Business Week - "Mutually Assured Mayhem " (6-29-07)

"Wall Street is on edge, scrambling to buck up Bear Stearns and avert a domino-effect debacle "

Miami Herald - Straw Buyer Cartoon

MSNBC - "Thousands of Arizonans in danger of losing homes" (6-28-07)

"Statewide, 5,918 properties entered some stage of foreclosure last month, a nearly 200 percent increase from May 2006, said RealtyTrac, which tracks the national foreclosure market."


NAR - "NAR Hails Bank Regulator Statement on Subprime Mortgage Lending" (6-29-07)

The National Association of Realtors® welcomes today’s statement issued by the federal regulators of banks, thrifts and credit unions that prescribes strong underwriting and consumer protection standards in connection with certain subprime adjustable rate mortgages (ARMs). Those mortgages can impose an unaffordable “payment shock” on borrowers when the interest rate resets. They include “2/28” mortgages that have a two-year “teaser rate” that adjusts as often as every six months based on a high margin.

Bloomberg - "S&P, Moody's Mask $200 Billion of Subprime Bond Risk (Update2)" (6-29-07)

"Standard & Poor's, Moody's Investors Service and Fitch Ratings are masking burgeoning losses in the market for subprime mortgage bonds by failing to cut the credit ratings on about $200 billion of securities backed by home loans. The highest default rates on home loans in a decade have reduced prices of some bonds backed by mortgages to people with poor or limited credit by more than 50 cents on the dollar and forced New York-based Bear Stearns Cos. to offer $3.2 billion to bail out a money-losing hedge fund. Almost 65 percent of the bonds in indexes that track subprime mortgage debt don't meet the ratings criteria in place when they were sold, according to data compiled by Bloomberg. "

MSN - "Deepening debt crisis hits close to home" (6-29-07)

"Who's likely to get badly hurt as the subprime lending crunch assaults various pools of high-risk debt? Pension funds, mutual funds and other victims shockingly close to your wallet."

Daily Press - "KB Homes building smaller, more affordable homes" (6-29-07)

"KB Home is discovering that less could be more when it comes to luring skittish buyers in a housing slump. In recent months, the company has rolled out a new line of smaller, more affordable homes that it hopes will jump-start sagging sales, including at the company’s Las Haciendas master-planned community in Victorville. Currently, KB Home is building single-family homes ranging in size from 1,800 to 3,700 square feet. Now that those larger units are almost sold out, the company plans to build smaller units ranging from 1,300 to 2,400 square feet."

Reuters - "Benchmark subprime ABX indexes close at record lows" (6-29-07)

"Benchmark subprime mortgage ABX indexes closed at record new lows on Friday as concerns over subprime mortgages intensified, traders said. The ABX 07-1 "BBB-" index, which is tied to subprime mortgage loans made in last year's second half, fell to 54.54, below the 56.16 record low close set earlier this week, according to Markit.com. The index has tumbled by 42 percent since January."

CNN - "Subprime loans get new standards" (6-29-07)

"U.S. bank regulators issued new standards for subprime mortgage lending Friday that includes several new consumer protections. Subprime borrowers should not be penalized for refinancing out of a mortgage before the interest rate resets to a higher level, according to a statement of principles issued by the regulators. Lenders should only offer loans to borrowers with little proof of assets and income if there is other evidence that they can repay, the statement says."

Business Week - "Housing's New Risks For The Economy" (6-29-07)

" As 2007 began, one overarching question hung in the minds of everyone from investors to economists to policymakers: Will the housing recession sink the economy? The housing boom and bust is easily the defining feature of this business cycle. The slump is unique in that no housing downturn of this size has ever occurred outside of a general economic recession. This time the market collapsed under its own weight from past overbuilding, speculation, and soaring prices, not because of the classic triggers, such as prohibitive mortgage rates, tight credit, and rising unemployment. So far, the economy has absorbed the blow, but it has not been painless."

Realty Times - "California Capital Becomes Crunch Town" (6-20-07)

"Sacramento's owner-occupied housing market -- one of the most troubled major housing markets in the nation -- has become a big challenge for the market's rental sector. Troubling oversupplies and dwindling numbers of qualified rental applicants are exacerbating conditions for property owners and management companies alike. "

Inman - "Residential construction spending drops for 15th straight month" (6-29-07)

The residential construction spending rate dropped 17.6 percent in May compared to the same month last year, the U.S. Census Bureau announced today, falling for the 15th consecutive month and reaching its lowest level since April 2004. Residential construction spending fell to a seasonally adjusted annual rate of $549 million in May, compared to $665.9 million in May 2006, according to the report. This rate is a projection of a monthly total over a 12-month period, adjusted for seasonal variations in construction activity. The adjusted annual rate of spending for all types of construction reached $1.18 trillion in May, down 2.8 percent compared to the May 2006 estimate of $1.21 trillion.

OC Register - "Single-family construction no longer king in O.C." (6-29-07)

"Building permits for apartments and condominiums hit a 16-year high so far this year, while permits for single-family homes fell to a 20-year low, a research group reported this week."

OC Register - "Orange County home prices and sales" (6-29-07)

"For the 22 business days ending June 18, sales for all types of Orange County home sales decreased 29.4 percent. The median sales price decreased .2 percent. The median is where half the homes sold for more and half for less. Types of homes selling, as well as home value changes, cause the median to change."

Real Estate Journal - "Give 'Flipper' His Due If You Want the House He Bought" (6-29-07)

" As an investor, when I look at a potential property, I compare the claimed square footage against what is in the tax records. If the numbers are different, I want to know why. For example, it could be that the seller is simply misinformed, is lying or that he did an addition without a building permit. In any event, it's a red flag. Abe Wishnia."

Market Watch - "American Home sees second-quarter loss" (6-28-07)

"American Home Mortgage Investment Corp. forecast a second-quarter loss late Thursday because of rising delinquencies on some of its mortgages."

Newsday - "Builders wait out high land prices" (6-28-07)

"Pulte is not alone. Across the Island, residential developers said, land prices are artificially high - and most are waiting for them to drop before returning to the aggressive acquisition mode of the past several years."

North County Times - "Housing market slowing local economy" (6-28-09)

"The housing market slump has begun to drag down the overall local economy, according to an index of San Diego County's economy released Thursday. Dropping by 0.5 percent since April, the index fell to 138.3 in May, according to the latest University of San Diego Index of Leading Economic Indicators, released Thursday. A year ago, the index stood at 142.7. Job losses in the housing industry are taking dollars out of circulation for the rest of the economy, Alan Gin, an economist who compiles the report, said in a Thursday interview. The housing and real estate industry accounts for 10 percent of local employment, Gin said."

Press Enterprise - "Inland area growth slows" (6-28-07)

" The populations of Riverside and San Bernardino counties continue to swell but at a brisk trot rather than a gallop. Since the 2000 census, the combined populations of the two Inland counties have grown 27 percent, new census data show. Cities also have grown swiftly, averaging 31 percent. However, Inland cities grew about 3.2 percent in 2003 but just 1.5 percent in 2006. Eight Inland cities lost population last year. High housing and gas prices, the home construction slowdown and higher interest rates for mortgages could be to blame, said Max Neiman, associate director of research for the Public Policy Institute of California, a nonpartisan think tank. "

Market Watch - "Subprime shakeout claims another fund" (6-28-07)

"Caliber Global Investment Ltd., a London-listed fund that controlled almost $1 billion of mortgage assets, said on Thursday that it's shutting down after turmoil in the subprime market cut demand for its shares."

CNN - "The most affordable U.S. housing markets" (6-28-07)

"The housing slump has its benefits; affordability improved in many metro areas across the nation during the first three months of this year. According to a report from Wells Fargo Bank and the National Association of Home Builders (NAHB), about 44 percent of all homes sold in the United States during the first three months of the year were affordable to families earning the median household income for the area they lived in."

Yahoo! - "Fed Leaves Interest Rates Unchanged" (6-28-07)

"The Federal Reserve held interest rates steady Thursday, extending a yearlong breather for borrowers. Although policymakers observed improvements on inflation, they made clear they were not ready to declare victory on that front."

The New York Sun - "Bear Stearns Assigns Top Trader To Bail Out Hedge Fund" (6-28-07)

"Bear Stearns Cos. assigned its top mortgage trader to help manage the $1.6 billion bailout of a money-losing hedge fund as it tries to unwind bets on investments tied to home loans. The global head of mortgages and asset-backed securities, Thomas Marano, 45, was appointed after Bear Stearns agreed to provide financing to its High-Grade Structured Credit Strategies Fund, said a person with knowledge of the decision. Bear Stearns, the fifth-biggest American securities firm, said in a statement Tuesday that it won't rescue a second fund, which borrowed more and sustained bigger losses."

CNN - "Subprime lending: Abuse as usual" (6-28-07)

"It would appear that subprime lenders have yet to learn from their mistakes. According to a consumer advocate group, abuses persist industry wide, despite the recent subprime mortgage meltdown. At a Senate subcommittee hearing on ending mortgage abuse this week, the Center for Responsible Lending (CRL) presented its findings on subprime loans included in 10 recent packages of mortgage backed securities."

MBA - "MBA Releases Commercial/Multifamily Quarterly Data Book" (6-28-07)

"The Mortgage Bankers Association (MBA) today released its Commercial Real Estate/Multifamily Finance Quarterly Data Book for the first quarter of 2007. The Data Book combines the most up-to-date information on various topics of interest to industry participants and observers."

CBIA - "California Housing Affordability Still Bleak, CBIA Reports" (6-28-07)

"Thanks to lower home prices and favorable financing, housing affordability in California improved modestly in the first quarter of 2007 – but was still by far the worst in the nation, the California Building Industry Association reported today. According to the quarterly National Association of Home Builders/Wells Fargo Housing Opportunity Index, nine of the 10 least affordable metro areas in the nation were located in California, as were 25 of the bottom 30. The least-affordable metro area in the nation continued to be Los Angeles County, where just 3 percent of the new and existing homes sold during the first quarter of the year were affordable to the county’s median-income household."

NAHB - "Indianapolis and Youngstown, Ohio Share Title of Most Affordable Housing Market" (6-28-07)

"The metropolitan areas encompassing Indianapolis-Carmel, Ind. and Youngstown-Warren-Boardman, Ohio-Pa. tied for the title of most affordable major U.S. housing market in this year’s first quarter, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI), released today. Meanwhile, lower home prices and mortgage interest rates helped boost housing affordability across the nation in the first three months of this year. 'The latest HOI shows that about 44 percent of new and existing homes that were sold in the United States during this year’s first quarter were affordable to families earning the national median income,' said NAHB President Brian Catalde, a home builder from El Segundo, Calif. 'This is up from 41.6 percent of homes sold in the final quarter of 2006, and is likely the result of lower house prices as well as the very favorable financing conditions that existed at the beginning of this year.'"

NAHB - "NAHB'S National Housing Endowment Awards Grants For Construction Training And Education Programs" (6-28-07)

"The National Housing Endowment, the philanthropic arm of the National Association of Home Builders (NAHB), recently announced the recipients of its 2006 Challenge/Build/Grow Matching Grant Initiative. Six local home builder associations (HBAs) from across the country each received up to $5,000 in matching challenge grant funds for programs and projects in NAHB's highest priority areas of Education, Land Use and Labor Shortage/Worker Training. The grant awarded nearly $25,000 in total funding."

CBIA - "California Housing Starts Up 2 Percent in May, CBIA Reports" (6-28-07)

"Total housing starts in California in May increased by a little over 2 percent compared to April’s level, the California Building Industry Association announced today. According to housing permit data supplied by the Construction Industry Research Board, single-family housing starts in May stayed relatively level around the state while multifamily homes saw a strong boost in permits being pulled. However, production for both single-family and multifamily units is still well behind starts recorded during the same period one year ago. In May, permits were pulled for 7,164 single-family homes statewide, down just 2.5 percent from the previous month but down 40 percent from May 2006, while multifamily housing starts — condos and apartments — totaled 3,574, up 14 percent from the previous month and down 2 percent compared to May 2006."

NAHB - "NAHB Statement in Reaction to the Delisting of the Bald Eagle" (6-28-07)

"Jerry Howard, executive vice president and chief executive officer of the National Association of Home Builders, issued the following statement today in reaction to the delisting of the bald eagle: The National Association of Home Builders celebrates the success of the bald eagle as this majestic bird is officially removed from the federal list of endangered species."

NAHB - "Despite Senate Setback, Builders Continue To Call For Immigration Reform" (6-28-07)

"The National Association of Home Builders (NAHB) today expressed disappointment in a Senate vote that effectively ended consideration of immigration bill S. 1639 and urged lawmakers not to abandon efforts to overhaul the nation’s immigration laws. 'Though the Senate fell short today in keeping the legislation alive, the nation’s home builders strongly support comprehensive immigration reform that would protect our borders; provide a process by which immigrants can legally enter the country to work to meet the labor demands of a growing economy; and create an enforcement system that is fair, efficient and workable for all U.S. employers,' said Jerry Howard, executive vice president and CEO of NAHB."

Bloomberg - "Carlyle Postpones $415 Million IPO of Mortgage Fund" (6-28-07)

"Carlyle Group, the buyout firm run by David Rubenstein, postponed a planned $415 million initial public offering of a fund that invests in bonds backed by mortgages after a slump in the U.S. subprime market. Carlyle is preparing a revised timetable for the sale, it said in a statement today. The Washington-based firm planned to use most of the money from the IPO to buy AAA-rated residential mortgage-backed securities. The fund also targeted loans, high- yield bonds, and collateralized debt obligations."

CNN - "Beazer fires accounting chief" (6-28-07)

"Beazer Homes USA Inc. said Wednesday it fired its chief accounting officer Michael Rand due to violations of the company's ethics policy stemming from attempts to destroy documents. In a regulatory filing, the sixth largest U.S. home builder said its board's audit committee was conducting an internal investigation of the company's mortgage origination business and related matters. Atlanta-based Beazer said the action was taken by its board and management following a briefing by the independent, legal counsel retained by the audit committee."

CNN - "KB Home reports unexpected loss" (6-28-07)

"Homebuilder KB Home has become the latest company in its battered sector to report a loss, as it says it continues to see deteriorating market conditions. KB Home (Charts, Fortune 500) reported a second-quarter operating loss from continuing operations of $174.2 million, or $2.26 a share. A year earlier the company had earnings from continuing operations of $184.4 million, or $2.20 per diluted share. Most of the loss was due to a non-cash charge of $308.2 million related to the writedown in the value of inventory and joint ventures, and the abandonment of land option contracts."

CNN - "Mortgage rates back off again" (6-28-07)

"Mortgage rates eased slightly for the second week in a row after taking their biggest jump in four years two weeks ago, Freddie Mac said Thursday. The government-sponsored loan buyer said the average rate on a 30-year fixed-rate loan slipped to 6.67 percent for the week ending June 28, from 6.69 percent the previous week. Last year at this time, 30-year mortgage rates averaged 6.78 percent."

The New York Sun - "Bear Stearns Assigns Top Trader To Bail Out Hedge Fund" (6-28-07)

"Bear Stearns Cos. assigned its top mortgage trader to help manage the $1.6 billion bailout of a money-losing hedge fund as it tries to unwind bets on investments tied to home loans. The global head of mortgages and asset-backed securities, Thomas Marano, 45, was appointed after Bear Stearns agreed to provide financing to its High-Grade Structured Credit Strategies Fund, said a person with knowledge of the decision. Bear Stearns, the fifth-biggest American securities firm, said in a statement Tuesday that it won't rescue a second fund, which borrowed more and sustained bigger losses."

Orange County Register - "County lags in affordable workforce housing" (6-28-07)

"Housing in Orange County for workers is diminishing, and will continue to get tighter by the year 2030 unless local cities take further action to increase the supply of affordable residences here, said a report issued today by the Orange County Business Council to business and city leaders at the Tiger Woods Learning Center in Anaheim. According to the Business Council's first 'Workforce Housing Scorecard,' Orange County now had a ratio of 1.61 jobs for every housing unit in the county in 2005, compared to 1.4 jobs per unit in 1991. By 2030 the council's housing scorecard projects a jobs-to-housing ratio of 1.79."

Los Angeles Times - "Realtors Blame Media for Housing Slump" (6-28-07)

"To a great extent, we can thank steady media coverage of the real estate market 'correction' for unfounded consumer concerns.... But there’s no real correction where consumers are concerned. Yes, home price appreciation has slowed considerably, and nationally we’re expecting a price drop of 1% for 2007. But that drop comes at the tail end of a five-year spurt that increased home prices by 53%. We may have taken one small step back, but that’s after taking 53 steps forward.' More: 'When today’s consumers look at real estate markets, they need to use the same analytical approach as investors in the stock market. Those buyers aren’t generally concerned about the volume of stock trades on a given day. Why should they be? They’re focused on price trends. And by that measure, now is a great time for consumers to be in the housing market: Prices have steadied, and inventories are healthy.'"
Real Estate Journal - "How Wall Street Stoked The Mortgage Meltdown" (6-28-07)

"The vice president, Eric Hibbert, wrote a memo describing First Alliance as a financial "sweat shop" specializing in 'high pressure sales for people who are in a weak state.' At First Alliance, he said, employees leave their 'ethics at the door.' The big Wall Street investment bank decided First Alliance wasn't breaking any laws. Lehman went on to lend the mortgage company roughly $500 million and helped sell more than $700 million in bonds backed by First Alliance customers' loans. But First Alliance later collapsed. Lehman landed in court, where a federal jury found the firm helped First Alliance defraud customers."

