’s report does indicate that the size of its measurable labor force contracted by 315,000 persons.

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Hello Readers,

This came out today.   It will be interesting to see how this plays out with the investors in these Notes. Let’s all hope for the best.

Bob - Equity Title

Congress Calls for Principal Reductions from GSEs

11/30/2011

BY: KRISTA FRANKS

Twenty-one members of Congress sent a letter to Federal Housing Finance Agency (FHFA) Acting Director Edward DeMarco urging him to encourage principal reductions on loans backed by Fannie Mae and Freddie Mac.

“We do not urge that the enterprises reduce principal on mortgages as a kindness to homeowners,” the letter stated.

Instead, the congressmen support principal reductions on the basis that they will save taxpayers from some further potential losses.

The lawmakers cite first-quarter data from the GSEs stating 17.7 percent of Fannie borrowers are underwater, as are 19 percent of Freddie borrowers. These borrowers, they say, “are obviously at great risk of eventual default.”

With 44 percent of loans modified in the past two years more than three months past due, according to Freddie Mac data cited in the letter, “[t]he performance of the enterprises’ mortgage modifications leaves much to be desired for homeowners, for the housing market, and for taxpayers,” the letter stated.

The representatives urge DeMarco to disregard the short-term effects of principal reductions on the GSEs’ balance sheets in favor of looking at the long-term positive effects these reductions might have.

They point to an Amherst Securities study that negates the “moral hazard” theory, which hypotheses that offering principal reductions encourages homeowners to default.

“Right now, the FHFA is preventing underwater homeowners with mortgages backed by Fannie Mae or Freddie Mac from receiving balance reductions, even when a principal modification would save the investor – in this case meaning taxpayer – money compared to foreclosure,” said George Miller (D-California), one of the representatives who signed the letter.

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Study Finds Fewer Borrowers Sinking in Negative Equity

11/29/2011

BY: CARRIE BAY

The depreciation of home values over the past half-decade has left millions of mortgage borrowers owing more than their home is worth – 10.7 million, according to CoreLogic.

The company released its third-quarter update on negative equity within the U.S. housing market Tuesday. It shows that 22.1 percent of all residential properties with a mortgage were underwater as of the end of September.

That’s actually down from 22.5 percent – or 10.9 million borrowers – at the end of the second quarter, but CoreLogic says the number remains high and makes borrowers more vulnerable to economic shocks such as job loss or illness.

Nevada has the highest negative equity percentage with 58 percent of all its mortgaged properties underwater, followed by Arizona (47 percent), Florida (44 percent), Michigan (35 percent), and Georgia (30 percent).

This is the first quarter that Georgia entered the top five, surpassing California which had been in the top five since CoreLogic began tracking negative equity in 2009.

The top five states combined have an average negative equity ratio of 41.4 percent, while the remaining states have a combined average negative equity ratio of 17.6 percent.

Mortgage borrowers in New York have fared the best through the downturn, with just 6.3 percent in a negative equity position.

Other states on the low end of the spectrum include: North Dakota (6.9 percent), Oklahoma (7.3 percent), Pennsylvania (7.9 percent), and Montana (8.4 percent).

Should home prices continue to fall further, another 2.4 million mortgage borrowers in the U.S. could sink underwater – that’s the number of borrowers CoreLogic says had less than 5 percent equity in their homes, referred to as near-negative equity, in the third quarter.

Together, negative equity and near-negative equity mortgages accounted for 27.1 percent of all residential properties with a mortgage nationwide in the third quarter.

CoreLogic’s report provides additional details on the population of borrowers that are currently underwater.

Of the 10.7 million borrowers in negative equity, there are 6.3 million first liens without home equity loans that have an average mortgage balance of $222,000. They are underwater by an average of $52,000 which equates to an average loan-to-value (LTV) ratio of 131 percent.

The remaining 4.4 million negative equity borrowers hold first liens and home equity loans with an average mortgage balance of $309,000. These borrowers are underwater by an average of $84,000 and have an average LTV of 137 percent.

Given that bank portfolios account for 15 percent of all first lien mortgages, CoreLogic estimates that 1.6 million loans in a negative equity position are held by banks. Collectively these loans are underwater by about $105 billion.

Altogether, the 10.7 million borrowers who owed more than their home was worth at the end of the third quarter were underwater by a total of $699 billion by CoreLogic’s assessment.

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Hello Readers, hope you all had a great Thanksgiving holiday weekend.

The attached article shows that we are continuing to whittle away at our pile of unsold homes.   We are going in the right direction.

Good Luck to all

Bob – Equity Title

Industry's Shadows Continue to Shrink

11/23/2011

BY: CARRIE BAY

That ominous shadow inventory of repossessed and soon-to-be repossessed homes is getting smaller.

Standard and Poor’s (S&P) has released its third-quarter shadow inventory update, which shows both the volume of distressed assets and the amount of time it’d take to liquidate these properties is contracting.

