Saturday, September 29, 2007

Yahoo - "Freddie Mac Pays $50M to Settle Charges" (9-28-07)

"Freddie Mac, the nation's second-largest financer of home mortgages, is paying a $50 million fine to settle civil securities fraud charges brought by federal regulators in a four-year accounting lapse. In addition, four former executives at the government-sponsored company settled negligent conduct charges by agreeing to pay a total of $515,000 in civil fines and to make restitution totaling $275,548. They are former president and chief operating officer David Glenn, ex-chief financial officer Vaughn Clarke, and former senior vice presidents Robert Dean and r Dossani."

The San Diego Union Tribune - "S.D. economic forecast looks 'pretty bad'" (9-28-07)

"San Diego County's leading economic indicators took a sharp plunge in August, signaling that the county faces its greatest threat of recession in half a dozen years, according to a report released yesterday by the Burnham-Moores Center for Real Estate at the University of San Diego."

Bloomberg - "Bank Credit Risk Rises Amid Concern Over Money Market Funding" (9-28-07)

"Bank credit risk rose amid renewed concern lenders are having difficulty raising funds in the money markets, according to traders of credit-default swaps. Contracts on the iTraxx Financial Index of subordinated debt, a benchmark for the cost of protecting the bonds of 25 European banks and insurers against default, rose 4 basis points to 49 basis points, according to Deutsche Bank AG. The index increases as perceptions of credit quality worsen."

Los Angeles Times - "New-home sales plummet in August" (9-28-07)

"Sales of new homes plunged in August from the previous month and prices posted their biggest year-over-year drop in nearly 37 years, the Commerce Department said Thursday, underlining the depth of problems facing the housing sector. A separate report from the Labor Department showing that new claims for unemployment insurance fell a lower-than-expected 15,000 last week to 298,000 implied that the drag from housing was not spilling into labor markets. Even so, speculation flared that the Federal Reserve would have to cut interest rates further to counter an economic slowdown."

Los Angeles Times - "Wall Street gains despite dismal data" (9-28-07)

"Stocks extended their quarter-end rally Thursday despite some downbeat economic data and another jump in oil prices. The Dow index closed within 88 points of its record high reached in July. Some analysts said investors were betting that the Federal Reserve would follow up its Sept. 18 interest rate cut with another in October."

Real Estate Journal - "Small Investors Gain An Edge in Properties" (9-28-07)

"For small investors who've been shut out of the commercial-property market in recent years, there's a bright side to the mortgage meltdown: It's much easier for them to compete."

Friday, September 28, 2007

NAHB - "New-Home Sales Drop 8.3 Percent In August Following Turmoil In Mortgage Market" (9-27-07)

"Turmoil in the mortgage finance system in August led to an 8.3 percent drop in sales of new single-family homes for the month, according to figures released by the U.S. Commerce Department. The seasonally adjusted annual rate of 795,000 units was 21.2 percent below a year earlier."

CBIA - "California Housing Starts Continue Decline in August, CBIA Announces" (9-27-07)

"Home construction in California continued to decline in August as homebuilders continued to sell off existing inventory, the California Building Industry Association reported today. Total housing starts in California, as measured by building permits issued, dipped 19 percent in August when compared to the same month a year ago to 10,825, according to housing permit data supplied by the Construction Industry Research Board. Production of single-family homes dropped 35 percent while multifamily units saw a slight increase in permits being pulled when compared to August of 2006."

Mortgage Banker's Association - "MBA Releases 2nd Quarter 2007 Commercial Real Estate/Multifamily Finance Quarterly Data Book" (9-27-07)

"The Mortgage Bankers Association (MBA) today released the highly anticipated Commercial Real Estate/Multifamily Finance Quarterly Data Book for the second quarter of 2007. The Data Book compiles the most up-to-date information on topics of interest to financial investment industry participants and observers."

Mortgage Banker's Association - "Robbins Statement Commending Passage of Flood Insurance Bill" (9-27-07)

"John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA) today praised the U.S. House of Representatives for passing H.R. 3121, the Flood Insurance Reform and Modernization Act of 2007. The bill, which passed the House 263-146, would reform the National Flood Insurance Program (NFIP) and help protect homeowners, renters and commercial property owners from losses due to floods."

Bloomberg - "U.S. New-Home Sales in August Slump 8.3% to 795,000 Pace" (9-27-07)

"Sales of new homes in the U.S. dropped more than forecast in August and prices plunged by the most in almost four decades, pointing to a worsening housing recession that spells more cutbacks in construction. Purchases declined 8.3 percent to an annual pace of 795,000, the lowest level in more than seven years, from a revised 867,000 rate in July, the Commerce Department said today in Washington. The median price dropped 7.5 percent from August 2006, the most since 1970."

Bloomberg - "U.S. Commercial Paper Drop Slows After Fed Cuts Rates" (9-27-07)

"The decline in the U.S. commercial paper market slowed last week, after the Federal Reserve cut interest rates to shore up confidence in the credit markets. Debt maturing in 270 days or less fell by $13.6 billion in the period ended yesterday to a seasonally adjusted $1.86 trillion, including a $17.3 billion decline in asset-backed commercial paper, according to the Federal Reserve in Washington."

Bloomberg - "KB Home Reports Loss, Says Housing Market Will Worsen" (9-27-07)

"KB Home, the Los Angeles-based homebuilder that has lost half its market value this year, reported a third-quarter loss on costs to abandon land purchases and gave a pessimistic outlook for the housing market. The net loss was $35.6 million, or 46 cents a share, compared with net income of $153.2 million, or $1.90, a year earlier, KB Home said today in a statement. Revenue fell 32 percent to $1.54 billion."

Orange County Register - "Irvine led state in multi-family permits last month" (9-27-07)

"Irvine issued more building permits last month for multi-family construction than any other city in the state, a spokesman for the Construction Industry Research Board said Wednesday. The city issued 1,129 multi-family permits in August, 95 percent of all the multi-family permits issued countywide, according to the industry research board."

Los Angeles Times - "Supervisor seeks changes in L.A. residential zoning proposal" (9-27-07)

"Los Angeles County Supervisor Zev Yaroslavsky on Wednesday called on Mayor Antonio Villaraigosa to rework a proposal that would lift the city's limits on height, density or other planning rules for residential construction projects that have as little as one affordable housing unit."

Wednesday, September 26, 2007

Mortgage Bankers Association - "Mortgage Applications Decrease In Latest MBA Weekly Survey" (9-26-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending September 21, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 654.2, a decrease of 2.8 percent on a seasonally adjusted basis from 673.2 one week earlier. On an unadjusted basis, the Index decreased 3.3 percent compared with the previous week and was up 15.4 percent compared with the same week one year earlier. "

NAR - "Natural Disaster Legislation Would Help Property Owners" (9-26-07)

"The National Association of Realtors® supports the Homeowners’ Defense Act of 2007, H.R. 3355, because it would help protect homeowners, commercial property owners, and potential property owners by ensuring the availability of adequate and affordable insurance, which NAR views as an important consumer issue. "

The News-Press - "Housing market collapse makes life a bit easier for the 'victimized'" (9-26-07)

"Even though I am retired, I don't speculate in real estate, bought my first home almost on 'green stamps,' exist on limited income and pay my medical bills myself, I felt like I was doing something wrong — because I was living in my own home, yet all those police, firefighters, teachers and nurses, did not own the homes they were living in, and The News-Press and other media said that I was being unfair to the police, firefighters, teachers and nurses because I could afford a home, and they couldn't."

The San Diego Union Tribune - "Lennar posts record loss" (9-26-07)

"Tough times in the national housing market led to a company-record loss of $513.9 million for Lennar Corp. in the third quarter, with drops in sales prices and home deliveries compounded by heavy charges to write down land values. Its shares fell almost 4 percent."

The San Diego Union Tribune - "Reports raising fears on economy" (9-26-07)

"Crumbling consumer confidence and slumping home sales could prove to be a bad combination for retailers, and for the broader economy going into the holiday shopping season, if the labor market contracts further and chokes off spending, economic data showed yesterday."