MBA - "Mortgage Applications Decrease in Latest MBA Survey" (6-27-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending June 22, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 618.6, a decrease of 3.9 percent on a seasonally adjusted basis from 643.7 one week earlier. On an unadjusted basis, the Index decreased 4.5 percent compared with the previous week and was up 16.3 percent compared with the same week one year earlier. The Refinance Index decreased 2.5 percent to 1731.6 from 1776.8 the previous week and the seasonally adjusted Purchase Index decreased 4.9 percent to 428.9 from 450.9 one week earlier. The seasonally adjusted Conventional Index decreased 3.6 percent to 909.2 from 943 the previous week, and the seasonally adjusted Government Index decreased 7.4 percent to 134 from 144.7 the previous week."

Ventura County Star - "Buyers continue to wait out housing market" (6-27-07)

"Many homebuyers and sellers are familiar with the concept, watching from the sidelines, afraid to gamble on the slow housing market. Prospective buyers worried about falling real estate prices are staying away, which is the real reason that there's been a big drop in sales activity, said Bill Watkins, director of the UC Santa Barbara Economic Forecast Project."

Market Watch - "Pimco sees subprime impact on homes, consumers" (6-27-07)

"Pimco Chief Investment Officer and founder Bill Gross Tuesday predicted that the subprime mortgage crisis's impact will spread beyond the housing sector and prompt the Federal Reserve to cut rates to stir a flagging economy. Gross, in an outlook for July posted on the Pimco Web site, said the mortgage-sector crisis will impact consumption and new home building over the next year to year and a half. The crisis 'may be just what the Fed has been looking for: easy credit becoming less easy, excessive liquidity returning to more rational levels.'"

Bloomberg - "Bear Stearns Turns to Marano for $1.6 Billion Bailout" (6-27-07)

"Bear Stearns Cos. assigned its top mortgage trader to help manage the $1.6 billion bailout of a money-losing hedge fund as it tries to unwind bets on investments tied to home loans. Thomas Marano, the 45-year-old global head of mortgages and asset-backed securities, was appointed after Bear Stearns agreed to provide financing to its High-Grade Structured Credit Strategies Fund, said a person with knowledge of the decision. New York-based Bear Stearns, the fifth-biggest U.S. securities firm, said in a statement yesterday that it won't rescue a second fund, which borrowed more and sustained bigger losses."

Bloomberg - "Opaque Derivatives, Transparent Fed, `Bubblenomics': Timshel" (6-27-07)

"The most stunning aspect of the demise of two hedge funds belonging to Bear Stearns Cos. is the almost total absence of transparency surrounding the bailout. The debacle may finally provoke regulators, who have long suspected that buying derivatives is akin to running through a fireworks factory with a lighted blowtorch in each hand. Their focus is likely to fall on how to assign prices to complex derivatives, created by cooking together different flavors of securities whose values are driven by other assets such as stocks, bonds or mortgages."

The Raw Story - "US home sales fall; property glut hits new high" (6-27-07)

"Sales of existing US homes declined unexpectedly in May, dashing expectations that the struggling real estate market would show an uptick in sales, an industry survey showed Monday. The National Association of Realtors (NAR) said existing home sales dropped 0.3 percent to an annualized pace of 5.99 million last month. The drop in May sales defied Wall Street forecasts which had predicted a sales clip of 6.00 million units."

Reuters - "Further loan deterioration seen for Alt-A market-S&P" (6-26-07)

"Delinquency rates are rising for so-called 'Alt-A' home mortgages held by U.S. borrowers who are rated above the subprime category but below the more pristine prime borrower, said Standard & Poor's in a report on Tuesday."

NAHB - "Casa Y Comunidad: Latino Home and Neighborhood Design Named Winner in Prestigious Franklin Awards" (6-26-07)

"Casa y Comunidad: Latino Home and Neighborhood Design, published by BuilderBooks, the National Association of Home Builders’ (NAHB) book publishing division, and edited by Henry Cisneros, was named a silver medallion winner in the 2007 Benjamin Franklin Awards in the category of business publications. The award was presented in New York City last month on the eve of the BookExpo America held during the 2007 Publishing University."

Orange County Register - "Report: O.C. home prices dip" (6-26-07)

"May was a disappointing month for home sales in Orange County and around the country, according to real estate sales data released Monday by the California Association of Realtors. Sales of existing single-family homes locally fell 21.1 percent when compared with a year ago, a trend that mirrors the state and national pictures. In California, the state association reported that May sales fell 25 percent from a year earlier. During the month, homes sold at a pace equal to about 366,300 sales a year, down from a 2006 pace of 488,000 and a 2005 pace of more than 600,000."

NAHB - "New-Home Sales Slide 1.6 Percent In May As Correction Continues" (6-26-07)

"In the latest indication that the housing market remains in a correction phase, sales of new single-family homes slipped 1.6 percent in May to a seasonally adjusted annual rate of 915,000 units, according to figures released by the U.S. Commerce Department today. The May sales pace was 15.8 percent below a year earlier. 'Builders are continuing to offer incentives in order to shore up sales and work down their inventories as home buyer demand remains slack' said Brian Catalde, president of the National Association of Home Builders (NAHB) and a home builder from El Segundo, Calif."

Yahoo - "S&P Says U.S. Home Prices Fell in April" (6-26-07)

"U.S. home prices fell for a fourth consecutive month in April, with all regions showing the effect of the housing slowdown, according to the most recent figures in a housing index released Tuesday by Standard & Poor's. The trend followed 13 months of slowing price growth. The S&P/Case-Shiller index that covers 10 U.S. cities fell 2.7 percent in April from a year earlier. It was the steepest decline since 1991."
Market Watch - "Home prices fall at fastest rate in 16 years" (6-26-07)

"Home prices in 10 major U.S. cities dropped at the fastest pace in 16 years during the 12 months ending in April, according to Standard & Poor's Case-Shiller home price index released Tuesday. Home prices in the 10 cities fell 2.7% on a year-over-year basis, the largest decline since September 1991. Meanwhile, prices in 20 cities dropped a record 2.1% year over year."

Market Watch - "Lennar posts loss as home prices fall" (6-26-07)

"Lennar Corp. said Tuesday it swung to a quarterly loss, blaming impairment charges and growing inventories of homes for sale which are pushing prices lower and further squeezing margins. The Miami-based home buildersaid it saw a second-quarter loss for the period ended May 31 of $244.2 million, or $1.55 a share, compared with profit of $324.7 million, or $2 a share a year earlier. "The housing market has continued to deteriorate throughout the second quarter. The supply of new and existing homes has continued to increase resulting in declining home prices across our markets," said Chief Executive Stuart Miller in a statement."

Bloomberg - "Freddie Mac Says Subprime Rout `Severe but Contained'" (6-26-07)

"Freddie Mac Treasurer Timothy Bitsberger said the subprime mortgage slump is 'severe but contained.' Subprime borrowers, people with the riskiest credit records, make up a small part of the U.S. mortgage market and are mostly in seven states, Bitsberger said today at a conference in London. The owners of bonds made up of subprime mortgages are mainly 'large institutional players who can withstand the loss,' he said. Freddie Mac is the second-biggest U.S. mortgage finance company."

Reuters - "PIMCO's Gross says 'subprime crisis' not isolated" (6-26-07)

"Bill Gross, manager of PIMCO, the world's largest bond fund, said on Tuesday the subprime mortgage crisis gripping U.S. financial markets was not an isolated event and will eventually take a toll on the economy. Gross, the chief investment officer of Pacific Investment Management Co., or PIMCO, also said in his July investment outlook that the crisis would prompt the Federal Reserve to lower the benchmark interest rate by year-end."

Bloomberg - "CDOs in `Hooker Heels' Fool Moody's, S&P, Gross Says" (6-26-07)

"Moody's Investors Service and Standard & Poor's were duped by the make-up and ``six-inch hooker heels'' of collateralized debt obligations they gave investment-grade ratings, and investors now stand to lose all their money, according to Bill Gross, manager of the world's biggest bond fund. Subprime mortgage bonds made up about $100 billion of the $375 billion of CDOs sold in the U.S. in 2006, Moody's and Morgan Stanley data show. CDO's are created by bankers and money managers who bundle together securities and divide them into slices with credit ratings as high as AAA."

Los Angeles Times - "It's Real Estate Fraud Week at L.A. Land" (6-26-07)

"Now houses are piling up in forelcosure and so are the lawsuits. Reporter Chris Bagley at the North County Times has been all over this story: 'Nurses and other middle-class investors bought more than 100 Murrieta-area houses in 2004 and 2005 through Stonewood Consulting Inc., a Murrieta mortgage brokerage that the California Department of Real Estate is now seeking to bar from the industry.' More: 'The first of those houses fell into the foreclosure process last fall, and the owners began filing lawsuits in January. Stonewood clients often paid far more for their houses than did buyers of comparable houses nearby and, according to numerous neighbors and real estate agents who followed the purchases, $50,000 to $120,000 more than the original asking prices -- a pattern that raised eyebrows in the slackening market.'"
Real Estate Journal - "New Reverse Mortgages Bring Perks, but Also Some Risk" (6-26-07)

"As more homeowners nationwide tap into reverse mortgages, banks are jumping into the market to offer their own versions of these sometimes controversial loans. The new breed of reverse mortgages generally allow for higher loan amounts and lower fees than the traditional, government-backed loans, but may charge higher interest rates. There's even a new product that sidesteps banks entirely and structures a reverse-mortgage loan between family members. Reverse mortgages allow homeowners who are 62 and older to convert home equity into income, with the lender paying out via a lump sum, monthly payments or a credit line. When the house is sold, the lender is paid back with interest. With a typical reverse mortgage, the homeowner never owes the lender more than the value of the home."

The Real Estate Journal - "Tax Deductions For Second Homes" (6-26-07)

"Before you make any decisions, crunch the numbers again to make absolutely sure that itemizing your deductions would be better than claiming the standard deduction. If so, that brings us to your next question: Can you amend your tax returns for the past five years? The answer is you certainly can amend some of those prior returns -- but not for all five years."

NAHB - "Media Advisory: Online Press Registration For 2008 International Builders' Show Now Open" (6-25-07)

"The 2008 International Builders’ Show® (IBS), the housing industry’s largest annual trade show and exhibition is now open for online registration. Produced by the National Association of Home Builders (NAHB), the Show is expected to attract more than 100,000 attendees from 100 countries. The Show will offer the industry’s largest new product showcase, with suppliers encompassing all aspects of the residential building industry. The 2008 IBS will feature more than 1,900 exhibitors representing more than 300 industry categories and displaying the latest in home and building products and services. IBS also hosts nearly 300 educational seminars on topics ranging from construction codes and standards and green building to economic trends and 50+ housing, as well as home tours and special events."

NAHB - "High Court Rules For NAHB In Clean Water Permit Case" (6-25-07)

"The U.S. Supreme Court has ruled in favor of regulatory balance—and environmental stewardship—in a five to four decision regarding home builders’ consultation requirements under the Endangered Species Act. In the case of National Association of Home Builders v. Defenders of Wildlife, the court reversed and remanded a lower court decision that required the U.S. Environmental Protection Agency to consider the protection of 'listed' species before handing Clean Water Act permitting authority over to the state of Arizona. The EPA had determined that the state met all the necessary criteria for receiving that authority."

NAHB - "Home Building Educational Software From NAHB Wins ASAE's 2007 Associations Advance America Award" (6-25-07)

"The National Association of Home Builders (NAHB) has been honored with the Award of Excellence in the 2007 Associations Advance America (AAA) Awards program for its “Building Homes of Our Own” education game. The national competition was sponsored by the American Society of Association Executives (ASAE) & The Center for Association Leadership, Washington, D.C."

CAR - "C.A.R. reports sales decrease 25 percent in May, median price of a home in California at $591,180, up 4.8 percent from year ago" (6-25-07)

"Home sales decreased 25 percent in May in California compared with the same period a year ago, while the median price of an existing home increased 4.8 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today. 'Concerns about subprime lending will be with us well into next year, but improving economic conditions should bolster consumer confidence in the economy as we move through the second half of this year,” said C.A.R. President Colleen Badagliacco. “However, with prices holding steady or showing marginal declines in many parts of the state, affordability will continue to be a problem even with mortgage rates that remain near historic lows. In a competitive market with a wide range of properties for sale compared with a year ago, those homes that are in top shape and are well priced are in the best position to attract buyers in today’s market.'"

Yahoo - "When Paying Off Doesn't Pay" (6-25-07)

"I get many letters asking whether it's better to pay off your mortgage or invest the money in the stock market instead. This is a complex question, but I'll offer several ways of thinking about it. First, no one ever spent a sleepless night because she had millions in the bank and stocks but didn't have her home paid off. On the other hand, if you pay off your mortgage and deprive yourself of liquidity, you could be in for some miserable times. As I see it, if money is even the slightest bit tight, hold onto it and pay off the mortgage month by month. There's nothing magically good about having a paid-off mortgage, but there's something seriously bad about not having ready liquid assets even if your home is paid for."

Bloomberg - "Bear Stearns Rivals Reject Fund Bailout in LTCM Redux" (6-25-07)

"Bear Stearns Cos. is getting a taste of its own medicine. It was Bear Stearns, the biggest broker to hedge funds, that nine years ago declined to join 14 other investment banks in the bailout of Long-Term Capital Management LP. Then last week, as New York-based Bear Stearns pleaded for help to rescue two of its hedge funds teetering on the brink of collapse, many of the same firms refused to come to its aid."

CNN - "Weakest home sales in 4 years" (6-25-07)

"Home sales slumped to a four-year low in May as prices slid further and the glut of homes on the market hit a 15-year high, a real estate group said Monday, noting buyers are being scared away by the weak housing market. Existing homes sold at an annual pace of 5.99 million last month, down from a revised 6.01 million rate in April, according to the report from the National Association of Realtors. It was the slowest pace of home sales since June 2003, although it was essentially unchanged from the original April reading."

CNN - "Putting the card before the house" (6-25-07)

"In another symptom of the subprime mortgage meltdown, stressed-out borrowers may be taking care of their credit card bills before making their mortgage payments. According to a report from consumer credit reporting agency Experian, borrowers with credit scores of 620 or below are 30 days late more often with mortgage payments than with payments on bank-card debt."

The San Diego Union Tribune - "Petersons' former home draws no bids in foreclosure auction" (6-25-07)

"No one showed up to bid on the former home of Scott and Laci Peterson, leaving a bank to take possession of the tidy house that was once at the center of a national drama. A foreclosure auctioneer opened and closed bidding Friday on the small bungalow where the couple lived before the pregnant wife disappeared on Christmas Eve. A Simi Valley bank is the new owner."

Bloomberg - "U.S. Home Resales Fell in May to Lowest Since 2003" (6-25-07)

"Sales of previously owned homes in the U.S. fell in May to the lowest in almost four years, reinforcing concerns about a protracted housing slump. Purchases last month declined 0.3 percent to an annual rate of 5.99 million, the lowest since June 2003, from a revised 6.01 million in April, the National Association of Realtors said today in Washington. The supply of unsold homes jumped to the highest in almost 15 years."

Bloomberg - "U.S. Economy: Existing Home Sales Approach Lowest in Four Years" (6-25-07)

"Sales of previously owned homes in the U.S. fell in May to the lowest level in almost four years, reinforcing concerns about a protracted housing slump. Purchases declined 0.3 percent to an annual rate of 5.99 million, from a revised 6.01 million the prior month, the National Association of Realtors said today in Washington. The supply of unsold homes jumped to a record."

NAR - "May Existing- Home Sales Show Market is Under Performing" (6-25-07)

"Existing-home sales were essentially unchanged in May, according to the National Association of Realtors®. Total existing-home sales – including single-family, townhomes, iniums and co-ops – eased by 0.3 percent to a seasonally adjusted annual rate1 of 5.99 million units in May from an upwardly revised pace of 6.01 million in April, and are 10.3 percent below the 6.68 million-unit level in May 2006."

Los Angeles Times - "New Condos in South LA -- Or Is It South Central?" (6-25-07)

"Good Morning. "Hope Builds in South L.A.," says the headline in this morning's LATimes, above a story that raises some questions for us: --Is there a market for 150 new condos at $340,000 to $380,000 in this part of town? The developer calls it a 'rough area' where 'We have had drive-by s in the past.'"

Los Angeles Times - "Inspectors under the gun, thanks to a rise in home prices, legal actions" (6-24-07)

"The growing influence of home inspections on residential real estate sales has been rapid and unmistakable. Two reasons stand out: First, home prices in major markets have increased dramatically. Buyers typically seek the most expensive homes they can afford, leaving little or no reserves for repairs that might be needed later. By disclosing unseen defects, home inspections help avoid unexpected costs. And second, the litigious nature of today's business culture arouses caution among all parties to real estate transactions. Agents and brokers have been particularly affected, causing many to become advocates for defect disclosure in general and home inspections in particular."

Los Angeles Times - "Banking on it" (6-24-07)

"IF your retirement garden — specifically your individual retirement account or IRA — hasn't been growing fast enough to meet your future retirement needs, you might want to join a club of contrarians: those who have decided to take matters into their own hands. Literally. Self-directed IRAs are billed as "putting the 'I' back in IRA." They let individuals determine what, when and where to invest their retirement money. And they are catching on — in no small part thanks to the stock market's volatility and the real estate market's recent riches."

