Today’s News Synopsis:
According to Freddie Mac, rates on 30-year FRMs fell to 4.77% this week. Altos Research reports home prices fell 1.63% in December. Timothy Geithner requested from Congress to increase the national debt limit. The current debt limit is $14.29 trillion, and the nation’s current debt level is just $335 billion short of the limit.
In The News:
Research Institute for Housing America – “A Study of Real Estate Markets in Declining Cities” (1-6-11)
“many places will likely resume growth and fully recover within the next decade or so. This is almost certainly not to be the case for all metropolitan areas. In fact, a number of large metropolitan statistical areas (MSAs) experienced severe recessions during the latter half of the 20th century and prior to the Great Recession and never fully recovered or took many years to do so”
USA Today – “30-year fixed mortgage rate dips to 4.77% average in latest week” (1-6-11)
“Freddie Mac says the average rate on 30-year mortgages dropped to 4.77% from 4.86% the previous week. It hit a 40-year low of 4.17% in November.”
Realty Times – “Consequences of Defaults and Foreclosures” (1-6-11)
“One of the most startling impacts of a foreclosure appears on one’s credit report. Your credit score may plummet by 200 to 300 points. In this economic climate, where credit lending standards are already tightened, you may then find it difficult to do everything from buying a car to renting an apartment. What’s worse is that the notation of foreclosure stays on your report for up to seven years.”
Housing Wire – “Altos: Home prices down 1.63% in December, new listings even lower” (1-6-11)
“Home prices fell 1.63% in December, but new listings are hitting the market well below that, according to analytics firm Altos Research. Prices fell in each of the 27 markets studied by Altos. Prices fell 4.77% in San Francisco — the steepest drop of any area, 3.71% in San Diego”
Housing Wire – “Commercial mortgage modifications become huge trend in just two years” (1-6-11)
“Of all loan modifications in the commercial mortgage industry over the past decade, 96% occurred in the last years, according to Standard & Poor’s. The rating agency said 354 commercial real estate loans with a principal balance $15.6 billion were modified from January through November, up significantly from 216 loans valued at $7.06 billion for all of 2009.”
Housing Wire – “DebtX November CRE loan volume down to 80.3%” (1-6-11)
“The decline in the value of commercial real estate loans in November was due primarily to an increase in Treasury rates”
Housing Wire – “Geithner urges Congress to increase national debt limit” (1-6-11)
“Geithner wrote a letter to Congress Thursday requesting an increase in the federal debt limit. According to his numbers, the current debt limit set last February is $14.29 trillion. As of the writing of the letter, the outstanding debt subject to the limit standards is $13.95 trillion — just $335 billion shy of the maximum.”
Housing Wire – “Equator’s Vella: Short sales set to swell 25% in 2011” (1-6-11)
“With one in five borrowers underwater on their home and an estimated 1.5 million foreclosures scheduled for 2011, the opportunity for short sales will be better than ever. Investors usually see a 20% to 30% better execution on a short sale versus an REO sale when it comes to loss severity. With the foreclosure volume, current and pending REO inventories, servicers will be pressed to do more short sales in 2011.”
Housing Wire – “New Fannie interactive Web tool provides foreclosure avoidance options” (1-6-11)
“Fannie Mae’s new WaysHome interactive multimedia tool walks homeowners through options if they are struggling to pay the mortgage — even allowing them to select a character and be a part of an interactive video.”
Looking Back:
One year ago, California Governor Schwarzenegger announced a new home buyer tax credit. The Mortgage Bankers Association reported that mortgage applications had increased by .4 percent from Christmas. The FOMC confirmed plans to buy $1.25 trillion in mortgage-backed-securities from Freddie Mac, Fannie Mae and Ginnie Mae. Eugene Ludwig believed that commercial real estate losses would break historical records in 2010.
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California Real Estate Investing News is a post from: The Norris Group