Bloomberg - "Fremont Says Ford Isn't Prepared to Complete Purchase" (9-26-07)

"Fremont General Corp., the California thrift ordered in March to stop making home loans, said billionaire banker Gerald J. Ford doesn't want to proceed with a rescue plan. The shares fell 20 percent."

Bloomberg - "House Panel Passes Tax Rise on Vacation-Home Sales" (9-26-07)

"The House Ways and Means Committee, seeking revenue to help homeowners in foreclosure, unanimously approved higher taxes on the sale of vacation homes. The panel adopted a Democrat-drafted provision that would make it harder for people who sell their second homes to exclude as much as $500,000 in profit from capital-gains taxes. The provision would raise $2 billion in additional taxes over the next decade, according to an estimate by the congressional Joint Committee on Taxation."

CNN - "Housing: Big-ticket vs. Big value" (9-26-07)

"What's the difference between living in Beverly Hills and Killeen, Texas? About $2 million, according to a new survey. Beverly Hills, Calif. topped Coldwell Banker's annual Home Price Comparison Index (HPCI), as the nation's most expensive housing market for the second year in a row with an average cost of $2.21 million for a house. About 1,400 miles away, Killeen came in as the most affordable market in the index with an average sale price of $136,725."

Orange County Register - "O.C. high-rise boom fizzles" (9-26-07)

"At one time, developers envisioned nearly 50 residential high-rises towering above the Orange County landscape, citing an appetite here to live in skyscrapers like New Yorkers. The first development took off in 2004, selling out while it was little more than a hole in the ground. Other developers soon announced about 20 more projects with four dozen towers ranging from eight to 35 floors high."

Orange County Register - "Reports: Home sales still weak in O.C., nationwide" (9-26-07)

"Sales of existing Orange County houses fell 20.5 percent in August from the same month a year ago, the California Association of Realtors reported. Statewide, home sales decreased 27.8 percent in August. Closed escrow sales of existing, single-family detached homes in California totaled 319,200 in August at a seasonally adjusted annualized rate, CAR reported. That compares with the 442,150 sales pace recorded in August 2006."

Tuesday, September 25, 2007

Bloomberg - "Subprime Panic Freezes $40 Billion of Canadian Commercial Paper " (9-25-07)

"The Canadian cash crunch that started with defaults on subprime mortgages in Southern California and Florida has hurt more than 25 companies that invested in commercial paper, including Sun-Times Media Group Inc. and Canada Post, the nation's mail service. Baffinland has 95 percent of its cash in Canadian commercial paper, debt that is due in 364 days or less. "

NAR - "August Existing-Home Sales Fall on Temporary Mortgage Problems" (9-25-07)

"Existing-home sales fell in August when mortgage availability problems were peaking, according to the National Association of Realtors®. Total existing-home sales – including single-family, townhomes, condominiums and co-ops – were down 4.3 percent to a seasonally adjusted annual rate1 of 5.50 million units in August from a level of 5.75 million in July, and are 12.8 percent below the 6.31 million-unit pace in August 2006. "

CAR - "C.A.R. reports sales decrease 27.8 percent in August, entry-level median home price falls 5. 1 percent" (9-25-07)

"Home sales decreased 27.8 percent in August in California compared with the same period a year ago, while the median price of an existing home increased 2 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today."

Yahoo - "Lennar post big loss on housing woes" (9-25-07)

"Builder Lennar Corp (NYSE:LEN - News), the No. 2 U.S. home builder, on Tuesday reported its worst-ever quarterly results as the crumbling housing market led to a much wider-than-expected loss, sending its shares to a five-year low."

MSN - "Lost your home? You may owe IRS" (9-25-07)

"If you thought a foreclosure ended the financial miseries associated with your former home, think again. You soon could be hearing from the IRS about taxes due in connection with the residence you no longer own."

Mortgage Bankers Association - "Edgar A.G. Bright, III, CMB Testifies on Mortgage Industry Response and Lessons Learned After Gulf Hurricanes" (9-25-07)

"The mortgage industry created a working group made up of lenders, servicers and their trade associations to help work on public and private sector problems and solutions. An industry practice was established that forbearance in the worst-impacted areas should continue and be re-visited every 90 days. This was a watershed event and it helped avoid mass foreclosures. "

CNN - "Lennar's loss bigger than expected" (9-25-07)

" In a further sign of trouble for the battered housing and homebuilding markets, Lennar posted a much bigger-than-expected loss Tuesday for its fiscal third quarter, saying it has already slashed staff and plans further cuts."

Bloomberg - "S&P/Case-Shiller Home Price Index Falls 3.9% in July" (9-25-07)

"Home prices in 20 U.S. metropolitan areas fell the most on record in July, indicating the threat to consumer spending was rising even before credit markets seized up in August, a private survey showed today."

Bloomberg - "U.S. Consumer Confidence Declines More Than Forecast" (9-25-07)

"Consumer confidence fell more than forecast in September to the lowest level in almost two years, as declining home values, a deteriorating labor market and tougher borrowing standards took a toll on Americans' spirits."

Los Angeles Times - "Sun-powered homes defy a cool housing market" (9-25-07)

"With foreclosures rising and home prices diving, there is a bright spot in California's residential real estate market: Solar-powered homes are starting to outsell traditionally electrified new homes in several markets, and developers are stepping up their use of the technology."

Real Estate Journal - "Auctions Gain TractionAs Housing Market Lags" (9-25-07)

"The excess inventory of condos is creating an ultimate buyer's market in areas of Florida. So this fall, Ben Anderson is taking a different tactic to finding buyers for some of these lonely units languishing on the market without many nibbles: He's organizing an auction."

Monday, September 24, 2007

St. Petersburg Times - "Rate cut helps; What's next" (9-22-07)

"Nobody's about to dismiss lower interest rates as an aid to a wavering economy. But the Federal Reserve's decision this week to cut the short-term federal funds rate more sharply than expected to 4.75 from 5.25 percent was met with some decidedly mixed views in a sampling of Tampa Bay businesses and borrowers by Times business reporters. The bottom line: A rate cut can help but the economy - especially the tighter availability of credit - has plenty of other challenges before it."

Friday, September 21, 2007

Orlando Sentinel - "Foreclosures and the art of the short sale" (9-21-07)

"Robert Orsolits is a guy you want to be nice to. Especially if you're one of the thousands of local homeowners failing to make your monthly mortgage payment. Orsolits is the president of Bank Owned Services, a foreclosure and bank-owned asset and real estate management company."

Bloomberg - "HSBC to Close U.S. Subprime Mortgage Unit, Cut Jobs" (9-21-07)

"HSBC Holdings Plc, Europe's biggest bank, said it will close its Decision One subprime mortgage unit in the U.S., eliminating 750 jobs. Employees in Fort Mill, South Carolina, Phoenix and Charlotte, North Carolina, will be affected, London-based HSBC said in a statement today."

Orlando Sentinel - "Will housing bubble rise again?" (9-21-07)

"Downtown Orlando developer Cameron Kuhn, who built a portfolio worth more than $100 million just as the nation's housing bubble was inflating and peaking, said Thursday he expects another bubble before the market stalls and falls again."

The San Diego Union Tribune - "Portfolios of Fannie, Freddie, may grow" (9-21-07)

"The Bush administration, bracing for a tidal wave of home foreclosures by people with subprime mortgages, is softening its opposition to Democratic proposals to expand the giant government-sponsored mortgage finance companies. In a chilling assessment yesterday, Housing and Urban Development Secretary Alphonso Jackson told the House Financial Services Committee that about 500,000 homeowners – one-quarter of the 2 million who have subprime mortgages scheduled to reset to higher interest rates over the next 18 months – were likely to lose their houses."

Real Estate Journal - "Bush Wants to Expand Mortgage Disclosures" (9-21-07)

"As President Bush seeks ways to respond to the subprime-mortgage meltdown, his administration is readying a plan that would help borrowers better understand the costs and fees associated with buying a home. The twist: It proposed and shelved a similar plan three years ago."