Los Angeles Times - "The Sunday Morning Interest Rate Roundup" (6-24-07)

"Good Morning. Freddie Mac had 30-year fixed rates averaging 6.69% last week, down slightly from the week before. Without further ado, our random roundup on rates: Conrad De Aenlle writes in The New York Times: "No change in key interest rates is foreseen when the Fed meets on Thursday. The federal funds rate stands at 5.25 percent." The real news will be the Fed's statement, and what hints it gives about whether the Fed is leaning toward higher rates or lower rates."

Yahoo - "Global property investment at a turning point" (6-24-07)

"Global real estate investment is still buoyant but a few cracks are starting to show as higher borrowing costs begin to bite, making 2007 a pivotal year after an extended bull run in property prices. Future trends will be a key theme for top executives from the world's property industry at the Reuters Real Estate Summit, which is being held in London, New York and Singapore on June 25-27."

Orange County Register - "Retooling for a slow housing market" (6-23-07)

"The Yorba Linda beauty had been on the market for more than a year. But despite the '$450k in upgrades,' the 'unbelievable view of Catalina' and the'gorgeous pool/spa' – not to mention a $150,000 price reduction – it drew only low-ball offers."

Los Angeles Times - "It's Real Estate Fraud Week at LA Land" (6-23-07)

"Good morning. We noticed our in-box was filling up with fascinating (to us, at least) stories about real estate fraud. So we made an executive decision: This is Real Estate Fraud Week at LA Land. First out of the box, a good one. Kate, the voice behind the quirky, Valley-based blog 'May 5 & Everything After,' writes about an agent who was determined to give her $40,000 cash back at closing -- even though she didn't want it!"

Los Angeles Times - "Home Builder Hosedown: Video Shows Protesting Workers Blasted By Water Truck" (6-23-07)

"Weird news item: Tensions between labor unions and home builder Pulte Homes have escalated to the point where protesting workers in Arizona were hosed down at a home construction site, as this YouTube video documents."

Bloomberg - "H&R Block, Hurt by Mortgages, Posts $86 Million Loss" (6-22-07)

"H&R Block Inc., the largest U.S. tax preparer, posted a fiscal fourth-quarter loss after reducing the value of its unprofitable mortgage unit and forecasting that profit for 2008 will be less than some analysts estimated. Net loss for the quarter ended April 30 was $85.6 million, or 26 cents a share, compared with a profit of $588 million, or $1.77, a year earlier, Kansas City, Missouri-based H&R Block said today in a statement. Profit excluding the mortgage unit was $591 million, or $1.81 a share, missing the $1.88 average estimate of seven analysts compiled by Bloomberg."

The Washington Post - "Mortgage Losses Push Hedge Funds to Brink" (6-22-07)

"Two Bear Stearns hedge funds, worth more than $20 billion, teetered near collapse yesterday after absorbing major losses from investments in the subprime mortgage industry. The troubled funds, which lost a key financial backer yesterday, are the latest sign that the problems in the subprime mortgage industry are spreading across the financial markets. If the hedge funds fold and their holdings are sold off at a discount, the value of similar assets owned by other banks, hedge funds and investors also could fall."

Bloomberg - "Bank of America Report Sees Worse Mortgage Defaults" (6-22-07)

"Losses in the U.S. mortgage market may be the ``tip of the iceberg'' as borrowers fail to keep up with rising payments on billions worth of adjustable-rate loans in coming months, Bank of America Corp. analysts said. Homeowners with about $515 billion on adjustable-rate home loans will pay more this year, and another $680 billion worth of mortgages will reset next year, analysts led by Robert Lacoursiere wrote in a research note today. More than 70 percent of the total was granted to subprime borrowers, people with the riskiest credit records, they said."

The Boston Globe - "Fannie Mae investors seek compensation" (6-22-07)

"Fannie Mae investors should be entitled to about $10 billion in compensation for losses stemming from accounting manipulation at the mortgage finance company, Ohio Attorney General Marc Dann said yesterday. 'It was not until the fall of 2005 that people had an actual sense of the magnitude of the restatement,' Dann said in an interview after a hearing in US District Court in Washington. Fannie Mae, the largest source of money for US home loans, completed a restatement in December of earnings from 2001 through June 2004."

Telegraph.co.uk - "Banks fear rout on risky US bonds" (6-22-07)

"Credit markets across the world were braced for trouble last night after Merrill Lynch abandoned efforts to save two Bear Stearns hedge funds, forcing the sale of $850m (£426m) of sub-prime mortgage bonds and other assets for debt repayment. JP Morgan and other key creditors have yet to decide whether to enforce margin calls as a panic sell-off in the market for 2006-vintage mortgage securities pushes the two asset management funds towards the brink."

MSN - "The true cost of owning a home" (6-22-07)

"If you're entertaining thoughts of buying your first home now that the housing market is cooling off and prices are coming down, take note: The cost of home ownership might be a lot more than you think. I'm not talking about the down payment or monthly mortgage payments. Although buying a home is a big investment, owning one comes with a new set of expenses you may not have had while renting or living with Mom and Dad. These extras can put a strain on your daily finances if you aren't prepared."

Orange County Register - "Orange County home prices and sales" (6-22-07)

"For the 22 business days ending June 12, sales for all types of Orange County home sales decreased 30.5 percent. The median sales price decreased .8 percent. The median is where half the homes sold for more and half for less. Types of homes selling, as well as home value changes, cause the median to change."

Los Angeles Times - "Owners still upbeat about homes' value" (6-22-07)

"Slumping sales and drooping prices haven't diminished homeowner optimism about their own nest egg's value, a recent survey shows. The survey by Boston Consulting Group showed that 55% of Americans believed they could sell their house for more now than a year ago, down slightly from the 59% who felt that way last summer. Nearly three-quarters think they could sell their homes within the next six months at a price they set, and 63% believe that real estate is a good or excellent investment."

Real Estate Journal - "Real-Estate Investors Are Heading Overseas" (6-22-07)

"Investing in real estate once meant owning rental property downtown or buying shares in a U.S.-based real-estate investment trust. Today, it increasingly means putting money in a REIT trading in Singapore or buying a pied-à-terre in a refurbished medieval village in northern Italy. These days, real-estate investing is a international proposition. Nearly a score of global real-estate mutual funds have launched in the U.S. in the past two years, more than doubling in number. They now manage some $16.8 billion collectively, with more than $5.8 billion in new money flowing in this year alone, according to investment researchers Morningstar Inc."

NAHB - "Grassley/Baucus/Obama Amendment Puts Immigration Bill Back On Right Track" (6-21-07)

"A bipartisan amendment put forth by Senators Charles Grassley (R-Iowa), Max Baucus (D-Mont.) and Barack Obama (D-Ill.) is critical to putting immigration reform back on the right track, according to the nation’s home builders. 'Everyone has a stake in reforming the nation’s immigration laws in a fair and just manner that will enhance our border security and provide a sensible process for people to enter our country legally,' said Jerry Howard, executive vice president and CEO of the National Association of Home Builders (NAHB). 'The Grassley/Baucus/Obama amendment would help achieve these aims by improving the bill’s employer provisions to allow small business owners to play a constructive role in the enforcement of the new laws.'"

Bloomberg - "Bear Stearns Fund Collapse Sends Shock Through CDOs" (6-21-07)

"Merrill Lynch & Co.'s threat to sell $800 million of mortgage securities seized from Bear Stearns Cos. hedge funds is sending shudders across Wall Street. A sale would give banks, brokerages and investors the one thing they want to avoid: a real price on the bonds in the fund that could serve as a benchmark. The securities are known as collateralized debt obligations, which exceed $1 trillion and comprise the fastest-growing part of the bond market."

The San Diego Union Tribune - Treasury Secretary Paulson says housing correction is likely near the bottom" (6-21-07)

"The major slump in the housing market is nearing an end and should not have a significant impact on the overall economy, Treasury Secretary Henry Paulson said Wednesday. Paulson refused to comment specifically on the market impact of troubles confronting two large Bear Stearns hedge funds that invested heavily in subprime mortgages – loans made to borrowers with spotty credit histories."

Yahoo - "When Should Homebuyers Jump In?" (6-21-07)

"Investors who time any market hope to buy at the nadir and sell at the zenith, but homebuyers have a trickier time knowing when to sit on the sidelines and when to jump in. The reason? There are several. Buying a home is one of the largest financial investments a homebuyer will make. Transaction costs are expensive enough that homeowners remain in their homes approximately six years before trading up or down. As the recent buyers market shows, homes aren't liquid, and may not find buyers at the price and in the time frame that sellers prefer."

USA Today - "Mortgage applications drop as rates remain high" (6-21-07)

"Applications to buy and refinance homes dropped last week, an industry trade group said Wednesday, the latest sign that housing remains mired in a downturn. The Mortgage Bankers Association's mortgage application index slid 3.4% to a seasonally adjusted 643.7 in the week ended June 15."

Orange County Register - "H&R Block swings to loss on Option One woes" (6-21-07)

"The nation's largest tax preparer reported a loss of $433.7 million million for its fiscal year 2007, compared to a gain of $490.4 million a year ago. And it lost $85.6 million in the fourth quarter vs. a whopping gain of $587.5 in the year earlier period. Blame falls to its subprime unit Option One, which the company is selling to Cerberus Capital Management in a deal set to close during the October quarter."

Orange County Register - "Subprime borrowers pay credit cards, not mortgages" (6-17-07)

"It used to be when people got into financial trouble they would pay their mortgage and let their credit cards slide. Not any more -- at least not for subprime borrowers. A new study by Experian, the Costa Mesa-based credit bureau and information services company, shows that subprime borrowers are now paying their credit cards first and getting behind on their mortgages instead."

Los Angeles Times - "The duplex distinction" (6-21-07)

"Distinctive in appearance and designed with thoughtful features that would make the average house dweller jealous, the not-so-humble duplex is back after a prolonged absence from L.A.'s architectural scene. Preminger's home and others like it are rising across the city with a level of ambition rarely seen since the 1920s and '30s, when graceful Spanish and Mediterranean Revival duplexes rose alongside houses in several pockets of town, most notably the tree-lined boulevards near Highland Avenue and 3rd Street."

Orange County Register - "The Thursday Mortgage Rate Update: Rates Dip Slightly" (6-21-07)

"Why didn't we think of this earlier? A weekly update on mortgage rates, via the reliable crew over at Inman News: 'Long-term mortgage rates dipped this week as weak home-builder optimism and lower housing starts took pressure off inflation, Freddie Mac and Bankrate.com reported today.'"

Real Estate Journal - "A Guide for First Timers Making That First Big Home Purchase" (6-21-07)

"Owning a home is a key to the American dream, but with foreclosure rates at a 50-year high in the U.S. it has never been more important to be a responsible buyer. Here are four steps first-time home buyers should take before sinking their life savings into a house."

MBA - "Mortgage Applications Decrease In Latest MBA Survey" (6-20-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending June 15, 2007. The Market Composite Index, a measure of mortgage loan application volume, was 643.7, a decrease of 3.4 percent on a seasonally adjusted basis from 666.5 one week earlier. On an unadjusted basis, the Index decreased 4.1 percent compared with the previous week and was up 13.2 percent compared with the same week one year earlier. The Refinance Index decreased 4.2 percent to 1776.8 from 1854.8 the previous week and the seasonally adjusted Purchase Index decreased 3.0 percent to 450.9 from 464.7 one week earlier. The seasonally adjusted Conventional Index decreased 3.7 percent to 943.0 from 979.1 the previous week, and the seasonally adjusted Government Index decreased 0.3 percent to 144.7 from 145.2 the previous week."

Reuters - "Bear CDO lists total at least $1.44 bln - sources" (6-20-07)

"The sale of securities from troubled Bear Stearns hedge funds includes at least $1.44 billion in collateralized debt obligations, according to bid lists obtained by Reuters. The lists, circulated by JPMorgan Securities and Morgan Stanley, include CDOs managed by Tricadia Capital, Strategos Capital Management and Bear Stearns Asset Management."

New York Post - "SUBPRIME STREET IS FEELING THE HEAT" (6-20-07)

"As a Bear Stearns internal hedge fund begins collapsing, all of Wall Street is wondering if other funds might follow suit. One hedge fund portfolio manager at a $4 billion fund told The Post that auctioning off the assets of Bear's High Grade Structured Credit Strategies Enhanced Leverage fund would unleash Wall Street's dirty secret."

Houston Chronicle - "Fla., Calif. Face Home Price Drops" (6-20-07)

"The days of oceanfront property as a good investment might be a thing of the past. Some homeowners in California, Florida and the southwestern U.S. now face more than a 60 percent chance their property will be worth less in two years, according to a new study by a mortgage insurer. But for Texans and Midwesterners, there is much less reason to worry."

MSN - "Mortgage applications drop" (6-20-07)

"Applications to buy and refinance homes dropped last week, an industry trade group said on Wednesday, the latest sign that U.S. housing remains mired in a downturn. The Mortgage Bankers Association's mortgage application index slid 3.4 percent to a seasonally adjusted 643.7 in the week ended June 15. The drop in applications piled on to reports from the country's builders and the government this week suggesting any sustained housing rebound could be next year's business."

Bloomberg - "Rate Rise Pushes Housing, Economy to `Blood Bath'" (6-20-07)

"The worst is yet to come for the U.S. housing market. The jump in 30-year mortgage rates by more than a half a percentage point to 6.74 percent in the past five weeks is putting a crimp on borrowers with the best credit just as a crackdown in subprime lending standards limits the pool of qualified buyers. The national median home price is poised for its first annual decline since the Great Depression, and the supply of unsold homes is at a record 4.2 million, the National Association of Realtors reported."

CNN - "Foreclosures drift to Sun Belt from Rust Belt" (6-20-07)

"For sheer volume, housing foreclosures across the nation appear to be moving from the Rust Belt to the Sun Belt. A study for CNNMoney.com by RealtyTrac, an online marketer of foreclosure properties, showed that 139 of California's ZIP codes fell within the top 500 for total foreclosure filings in the United States. The next highest count for any state is less than half that at 72 and is in another sun-belt state - Florida."

Mish's Global Economic Trend Analysis - "Delinquencies, Foreclosures, Dumbness" (6-20-07)

"The Modesto California Bee is reporting Hundreds delinquent on taxes. Modesto and Patterson this summer are preparing to speed the foreclosure process on hundreds of homes because an unusually large number of residents in six subdivisions are delinquent on their Mello Roos taxes. About 145 homes are at risk in parts of the Village I neighborhood in east Modesto and in the Fairview Village development in southwest Modesto. In Patterson, 489 homes are delinquent on their Mello Roos taxes in the Patterson Gardens, Walker Ranch, Miraggio and Sutter Point developments."

Yahoo - "Housing Construction Down in May" (6-20-07)

"Construction of new homes fell in May as the nation's homebuilders were battered by the crisis in subprime lending and rising mortgage rates. Housing, which is struggling through its biggest downturn in 16 years, is expected to continue to face troubles in the months ahead before starting to stage a sustained rebound in 2008."

Yahoo - "Moody's Downgrades Subprime Investments" (6-20-07)

"Moody's Investors Service said Friday it downgraded 131 mortgage investments backed by loans issued to people with weak, or subprime, credit histories. More people who took out subprime mortgages, especially adjustable-rate loans issued over the past two years, have been defaulting on their monthly payments as their mortgages reset to higher rates."

Los Angeles Times - "L.A. Asking Prices Slip Again, to $539K, as Inventory Climbs" (6-20-07)

Asking prices in greater L.A. fell slightly in the last week as inventory continued to pile up, according to Housing Tracker's analysis of MLS listings, which we monitor here every week. Housing Tracker shows the median asking price fell $1,000, to $539,000 this week. Inventory lurched higher again, with an additional 558 homes listed, and now 41,324 are on the market. More on the numbers: The $539,000 median asking price represents a drop of 6.9% over the last year, and 1.1% over the last month. Inventory increased 5.7% in the last month and 18.7% over the last year."

Charles Hugh Smith - "How the Housing Bubble/Credit Bubble Will Pop" (6-20-07)

"When 2008 rolls around and the U.S. economy is sinking with frightening momentum into a quagmire, you'll be glad you read this entry. Why? Because you anticipated every step of the implosion and warned your friends who were still floating complacently down that river in Egypt (de-nial). In keeping with our theme of context, let's begin by noting that the proper context for the housing bubble is the all-encompassing global credit bubble which has inflated every asset class. With this fundamental firmly in mind, let's follow Deep Throat's advice from the classic film All the President's Men and 'Follow the money.'"

Credit Suisse - "Mortgage Liquidity du Jour: Underestimated No More" (6-20-07)

"In response to the recent turmoil in the mortgage market, we surveyed our private homebuilders and their mortgage lenders to asses the new home market’s exposure to mortgage products that are at greatest risk for tightening and increased regulation in the coming months --- it’s not just a subprime issue. We believe that 40% of the market (share of subprime and Alt-A) is at risk of significant fallout from tightening credit and increased regulatory scrutiny. In particular, we believe the most pressing areas of concern should be stated income (49% of originations), high CLTV/piggyback (39%), and interest only/negative amortizing loans (23%). The proliferation of these exotic mortgage products has been disproportionately weighted to former hotbeds such as California, Nevada, Arizona and Florida, which have accounted for the lion share of builder profits."