S&P says the volume of distressed residential mortgages included in its shadow inventory estimate remained “extremely high” at $384 billion in the third quarter, but it has declined in each quarter since mid-2010. S&P’s third-quarter evaluation is down from $405 billion at the end of the previous quarter.

“We believe this points to a continued drop in the amount of time it will take to clear this ‘shadow inventory’ over the next year assuming national liquidation rates do not decline abruptly,” the analysts at S&P said in their report.

Regional default and liquidation rates varied widely in the third quarter of 2011, but overall improvements prompted S&P to lower its projection of the number of months to clear the supply of distressed homes on the market and coming down the pipeline.

The agency now estimates that it will take 45 months to work through the national shadow inventory. This assessment is seven months below S&P’s peak estimate of 52 months in March 2011, but is three months longer than the agency’s estimate a year ago.

S&P calculates shadow inventory as the number of properties for which borrowers are 90 days or more delinquent on their mortgage payments, properties in foreclosure, and properties that are REO. The agency also includes 70 percent of the loans that “cured” from being 90 days delinquent within the past 12 months because these loans carry a higher risk of redefault.

S&P’s analysis of the shadow inventory uses only non-agency (non-GSE) data, but the company’s analysts say they believe the months-to-clear is similarly high for the market as a whole.

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Good Day Bloggers,

 A good day for those upside down in their homes that they want to keep.  No LTV on 30 year fixed loans, No appraisals.

Could Help America Alot!!!

Bob -  Equity Title

Fannie and Freddie Detail New HARP Guidelines

11/15/2011

BY: CARRIE BAY

Fannie Mae and Freddie Mac have released highly anticipated guidelines for the revised Home Affordable Refinance Program (HARP).

Both GSEs have posted details of the program modifications and procedural changes on their respective business sites for mortgage servicers to follow (Fannie’s, Freddie’s).

Among the key program revisions, the GSEs have eliminated or raised the loan-to-value (LTV) cap, and relaxed representation and warranty stipulations – changes that officials expect to at least double the number of homeowners with a HARP-refinanced mortgage. Since the program was launched in 2009, just under 900,000 borrowers have participated.

Negative equity typically excludes a homeowner from refinancing through traditional channels. Removing previous LTV ceilings will allow homeowners who are severely underwater due to plummeting property values to take out new loans at today’s lower interest rates. There are, however, some LTV conditions depending on loan type.

There are no LTV restrictions for fixed-rate mortgages with terms up to 30 years, including those with terms of 15 years.

For fixed-rate loans with terms between 30 and 40 years, LTV is limited to 105 percent. Likewise, a 105 percent LTV cap has been placed on adjustable-rate mortgages (ARMs) with initial fixed periods of five years or more and terms up to 40 years.

Any borrower with an LTV ratio below 80 percent is not eligible for HARP.

As previously announced, across the board, the original mortgage must have been sold to Fannie or Freddie prior to April 1, 2009.

In the October notice announcing their intent to modify HARP to increase participation, the GSEs said they would “waive certain representations and warranties” on loans refinanced through the program. Analysts said at the time

that depending on what exceptions would be made, such a move could spark increased competition among lenders to refinance borrowers through HARP.

In Tuesday’s guidance, the GSEs provided specifics on which liabilities would be lifted and noted that the rep and warranty adjustment is one of the most important components of the new program.

The lender will not be responsible for any of the representations and warranties associated with the original loan.

The lender is also relieved of the standard underwriting representations and warranties with respect to the new mortgage loan as long as the data in the case file is complete and program instructions are followed for collecting information on income, employment, assets, and fieldwork.

The lender is not required to make any representation or warranty as to value, marketability, or condition of the subject property unless they obtain a new appraisal.

Lenders will, however, be held accountable for any fraudulent activities.

Administration officials are hoping that eliminating the risk associated with reps and warranties – whether transferred from the original loan or on the new loan – will spark healthy competition among lenders to help homeowners get into the program. And Fannie and Freddie are making it easier for the competition to flourish.

The GSEs are modifying their policies to allow lenders to solicit borrowers with Fannie- and Freddie-owned mortgages for a refinance. The only condition is that the lender “simultaneously applies the same advertising and solicitation activities” to borrowers of both GSEs, and for loans both owned or securitized by the GSEs.

In the new guidelines, the GSEs detail specific language that must be included in any borrower solicitation material.

Regarding program eligibility as it relates to delinquencies, the borrower must not have been behind on their payments at all within the most recent six-month period, and had no more than one 30-day delinquency within the last year.

The GSEs are also removing the requirement that the borrower (on the new loan) meet the standard waiting period following a bankruptcy or foreclosure. The requirement that the original loan must have met the bankruptcy and foreclosure policies in effect at the time the loan was originated is also being removed.

The new HARP program has been extended through December 31, 2013.

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