Bloomberg - "Ross to Buy American Home Unit, Expand in Mortgages" (9-21-07)

"Wilbur L. Ross Jr., who became a billionaire by investing in bankrupt steel companies, offered to pay at least $435 million for a unit of American Home Mortgage Investment Corp. and said he plans to 'get into all aspects of the mortgage industry.' Ross formed AH Mortgage Acquisition Co. to buy the servicing unit of bankrupt American Home that collects payments and maintains escrow accounts for about $57 billion in home loans. To complete the purchase, he must first win a court-sanctioned auction for the unit next month."

Thursday, September 20, 2007

NAHB - "Builder Confidence In Condo Market Drops To Lowest Level In Five Years" (9-20-07)

"Despite reporting increased traffic by prospective buyers, inium builders and developers are extremely concerned about the current conditions in the condo market, according to the latest results of the Multifamily Condo Market Index (MCMI), released today by the National Association of Home Builders (NAHB). The index lost 14 points in the second quarter of this year to stand at 18, which is 14 points lower than it was a year ago—and its lowest level since NAHB created the index five years ago."

Mortgage Bankers Association - "Commercial/Multifamily Debt Outstanding Grows in Second Quarter, Now Exceeds $3.1 Trillion" (9-20-07)

"The level of commercial/multifamily mortgage debt outstanding grew by 3.4 percent in the second quarter, exceeding $3.1 trillion, according to the Mortgage Bankers Association (MBA) analysis of the Federal Reserve Board Flow of Funds data. The $3.121 trillion in commercial/multifamily mortgage debt outstanding recorded by the Federal Reserve was an increase of $103.8 billion from the first quarter 2007. Multifamily mortgage debt outstanding grew to $778 billion, an increase of $16.1 billion or 2.1 percent from the first quarter."

Yahoo - "Bear Stearns 3Q Profit Falls 62 Percent" (9-20-07)

"Bear Stearns Cos. said Thursday its profit plunged 62 percent in the third quarter as turbulence in the debt market and wrong-way bets on mortgages crunched the investment bank's credit portfolio and bond business."

MSN - "Are we headed for an epic bear market?" (9-20-07)

"Satyajit Das is laughing. It appears I have said something very funny, but I have no idea what it was. My only clue is that the laugh sounds somewhat pitying. One of the world's leading experts on credit derivatives, Das is the author of a 4,200-page reference work on the subject, among a half-dozen other tomes. As a developer and marketer of the exotic instruments himself over the past 30 years. He seemed like the ideal industry insider to help us get to the bottom of the recent debt crunch -- and I expected him to defend and explain the practice."

The San Diego Union Tribune - "Prices, home building both slide in August" (9-20-07)

"Consumer prices posted a rare decline in August, while the battered housing industry saw construction fall to the slowest pace in 12 years. The new economic reports yesterday were seen as justification for the Federal Reserve's bolder-than-expected cut in interest rates to try to ward off a recession. Analysts said the waning inflation pressures gave the Fed the room to cut interest rates while the continued severe downturn in housing gave the central bank a reason to move."

CNN - "Falling home prices hurt borrowers, neighbors" (9-20-07)

"If home prices fall as forecast, the $23 trillion housing market could lose $3 trillion in value by August 2008, a leading housing economist and former mortgage bank president told lawmakers on Wednesday. Between 1998 and early 2006, when housing prices peaked, home values rose 86 percent on an inflation-adjusted basis, Robert Shiller, a professor of economics at Yale University, said at a hearing about the subprime crisis held by Congress's Joint Economic Committee."

Market Watch - "Could a run on a bank happen in the U.S.?" (9-20-07)

"It seems like only a few weeks ago that bankers and financial gurus around the world were confidently predicting that the subprime mortgage mess in the U.S. was a local problem that would not affect the global markets."

Los Angeles Times - "Holiday sales to grow 4%, trade group predicts" (9-20-07)

"Holiday sales are expected to grow at the slowest pace in five years as shoppers worry about jobs, tight credit and slumping home prices, according to a forecast from the world's largest retail trade group. That could mean lower prices and big pre-Thanksgiving sales blitzes as merchants compete for a piece of the holiday budget."

Wednesday, September 19, 2007

Bloomberg - "Fannie Mae, Freddie Mac Regulator Eases Asset Limits" (9-19-07)

"The Bush administration reversed policy, allowing Fannie Mae and Freddie Mac, the two largest sources of money for U.S. home loans, to expand their investments in an effort to make mortgages easier to get. The Office of Federal Housing Enterprise Oversight will permit Washington-based Fannie Mae and Freddie Mac to boost their loan portfolios by about 2 percent a year beyond a cap of about $1.5 trillion. Just two days ago, Federal Reserve Chairman Ben S. Bernanke in a letter to Representative Barney Frank said easing restrictions on the companies could prove to be 'ill-advised.'"

Bloomberg - "U.S. Economy: Homebuilding, Consumer Prices Decline" (9-19-07)

"U.S. home starts fell still more last month and consumer prices unexpectedly dropped, validating the Federal Reserve's interest-rate cut to head off a further slowdown in the economy. The August housing figure points to a greater risk of recession from the downturn in residential real estate caused by increases in credit costs. As inflation recedes, Chairman Ben S. Bernanke will have room for more rate reductions after the half- point move yesterday, economists said. The Fed cited the 'potential' for broader damage to the economy in justifying the first cut since 2003."

Bloomberg - "Subprime Borrowers to Lose Homes at Record Pace as Rates Rise" (9-19-07)

"As many as half of the 450,000 subprime borrowers whose mortgage payments increase in the next three months may lose their homes because they can't sell, refinance or qualify for help from the U.S. government. 'Short of the cavalry riding in over the hill, a lot of these people are just stuck,' said Christopher Cagan, director of research and analytics at Santa Ana, California-based First American CoreLogic, the risk management unit of the biggest U.S. title insurer."

NAHB - "Builder Confidence In Rental Apartment Market Slips In Second Quarter 2007" (9-19-07)

"Builder confidence in current rental apartment market conditions dipped in the second quarter of 2007, amid concerns that an excess supply in the for-sale market is creating a shadow inventory of available rentals, according to the latest results of the National Association of Home Builders’ (NAHB) Multifamily Rental Market Index (MRMI), released today."

NAR - "Senate Moves FHA Reform Legislation to Help Homeowners" (9-19-07)

"The National Association of REALTORS® commended Senate Banking Chairman Christopher Dodd, D-Conn., Sen. Mel Martinez, R-Fla., and Sen. Richard Shelby, R-Ala., for their demonstrated leadership in protecting the interests of America’s current and future homeowners by passing FHA reform legislation today."

NAHB - "Housing Starts Fall 2.6 Percent in August" (9-19-07)

"Housing starts fell 2.6 percent in August to a seasonally adjusted annual rate of 1.331 million units as the downswing in the housing market continued, according to figures released by the Commerce Department today. Starts were down 19.1 percent from a year earlier, falling to the lowest level in 12 years."

CBIA - "July New Home Sales Fall 27.8% From Year Ago, CBIA Announces" (9-19-07)

"New home sales in July at California new-home communities continued to lag behind last year’s pace, the California Building Industry Association reported today. The monthly CBIA/Hanley Wood Market Intelligence New Home Sales and Pricing Report showed that new home sales in July were 27.8 percent below July 2006, continuing a trend of decline. For the month, 4,990 homes and condominiums were sold in the subdivisions tracked by Costa Mesa-based HWMI, compared to 6,915 in July 2006. Sales of single-family homes dropped by 20 percent, sales of townhomes and 'plexes' – duplexes, triplexes, etc. – were down 44 percent and sales of condominiums were down 40 percent."

Mortgage Bankers Association - "Mortgage Applications Increase In Latest MBA Weekly Survey" (9-19-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending September 14, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 673.2, an increase of 2.4 percent on a seasonally adjusted basis from 657.4 one week earlier, which was a holiday shortened week. On an unadjusted basis, the Index increased 26.6 percent compared with the previous week and was up 12.8 percent compared with the same week one year earlier."