Orange County Register - "Opteum Financial closes doors early" (6-20-07)

"Workers at Opteum Financial Services thought they had four days left before they lost their jobs, but when they showed up for work Tuesday, they found their way blocked by security guards and were told the office was closed, effective immediately, said Mary Glass Schannault. She was a senior vice president at the mortgage company and one of those who suddenly found themselves out of work."

Orange County Register - "Could housing pose risk to economy?" (6-20-07)

"Orange County is the sixth riskiest major housing market in the nation. Or so says fresh rankings from one major player in the mortgage game. And, believe it or not, this ranking is a noteworthy improvement. PMI Group, the mortgage insurer, just revamped its housing risk metrics that are based on local pricing trends and regional economics. When you're like PMI, and you're in the business of protecting lenders and mortgage investors from themselves, you'd better be up-to-date on what's happening in housing markets."

Inside Bay Area - "Report: Bay Area may face job losses" (6-19-07)

"A 2-year-old bill is about to come due for the Bay Area and the rest of California in the form of job losses triggered by the nose-dive in the housing market, a forecast being released today suggests. Experience points to a lag time of two years between a peak in home-building activity and a pronounced slowdown, or even job losses, for industries whose fortunes are linked to the housing market, according to researchers with the UCLA Anderson Forecast. The economists studied four cycles involving housing slumps and the after-effects on the job market. Somewhere around summer 2005, building permits in California hit a peak and then began to slump, said Ryan Ratcliff, an economist with UCLA Anderson."

NAHB - "Housing Starts Fall 2.1 Percent In May As Downswing Continues" (6-19-07)

"Housing starts fell 2.1 percent in May to a seasonally adjusted annual rate of 1.474 million units as the correction in the housing market continued, according to figures released by the Commerce Department today. Starts were down 24.2 percent from a year earlier. 'Builders still are cutting back on new production as they work down their inventories in the face of slack home buyer demand,' said Brian Catalde, president of the National Association of Home Builders (NAHB) and a home builder from El Segundo, Calif. 'According to recent NAHB Housing Market Index surveys, they are trimming prices and offering a variety of nonprice incentives to boost sales and limit cancellations.'"

MBA - "MBA Hails House Introduction of Legislation to Extend Terrorism Risk Insurance Program" (6-19-07)

"The Mortgage Bankers Association (MBA) today applauded the introduction of HR 2761 – the Terrorism Risk Insurance Revision and Extension Act of 2007 - by Representative Michael Capuano (D-MA) and House Financial Services Committee Chairman Barney Frank (D-MA). As introduced on June 18, HR 2761 provides for a ten year extension to the Terrorism Risk Insurance Program at the Department of the Treasury. MBA is pleased to see the introduction of this bill and looks forward to working with Congress on a long-term solution."

The San Diego Union Tribune - "Housing slump's drag on state flagged" (6-19-07)

"The continuing downturn in the real estate market will result in sluggish economic growth in California through late 2008 and home sales may not stabilize until mid-2009, according to a report released today by one of the state's leading economic think tanks. Layoffs in construction and finance will drag job growth to below 1 percent for the next five quarters, said a report by the UCLA Anderson Forecast."

Bloomberg - "U.S. Housing Starts Fell in May to 1.474 Million Pace" (6-19-07)

"Housing starts in the U.S. fell in May, signaling the slump in home construction will continue to depress growth. Builders broke ground on new houses at an annual rate of 1.474 million, down 2.1 percent from 1.502 million the prior month, the Commerce Department said today in Washington. Building permits rose 3 percent to 1.501 million from 1.457 million."

Yahoo - "Is That Gain on Your Home Really So Big?" (6-19-07)

"Here's a not-so-uncommon scenario these days: You bought your lovely home, be it a castle, bungalow or yurt, for $200,000 five years ago. Today, it's worth about $300,000. That's a tidy 50% total gain, or 8.5% on a compound annual basis. Right? Not so fast -- you've probably oversimplified matters. For example, think about what you've put into the home over the years. Some of those purported profits probably went to businesses like Home Depot (NYSE: HD - News), Lowe's (NYSE: LOW - News), or home-building supplier USG (NYSE: USG - News)."

CNN - "When the housing rebound comes" (6-19-07)

"If you're the sensitive type of homeowner, you may want to skip the rest of this paragraph, which recounts the unrelentingly grim news about home prices. At least 42 percent of major housing markets are in decline, with some projected to fall by double digits over the next five years. One alarming sign: The National Association of Realtors has reversed its usually sunny outlook and is now predicting a 1 percent drop nationwide in existing home prices in 2007, the first such prediction in the four decades since NAR started tracking prices."

Yahoo - "Adjusting to Higher Mortgage Payments" (6-19-07)

"Back in April, I wrote "Six Steps to Avoiding Foreclosure" as a practical guide for homeowners who are having trouble meeting their mortgage payments. The most important nugget of advice I gave in that column -- and something that not enough homeowners do -- is to take the initiative to call your lender as soon as you realize you have a problem. The same advice holds true if you have an adjustable rate mortgage that's going to reset to a higher interest rate -- which in turn will raise your monthly mortgage payment."

Bloomberg - "U.S. Economy: Housing Starts Fell, Signaling Prolonged Slump" (6-19-07)

Housing starts in the U.S. fell for the first time in four months in May as interest rates rose, suggesting no early end to the recession in residential real estate. Builders broke ground on new houses at an annual rate of 1.474 million, down 2.1 percent from the prior month, the Commerce Department said today in Washington. Building permits increased 3 percent to 1.501 million. The worst housing recession in 16 years is restraining economic growth even as inflation is too high for the comfort of Federal Reserve officials. A jump in mortgage rates and a glut of unsold properties may further reduce demand in coming months, economists said."

Orange County Register - "Bixby Land closes on $345 million purchase of six O.C. properties" (6-19-07)

"Newport Beach-based Bixby Land Co. announced Tuesday it has finalized the purchase of six properties in Newport Beach, Irvine and Seal Beach that it's buying from Maguire Properties for about $345 million. The sales are the latest in a series of property flips that began when The Blackstone Group bought Equity Office Properties in February. The properties consist of 11 buildings at five locations, with a total of 816,000 square feet, the real estate investment and development firm said. In addition, the deal includes a developable 3.5-acre site in Irvine where Bixby plans to build a four-story office building consisting of about 100,000 square feet."

Orange County Register - "Arden Realty acquires 106 office buildings in O.C. and the West" (6-19-07)

"Arden Realty officials announced today the signing of an agreement to buy 38 properties in Orange County and five Western cities. The properties consist of 106 office buildings and 5.9 million square feet in Orange County, San Diego, San Francisco, Seattle, Portland and Salt Lake City. The properties made up the CarrAmerica West Coast Collection that Blackstone Group purchased last year."

Los Angeles Times - "Santa Monica Snapshot: North of Montana, $5 Million Is the New Normal" (6-19-07)

"Like Westside Bubble, we were surprised when listings broke through the $5-million barrier north of Montana in Santa Monica, and more surprised when the house in question sold above the asking price in, like, 11 minutes."

Real Estate Journal - "Luxury-Home Floor Plans That Are Popular With Buyers" (6-19-07)

"Even in a slow market for new homes, some luxury models are still proving popular with buyers. Nearly two years into the housing slowdown, builders report that their top-selling high-end homes feature less-conventional floor plans and more specialty rooms than previous models, even though the overall square footage in most cases has remained the same. Many of the most popular models, designed to fit onto smaller lots, feature angled walls or entryways that make interiors appear bigger; game rooms, sun rooms and other special-use spaces; and smaller formal living rooms."

Real Estate Journal - "How I Sold My House In Just Six Days" (6-19-07)

"When my agent listed my house on June 8, she included what I feared was too bold a directive: 'Seller will review all offers on June 14.' All offers? What if there were no offers? Such a technique was common during the real-estate boom. But more recently, I've mostly seen the tactic used when a home is in excellent shape -- a message that a lot of time (and possibly, money) was spent making the house move-in ready and that a buyer should act quickly. I wondered whether my place was really in such good shape and worried buyers might be scared away."

NAHB - "Builder Confidence Slips Again In June" (6-18-07)

"Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as either 'good,' 'fair' or 'poor.' The survey also asks builders to rate traffic of prospective buyers as either 'high to very high,' 'average' or 'low to very low.' Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor."

MBA - "Fannie Mae Cliarifies Manufactured Housing Requirements" (6-18-07)

"In its' commitment ’s commitment to homeownership, Fannie Mae is involved helping to make lower cost funds available for the purchase of affordable housing. Manufactured homes play an important role in providing affordable housing for many low- and moderate-income borrowers, especially in high-cost or rural areas. Fannie Mae invests in mortgages secured by manufactured housing as part of its mission to expand affordable housing by providing liquidity to a market segment that is crucial to many homebuyers. We remain committed to providing funding for this important segment of the housing market and we do so under terms that provide successful homeownership opportunities for homebuyers while ensuring that mortgages we purchase meet our credit standards."

Briefing.com - "Moody's Issues Subprime Reminder" (6-18-07)

"In the earnings reports last week from Lehman Bros. (LEH 79.07), Goldman Sachs (GS 226.19) and Bear Stearns (BSC 150.09), it was readily apparent that their fixed income businesses weren't all they could be due to the problems in the subprime mortgage market. Today's Wall Street Journal has an article on the subprime woes that calls specific attention to a Moody's downgrade on Friday of 131 bonds backed by pools of subprime loans. The reporters were careful to point out that the downgrade affects only $3 billion worth of bonds out of the roughly $400 billion in subprime mortgage-backed bonds issued in 2006."

WSBTV.com - "Looking For Home Lender? Be Prepared" (6-18-07)

"In fact, borrowers could lose big. It's up to borrowers to figure out their financial situation, know how much house they can afford and not use a mortgage as an excuse to overspend. Part of that process involves getting finances in order, finding a lender and getting matched with a loan product that suits that person's financial picture. In the fourth quarter of 2006, 1.19 percent of 43.5 million outstanding loans were in the foreclosure process, according to the Mortgage Bankers Association. That's up 20 basis points over the fourth quarter of 2005."

CNN - "Desperate measures for the mortgage business" (6-18-07)

"During the height of the real estate bubble, mortgage lenders were often shameless in how they pursued new business. Whether it was jacking up hidden closing costs to make loans appear cheaper than they were or using absurdly-low teaser rates on option- or interest-only ARMs to get customers in the door, lenders made owning a home seem easy. Too easy. Fast forward a couple years, and mortgage defaults are skyrocketing. Foreclosures were up 90 percent in May alone, according to RealtyTrac. And lenders are finally realizing that coaxing consumers to borrow more than they can really afford is, as business strategies go, just plain dumb."

CNN - "3 problems with refis - and what you can do" (6-18-07)

"When my husband and I took out a mortgage a few years ago, our mortgage broker assured us that no matter which product we chose, we didn't have to worry. If we decided we didn't like the loan in a few years, we could simply swap it for a new one. Nowadays a lot of borrowers with adjustable-rate and interest-only loans are facing rate resets and would love to swap out of trouble."

Yahoo - "Moody's Downgrades Subprime Investments" (6-18-07)

"Moody's Investors Service said Friday it downgraded 131 mortgage investments backed by loans issued to people with weak, or subprime, credit histories. More people who took out subprime mortgages, especially adjustable-rate loans issued over the past two years, have been defaulting on their monthly payments as their mortgages reset to higher rates. That, in turn, makes mortgages pooled into securities and sold to investors a riskier proposition. Moody's said it also put 237 securities on review for further downgrades, including 111 of those already downgraded Friday. The downgrades affects both investment-grade and below-investment grade debt, including securities that had been rated 'Aa', 'Aaa' or 'A' and below, Moody's said."

Bloomberg - "Housing Starts Probably Declined in May: U.S. Economy Preview" (6-18-07)

"Residential construction declined in May to a four-month low and homebuilder confidence stayed depressed, reports this week may show, indicating the housing slump will persist even as other parts of the economy show renewed strength. Housing starts slid to an annual rate of 1.472 million in May from 1.528 million the prior month, according to the median forecast of 58 economists in a Bloomberg News survey ahead of the Commerce Department's June 19 report."

Yahoo - "The rich are bullish on real estate" (6-18-07)

"The very rich are different from you and me: they don't seem to be too worried about the current housing slump. At least that's what a new study released Monday found. More than half of affluent homeowners expect their property value to appreciate at least somewhat during the next year, according to the Coldwell Banker Previews International Luxury Survey. A tenth of them expect significant gains."

Yahoo - "Make a buck off rising interest rates" (6-18-07)

"The recent run-up in interest rates may be a letdown to someone looking for a home loan, but it could spell dollar signs for investors with money to lend. Four years ago, when rates were around 1 percent, loan-based investments like certificates of deposit (CDs) and money market funds weren't attractive because their payoffs rise and fall along with rates."

Yahoo - "Outsmart rising mortgage rates" (6-18-07)

"Mortgage rates jumped to the highest level in nearly a year, according to Freddie Mac. So if you have an adjustable-rate mortgage - or you're just worried about making those monthly payments - we'll tell you what to do now. 34 percent of homeowners don't know what kind of mortgage they have, and with interest rates going higher, that's a costly error. If you have a traditional ARM, or 1-, 3-, or 5-year hybrid ARM, your monthly statement will not tell you your caps or any other terms of your loan. The only way to figure that out is to look at your adjustable rate rider. This should be included with your original closing papers."

Reuters - "Home builders pare down to weather storm" (6-18-07)

"There is no good news for some the largest home building companies in the United States. 'We do think if you're dumb enough to buy a home builder (share), you ought to buy us,' Ryland Group Inc.(RYL.N: Quote, Profile, Research) Chairman and Chief Executive Officer R. Chad Dreier, told an investor audience at the JP Morgan Basics and Industrials Conference this week. Against a backdrop of plunging sales and rising contract cancellations, there was little talk of a turnaround or a bottoming out of the housing market."

Los Angeles Times - "L.A. Asking Prices Slip Again, to $539K, as Inventory Climbs" (6-18-07)

"Asking prices in greater L.A. fell slightly in the last week as inventory continued to pile up, according to Housing Tracker's analysis of MLS listings, which we monitor here every week. Housing Tracker shows the median asking price fell $1,000, to $539,000 this week. Inventory lurched higher again, with an additional 558 homes listed, and now 41,324 are on the market."

Real Estate Journal - "How I Came to Buy A Brady Bunch House" (6-18-07)

"It's now five days since I put my house on the market, and a couple in their early 30s may make an offer. They are renters in Seattle’s Capitol Hill area -- an 'artsy' neighborhood bordering downtown. They have 'connected' with the house and feel it's where they belong. It's funny, because hours before I learned of their interest, my agent forwarded me feedback from another buyer, a single woman who thought my front steps were too steep for her aging parents and that the home's "unusual additions" and lack of a garage wouldn’t work for her."

MSN - "Hated blogger leaves U.S., threatens lawsuits" (6-17-07)

"A failed real estate speculator who created a popular Web site touting his exploits has begun threatening to sue his critics and claims to be in hiding in Australia. Casey Serin, arguably the world's most-hated blogger, rocketed to Internet stardom after disclosing his pending foreclosures, marital strife and unwillingness to find a job. But the 24-year-old's online fame was hardly flattering: it arose from legions of readers who call themselves "haterz" and frequent his iamfacingforeclosure.com blog to ridicule his financial missteps and urge Serin to pay back up to $420,000 he is said to owe creditors."

The News-Press - "Avoid costly use, zoning assumptions when buying land" (6-17-07)

"The first three questions a real estate agent is usually asked, although not necessarily in this order, are: 1) What is the asking price? 2) What is the size? 3) What is the zoning? The first two are pretty straightforward, but look out for No. 3, because you'll probably get the right answer, but you might be asking the wrong question. Zoning is a general classification as to what a property MIGHT be used for. I can't emphasize, "might" enough, because a zoning classification does NOT automatically grant permission to use a property in a certain way. This is especially true for vacant land."

The San Diego Union Tribune - "No mortgage bailout this year, experts say" (6-17-07)

"Homeowners unable to pay monthly mortgage bills and facing foreclosure shouldn't count on help from Washington this year. Regulators and lawmakers seem to be taking a wait-and-see approach as they confront the fallout from several years of lenders making too many home loans to people with inadequate credit. It would be a mistake to overreact to a market that is already showing signs of self-correcting at a time when little evidence has emerged that the broader economy is at risk, according to regulators and some lawmakers. They also note that consumer spending remains solid, the nation's jobless rate is still low, and stock indexes have hit record highs in reaction to strong corporate profits."

The San Diego Union Tribune - "Renting good credit may become history" (6-17-07)

"The days may be numbered for dozens of Internet-based companies that promise to quickly boost FICO credit scores by 200 to 300 points. Fair Isaac Corp., the developer of the widely used FICO score, soon plans to introduce key changes designed to derail schemes that transplant high-quality credit card histories into the files of people with low FICO scores."

Recordnet.com - "Housing market takes a hit" (6-17-07)

"What do you get when you combine a huge number of interest-only and subprime mortgages with a skidding real estate market? Foreclosures, that's what. And in the case of San Joaquin County, you get the highest metropolitan foreclosure rate in the nation. No. 1."