CNN - "Subprime layoffs head for record" (9-19-07)

"If the banking industry, with its load of worries caused by the subprime meltdown, has another month like it did in August, it will be in record territory for job losses. Last month, banks with ties to the subprime mortgage industry laid off more than 26,000 employees, the most of any month since global outplacement consultancy Challenger, Gray & Christmas began keeping such records in 1993."

Yahoo - "Congress Asked to Lift Debt Ceiling" (9-19-07)

"Treasury Secretary Henry Paulson told Congress on Wednesday that the federal government will hit the current debt ceiling on Oct. 1. He urged quick action to increase the limit, saying it was essential to protect the 'full faith and credit' of the country, especially at a time of financial market turmoil. The current debt limit is $8.965 trillion. Unless Congress votes to raise that ceiling, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due. The United States has never defaulted on a debt payment but the decision on whether to raise the debt ceiling often sparks a prolonged political battle in Congress."

Market Watch - "Fannie, Freddie can't do what they should" (9-19-07)

"Unless someone finds a way to bring more money -- responsible money -- into the mortgage business, the housing slump will worsen and make a recession more likely."

Tuesday, September 18, 2007

NAR - "Solid Fundamentals Support Commercial Real Estate" (9-18-07)

"Most commercial real estate markets are enjoying relatively low vacancy rates and healthy rent growth from a fundamentally sound economy, according to the latest COMMERCIAL REAL ESTATE OUTLOOK of the National Association of Realtors®. NAR Senior Economist Lawrence Yun said, 'Commercial real estate responds to economic growth and job creation, which have been fairly strong over the past two years and have created the need for additional commercial space,' he said. 'These fundamentals will continue to support commercial real estate markets in 2008. There has not been much overbuilding in the commercial sectors, and investors are more diverse.'"

NAHB - "Federal Home Loan Bank Of Des Moines Boosts Housing Credit Liquidity" (9-18-07)

"The National Association of Home Builders (NAHB) today applauded the successful efforts of the Federal Home Loan Bank of Des Moines to include single family construction loans as eligible collateral for member loans. The Des Moines Bank received approval from its regulator, the Federal Housing Finance Board, on September 10 to accept one-to-four family construction loans as part of a basket of other real estate collateral that may back the Bank’s secured lending (called advances) to member financial institutions in its district, which includes Iowa, Minnesota, Missouri, North Dakota and South Dakota."

NAHB - "Builder Confidence Continues Downward In September" (9-18-07)

"Concerns about the substantial inventory of new homes for sale and the effects that deepening mortgage market problems are having on buyer demand caused builder confidence to decline for a seventh consecutive month in September, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The HMI dropped two points to 20, tying its record low reached in January of 1991 (the series began in January 1985)."

Hartford Business - "In credit crunch, location matters" (9-18-07)

"You've heard about how the credit crunch has made it harder for many types of buyers to afford a home or qualify for a mortgage. First-time buyers. Those moving up to larger homes. Buyers with marred credit or little cash for down payments. Those in pricey areas who need "jumbo" loans exceeding $417,000."

Reuters - "Accredited Home posts big loss; survival in doubt" (9-18-07)

"Accredited Home Lenders Holding Co (LEND.O: Quote, Profile, Research), a struggling subprime mortgage lender, on Tuesday posted a $260.2 million quarterly loss and said it remained unsure it would survive the fallout from a slumping U.S. housing market. The loss was $10.29 per share for the quarter that ended March 31, according to a delayed first-quarter report filed with the U.S. Securities and Exchange Commission. That compared with a profit of $35.8 million, or $1.61 per share, a year earlier."

Reuters - "Impac slashes mortgage lending, scraps dividend" (9-18-07)

"Impac Mortgage Holdings Inc (IMH.N: Quote, Profile, Research), a struggling mortgage lender, said on Tuesday it will quit substantially all of its mortgage lending operations and has fired 144 workers, citing market disruptions and illiquidity. The company said it will stop making 'Alt-A' home loans, long its main business. Such loans go to people who don't qualify for prime loans, often because they cannot fully document income or assets. Impac also said it is quitting warehouse lending and commercial lending. It plans to keep some facilities related to a recent acquisition."

CNN - "House eyes changes at housing agency" (9-18-07)

"House lawmakers are planning to vote Tuesday on an overhaul of a federal agency that insures mortgages against default in an effort to help struggling homeowners avoid foreclosure. The plan of leading House Democrats to expand the role of the Federal Housing Administration goes further than the Bush administration's plan to ease some of the mortgage market troubles that have rattled the economy."

Yahoo - "Fed Cuts Interest Rate by Half Point" (9-18-07)

"The Federal Reserve cut a key interest rate for the first time in four years, starting with an aggressive half-point move to prevent a steep housing slump and turbulent financial markets from triggering a recession. The action triggered a huge rally on Wall Street. The Fed announced Tuesday that it was reducing its target for the federal funds rate, the interest that banks charge each other, from 5.25 percent to 4.75 percent."

Los Angeles Times - "Cal. foreclosures spike 48% from July" (9-18-07)

"RealtyTrac reports a big spike in foreclosure activity from July to August -- filings were up 36% from July nationally, and 48% in California. Those month-to-month gains are staggeringly high."

Real Estate Journal - "Family Makes Decision To Sell Rental Home" (9-18-07)

"In recent months my family's life has started to burst at the seams. My 10-year-old son has two 90-minute soccer practices a week, multiple soccer games on weekends, and a lot more homework now that he's in fifth grade. My 4-year-old daughter has started dance classes. My wife, Amy, is increasingly busy at work as an administrator for a new medical center that's growing quickly. I've taken on a book project, I'm rewriting another author's book, and Amy and I are now doing a weekly Love & Money video."

Monday, September 17, 2007

Bloomberg - "Frank May Win `Tougher Than Expected' Subprime-Lending Limits" (9-17-07)

"U.S. Representative Barney Frank, whose efforts to clamp down on mortgage-lending abuses were thwarted by the last Republican Congress, is about to try again. He should have better luck this time. Frank, the Massachusetts Democrat who heads the House Financial Services Committee, will soon introduce legislation aimed at shielding consumers from deceptive practices. His proposals follow those already floated by his Senate counterpart, Banking Committee Chairman Christopher Dodd, and President George W. Bush."

CNN - "Caught in a toxic mortgage" (9-17-07)

"It seems surprising that Kurt and Vicki Oliver could lose their home to a bank foreclosure. They had great credit, long-term employment and excellent assets and income. But their main problem wasn't a usual symptom of troubled borrowers: job loss, divorce, personal problems or health reasons. Instead, they say, it was a bad mortgage from a fast-talking broker."

Bloomberg - "Greenspan's Miscues Haunt Bernanke as Fed Weighs Cut" (9-17-07)

"Federal Reserve Chairman Ben S. Bernanke is grappling with what predecessor Alan Greenspan might call a conundrum. At issue is whether today's U.S. economy most resembles 1998, when Greenspan may have been too eager to cut interest rates, or 2000-2001, when he may have been too slow. The trouble is, the situation now resembles a bit of both."

NAHB - "FHA Reform Bill Would Expand Mortgage Financing Options And Address Subprime Crisis" (9-17-07)

"The National Association of Home Builders (NAHB) today called on the U.S. House of Representatives to approve legislation this week that would allow the Federal Housing Administration to insure more home loans and address problems in the subprime mortgage market. Underscoring the importance of this issue to the housing community, NAHB sent a letter to every House member urging them to support H.R. 1852, the Expanding American Homeownership Act of 2007, when the bill goes to the House floor later this week."

CNBC - "Greenspan: Fed Couldn't Stop Housing Bubble" (9-17-07)

"The Federal Reserve tried to curb the explosive growth in the U.S. housing sector under Alan Greenspan's tenure, but each time it tried to raise long-term interest rates it failed, the former Fed chief said. 'In 2004 we tried to raise mortgage rates by moving the 10-year Treasury note up and we failed,' Greenspan told CNBC, adding that the Fed failed again in 2005 and would have failed had it tried in 2002."

DQNews - "
California August 2007 Home Sales" (9-17-07)

"A total of 33,429 new and resale houses and condos were sold statewide last month. That's down 5.0 percent from 35,185 for July, and down 34.5 percent from 51,054 for August 2006. Last month's sales made for the slowest August since 1992 when 29,764 homes were sold. August sales from 1988 to 2007 range from the 29,764 in 1992 to 73,285 in 2005. The average is 50,524. On a year-over-year basis, sales have declined the last 23 months." - "Clean-up specialists capitalize on forclosures" (9-16-07)

"As the housing market sinks deeper into the biggest slowdown that local real-estate brokers can remember, the few agents who specialize in foreclosures are hopping busy. Kevin Moran, an agent with Coldwell Banker Grupe of Stockton, was involved in some foreclosure deals in the mid-'90s real-estate downturn brought on by a statewide recession, but he's in it exclusively this round because he sees much bigger opportunities."

The Signal - "Housing Inventory Growing in SCV" (9-16-07)

"As most of Southern California faces steep declines in home sales and prices, the buyers and sellers of Santa Clarita see a similar market as the current inventory of houses on the market almost triples the number of listed homes that are actually sold last month, according to Remax Realtor Pam Ingram. Even though this is the worst real estate market Southern California communities have seen in 15 years, Ingram said Santa Clarita is not being hit as hard as other areas, like Orange County."

MSN - "Greenspan alert on US house prices" (9-16-07)

"US house prices are likely to fall significantly from their present levels, Alan Greenspan has told the Financial Times, admitting that there was a bubble in the US housing market. In an interview ahead of the release on Monday of his widely-anticipated memoirs, the former chairman of the Federal Reserve said the decline in house prices 'is going to be larger than most people expect'."

Los Angeles Times - "
Selling a home without an agent comes with risks, rewards" (9-16-07)

"Zillow estimated his home's worth at $1.4 million. But Grant, who was planning to sell his home when he retired in two years, decided to have some fun. So he posted a notice on the site saying he would gladly hand over the keys to anyone willing to pay him $1.6 million for his 4,500-square-foot abode. Two days later, after receiving an e-mail from a would-be buyer and giving a showing, his house was in escrow for his asking price." - "Sales drop to lowest level since 1990s downturn" (9-15-07)

"August was a very cold month, at least in the home-sales market. The last time the median sales price of an existing Stockton home crossed the $300,000 mark - in November 2004 - it was a major landmark in a long-running boom market. Last month, the sales price crossed $300,000 again, but this time, on the way down." - "Would Fed rate cut help?" (9-15-07)

"The Federal Reserve is widely expected to cut its benchmark interest rate Tuesday for the first change since June last year. Given what's roiling Wall Street, however, it might prove akin to offering a Band-Aid to stop a stomachache. In recent speeches, Fed governors have all but confirmed that a cut is coming from the Federal Open Market Committee, the Fed's policymaking group."

Friday, September 14, 2007

Mortgage Bankers Association - "FTC Warns Mortgage Advertisers and Media That Ads May Be Deceptive" (9-14-07)

"The Federal Trade Commission is warning mortgage brokers and lenders, and media outlets that carry their advertisements for home mortgages, that some of the advertising claims currently appearing in Web sites, newspapers, magazines, direct mail, and unsolicited e-mail and faxes may violate federal law."

Bloomberg - "Merrill Says Fair Value Adjustments Made for Subprime" (9-14-07)

"Merrill Lynch & Co., the biggest underwriter of collateralized debt obligations, signaled that the subprime-mortgage crisis may hurt third-quarter earnings. The New York-based firm said in a regulatory filing today that it made 'fair value adjustments' for potential losses to date on unspecified holdings and financing commitments. Merrill fell 49 cents to $74.65 as of 4:26 p.m. in composite trading on the New York Stock Exchange, making it the day's second-biggest decliner on the 12-member Amex Securities Broker/Dealer Index."

CNN - "Trapped by the mortgage meltdown" (9-14-07)

"Whether you're a home seller, owner or buyer, by this point you've got to be feeling a little rattled. The bad news about the housing market seems never ending: Foreclosures have more than doubled over the past year. Sales of existing homes are off 11 percent from this time last year. At that rate, it will take at least nine months to work off the inventory of unsold homes. And median home prices in July (the most recent figure available) dropped for the 12th month in a row."

CNN - "Fed rate cut no rescue for mortgage biz" (9-14-07)

"A Friedman Billings Ramsey analyst said Friday any benefit stocks of mortgage lenders will enjoy if the Federal Reserve cuts its interests rates this month will be temporary. At first, stocks in the home lending sector will jump on a rate cut, Friedman Billings Ramsey (Charts) analyst Paul J. Miller Jr. wrote in a report. But the rally will be short-lived, he said, and the reality of the industry's struggles will drag the stocks back down within a few months."

Bloomberg - "Hovnanian Chief Says Housing Bottom Is `Very Near'" (9-14-07)

"Hovnanian Enterprises Inc. Chief Executive Officer Ara Hovnanian said the U.S. housing market is near the bottom and won't recover until 2009. The shares rose 9.7 percent. Hovnanian, whose family has been building homes since 1959, said a three-day sale starting today may help boost revenue in the company's slowest markets, including California and Florida. The builder, based in Red Bank, New Jersey, hopes to sell 1,000 homes this weekend, Hovnanian said in an interview."

Los Angeles Times - "Bay Area home sales tumble 25% in August" (9-14-07)

"San Francisco Bay Area house and condominium sales fell 25% last month to the lowest for an August in 15 years as stricter loan standards pushed some buyers out of the market, DataQuick Information Systems said Thursday. A total of 7,299 new and existing single-family homes and condominiums were sold in San Francisco, Santa Clara, Alameda and six other Northern California counties last month, down from 9,713 a year earlier, DataQuick said. Last month's sales count was the lowest for an August since 1992, when 6,688 homes changed owners."

Los Angeles Times - "Selling a home without an agent comes with risks, rewards" (9-14-07)

"On a lark last spring, Ronald Grant decided to "list" his South Pasadena house for sale on the popular real estate valuation website Zillow estimated his home's worth at $1.4 million. But Grant, who was planning to sell his home when he retired in two years, decided to have some fun. So he posted a notice on the site saying he would gladly hand over the keys to anyone willing to pay him $1.6 million for his 4,500-square-foot abode."

Real Estate Journal - "Home-Loan Report Portends More Mortgage Pain" (9-14-07)

"An analysis of federal data on nearly 14 million U.S. home loans made last year portends more misery for subprime borrowers, lenders and investors, as existing loans are pressured by falling home prices and lenders put tougher underwriting standards in place. The study by the Federal Reserve, based on data collected each year under the Home Mortgage Disclosure Act, found that the percentage of U.S. mortgages carrying high interest rates (generally, subprime loans) climbed to about 29% last year from 26% in 2005."

Thursday, September 13, 2007

Bloomberg - "Goldman's Global Alpha Fund Fell 22 Percent in August" (9-13-07)

"Goldman Sachs Group Inc.'s Global Alpha hedge fund fell 22.5 percent in August, its biggest monthly decline, on losses from currency and stock trades. The fund, managed by Mark Carhart and Raymond Iwanowski, lost a third of its value in 2007, according to an update sent to investors. Investors last month notified New York-based Goldman, the most profitable securities firm, that they plan to withdraw $1.6 billion, or almost a fifth of the fund's assets as of July 31."

Bloomberg - "Ease Money-Market Crisis by Letting Banks Go Bust" (9-13-07)

"'A further important cause for alarm was the danger that the troubles, if not solved, would be transmitted through a domino effect to the many other secondary banks which, with much vulnerable short-term borrowing and many assets tied up in the increasingly troubled property industry, were themselves showing signs of being at risk in the harsher new economic environment.' Sounds like an apt, if somewhat wordy, description of the current money-market crisis prompted by the collapse of the U.S. subprime mortgage market, doesn't it?"