Orange County Register - "Readers tell whether Greenspan created 'froth'" (6-17-07)

"Two years ago – June 9, 2005 – then-Fed czar Alan Greenspan gave us real estate watchers a new word to debate – "froth." As he told Congress: "Although a 'bubble' in home prices for the nation as a whole does not appear likely, there do appear to be, at a minimum, signs of froth in some local markets where home prices seem to have risen to unsustainable levels." We asked visitors to the Lansner on Real Estate blogwhat they thought of Greenspan's "froth" call. Here are the results from 318 votes cast in what's an unscientific sample of public sentiment:"

Los Angeles Times - "It's the new normal" (6-17-07)

"ON a recent Sunday, Bob and Jane Baker practically tiptoed across the hardwood floor of a newly refurbished Sherman Oaks home, looking a bit sheepish about bringing their Italian greyhound to the open house. They needn't have worried about Digby being an unwelcome visitor, however. Just about anything goes today, as agents vie to get potential buyers into homes for sale. 'A couple years ago, a house situated next to an alley, with 16 additions, could sell without an open house' said Keith J. Fisher, associate manager of Prudential California Realty in Sherman Oaks. 'Now, it's sitting there for half a year. Open houses can make a difference, especially for new listings.'"

Los Angeles Times - "Malibu, Encino at top of the real estate market" (6-17-07)

"As other real estate markets in Southern California plod, stagnate or worse, the Davises' Encino ZIP Code continues to march right along, enjoying annual price percentage gains in the double digits. Through the first four months of the year, single-family homes in the 91316 ZIP Code in Encino experienced an 18.2% jump in price over the same period last year when measured by cost per square foot, according to real estate tracker DataQuick Information Systems. Although most buyers focus on median sales prices, analysts say the price per square foot offers the most reliable snapshot of how a market is performing over a wide area."

Los Angeles Times - "From the Doctor, Tough Medicine For Sellers: Forget About Last Year, Lower Your Price" (6-17-07)

"Dr. Housing Bubble is a blogger with a sense of humor, and we particularly enjoyed his post this weekend titled, 'Putting Home Sellers on the Couch: The Psychology of Why Sellers Refuse to Lower Prices.' Examining sellers who are in denial and refuse to cut their prices, the Doctor observes, 'They are pining for the days of 2006 as if it were a lost high school love interest.'"

Ventura County Star - "Assessor lowers assessed values of 8,622 homes" (6-16-07)

"Property owners who think their tax assessments should be reduced amid falling real estate prices should wait before hiring a company to help them win a reduction, Ventura County Assessor Dan Goodwin said Friday. That's because their homes may be among 8,622 whose assessed value has been cut under a program that Goodwin's staff launched this year in response to the real estate downturn."

Bloomberg - "Treasury Yields Reach Five-Year High as Rate Cut Bets Diminish" (6-16-07)

"U.S. 10-year Treasury yields reached a five-year high as traders stepped up bets the economy is strong enough to keep the Federal Reserve from cutting interest rates this year. The price of the benchmark 10-year note, which moves inversely to the yield, dropped a sixth straight week, the longest slide since 2005. A government report on June 13 showed retail sales rose by the most in more than a year in May, easing concern that falling home values will crimp consumer spending."

Los Angeles Times - "Online Cheating Lessons -- Mortgage Fraud 2.0" (6-16-07)

"The New York Times reports new websites are fueling the rampant mortgage fraud that has caused a huge spike in loan defaults. Aside: Items like this make us feel old. We remember the good old days, about two years ago, when you had to actually know some real criminals to engage in a fraud scheme."

Los Angeles Times - "The Problem With Section 8: A Crackdown in The Antelope Valley" (6-16-07)

"Good piece of reporting today on LATimes.com about a crackdown on Section 8 tenants in The Antelope Valley, and the various issues it raises. Chief among those issues, as Jessica Garrison and Ted Rohrlich report, is whether it's fair, or even legal, to have armed deputies piling into an apartment without a warrant to investigate a neighbor's complaint about the people who live there."

DQNews.com - "California May 2007 Home Sales" (6-15-07)

"A total of 36,975 new and resale houses and condos were sold statewide last month. That's up 5.8 percent from 34,949 for April, and down 31.7 percent from 54,099 for May 2006. Last month's sales made for the slowest May since 1995 when 32,223 homes were sold. May sales from 1988 to 2007 range from 32,952 in 1993 to 67,958 in 2004. The average is 48,780. On a year-over-year basis, sales have declined the last 20 months."

MBA - "Freddie Mac Offers Guidance Regarding 2007 Area Median Income Changes" (6-15-07)

"On February 17, 2005, Freddie Mac introduced Home Possible Mortgages to help its Sellers meet the needs of more low- to moderate-income borrowers. The Home Possible Mortgage suite has successfully provided low-down payment options and credit flexibility to assist these borrowers. The suite also provides features such as higher debt payment-to-income ratios and extended temporary subsidy buydown plans for firefighters, law enforcement officers, healthcare workers and teachers—borrowers who live in the communities they support—and to members of the armed forces."

Voice of America - "Bankers Says More Problems Ahead for Slumping US Housing Market" (6-15-07)

"The bankers' association predicts overall growth in the U.S. economy will be 2.1 percent in 2007. That is less than the 3.2 percent growth of 2006. But bank economists do not foresee an outright decline or recession either this year or next. Stockbroker Scott Brown of St. Petersburg, Florida, says the growth deceleration is mainly the result of weakness in the housing sector. Brown says home owners are seeing a painful correction from the buying frenzy that in many areas sent home prices soaring between 2000 and 2005."

Bloomberg - "U.S. Economy: Core Prices Ease, Letting Fed Hold Rate" (6-15-07)

"A measure of U.S. consumer prices rose less than forecast in May, evidence that ebbing inflationary pressures may allow the Federal Reserve to keep interest rates unchanged this year. The 0.1 percent increase in core consumer prices, which exclude food and energy costs, followed a 0.2 percent rise the prior month, the Labor Department said in Washington today. Separately, the University of Michigan reported that consumer confidence fell, and Fed figures gave conflicting signals on the strength of manufacturing."

CNN - "Overheated housing markets cool down" (6-15-07)

"Some of the nation's most overheated housing markets may be cooling off to more reasonable levels following their unprecedented run-up in the first half of the decade. According to a report from the financial service companies, National City Corp and Global Insight, the number of single-family homes they judged overvalued in the United States fell from 17 percent in the last quarter of 2006 to 14 percent in the quarter ended March 31."

DQNews.com - "Bay Area home sales drop, prices up" (6-15-07)

"Bay Area homes continued to sell at their slowest pace in 12 years last month, as the median sales price edged up to a new peak, a real estate information service reported. A total of 8,080 new and resale houses and condos were sold in the nine-county Bay Area in May. That was up 8.5 percent from 7,447 in April, and down 18.7 percent from 9,935 for May a year ago, according to DataQuick Information Systems."

The Boston Globe - "Mortgage rates rise toward 5-year high" (6-15-07)

"Mortgage rates are nearing a five-year high, raising the cost of home ownership for buyers by hundreds or thousands of dollars a year at a time when real estate markets are struggling with tepid demand and a surplus of houses for sale. The average rate for a traditional 30-year fixed mortgage jumped to 6.74 percent, from 6.53 percent a week ago, Freddie Mac, one of the nation's largest mortgage investors, said yesterday in its weekly market survey. That was the biggest one-week jump since 2004, and in just one month rates have come up by more than one-half a percentage point."

Seeking Alpha - "FTC Confirms That Most Homebuyers Couldn't Identify Mortgage Amount" (6-15-07)

"Tim Iacono submits: Today's LA Times report of a study by the Federal Trade Commission confirms what many observers may have suspected about mortgage lending disclosure during the housing boom a couple years back - even if home buyers cared about the price they were paying, they had only a fifty-fifty chance of finding it on their loan documents."

Reuters - "Home builders pare down to weather storm" (6-15-07)

"There is no good news for some the largest home building companies in the United States. 'We do think if you're dumb enough to buy a home builder (share), you ought to buy us,' Ryland Group Inc.(RYL.N: Quote, Profile, Research) Chairman and Chief Executive Officer R. Chad Dreier, told an investor audience at the JP Morgan Basics and Industrials Conference this week."

CNN - "An era of cheap money - gone" (6-15-07)

"This month's rise in global interest rates is probably a sign of the beginning of the end of an era of supercheap money - a change with profound implications for the recent record-setting stock rally, the buyout boom and economic growth worldwide. The question now is how much more rates might rise in the United States and elsewhere, and how that will affect world markets - and hundreds of millions of investors and consumers from Tokyo to Frankfurt to New York."

Market Watch - "Adjustable-rate mortgages going sour" (6-15-07)

"The mortgage bankers came out with their latest survey on mortgage delinquencies and foreclosures on Thursday, showing a small rise in the percentage of homeowners who are in the process of losing their homes because they aren't paying the mortgage. At the end of the quarter, 1.28% of all loans were in the foreclosure process, up from 1.19% in the fourth quarter. See full story. For those who have fixed-rate loans, or who passed the strict criteria to get a loan from the FHA or VA, foreclosure and delinquency rates actually fell. But those who took out adjustable-rate loans fell further behind."

Los Angeles Times - "'60 Minutes' Effect? Overwhelmed Redfin Stops Accepting New Listings" (6-15-07)

"Redfin, the discount online real estate brokerage, announced tonight that it has stopped accepting new listings, saying it has been overwhelmed by an unexpected spike in listings in Los Angeles and San Francisco. The company was recently featured on the CBS news show '60 Minutes.' Redfin made the announcement on its corporate blog Friday in a post titled 'A Crazy Decision': 'From June 16 to July 8, Redfin is not accepting new listing customers. You can submit listing information now if you'd like, but we will not contact you or list your property until July 9. If Redfin has already committed to listing your property, you can be sure that we will continue to meet your highest expectations.'"

Real Estate Journal - "Race to the Finish: Will the Seller's Home Be Ready for Open House?" (6-15-07)

"I'm familiar with some staging basics, such as cleaning out clutter and leaving as little as possible in small closets. It was interesting to see my personal belongings rearranged to 'depersonalize' my home -- and render it 'merchandised.' Here's some staging tactics we used"

NAHB - "Newest Recipients Named To National Housing Hall Of Fame" (6-14-07)

"In recognition of their outstanding lifetime achievements in the housing industry, Henry Cisneros, R. James 'Jim' Nicholson, Bruce C. Smith and William J. Levitt were inducted into the National Housing Hall of Fame last week during an induction ceremony held in conjunction with the National Association of Home Builders’ (NAHB) Spring Board of Directors meeting. 'The National Housing Hall of Fame recognizes individuals whose spirit, ingenuity and determination have changed the face of housing history for the better,' said Brian Catalde, a home builder from El Segundo, Calif. and president of NAHB. 'All of these fine people deserve this award and our thanks for strengthening our industry.'"

NAHB - "NAHB To Launch National Green Building Program" (6-14-07)

"The board of directors of the National Association of Home Builders has approved the creation of a national green building program to provide a template for voluntary, market-driven green building all over the country. The vote came during the NAHB Spring Board of Directors meeting in Washington, D.C. on June 10. The new program will be based on the National Green Building Standard, a model for residential construction and renovation written by builders, architects, environmentalists and product experts that will be released in early 2008."

Victorville Daily Press - "Foreclosed Victorville homes go on block" (6-14-07)

"As foreclosures add to the surplus of homes on the residential property market, auctions are rising in popularity. Hudson and Marshall on Thursday will put 12 homes under the gavel in Victorville ranging in price from $86,000 to about $350,000. 'We are truly in a buyer’s market, and purchasing a home through the auction is a great way to find a deal,' said Dave Webb, principal with Hudson & Marshall, the country’s largest real estate auction firm of foreclosed properties."

The Washington Post - "Foreclosures Up on Certain Mortgages" (6-14-07)

"The number of U.S. mortgages entering foreclosure reached an all-time high in the first three months of the year, led by homeowners with blemished credit histories, the Mortgage Bankers Association said in a report today. The rate of loans entering foreclosure was 0.58 percent on a seasonally adjusted basis, up from the previous record 0.54 percent in the fourth quarter of 2006. So-called subprime loans, made to risky borrowers, entered foreclosure at a rate of 2.43 percent, up from 2 percent the previous quarter. There was also an uptick in new foreclosures on prime loans, those made to people deemed more creditworthy-- from 0.24 percent last quarter to 0.25 percent this quarter, the association reported."

Yahoo - "Most Resilient U.S. Real Estate Markets" (6-14-07)

"When it comes to real estate, the questions on everyone's lips are: How low is low, and when's the perfect time to buy back in? That moment has passed in Seattle and Charlotte--both metros hit bottom in the first quarter of 2006 and have since posted price gains of 12.3% and 6.3%, respectively, according to National Association of Realtors (NAR) data. Of the 40 largest metros that have yet to bottom out, which are ripe for investment? Philadelphia and New Orleans. Based on housing inventory and local economic conditions, both should hit price troughs by year's end and bounce back with moderate gains around 4% in 2008."

CNN - "Fed looks to rein in 'liar loans'" (6-14-07)

"The Federal Reserve opened a hearing in Washington today to solicit suggestions on how to curb abusive mortgage lending practices. Representatives from a wide range of interest groups were scheduled to appear at the hearing, which was chaired by Randall S. Kroszner, a member of the Fed's Board of Governors. In opening remarks Kroszner said, 'The hearing will focus specifically on how the Board might use its rulemaking authority under HOEPA (Home Ownership and Equity Protection Act) to address concerns about abusive mortgage lending practices.'"

CNN - "Mortgage rates: biggest spike in 4 years" (6-14-07)

"Mortgage rates made their largest upward movement in nearly 4 years, and the 30-year fixed-rate reached its highest level since July 2006, Freddie Mac said Thursday. The average rate on 30-year fixed-rate loans climbed to 6.74 percent for the week ending June 14, from 6.53 percent the previous week. That marked the biggest one-week increase since July 2003. Last year at this time, 30-year mortgage rates averaged 6.63 percent. The rate is the highest since July 20, 2006, when it averaged 6.80 percent. The 30-year rate stood at 6.15 percent on May 10th, just before it turned sharply up."

CNN - "Home foreclosures hit record" (6-14-07)

"Home foreclosures hit record levels the first quarter, jumping sharply from a year ago level due to economic weakness in the Midwest and the battered housing market in the overbuilt Sunbelt. The report is the latest look at the hit to the home loan market caused by the problems in the subprime mortgage sector that first started getting national attention early this year. Those problems have led to bankruptcies and tighter lending standards, which in turn have hit the sales of both new and existing homes."

Reuters - "Bear Stearns fund facing mortgage losses: WSJ" (6-14-07)

"Bear Stearns' High-Grade Structured Credit Strategies Enhanced Leverage Fund is facing losses and, together with a sister fund, is trying to sell about $4 billion in bonds to raise cash for redemptions and to prepare for likely margin calls, according to the report, which cited people close to the fund. Market sources told Reuters on Wednesday that Bear was aiming on Thursday to sell $3.8 billion of asset-backed securities backed by subprime loans."

Yahoo - "Freddie Mac Posts 1Q Loss of $211M" (6-14-07)

"Freddie Mac, the nation's second largest buyer and guarantor of home mortgages, reported a first-quarter loss of $211 million, mainly from erosion in the value of financial instruments it uses to hedge against interest rate swings. The government-sponsored company, which is emerging from an accounting scandal, said Thursday it lost 46 cents a share for the three months ended March 31. That contrasted with a profit of $2 billion, or $2.80 a share, a year ago."

MBA - "Delinquencies Decrease in Latest MBA National Delinquency Survey" (6-14-07)

"The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 4.84 percent of all loans outstanding in the first quarter of 2007 on a seasonally adjusted (SA) basis, down 11 basis points from the fourth quarter of 2006, and up 43 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 1.28 percent of all loans outstanding at the end of the first quarter, an increase of nine basis points from the fourth quarter of 2006 and 30 basis points from one year ago."

MBA - "MBA Applauds Board of Governors of the Federal Reserve for Hearing on HOEPA" (6-14-07)

"John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA) applauded the Board of Governors of the Federal Reserve (The Board) for holding a hearing today on the Home Ownership Equity Protection Act of 1994 (HOEPA). He offered the following statement: 'I would like to thank Governor Kroszner and the Federal Reserve for holding this important forum to explore ways The Board can address abuses in the mortgage market while still preserving incentives for responsible lenders to provide credit to borrowers, particularly subprime borrowers. MBA abhors predatory lending and looks forward to sharing our views on how to take a balanced approach to rid the market of abusive lending practices."

CNN - "Rate woes: The latest hit to home values" (6-14-07)

"The recent run-up in bond yields isn't just fueling a stock selloff on Wall Street. It's nearly certain to batter already battered home prices on Main Street. Mortgage rates follow bond yields closely, and economists say that the recent run-up in rates in the bond market will further erode what home buyers can pay for houses. Mortgage rates hit a 10-month high last week and are likely to climb further still - the latest bad news for the nation's troubled housing market."

pasadenastarnews.com - "Bonds presage interest rate hike" (6-14-07)

"Investors' expectations of an interest rate cut - and home buyers' hopes for cheaper mortgages - seem to be disappearing. The yield on the Treasury's 10-year note passed 5 percent Thursday, closing at a session high of 5.13 percent, its highest point since mid-July. Some market watchers say the yield is likely to climb higher as bond prices weaken, making it even harder for consumers to finance home purchases and for companies to borrow money. If the yield reaches 5.25 percent, a five-year high, it would match the Federal Reserve's current benchmark interest rate - signaling that the market is, in a sense, beating the central bank to the punch in hiking rates to curb inflation."

Bloomberg - "Subprime Crash Squeezes Out First-Time Home Buyers" (6-14-07)

"Josh Tullis, who in his eight years as a senior loan officer rarely felt compelled to reject a first-time home buyer's mortgage application, is sending people away empty- handed in 2007. Tullis's latest clients are a married couple that banks ought to love. Between them they make $70,000 a year and they've been renting the same apartment for three years with zero late payments, he said."

Orange County Register - "Housing hits plateau" (6-14-07)

"In Yorba Linda, a one-story home with a view sold recently for $860,000, netting $25,000 more than the seller paid for that same house just 11 months before. But it's a different story over in Garden Grove, where a 1,400-square-foot house on a quiet street is having trouble selling, even though the asking price is $15,000 less than the amount paid a year ago for a comparable home that is smaller with inferior construction and in a worse location."

Los Angeles Times - "Sales of homes down 34% in region" (6-14-07)

"Build them and the buyers will come. That's how developer Shone Wang has been selling homes in Southern California for the last 15 years. But this spring, Wang hit a snag: no takers for a cluster of luxury homes he built in Rancho Cucamonga. 'The first day my homes went on sale I decided I had to do something else,' Wang said. His solution is an auction, set for Saturday, at which bidders have to agree to pay at least $700,000 for homes originally priced at $1.2 million."

Real Estate Journal - "Seller Rushes to Make Fixes Before House Goes on Market" (6-14-07)

"Lately my house has been in such a mess that I can't even find the checklist of items I planned to address before it hits the market. Back in late March, when my agent and a stager did a walk-through to give me pointers on renovations, I took copious notes and made a lengthy checklist. But with only a week to my listing date, I'm wondering if I bit off more than my beau, Dave, and I could chew."

Real Estate Journal - "Lower Home-Price Appreciation Fuels Subprime Delinquencies" (6-14-07)

"Areas of the U.S. with greater house-price appreciation last year tended to have lower delinquency rates on subprime mortgages, economists at the Federal Reserve Bank of San Francisco said. Economists there also found the reverse to be true. In an economic letter, 'House Prices and Subprime Mortgage Delinquencies,' San Francisco Federal Reserve economists noted a close link between house-price appreciation and the severity of recent subprime mortgage delinquencies, with metropolitan areas where home prices decelerated the most in 2006 showing the largest rise in subprime delinquency rates."

CBIA - "Riverside Is First City to Provide Incentives for California Green Builder Program" (6-13-07)

"The City of Riverside on Tuesday became the first community in California to provide incentives to builders who utilize the voluntary California Green Builder program as a way to meet the city’s “Clean and Green” requirements, the California Building Industry Association announced today. The Riverside City Council enacted an ordinance officially recognizing the program. The vote was unanimous. Riverside joins a number of other communities, including Palm Springs, Palm Desert and Cathedral City, that have recognized the California Green Builder program as a preferred green homebuilding alternative. In addition, the Imperial Irrigation District provides incentives to builders who utilize the program in its service territory in the Imperial and Coachella valleys."

NAHB - "'Father Of Suburbia"' William J. Levitt Name To National Housing Hall Of Fame" (6-13-07)

"In recognition of his outstanding lifetime achievements in the housing industry, William J. Levitt, a real-estate developer widely credited as the father of modern American suburbia, was inducted into the National Housing Hall of Fame on June 9, 2007. 'The National Housing Hall of Fame recognizes individuals whose spirit, ingenuity and determination have changed the face of housing history for the better. Except for the man who invented nails, no one man has had a greater effect on home building in America than William J. Levitt,' said Brian Catalde, a Southern California home builder and president of the National Association of Home Builders (NAHB)."


NAHB - "Citing Regulatory Overreach, NAHB Files Clean Water Act Lawsuit" (6-13-07)

"The National Association of Home Builders (NAHB) has filed a lawsuit against the U.S. Army Corps of Engineers over the latest iteration of the agency’s Nationwide Permit (NWP) program. With the new rules, the Corps has overstepped its authority to regulate development under the Clean Water Act, said NAHB. With Nationwide Permit 46, issued as part of the newest version of the program, the Corps has extended its reach into upland ditches. 'Now, they’ve gone way too far,' said NAHB President Brian Catalde, a home builder from El Segundo, Calif."

NAR - "Commercial Real Estate Sound With Record Investment" (6-13-07)

"Investment in commercial real estate remains at record levels with sound fundamentals in most sectors, according to the latest COMMERCIAL REAL ESTATE OUTLOOK of the National Association of Realtors®. Lawrence Yun, NAR senior economist, said there are variations across the commercial sectors. 'The overall office market has been booming, the industrial sector is holding its own, retail is a bit sluggish while apartments are strong with some condo conversions reverting to rental,' he said. 'We expect fundamentals to remain basically sound for the commercial sectors.'"

MBA - "Mortgage Applications Increase in Latest MBA Survey" (6-13-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending 6/8/2007. The Market Composite Index, a measure of mortgage loan application volume, was 666.5, an increase of 6.6 percent on a seasonally adjusted basis from 625.3 one week earlier. On an unadjusted basis, the Index increased 17.4 percent compared with the previous week and was up 16.1 percent compared with the same week one year earlier. The Refinance Index increased 5.6 percent to 1854.8 from 1757.1 the previous week and the seasonally adjusted Purchase Index increased 7.2 percent to 464.7 from 433.6 one week earlier. The seasonally adjusted Conventional Index increased 6.4 percent to 979.1 from 920.6 the previous week, and the seasonally adjusted Government Index increased 9.3 percent to 145.2 from 132.8 the previous week."

MBA - "Q1 2007 Commercial/Multifamily Mortgage Debt Outstanding Exeeds $3 Trillion" (6-13-07)

"The level of commercial/multifamily mortgage debt outstanding grew by 2.5 percent in the first quarter, exceeding $3 trillion for the first time, according to the Mortgage Bankers Association (MBA) analysis of the Federal Reserve Board Flow of Funds data. The $3.001 trillion in commercial/multifamily mortgage debt outstanding recorded by the Federal Reserve was an increase of $72.4 billion from the fourth quarter 2006. Multifamily mortgage debt outstanding grew to $741 billion an increase of $11.8 billion or 1.6 percent from the second quarter."

Bloomberg - "Subprime Crash Squeezes Out First-Time Home Buyers" (6-13-07)

"Josh Tullis, who in his eight years as a senior loan officer rarely felt compelled to reject a first-time home buyer's mortgage application, is sending people away empty- handed in 2007. Tullis's latest clients are a married couple that banks ought to love. Between them they make $70,000 a year and they've been renting the same apartment for three years with zero late payments, he said."

The Press Enterprise - "Foreclosure rate spikes in region" (5-13-07)

"With the cooling of the housing market compounded by a spike in mortgage failures, foreclosure activity is skyrocketing in California, according to a report released Tuesday. The state had the third highest foreclosure rate in the nation in May, the report found."

Bloomberg - "Regulators Kept Quiet as Subprime Lenders `Targeted' Minorities" (6-13-07)

"The U.S. agencies that supervise more than 8,000 banks haven't censured any of them for violating fair-lending laws, three years after Federal Reserve researchers began assembling data showing blacks and Hispanics are more likely than whites to be saddled with high-priced home loans. Minorities stand to be hardest hit by rising delinquencies and foreclosures in subprime loans. While Census Bureau data show that homeownership rates rose to records among blacks in 2004 and among Hispanics in 2005, they still trail whites by 25 percentage points, and the gap may widen in the current bust."

CNN - "Old realtors vs. young Web threat" (6-13-07)

"If there's a lesson to be learned from the Internet, it's that old business s can't rely on past results - just ask your neighborhood travel agent. Like stock brokerages, travel agencies have watched their customers migrate to do-it-yourself sites like Orbitz and eTrade because of easy service and low charges. But what about real estate? Agents collect sizeable commissions for what looks like little effort. And now, for-sale-by-owner Web sites promise to eliminate the middleman and put more money in your pocket. So are realtors worried they're going to be replaced by masses of home sellers infected with the D.I.Y. spirit?"

The Arizona Republic - "Valley realty bloggers generate strong opinions - but beware" (6-13-07)

"Debi Averett has a master's degree in botany and can tell you everything you want to know about the mint plant, her specialty area of study. But what really gets her charged is a good argument about the Valley's housing market. Averett, a Gilbert mother of five, runs a blog called HousingDoom .com. She is one of the growing number of people locally and nationally sounding off about housing in online journals, where the conversation ranges from calm and reasoned to and intolerant. One blogger, for instance, goes so far as to root for a housing collapse."

NorthJersey.com - "Lowering broker's fees can pay off" (6-13-07)

"Hogans' confusion is common. A national survey released Monday shows that public misunderstanding abounds concerning just how the real estate industry works. Few of the 2,000 respondents knew that they can negotiate an agent's commission, or how to determine whom a broker represents -- the seller, buyer or, in many cases, both."

The Union-Tribune - "Housing slump into '08 likely, study finds" (6-13-07)

"The implosion of the subprime mortgage market is likely to prolong the national housing slump, Harvard University researchers said yesterday in their annual report on the state of the nation's housing. 'At a minimum it will slow any recovery,' said Nicolas P. Retsinas, director of Harvard's Joint Center for Housing Studies, which issued the report. 'Add to that the overbuilding and the inventory correction and you can see why it appears, particularly for the new-home market, that this slump will last well into 2008.'"

Reuters - "Lehman sees housing downturn ing" (6-13-07)

"The U.S. housing market downturn could for years but probably does not pose a major risk to the overall economy, Lehman Brothers' chief global fixed-income strategist said on Monday. 'The subprime saga will not be sufficient to derail the U.S. and world economy,' Lehman's Jack Malvey said at the Reuters Investment Summit in New York."

CNN - "Foreclosures jump 90% over last year" (6-13-07)

"Home foreclosures in May jumped 90 percent from a year earlier, reflecting a poor spring housing market and foreshadowing even higher levels later in 2007, real estate data firm RealtyTrac said Tuesday. The May foreclosures - a sum of default notices, auction sale notices and bank repossessions - totaled 176,137, up 19 percent from April, the firm said in its May 2007 U.S. Foreclosure Market Report. After a barely perceptible dip in April, foreclosure activity roared back with a vengeance in May,' James Saccacio, chief executive officer of RealtyTrac, said in a statement."

Orange County Register - "California ranks third in foreclosure filing" (6-13-07)

"Foreclosure filings jumped in May as the national housing slump rolled on. RealtyTrac of Irvine said Tuesday that 176,137 foreclosures were filed nationwide, a figure that includes default notices, auction sale notices and bank repossessions. The number is up 19 percent from April and nearly 90 percent from May 2006. In California, one in every 308 households filed a foreclosure, making the state's foreclosure rate the nation's third-highest, up a notch from April. The national average is one foreclosure for every 656 households."

Orange County Register - "Readers say inventory best signal" (6-13-07)

"Perhaps the O.C. home market is near a bottom. Or maybe, a real estate turnabout is still months or years away. Either way, we asked visitors to the Lansner on Real Estate online blog what key housing statistic would be the first economic signal to say that the market is about to turnaround."

Orange County Register - "Values of nine homes go three ways" (6-13-07)

"A survey of nine homes across Orange County showed that values went down for four, went up for two and stayed the same for three."

Los Angeles Times - "We Stand Corrected: You Can Buy a House in Santa Monica For Under $1 Million" (6-13-07)

"When we are wrong, we admit it, and we were wrong when we said you can only get a master bedroom suite for under $1 million in Santa Monica. Proof of the error of our ways: Westside Bubble found THREE listings in Santa Monica for under $1 million"

Los Angeles Times - "Homebuilder CEOs Dodge CNBC; 'I've Never in My Life Seen So Many Freaked Out CEOs'" (6-13-07)

"A funny thing happened to CNBC real estate reporter Diana Olick yesterday at a Wall Street conference full of homebuilding CEOs: the executives ran away from her like frightened children. 'I've never in my life seen so many freaked out CEOs,' Olick wrote on her real estate blog. 'I say this only because not nine months ago I attended a similar UBS conference, where the homebuilder CEOs and their CFOs and their PR reps and their baggage handlers and their mother-in-laws were all fighting with each other to jump in front of our cameras to talk about the recovery shining brightly ahead in the housing market.'"

Real Estate Journal - "Home Prices to Drop Further, But Recovery May Be Ahead" (6-13-07)

"It's still too early to tell exactly when this housing slump is going to end, with house prices just beginning to soften, mortgages at risk of defaulting beginning to hit reset dates and lending standards that are starting to tighten, according to researchers at the Harvard University's Joint Center for Housing Studies. One thing's for sure: Before the sun shines again on the housing industry, a good amount of excess inventory will have to be sold, according to the center's 'State of the Nation's Housing' report, released Monday. Employment growth will play a role as well in the recovery, as will interest rates, the report said."

Los Angeles Times - "Seller Discovers There's Work Required to Stage Her Home" (6-13-07)

"I've always been fascinated with 'staging,' the art of depersonalizing, decluttering and "merchandising" a home for sale.bStaging a home can boost its price by about 7% and make it sell up to 50% faster than the market average, according to data from Stagedhomes.com, a site for accredited staging professionals."

Yahoo - "Nation Doomed To 2 Million Foreclosures" (6-12-07)

"A second study forecasting millions of foreclosures sweeping the nation in the next few years, says it won't matter what the Feds do to fix the problem. 'Foreclosures Will Affect 2 Million Homeowners,' by upstart housing market researcher HomePredictor.com says subprime mortgages are the culprit."

Bloomberg - "REITs Fall After Stifel Downgrades On Rate Concern" (6-12-07)

"Shares of some real estate investment trusts declined after Stifel Nicolaus & Co. analysts downgraded the companies to 'hold' from 'buy' on concern over rising interest rates. 'Recent interest rate increases may stick or tighten further,' hurting property values and capitalization rates, or the profit margin on the first year of a real estate investment, analysts including David Fick wrote in a note to investors. Fick also cut his rating on the REIT sector to 'negative bias.'"

MSN - "Who's most at risk for foreclosure?" (6-12-07)

"You have a 1-in-3 chance of losing your house to foreclosure if you got an adjustable-rate mortgage, or ARM, in 2004 through 2006 that had an initial teaser rate of less than 4%. If you got a subprime ARM in that period, you started out with a higher rate, and that puts you at less risk. You have a 1-in-8 chance of losing your home."

Brandenton Herald - "Economists foresee housing slump enduring past 2007's end" (6-12-07)

"Economists are giving up on the idea that the U.S. housing slump will be quick and relatively painless. Instead, more are concluding, the downturn that began nearly two years ago will last at least through the end of 2007, remaining a major drag on the U.S. economy. The culprits: a glut of homes for sale and growing caution among lenders who now regret being so free with their mortgages during the boom."

Yahoo - "Wannabe Buyers Welcome Housing Slump" (6-12-07)

"Kurt Montufar isn't stressing over the housing slump. He's actually hoping things get worse. Like many wannabe homebuyers who were priced out of the market during the last boom, Montufar spends time these days scanning real estate ads and news reports to determine if it's time to take the plunge and buy. Foreclosures rising? Great. Cash-strapped sellers pressured into lowering prices because they can't find buyers? Even better."

Market Watch - "'Pop!' Bubbles are great for America!" (6-12-07)

"Yes, that's the message of Dan Gross' new book, 'Pop! Why Bubbles are Great for the Economy.' Bubbles are miracle workers. So let 'em pop, Pop, POP! Gross is in love with what happens after a bubble pops, an idea first heard in uber-economist Joseph Schumpeter's 1942 law of 'creative destruction.' Destruction is a small price to pay: Business failures, bankruptcies, lost jobs, recessions are all part of natural law eliminating the dead wood from a prior bubble, clearing the way for a new round of creative innovations, prosperity and another roaring bull. So don't get all teary-eyed and maudlin. Suck-it-up, folks. 'Pops' are like Irish wakes, lotsa drinking, laughing, singing 'Auld Lang Syne,' having a good time saying goodbye to a bubble. Well, at least for Wall Street."

Market Watch - "The impossible dream" (6-12-07)

"Let me see if I have this right: Investors want the economy to be strong enough to generate decent profits growth, yet weak enough to give the Federal Reserve a reason to reduce interest rates. Talk about dreaming the impossible dream! When the economy nearly ground to halt in the first three months of this year, investors didn't know whether to laugh or to cry. They were happy in one sense because they figured for sure that this weakness would lead to an early cut in interest rates by the Fed. On the other hand, they also were concerned about what this lack of growth would do to corporate profits."

San Francisco Chronicle - "WOULD-BE HOME BUYERS HESITATE" (6-12-07)

"The Bay Area real estate market has become a giant game of chicken. Just 18 months ago, buyers swarmed open houses waving piles of cash. Now they are staying away in droves, waiting for prices to fall. 'Buyers don't want to buy until we're at the bottom of the market,' said Dean Wehrle, vice president for Northern California of the Sullivan Group Real Estate Advisors, which does consulting for new-home builders, developers and lenders. 'It's the converse of 2003, '04 and '05, when people would jump in the market because of the frenzy, thinking that they had to get in now because appreciation would go on forever in the double digits.'"