The San Diego Union Tribune - "Housing decline continues" (9-13-07)

"San Diego County housing prices continued their slide in August as home sales dropped to a 15-year low, DataQuick Information Systems reported yesterday. The market's decline, a 4 percent drop in price from August 2006 to a median of $475,000, was propelled by relatively strong sales of lower-priced condominiums pushing down the overall median, DataQuick said."

Yahoo - "Greenspan says didn't see subprime storm brewing" (9-13-07)

"Former Federal Reserve Chairman Alan Greenspan said he was late to see the storm gathering around mortgage lending practices and commended his successor Ben Bernanke's handling of the crisis, saying he would likely be responding in a similar fashion"

Ventura County Star - "Foreclosure sales up 784% in 2007" (9-13-07)

"Anyone wondering just how many Ventura County properties are being lost in the battered real estate market need only look at the foreclosure sales from the first half of 2007. With 548 tallied through the second quarter, foreclosure sales have increased 784 percent compared with 62 in the first half of 2006."

Bloomberg - "San Francisco Area House, Condo Sales Drop 25 Percent" (9-13-07)

"San Francisco Bay Area house and condominium sales fell 25 percent last month to the lowest for an August in 15 years as stricter loan standards pushed some buyers out of the market, DataQuick Information Systems said. A total of 7,299 new and existing single-family homes and condominiums were sold in San Francisco, Santa Clara, Alameda and six other Northern California counties last month, down from 9,713 a year earlier, La Jolla, California-based DataQuick said today in a statement. Last month's sales count was the lowest for an August since 1992, when 6,688 homes changed owners."

The San Diego Union Tribune - "Foreclosures reach record high in S.D." (9-13-07)

"San Diego's distressed-property market grew substantially larger last month as mortgage defaults topped the 2,000 mark for the first time and foreclosures hit a record that was more than six times what they were a year ago. DataQuick Information Systems said notices of defaults, the first step leading to foreclosure, numbered 2,071 in August. That was up from 1,573 in July and more than twice the number recorded last year, 794. The previous record was 1,596 in June. DataQuick's figures go back to 1988."

Orange County Register - "O.C. home sales stay depressed" (9-13-07)

"The O.C. home sales slump deepened in August with just 2,285 residences sold, down 33.9 percent from a year ago, DataQuick said Wednesday. It was the 23rd straight month of year-over-year declines, the longest such stretch in the 20 years that DataQuick has been compiling local housing statistics. It also was the slowest August on record and the 11th worst of any month in the database."

Real Estate Journal - "Size of New Homes Shrink As Builders Battle Housing Slump" (9-13-07)

"With the nation's housing market in a slump and the mortgage market in disarray, many home builders are putting up fewer supersize homes and offering smaller floor plans. That seems to be what buyers suddenly want in an era of high prices and tougher financing."

Los Angeles Times - "Last-minute bill boosts Anschutz's L.A. project" (9-13-07)

"Legislation approved in a post-midnight rush has positioned Anschutz Entertainment Group, a major political contributor and owner of Staples Center, to tap millions of dollars in state funds to spruce up the area near the downtown arena and the company's $2.5-billion L.A. Live development. The bill's approval early Wednesday, only a few hours before the Legislature adjourned for the year, angered several lawmakers and advocates of affordable housing, including some who called for Gov. Arnold Schwarzenegger to veto it."

Wednesday, September 12, 2007

NAR - "Mortgage Problems to Dampen Home Sales in The Short Term" (9-11-07)

"Tighter credit for home mortgages will measurably dampen home sales in the short term and postpone an expected recovery for existing-home sales until 2008, according to the latest forecast by the National Association of Realtors®. Lawrence Yun, NAR senior economist, said unusual disruptions in the mortgage market are dampening the outlook for home sales, notably for August and September."

The Washington Post - "Mortgage Mess Unleashes Chain Of Lawsuits" (9-11-07)

"When something goes badly on Wall Street, people wind up in court. And the subprime mortgage mess is no exception. A consortium of investors is going after the collapsed Bear Stearns hedge funds. Home buyers, shareholders and investment banks have filed suits against more than a dozen mortgage lenders. A working group at the Securities and Exchange Commission is examining accounting and disclosure issues, as well as stock sales earlier this year by executives at companies that since have been ensnared by the subprime mess."

Bloomberg - "Countrywide Shares Fall on Report Lender Needs Cash" (9-11-07)

"Countrywide Financial Corp., the biggest U.S. mortgage lender, fell almost 2 percent on the New York Stock Exchange after the New York Post said the company is negotiating a second multibillion-dollar bailout. Goldman Sachs Group Inc., the world's biggest investment bank, and the New York-based law firm Wachtell Lipton Rosen & Katz are helping arrange a cash infusion similar to the $2 billion package Bank of America Corp. provided last month, the newspaper said, citing people familiar with the Calabasas, California-based company."

Bloomberg - "Realtors Cut Forecast, Say Slump Will Extend to 2008" (9-11-07)

"The National Association of Realtors reduced its home sales forecast for the ninth time this year and said the housing slump will extend into 2008. Existing home sales will fall 8.6 percent in 2007, exceeding the 6.8 percent drop estimated a month ago. New-home sales probably will decline 24 percent on top of an 18 percent fall in 2006, the Chicago-based trade group for 1.3 million real estate brokers said today in a statement."

Bloomberg - "Retirement Funds Vanish as Bankruptcies Hit Tax-Deferred Scheme" (9-11-07)

"Marsha Slotten's bad news came in April by e-mail, from a tipster warning that the company holding her retirement nest egg had collapsed. After racing in a panic to the office of Southwest Exchange Inc. outside Las Vegas, she found a locked door and a sign saying the staff was 'in training.' It never reopened."

Yahoo - "Home Buyers on the Fence" (9-11-07)

"I recently wrote about how the mortgage crunch is playing out among homeowners in my area. In response, some readers wanted to know if they should buy a home now or wait in case prices fall lower. It's not a decision to be taken lightly. Prospective homebuyers who aren't likely to be in their homes long enough to weather the downturn could end up 'under water' -- owing more on a mortgage than a home's market value."

CNN - "Realtors: Home price slump through '08" (9-11-07)

"Home values and housing sales will take an even bigger hit than previously forecast and will not recover to their earlier levels throughout all of 2008, at least, according to the latest economic outlook from the National Association of Realtors released Tuesday. While the trade group sees gains in prices in 2008 from the current weak levels, it projects that the median existing home price will be $224,600 in the fourth quarter of next year. That would still put the price slightly below the record price reading of $225,000 in the third quarter of last year."

Yahoo - "Realtors Predict Drop in 2007 Home Sales" (9-11-07)

"A trade group for real estate agents on Tuesday lowered its forecast of 2007 existing home sales for the seventh straight month, predicting a drop of 8.6 percent from last year. The National Association of Realtors' revised monthly prediction calls for U.S. existing home sales of 5.92 million in 2007, down from 6.48 million last year. The forecast was below last month's prediction of a 6.8 percent drop."

CNBC - "Want to Refinance? Think Again, Brokers Say" (9-11-07)

"Some 57 percent of mortgage broker customers were unable to refinance their adjustable-rate loans to avoid higher monthly payments in August, suggesting the U.S. housing slump may worsen, according to a national survey on Tuesday. Subprime borrowers had trouble refinancing mortgages because loan programs were no longer available, according to a poll of 1,744 brokers in the last week of August by Campbell Communications, a Washington-based research firm. Prime borrowers were impeded by appraisals and high loan-to-value ratios, it said."

SmartMoney - "Regulators, Investors at Odds on Mortgages" (9-11-07)

"Regulators want banks to help subprime mortgage borrowers avert disaster by easing their loan terms, but for bond investors, the cure may not be better than the disease. Changing the terms of these home loans - which are made to risky borrowers with poor credit profiles - after they have been packaged into bonds leaves investors scrambling to adjust to new terms they hadn't expected at the outset. That type of uncertainty, the concern is, could make an already unpopular asset class even more unpopular."

Monday, September 10, 2007

Bloomberg - "Debt Market in `Pivotal' Test as $140 Billion Matures" (9-10-07)

"Corporations need to refinance almost $140 billion of commercial paper in Europe by the end of next week and will increase borrowing costs for companies, according to Deutsche Bank AG, Germany's biggest bank. 'This could be a pivotal seven to 10 days,' Jim Reid, a credit strategist at Deutsche Bank in London, wrote in a note to investors today. 'This will inevitably lead to wider corporate spreads, especially in high yield.'"

Bloomberg - "Global Growth Threatened as U.S. Contagion Spreads" (9-10-07)

"This time, when the U.S. sneezes, the rest of the world may well catch a cold. Global economic growth looks likely to slow markedly in the months ahead as further weakness in the U.S. infects Asia and Europe. That would represent a shift from the last 18 months, when the world economy proved immune to a U.S. slowdown and grew at an annual clip of more than 5 percent."

Bloomberg - "Bernanke Will Cut Interest Rates Twice, Survey Shows" (9-10-07)

"Federal Reserve Chairman Ben S. Bernanke, chastened by the first drop in employment in four years, will be forced to cut interest rates at least twice this year, according to a Bloomberg News survey. The unexpected weakness in the labor market, which has helped the expansion survive the housing slump, will compel officials to put aside concerns about inflation, economists said. The Fed will lower its benchmark rate by a quarter point to 5 percent next week, and then reduce it to 4.75 percent in the fourth quarter, according to the median forecast of 66 analysts in Bloomberg's monthly survey." - "Housing Market Slump Forces Couple To Open" (9-10-07)

"New Rochelle neighbors told CBS 2 the house had originally been listed for $750,000 but didn’t sell even after the price had been dropped to $600,000. David Saperstein said, 'He couldn’t get his price, then he rented,' but a series of families came and went and the house fell into apparent neglect until new occupants apparently arrived two weeks ago."

Bloomberg - "Wall Street Credit Costs Soar on Spread to U.S. Rates" (9-10-07)

"Wall Street is getting no benefit from the biggest bond market rally in five years. Lehman Brothers Holdings Inc. faces higher borrowing costs today than it did in June, even after the steepest quarterly drop in U.S. Treasury yields since 2002 pushed interest rates down for everyone from Procter & Gamble Co. to AT&T Inc. Investors are so leery of Bear Stearns Cos. that its 10-year bonds trade at a discount to Colombia, the South American nation that's barely investment grade. Goldman Sachs Group Inc. is being punished with a higher yield than Caterpillar Inc., the heavy-equipment maker."

Bloomberg - "Treasuries Rise as Lockhart Says Job Market Weakened in June" (9-10-07)

"Treasuries rose, pushing two-year note yields to the lowest since September 2005, as Federal Reserve Bank of Atlanta President Dennis Lockhart said job growth started weakening in June. The yields had their biggest two-day decrease in three years after a government report last week showed an unexpected drop in employment in August. The rally reflects increased optimism the Fed will cut its 5.25 percent benchmark lending rate at least a quarter-percentage point by this month's meeting in response to a slump in credit markets related to subprime mortgage losses."

Reuters - "Washington Mutual sees more 2007 loan losses" (9-10-07)

"Washington Mutual Inc said on Monday that most U.S. housing markets are weakening, creating a 'near perfect storm' that may force the largest U.S. savings and loan to set aside more money for bad loans. Chief Executive Kerry Killinger said the thrift may set aside $500 million more for loan losses than the $1.5 billion to $1.7 billion it had forecast in July. Any increase would be Washington Mutual's fourth this year."

Yahoo - "Moody's Warns Housing Slump Will Persist" (9-10-07)

"Credit rating agency Moody's Investors Service said Monday it expects the housing-market slump to last at least until 2009, likely precipitating numerous ratings downgrades at publicly traded homebuilders. 'Our current thinking is that the downturn, currently two years in the making, will last until 2009, with any sector recovery likely to be sluggish for some time after that,' said Joseph Snider, senior credit officer at Moody's."
Orange County Register - "No shortage of short sales" (9-9-07)

"The owners of an Anaheim fixer-upper got into a pickle when the value of their two-bedroom condo fell below the $335,000 they owe on their mortgage. Unable to afford their monthly payments, they ended up with just two options: lose the home to foreclosure, or sell it themselves for less than they owe and ask the lender to eat a loss of $25,000 or more."

CNN - "Housing woes hit title insurers" (9-9-07)

"In yet another sign of pain in the troubled real estate sector, title insurers are seeing a big increase in the number of claims, according to a new report. The Wall Street Journal reported on its website Sunday that title insurers like First American Corp. (Charts, Fortune 500) are fielding a significant rise in claims - yet more evidence of the housing market's woes." - "Trump condos still up in air" (9-8-07)

"This week was supposed to climax Trump Tower Tampa's two-year pursuit of financing. Area developer SimDag LLC promised either to seal a deal to build the $300-million luxury high-rise or concede defeat and refund buyers' deposits on condominiums costing up to $6-million."

The San Diego Union Tribune - "Job losses seen as sign of rising risk of recession" (9-8-07)

"The nation's job market took a serious and unexpected turn for the worse last month, raising the risk of a recession and putting added pressure on the Federal Reserve to keep the ailing housing industry from infecting the rest of the economy. The Labor Department reported yesterday that 4,000 jobs were lost from July to August, with the deepest cuts coming in industries connected to housing, such as construction and manufacturing."

Los Angeles Times - "U.S. housing woes go south -- to Baja" (9-8-07)

"The ripples of the U.S. real estate boom began washing up on the shores of this beach town a few years ago. Californians, feeling flush from the steep run-up in housing values stateside, pulled equity from their primary homes and snapped up vacation properties in northern Baja California as if they were buying $10 lobster dinners."

Friday, September 07, 2007

Yahoo - "Hovnanian Shares Fall After 3Q Loss" (9-7-07)

"Shares of Hovnanian Enterprises Inc. fell 4 percent Friday after the luxury homebuilder reported it fourth conscutive quarterly loss and said it would cut prices to reduce inventory. Hovnanian shares dropped 46 cents to $10.91 in morning trading on Friday. Its shares are near the low end of their 52-week trading range of $10.35 to $38.66."

CNN - "Who would buy real estate in this market?" (9-7-07)

"Several months ago Silvia Cuevas took stock of her life, and it was a profoundly unsettling experience. At 40 she had a solid job with a modest salary at the public library in Santa Ana, Calif. She'd carefully squirreled away some savings and bought herself a little house. She was financially secure - and utterly dissatisfied. All around her, Santa Ana throbbed with the feverish energy of recent immigrants eager to cash in on the promises of America. A short drive from Disneyland, Santa Ana boasts one of the highest concentrations of Latinos of any city in the U.S., and these days it is a hotbed of entrepreneurial activity. Cuevas, though, felt as conservative, meek, and, well, dull as a church mouse in Vegas. 'I was going nowhere,' she recalls. 'How was I going to find my fortune?' Then a girlfriend introduced her to Nouveau Riche University."

Bloomberg - "Fed May Cut to 5 Percent Without Promising More" (9-7-07)

"If Federal Reserve officials cut their 5.25 percent target for the overnight lending rate when they meet on Sept. 18, it will be by only a quarter-percentage point with no promise of more to come. Officials have already disappointed many market participants by refusing to cut the target in response to turmoil in financial markets. And they will surely disappoint those hoping for a half-point cut at the next meeting of the Federal Open Market Committee."

Bloomberg - "CB Richard Ellis Declines After Lehman Cuts Earnings Estimates" (9-7-07)

"CB Richard Ellis Group Inc. fell to the lowest since October after Lehman Brothers Holdings Inc. cut profit estimates for this year and next on expectations the commercial real estate market will weaken. CB Richard Ellis, the largest commercial broker, dropped $2.24, or 8.1 percent, to $25.41 in 10:41 a.m. New York Stock Exchange composite trading. They have lost 24 percent this year."