The Christian Science Monitor - "The cost of borrowing inching up" (6-12-07)

"Want to borrow money in New Zealand? The interest rate is more than half a percentage point higher than in January. Europeans are facing similar bank-account-sapping news. And in the US, a 30-year fixed-rate mortgage now costs at least a third of a percentage point more than in January. It's all part of a major shift taking place in the global economy: Borrowing is becoming more expensive. In Europe and other foreign industrialized countries, central banks are raising rates to try to keep inflation down as their economies become more robust. This may limit their economic growth later this year or next year."

thisismoney.co.uk - "ABN fears world housing crash" (6-12-07)

"Soaring borrowing costs could spark a housing slump on a 'global scale', investment bank ABN Amro has warned. Families have taken on 'unsustainably large' mortgages, leaving them vulnerable to the sharp increases in bond yields and official interest rates seen in recent weeks, wrote economist Dominic White."

Orange County Register - "O.C. homesellers firm on asking prices so far in '07" (6-12-07)

"The Housing Tracker Web site offers another view of the O.C. housing market: It tracks median asking prices – what sellers want. It also splits the market into three parts (median, what the 50th percentile wants; what I'll call a 'lower median,' or what the 25th percentile's asking for; and an "upper median," what the 75th percentile is asking)"

Los Angeles Times - "Housing affordability is likely to remain elusive, study finds" (6-12-07)

"Homeownership will remain out of reach for millions of Americans, despite slumping house prices, unless the wages of low-income people grow faster, a study released Monday said. A record 37.3 million U.S. households, or 1 in 3, were paying a "moderate cost burden" of 30% of their income toward housing in 2005, according to the State of the Nation's Housing 2007. The study said the number of households with that cost burden had risen roughly 20% since 2001, when interest rate cuts helped spark a price boom."

Los Angeles Times - "A Short Sale in Manhattan Beach: Too Much Leverage, Too Long on the Market" (6-12-07)

"The eagle-eyed Manhattan Beach Confidential has spotted something rare down there: a short sale. This is not your garden-variety "Prices-are-falling-and-I-financed 100%" short sale (otherwise known as the 'Sacramento Slipper'). It appears the owner here borrowed against the home at the peak and ran into trouble selling in a softening market."

Real Estate Journal - "Sizing Up the Competition: Will Home Sell at Its Asking Price?" (6-12-07)

"Friends have asked me if I considered skipping using a local real-estate agent and selling my Seattle home on my own or marketing my house through locally based companies Redfin.com, an online real-estate brokerage, or Zillow.com instead of going through the local Multiple Listings Service. If I had sold a home before or had a better financial cushion to tide me over should my efforts fail, I might have entertained trying a for-sale-by-owner (FSBO) transaction or some other form of sale. I personally know investors who successfully sell on their own."

MBA - "MISMO® Releases Three Data Standards for the Commercial/Multifamily Mortgage Industry" (6-11-07)

"MISMO, the not-for-profit data standards subsidiary of the Mortgage Bankers Association (MBA), announced the completion and release of three more data standards for the commercial/multifamily mortgage industry. The release of Document Classification Version 1.1, Environmental Site Assessment Synopsis Version 1.1 and Work Order Request and Response Version 1.1 marks the completion of the next phase of MISMO's broad effort to develop and promote data standards for the commercial/multifamily mortgage industry. These standards, along with the already released Commercial Servicing Transfer Standard Version 1.0, are the first of many planned for the industry. Ultimately, MISMO standards will reduce costs, streamline processes, improve accuracy, increase data transparency, and boost investor confidence in mortgages as an asset class."

The Boston Globe - "Home costs stay beyond reach of many" (6-11-07)

"Even with the downturn in the real estate market, houses in the Boston area will continue to be unaffordable for many working families and first-time homebuyers, according to a new report from Harvard University's Joint Center for Housing Studies. The median price of a single-family home in Greater Boston has dropped 3 percent in the current slowdown, to $402,200 in 2006. At that price, a house costs 5.4 times the median household income of $74,773 for the region. The standard for affordability is 3 to 3 1/2 times median household income, according to the Harvard center."

Daily Business Review - "Special Report: Condo Lending" (6-11-07)

"Sift through condominium foreclosure listings, and you are likely to see Deutsche Bank’s name as the plaintiff in hundreds of South Florida cases. Deutsche initiated 325 foreclosure actions against condo owners in Miami-Dade, Broward and Palm Beach counties from Jan. 1 through May 4, more than any other financial institution, court records show. Even more staggering was the total unpaid mortgage value: $70.3 million."

MSN - "Public pension funds take a risky gamble" (6-11-07)

"I'd like to continue last week's focus on the debt market -- because, without the incomprehensible complacency in all of its sectors, we would not be seeing the lunacy now on display in the equity market. I've already discussed how the world's central banks, by printing their own money to suppress their own currencies, have wound up owning trillions of dollars' worth of U.S. Treasurys."

CNN - "Subprime crisis: Was Greenspan remiss?" (6-11-07)

"Former Federal Reserve Governor Edward Gramlich claims that former Fed Chairman Alan Greenspan blocked a proposal to crack down on subprime lending practices back in 2000, according to The Wall Street Journal. Gramlich, who was Fed governor from 1997-2005, says he proposed the idea to Greenspan personally, The Journal reported. He suggested that the Fed send examiners into offices of lenders that were units of Fed-regulated bank holding companies. He claims Greenspan - well-known for his deregulatory practices - rejected the idea."

Bloomberg - "Treasuries Fall as Pianalto Says Inflation `Uncomfortably High'" (6-11-07)

"U.S. Treasuries fell, extending five weeks of losses, as Federal Reserve Bank of Cleveland President Sandra Pianalto said inflation is 'uncomfortably high.' Fourteen of the 21 primary dealers that underwrite the government's debt boosted their year-end estimate for the central bank's target rate or the 10-year note's yield. This week the government will release reports on consumer and wholesale prices. Yields on 10-year notes exceed two-year securities by 13 basis points, the most since May 2006."

USA Today - "Housing slowdown smacks Realtors hard" (6-11-07)

"Chris Beach often works through lunch and seldom leaves the office before 9 p.m. So far this year, he's taken 2½ days off from work. And he hesitates now to take vacations, because he fears losing business: potential home buyers or sellers. 'My wife went out and bought two dogs because I'm never home,' says Beach, whose hands-free cellular earpiece seems permanently attached to his head. This is the life of a real estate agent in a market in which in the past year home sales have tumbled 30%, prices have fallen 13% and there's a one-year supply of homes for sale."

Los Angeles Times - "A Subprime Lender That Went Too Far -- Didn't They All?" (6-11-07)

"We've told you before we're easily confused, and it's happening again. This time it's this MarketWatch report on federal fines against a subprime lending unit of AIG: 'A subprime-mortgage unit of American International Group offered inappropriate loans to some borrowers and charged fees that were too high, the Office of Thrift Supervision said Friday.' MarketWatch reports the settlement could cost the company up to $178 million."

News10 - "Facing Foreclosure Fears" (6-10-07)

"Nearly 20 percent of Sacramento homes are worth less than the value of their mortgage. Some 3,400 Sacramento County property owners faced foreclosure in the first quarter of 2007, up nearly 200 percent from 2006. Sacramento County ranks in the top ten nationally in the number of foreclosures."

North County Times - "Professor: San Diego economy to weaken" (6-10-07)

"The San Diego County economy will weaken through the end of this year, but it shouldn't fall into recession, according to an economist who compiles an index of leading indicators that was released Thursday. The index dropped slightly in April, the 12th decline in the last 13 months. That signals slower job growth, higher unemployment and continued slow home sales, said Alan Gin, a professor of economics at the University of San Diego, who compiles the university's San Diego Index of Leading Economic Indicators. 'Job growth has slowed considerably,' Gin said. 'It's almost exclusively due to the housing market.' The loss of jobs in construction, real estate sales and real estate financing account for much of the slowdown in job growth, Gin said. He estimated that jobs in the county would increase by 8,000 to 9,000, or about half the job growth of 18,000 in 2006."

The Boston Globe - "The subprime barn door" (6-10-07)

"HOME FORECLOSURES are on the rise, and lenders specializing in subprime mortgages -- that is, loans for homebuyers with blemished credit -- have been evaporating left and right. At long last, lawmakers and regulators have taken an interest in this untidy corner of the mortgage market, and financial-services trade groups are getting in on the act, too, recently issuing a joint statement offering their response to the mess."

The Press Enterprise - "Economists debate specifics of Inland's future economy" (6-10-07)

"Consumer spending is a bubble that will burst in coming months, punctured by mortgage failures and a pullback in home refinancing. Over the next two years, median home prices will decline by 25 percent in Riverside County and 18 percent in San Bernardino Counties, adjusted for inflation. Or scratch that. Job and population growth will not slow down quite so much and home prices, again adjusting for inflation, will fall slightly more than 10 percent in Riverside County and not enough to matter in San Bernardino County."

Orange County Register - "Crime vs. home prices" (6-10-07)

"Here's a look at how 63 major California cities – including eight from Orange County – fared in the 2006 version of annual FBI local crime statistics vs. their DataQuick median home prices, and how such measures compared to statewide benchmarks for 63 other large cities plus three slices of statewide data by housing costs from most to least costly. Stats shown are for 2006: population estimates; median selling price for all residences; violent crimes reported per 1,000 residents; property crimes per 1,000; and all crimes per 1,000."

Orange County Register - "S&P/Case-Shiller best index, poll says" (6-10-07)

"Four of five key home-price indexes for Orange County sit slightly off their peaks: S&P/Case-Shiller, Real Estate Research Council, DataQuick and Office of Federal Housing Enterprise Oversight. A California Realtor index is at its peak as of April. We asked visitors to the Lansner on Real Estate blog which indexes is currently giving out the most reliable signals."

Los Angeles Times - "LA's Champion House-Flipper, Another Subprime Warning" (6-10-07)

"The New York Times gives the full-on Style Section profile treatment to serial remodeler Sandy Gallin, calling him 'Home Flipper to the Stars.' 'Owning a Sandy Gallin flipped home is now nearly as prestigious as it once was to be managed by Sandy Gallin,' the Times says (Gallin once managed Dolly Parton). What's the secret to the successful high-end flip? 'Lots of windows and light, modern, outdoor California living,' says Gallin's architect, Scott Mitchell."

Los Angeles Times - "The 'Freakonomics' Guys Discover Cash Back At Closing" (6-10-07)

"We've written a couple of times about 'cash back at closing' scams. Today we feel ahead of the curve, because the 'Freakonomics' economists (Levitt and Dubner) are examining the same issue here in The New York Times Sunday Magazine. That said, they view it through the prism of Chicago real estate, and focus on cash-back-at-closing scams intended to give the buyer enough cash back for a downpayment, so that the home does not appear to be 100% financed (Our favorite California cash-back scam involves taking the cash and walking away, letting the house fall into foreclosure)."

U.S. News - "The Spring of Home Sellers' Discontent" (6-9-07)

"Indeed, the numbers suggest that things are likely to get worse before they get better. After a sluggish start to the spring selling season, the National Association of Realtors reported that pending sales dropped 3.2 percent in April, the most recent data available, while mortgage applications fell about 2 percent over the past month, according to the Mortgage Bankers Association. Meanwhile, inventories of unsold homes in major metro areas rose another 5 percent in May, according to Zip Realty, nearly a one-third increase over the same time last year. And while home builders have cut back on construction by about as much, 'they still have a lot of money in the ground,' Credit Suisse housing analyst Ivy Zelman says of the raw land still on builders' books. 'And the only way to get their cash back is to build more houses.'"

The Washington Post - "Dressed to Sell" (6-9-07)

"Sales were swift when Winchester Homes began marketing Broad Creek Landing, a cul-de-sac community of 24 single-family houses not far from downtown Annapolis -- so swift that Winchester officials saw no need to decorate their model home. But 18 months later, the market has cooled and there are seven houses left to be sold, starting in the upper $700,000s."

Market Watch - "AIG's subprime unit slapped by regulator" (6-9-07)

"Wilmington Finance Inc., a subsidiary of New York-based AIG provided extensive loan-origination services for AIG Federal Savings Bank from July 2003 to May 2006, but the bank failed to manage and control its activities in a safe and sound way and didn't consider consumer-protection issues appropriately, the U.S. regulator explained. Wilmington originated subprime home loans that were inappropriate for some borrowers, and the firm didn't properly consider their ability to repay the debt. Some were adjustable-rate mortgages with low "teaser" rates and the OTS was concerned that once the rates reset, borrowers would be unable to afford the payments and could lose their homes to foreclosure, said Kevin Petrasic, an agency spokesman."

Reuters - "US CREDIT-D.R. Horton's debt risks junk status" (6-9-07)

"D.R. Horton Inc.'s (DHI.N: Quote, Profile, Research) debt ratings are teetering on the brink of junk territory and further weakness in the housing sector and tighter lending standards may push the largest U.S. home builder's ratings over the edge. Moody's Investors Service on Wednesday changed its outlook on Horton to negative from stable, indicating the company's debt ratings may be lowered into junk territory over the next 12 to 18 months."

Reuters - "Rising rates seen adding to housing woes" (6-9-07)

"The U.S. housing market, already on shaky ground after being sideswiped by the subprime loan crisis, faces a larger struggle from a long dormant threat -- swift rises in mortgage rates. If this week's massive sell-off in the bond market continues, mortgage rates will climb and borrowers will have an even harder time buying a new house or refinancing existing mortgages."

Contra Costa Times - "Rising yield strains consumers" (6-9-07)

"Investors' expectations of an interest rate cut -- and home buyers' hopes for cheaper mortgages -- seem to be disappearing. The yield on the Treasury's 10-year note passed 5 percent Thursday, closing at a session high of 5.13 percent, its highest point since mid-July."

Orange County Register - "New home sales contracts flat in April" (6-9-07)

"The number of new home sales contracts signed in April was virtually the same as a year ago in Orange County, while contracts fell 40 percent statewide, Hanley Wood Market Intelligence of Costa Mesa reported Friday. Overall, buyers signed sales contracts for 355 new Orange County homes in April, compared with 356 in April 2006, Hanley Wood reported. Sales were up 22 percent for single-family homes and for townhomes here, the new report shows. But sales fell 32 percent for Orange County condos."

Los Angeles Times - "New-home sales increase" (6-9-07)

"Sales at major new-home communities in parts of Southern California picked up in April as Los Angeles, Orange and San Diego counties bucked statewide trends to post gains from the previous month, an industry report Friday showed. Still, April's sales figures remained weaker throughout the state compared with a year earlier, with total sales falling 40%, the California Building Industry Assn. said. And after holding steady for several months, median asking prices fell 6.2% statewide as builders slashed prices to move unsold inventory."

Los Angeles Times - "Inventory Glut: L.A. Housing Inventory Growing at Rapid Pace" (6-9-07)

"Things you can learn from listening to Bob Brinker on KABC while driving your mother-in-law to the airport: the backlog of unsold houses in Los Angeles is growing much more rapidly than in other cities. In fact, Bob reported to me, L.A.'s inventory of homes for sale grew by 10% in May, and only two cities had a faster-growing inventory. Thanks, Bob."

NAHB - "Builders Applaud HUD’s Clear Guidance on Accessibility Requirements" (6-8-07)

"The U.S. Department of Housing and Urban Development (HUD) announced yesterday that multifamily builders can rest assured they are complying with all applicable accessibility requirements when following the 2006 edition of the International Building Code (IBC) and the 2003 edition of the International Code Council (ICC) A117.1 Accessible and Usable Buildings and Facilities. HUD’s safe harbor endorsement was announced by Kim Kendrick, HUD’s assistant secretary for Fair Housing and Equal Opportunity at the National Association of Home Builders’ (NAHB) Spring Board of Directors meeting."

The San Diego Union-Tribune - "Fear of inflation, Fed remarks take toll on markets" (6-8-07)

"Not long ago, Wall Street trembled when it looked as if the slowing U.S. economy might be getting worse. But now, anxiety over the potential for higher inflation, driven by a strong global economy, is preoccupying investors. Yesterday, that fear took its toll on stocks and bonds again. Share prices saw their steepest three-day decline since markets dropped around the world in February, and the interest rate on the benchmark 10-year Treasury note rose above 5 percent for the first time since last summer."

USA Today - "Rules 'hiding' trillions in debt" (6-8-07)

"The federal government recorded a $1.3 trillion loss last year — far more than the official $248 billion deficit — when corporate-style accounting standards are used, a USA TODAY analysis shows. The loss reflects a continued deterioration in the finances of Social Security and government retirement programs for civil servants and military personnel. The loss — equal to $11,434 per household — is more than Americans paid in income taxes in 2006."

Yahoo - "Money & Happiness" (6-8-07)

"In the midst of the current housing downturn, I've noticed more media stories bashing homeownership as a bad investment. As one Wall Street Journal article noted, 'economic studies have demonstrated over and over that houses (1) cost more than most people make when they sell and (2) rarely match the long-term returns of stocks or other investments.'"

Yahoo - "Where foreclosure risk is highest" (6-8-07)

"Home owners in the Rust Belt are in more danger of falling critically behind on mortgage payments than anywhere else in the United States, according to a recent study. First American CoreLogic, which provides property information and analysis, monitors 379 locations around the nation. Nine of its top 10 risk spots were in former Midwestern industrial centers."