Bloomberg - "Citigroup Unit Won't Take New Mortgage Bank Clients, People Say" (9-7-07)

"Citigroup Inc., the largest U.S. bank, stopped accepting new clients in a unit that offers credit lines to mortgage banks, according to two people familiar with the situation. First Collateral Services of Concord, California, is pulling back as failures of mortgage lenders make the business more risky. The unit still lends to existing customers, according to the people, who declined to be identified because they don't want to hurt relationships with New York-based Citigroup. First Collateral's 'warehouse' loans provide mortgage companies with cash so they can fund purchases and refinancings."

Bloomberg - "Beazer Shares Fall After Receiving Default Notices" (9-7-07)

"Beazer Homes USA Inc. shares fell as much as 13 percent after the homebuilder received notices of default from a bondholders' group for failing to file a quarterly report with regulators. The seller of homes for first-time buyers said the notices have no merit and it's not in default. The notices from U.S. Bank National Association, a trustee for debt investors, cover notes due 2011 to 2016, Atlanta-based Beazer said today in a statement."

Bloomberg - "IndyMac to Cut 10 Percent of Jobs; May Post a Loss" (9-7-07)

"IndyMac Bancorp Inc., the second- biggest U.S. mortgage company, plans to cut 10 percent of its workforce and lower the dividend as housing sales falter and defaults on home loans climb. It may post a loss for the first time in at least eight years. IndyMac expects to eliminate about 1,000 jobs over the next 'several months' and slice its dividend in half to 25 cents a share, the Pasadena, California-based company said today in a statement. It also may report a third-quarter loss of as much as $36.8 million, or 50 cents a share. The forecast falls short of the average estimate of eight analysts surveyed by Bloomberg, who predicted the company would earn 30 cents a share."

Orange County Register - "Home foreclosures, delinquencies at record high" (9-7-07)

"The number of Americans who may lose their homes to foreclosure reached a record in the second quarter as late payments by subprime borrowers surged to one out of every seven loans. Lenders began the process of seizing properties on 0.65 percent of U.S. mortgages in the second quarter, an all-time high, the Mortgage Bankers Association said in a report Thursday. In the first quarter, that figure was 0.58 percent. The percentage of subprime borrowers making late payments increased to 14.82 from 13.77."
MBA - "HUD Unveils The FHASecure Initiative; Provides Guidance" (9-6-07)

"The Federal Housing Administration rolled out an initiative that will enable homeowners to refinance various types of adjustable rate mortgages (ARMs) that have recently reset. This mortgagee letter describes how lenders and homeowners may refinance mortgages that, due to the increased mortgage payment following the reset, have become delinquent. The mortgagee letter also reiterates guidance to lenders about making objective decisions regarding the underlying collateral in declining markets. The FHASecure initiative, which is a temporary program designed to provide refinancing opportunities to homeowners and to increase liquidity in the mortgage market, requires that the loan application be signed no later than December 31, 2008."

MBA - "Delinquencies Increase in Latest MBA National Delinquency Survey" (9-6-07)

"The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 5.12 percent of all loans outstanding in the second quarter of 2007 on a seasonally adjusted (SA) basis, up 28 basis points from the first quarter of 2007, and up 73 basis points from one year ago, according to MBA’s National Delinquency Survey. The delinquency rate does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process was 1.40 percent of all loans outstanding at the end of the second quarter, an increase of 12 basis points from the first quarter of 2007 and 41 basis points from one year ago."

Bloomberg - "CPDOs Rated AAA May Risk Default, CreditSights Says" (9-6-07)

"Credit derivatives awarded the top ratings by Moody's Investors Service and Standard & Poor's may be as vulnerable to default as high-risk, high-yield bonds, according to independent research firm CreditSights Inc. Constant proportion debt obligations, known as CPDOs, use credit-default swaps to speculate that a group of companies with investment-grade ratings will repay their debt. An increase in credit rating cuts for investment-grade companies may cause losses that CPDOs would struggle to recoup, CreditSights said in a report entitled 'Distressed CPDOs: We're Doomed!'"

Yahoo - "Money market rates set to weigh on Wall Street" (9-6-07)

"Wall Street was set for a defensive start on Thursday with investors unable to take solace from some better than expected retail sales for August amid concerns over elevated money market rates. Stocks in Europe were trading lower ahead of Wall Street's open. Both the Bank of England and European Central Bank left their overnight lending rates unchanged at 5.75 per cent and 4 per cent respectively."

Market Watch - "New foreclosures set record in latest MBA survey" (9-6-07)

"According to the group's quarterly delinquency survey, a seasonally adjusted 0.65% of loans on one- to four-unit residential properties entered the foreclosure process during the period, the highest level in the survey's 55-year history. In the first quarter, when the previous record was set, 0.58% of loans entered the process; a year ago, 0.43% entered the process."

Bloomberg - "ECB Pumps Extra Cash Into Markets, Shelves Rate Increase" (9-6-07)

"The European Central Bank pumped 42.2 billion euros ($57.7 billion) into money markets to lower borrowing costs and said there's more to come as it shelved an increase in the benchmark interest rate. Policy makers meeting in Frankfurt kept the refinancing rate at 4 percent, stepping back from an increase signaled on Aug. 2 by ECB President Jean-Claude Trichet, after the U.S. housing slump threatened to curb economic growth."

Bloomberg - "U.S. Home Foreclosures, Delinquencies at Record High" (9-6-07)

"The number of Americans who may lose their homes to foreclosure reached a record in the second quarter as late payments by subprime borrowers surged to one out of every seven loans. Lenders began the process of seizing properties on 0.65 percent of U.S. mortgages in the second quarter, an all-time high, the Mortgage Bankers Association said in a report today. In the first quarter, that figure was 0.58 percent. The percentage of subprime borrowers making late payments increased to 14.82 from 13.77."

Bloomberg - "Countrywide Drops Below Bank of America's Deal Price" (9-6-07)

"Countrywide Financial Corp. shares briefly dropped below $18, erasing the $700 million paper profit Bank of America Corp. made when it invested $2 billion in the nation's biggest mortgage lender two weeks ago. Bank of America, the second-largest U.S. bank, bought preferred stock on Aug. 22 that can be converted to common shares at $18. Countrywide, which surged to $24.46 the day after the deal was announced, fell as low as $17.95 today on the New York Stock Exchange. The stock closed at $18.48."

Yahoo - "The Most Expensive Blocks in the U.S." (9-6-07)

"For the first time ever has generated a list of the most expensive blocks in 10 cities across the country. To do so, we created an index with California-based data provider Reply! of the 100 most expensive properties in each city, mapped them geographically and then measured home values and the concentration of high-priced home values in each particular cluster."

Bloomberg - "Global Credit Rout May Paralyze Infrastructure Loans" (9-6-07)

"The global credit rout sparked by the U.S. subprime mortgage slump may leave as much as $34 billion of leveraged loans for railroads, tollways and similar projects 'paralyzed,' said analysts at Standard & Poor's. Banks are less likely to lend to infrastructure projects after being saddled with as much as $332 billion of unsold leveraged loans, the S&P report said." - "The Government-Created Subprime Mortgage Meltdown" (9-6-07)

"The thousands of mortgage defaults and foreclosures in the 'subprime' housing market (i.e., mortgage holders with poor credit ratings) is the direct result of thirty years of government policy that has forced banks to make bad loans to un-creditworthy borrowers. The policy in question is the 1977 Community Reinvestment Act (CRA), which compels banks to make loans to low-income borrowers and in what the supporters of the Act call "communities of color" that they might not otherwise make based on purely economic criteria."

Los Angeles Times - "U.S. pending home sales plunge, private job gains fade" (9-6-07)

"Pending sales of existing U.S. homes plunged by a record 12.2 percent in July, and private employers hired the fewest workers in more than four years in August, according to reports released today that point to a weakening U.S. economy. Planned lay-offs at U.S. companies surged by 85 percent in August due to turmoil in the subprime mortgage market, another report said."