Birmingham Business Journal - "Mortgage companies struggling" (6-8-07)

"More than half of the mortgage companies in Birmingham have closed as a result of the subprime mortgage-lending industry, revealed a study commissioned by Birmingham's Henger Rast Mortgage Corp. As of May 2007, 284 of the 522 mortgage companies that operated between 2005 and 2007 in Jefferson and Shelby counties have either closed, bankrupted or dissolved, with 153 of those closing in the last six months, the study showed."

Bloomberg - "10-Year Treasuries Head for Biggest Weekly Decline in Two Years" (6-8-07)

"U.S. Treasury 10-year notes are poised for their biggest weekly decline in more than two years, even after recovering from early losses today, on concern that faster economic growth will lead central banks to raise interest rates. Ten-year notes, whose yields determine interest rates on mortgages and corporate bonds, had their biggest slump in more than three years yesterday. The yield touched 5.25 percent earlier today, matching the highest since May 2002."

Bloomberg - "Is Inflation Coming Back or Just Filling a Void?" (6-8-07)

"All of a sudden, inflation is back. At least that's what one would be led to believe based on a resurgence of inflation articles, if not the re-emergence of That 70s Scourge itself. It seems that global growth is turning up the heat on prices. Remember those billion Chinese and Indian workers being inducted into the industrial labor force, offering their services cheaply to any and all bidders? That excess capacity is now gone, based on what I read."

Seeking Alpha - "Housing Prosperity Just Around Corner? I Don't Think So" (6-8-07)

"I can't help but note the similarities between the dotcom-crash rhetoric/predictions back in 2000 and the housing-crash rhetoric/predictions in the last 12 months. Housing obviously won't experience as deep a correction as the dotcoms did, but I haven't heard a single persuasive argument explaining why this downturn won't look like every previous housing downturn: i.e., will last a lot longer and drop much farther than most people think--until price/rent and price/income ratios return to or below their long-term trend. Instead, all I hear are arguments like this one, which are based not on long-term historical trends, but on short-term bubble-year pricing and price trends (arguments I am very familiar with, having made similar ones in late 2000 and early 2001)"

New York Post - "HEDGE FUND BEAR-ISH ON SUBPRIME RELIEF" (6-8-07)

"A big hedge fund on one whopper of a winning streak is picking a bitter fight with Bear Stearns over whether renegotiating loans for homeowners struggling with subprime mortgages is fair play. Paulson & Co., an $11 billion hedge fund, has written regulators over concerns that Bear and other investment banks may be engaged 'in market manipulation" when the banks' mortgage-issuance units modify loans so that homeowners can avoid foreclosure.'"

Yahoo - "Federal Mortgage Reform Unlikely in 2007" (6-8-07)

"Homeowners unable to pay monthly mortgage bills and facing foreclosure shouldn't count on help from Washington this year. Regulators and lawmakers seem to be taking a wait-and-see approach as they confront the fallout from several years of lenders making too many home loans to people with inadequate credit."

Mish's Global Economic Trend Analysis - "Monte Carlo Simulation of CDOs (Part 1)" (6-8-07)

"Most people have unanswered questions on their minds. Not me. Right now I have two answered questions on my mind. 1. Who's rating the rating companies? 2. Who's the ultimate guarantor of CDOs when the derivative boom collapses?"

LewRockwell.com - "Ben Bernanke's Post-Horse Barn Door-Locking Strategy for Real Estate" (6-8-07)

"Ben Bernanke's June 5, 2007 speech on the real estate market was an exercise in futility. He did not refer to the obvious: his predecessor's monetary policy, which created a real estate bubble. Instead, he promised new regulatory measures, which are in fact the old measures, which failed to prevent the bubble. He admitted that the present economic slowdown was heavily dependent on the fall in the real estate market: about one percentage point."

Yahoo - "Meritage Homes Warns on 2007 Outlook" (6-8-07)

"Homebuilder Meritage Homes Corp. said Wednesday it expects to fall short of its previous 2007 guidance as a result of weaker-than-expected April and May home sales. According to preliminary figures, net sales for the first two months of the second quarter were about 21 percent lower than the same period last year, Meritage said. In addition, cancellations increased to 36 percent of gross orders from 27 percent in the first quarter, the company said."

Orange County Register - "Ohio sues two O.C. real estate firms over appraisals" (6-8-07)

"Ohio, the state with the third highest number of foreclosures, sued 10 real estate companies – including two based in Orange County – for improperly pressuring appraisers to inflate home values. The companies, based in Ohio, California, Arizona and New York, are accused of setting specific estimated values on properties and communicating a desired price to appraisers, according to the lawsuits filed by Attorney General Marc Dann on Thursday. In Ohio, it's illegal to influence an appraiser. Those sued include seven mortgage brokers, two lenders and an appraiser."

Los Angeles Times - "Are Realtors Really Worth the 6%? New Study Says No." (6-8-07)

"Are Realtors Really Worth It? A new study from Northwestern University concludes: No, not quite. Here's how The New York Times previewed the study today: 'The conclusion, in a study to be released today based on home-sales data from 1998 to 2004 in Madison, Wis., is that people in that city who sold their homes through real estate agents typically did not get a higher sale price than people who sold their homes themselves. When the agent’s commission is factored in, the for-sale-by-owner people came out ahead financially.'"

Real Estate Journal - "As Insurers Flee Coast, States Face New Threat" (6-8-07)

"As hurricane season gets under way, a dramatic shift in the way homeowners insure against disasters could pose a big financial risk in several coastal states. These last-resort insurers, which cover people the private sector won't, issued more than two million policies to homeowners and businesses in hurricane-prone states last year, about twice as many as in 2001. Over that same five-year period, their total liability for potential claims has increased roughly threefold, topping $650 billion. Meanwhile, a separate federal flood-insurance program has seen its liability jump by two-thirds since 2001 to just over $1 trillion."

NAHB - "NAHB Files Suit Over Costly New California Regulation" (6-7-07)

"The National Association of Home Builders has filed suit against a Central California air pollution control district challenging the legality of the so-called Indirect Source Rule (ISR), which is expected to add thousands of dollars to the cost of new homes. The suit was filed in U.S. District Court for the Eastern District of California. In NAHB v. San Joaquin Valley Unified Air Pollution Control District, home builders argue that the ISR is pre-empted by the federal Clean Air Act, and that the district ignored necessary procedures before adopting it. Under the Clean Air Act, only states, not local air districts, are given authority to regulate indirect sources, which in this case are emissions from the tailpipes of construction equipment and motor vehicles related to home construction."

NAHB - "Builders Support Leadership Program To Meet Housing Needs of Disabled Veterans" (6-7-07)

"The National Association of Home Builders (NAHB) today called on Congress to simplify paperwork requirements and increase grant limits for the U.S. Department of Veterans Affairs Specially Adapted Housing program to help builders and remodelers better accommodate the housing needs and improve the lives of the nation’s disabled veterans. Testifying before the Subcommittee on Economic Opportunity of the House Committee on Veterans’ Affairs, Brian Catalde, president of NAHB and a home builder from El Segundo, Calif., expressed support for the Specially Adapted Housing program and offered several suggestions to expand or improve the program to better serve the thousands of severely injured veterans whose homes must be modified in ways that will allow them to live independently."

CAR - "C.A.R. forecasts 14 percent sales decline, modest increase in median home price for state" (6-7-07)

"The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today projected a 14 percent decline in single-family home sales this year, and forecast a 1.8 percent increase in the median price of a home. C.A.R. Executive Vice President Joel Singer delivered the Association’s 2007 Midyear Housing Market Forecast as part of the California REALTOR® Showcase and C.A.R.’s Legislative Day activities this week in Sacramento. Sales are expected to fall to 410,500 units in 2007, a 14 percent decline from the 477,460 pace recorded in 2006, according to the forecast. The median price of a home will reach $566,500 this year, a 1.8 percent increase from the $556,640 median for 2006."

MBA - "Ginnie Mae Outlines New Monthly Reporting Process" (6-7-07)

"Ginnie Mae is pleased to announce, as part of its ongoing business process improvement efforts, the implementation of a new streamlined process for reporting remaining principal balances (RPBs), pool accounting data and loan level data on a monthly basis. The new streamlined process, Reporting and Feedback System ("RFS"), will require the electronic submission of a single consolidated file to Ginnie Mae on a monthly basis, replacing Ginnie Mae’s current reporting process where issuers have to submit separate file transmissions to Ginnie Mae on a monthly basis for each of the above reports. Ginnie Mae will reconcile the loan and pool level data with the reported RPBs. Issuers will be timely notified of any exceptions. This should eliminate the need for post payment adjustments on payments to Ginnie Mae investors."

Market Watch - "Benchmark Treasury yield rises above 5%" (6-7-07)

"Treasurys sold off sharply Thursday, thrusting the benchmark yield above 5% for the first time since August, on the heels of a global sell-off of government bonds triggered by foreign rate hikes. Selling pressure was intensified by the hedging strategies of many mortgage-backed securities portfolio managers that force them to unload Treasurys. There also is a trend of foreign central banks to diversify away from long-term Treasury notes."

Yahoo - "Rates on 30-Year Mortgages Jump" (6-7-07)

"Rates on 30-year mortgages rose for a fourth straight week, hitting the highest level in 10 months, as bond markets responded to strong employment growth. Mortgage giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 6.53 percent this week. That was up sharply from 6.42 percent last week and represented the highest point for 30-year mortgages since they averaged 6.55 percent on Aug. 10."

The Market Oracle - "Global Liquidity Crisis when the Credit Boom comes to an End" (6-7-07)

"Stock markets around the world have been skyrocketing lately. In fact, Forbes reported on Tuesday that: 'all 22 of the developed-world markets tracked by Morgan Stanley Capital International are in positive territory year-to-date… Emerging markets are looking just as flush. Of the 29 emerging market countries that MSCI tracks, only four — Argentina, Sri Lanka, Russia and Venezuela — are in negative territory.' There's just one little problem; the Commerce Department announced yesterday that that GDP in the first quarter was revised downward to a measly .6%."

The New York Times - "Interest Rates Raised in Euro Zone" (6-7-07)

"The European Central Bank raised its key interest rate to the highest level in nearly six years on Wednesday amid steady growth and left the door open to further increases -- though it appeared in no hurry to move again. The widely expected increase will make everything from mortgages to auto loans more expensive for more than 317 million people in the 13-nation euro zone, which accounts for more than 15 percent of the world's gross domestic product."

USA Today - "Many investors feel like running away from homes" (6-7-07)

"For-sale signs are sitting ignored in some cities. Interest rates on exotic loans are doubling. Insurance premiums and property taxes are skyrocketing. Wannabe real estate tycoons stuck with properties they can't sell have been turned into landlords, forced to fix toilets and take tenant calls in the middle of the night. Many are 'under water' — owing more on the mortgage than they could get by selling. Meanwhile, stock investors have been celebrating again as broad market indexes march to new highs. And that is prompting some real estate investors to make the switch back to stocks. Real estate 'isn't as lucrative as it used to be,' says Jack Patterson, a financial adviser in Coral Gables, Fla., who has been helping clients sell real estate and buy stocks."

Orange County Register - "Bella Terra may add 500 housing units" (6-7-07)

"The owner of Bella Terra plans to add more than 500 apartments and condos to the shopping center in Huntington Beach and expand the retail space. The mixed-use proposal, combining housing and retail, is part of a growing trend among malls and fledgling neighborhoods throughout Orange County."

Orange County Register - "Help for first-time homebuyers" (6-7-07)

"Jennifer and Dale Baisch gave up on their dream of buying a home five years ago. The Stanton couple had done their homework, studying first-time buyers guides to learn the ins and outs of homebuying, and thought they were ready to go. But before they could even look very much, they hit a common stumbling block in Orange County – home prices that far outstripped their then mid-$40,000s income."

Los Angeles Times - "Mortgage Fraud 101: Investigator Finds 400 'Crash and Inflate' Scams" (6-7-07)

"Signs of fraud: the house sits on the market for a long time. Then suddenly, miraculously, it sells for above the asking price. Then nobody moves in, and it goes to foreclosure. Where's the fraud? The seller kicks back a bunch of cash to the buyer, who never intended to move in, and everybody walks away happy."

Los Angeles Times - "Thursday Morning Rewind: Remember When 2007 Was Going to Be a Good Year?" (6-7-07)

"Because there seems to be some interest in the forecasts from the National Association of Realtors, here, courtesy of the blog at Inman.com, are the three forecasts the Realtors have issued this year"

Real Esate Journal - "Iraq War Memorial Sparks Fight Over Property Values" (6-7-07)

Like many San Francisco Bay Area residents, Shelly Valerio is against the continued conflict in Iraq. 'I really wish we weren't in Iraq; it's causing such strife,' says the 45-year-old personal trainer, who lives in this upscale town east of Berkeley, Calif. But when a local, Jeff Heaton, late last year planted dozens of three-foot-high crosses on a hillside to commemorate U.S. soldiers who have died in Iraq, Mrs. Valerio -- and many of Lafayette's 24,000 other residents -- objected. Instead of embracing the gesture, which Mr. Heaton says is part of an effort to "end all wars," Mrs. Valerio attended city-council meetings for the first time to voice her displeasure. She signed protest petitions, met with the Lafayette mayor to complain, and put eight signs on her front lawn decrying the 'cemetery' that had sprouted up near her home."

Real Estate Journal - "Rise in Home Inventory Continues to Hurt Prices" (6-7-07)

"Growing inventories of unsold homes continue to weigh on the U.S. housing market, portending more downward pressure on prices, the latest data show. The number of homes listed for sale in 18 major U.S. metropolitan areas at the end of May was up 5.1% from April, according to figures compiled by ZipRealty Inc., a national real-estate brokerage firm based in Emeryville, Calif. The data cover all listings of single-family homes, condos and town houses on local multiple-listing services in those areas."

Real Estate Journal - "What You Don't Know About Real Estate May Cost You" (6-7-07)

"Few consumers understand fundamentals of the real estate industry and don't know that they can negotiate better prices for basic services, according to an analysis released Monday from a consumer advocacy group. The new analysis indicates that about one-third of respondents to a survey, which was performed last year for AARP, knew that the local multiple listing service is the most complete source of information about homes for sale. Only about one-quarter of respondents knew that they can negotiate broker commissions."

NAR - "Home Sales Projected to Fluctuate Narrowly With a Gradual Upturn" (6-6-07)

"Home sales are projected to move in a relatively narrow range with a gradual upturn becoming more pronounced by the end of the year, according to the latest forecast (PDF 136k) by the National Association of Realtors®."

CAR - "California REALTORS® converge in Sacramento for 37th Annual Legislative Day" (6-6-07)

"More than 2,000 members of the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) are in Sacramento today to participate in the Association’s 37th Annual Legislative Day activities. Among the day's events are opportunities for REALTORS® to meet with the state's political leaders. During the morning briefing, scheduled from 9 a.m. to 11 a.m. at the Sacramento Convention Center, Senator Lou Correa will speak about issues affecting the real estate industry. REALTORS® then meet with their elected officials during the afternoon. At the Capitol Reception at the Sheraton Grand Hotel, C.A.R.’s valued political contributors and state VIPs mix and mingle with California’s power elite from 5:30 p.m. to 7:30 p.m."

MBA - "Q1 2007 Commercial/Multifamily Loan Originations Down From Q4 But Remains Strong Overall" (6-6-07)

"Commercial and multifamily mortgage bankers' loan originations were strong in the first quarter, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations . While down from the fourth quarter of last year, first quarter originations were up 37 percent compared to the same period last year. The increase was seen across all property types and most investor groups."

MBA - "SEC Publishes Final Rules of Credit Rating Agencies Registered as National Statistical Rating Agencies" (6-6-07)

"The Commission is adopting rules to implement provisions of the Credit Rating Agency Reform Act of 2006 (the “Rating Agency Act”), enacted on September 29, 2006. The Rating Agency Act defines the term “nationally recognized statistical rating organization,” provides authority for the Commission to implement registration, recordkeeping, financial reporting, and oversight rules with respect to registered credit rating agencies, and directs the Commission to issue final implementing rules no later than 270 days after its enactment (or by June 26, 2007). The rule and form prescribing the process for a credit rating agency to apply for registration are immediately effective. The remaining rules are effective on June 26, 2007."

MBA - "Mortgage Applications Decrease Slightly In Latest MBA Survey" (6-6-07)

"The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending June 1, 2007. This week’s results include an adjustment to account for the Memorial Day holiday. The Market Composite Index, a measure of mortgage loan application volume, was 625.3, a decrease of 1.7 percent on a seasonally adjusted basis from 636.4 one week earlier. On an unadjusted basis, the Index decreased 12 percent compared with the previous week and was up 16.5 percent compared with the same week one year earlier."

Seeking Alpha - "A Look At U.S. Home Price Performance in 20 Markets" (6-6-07)

"S&P/Case Shiller recently released the March figures for median home prices in the 20 cities they analyze. As many of you know, the Chicago Merc trades futures contracts based on these home-price indices."

Mish's Global Economic Trend Analysis - "In Love With Debt" (6-6-07)

"The idea that debt is good may be counterintuitive, but the U.S. should have more debt, not less. .... Debt is good. Historically, big deficits are followed by stock-market returns that are dramatically superior to those following surpluses--for as long as 36 months out."

eFinanceDirectory.com - "83 Percent of San Diego Homebuyers Used ARMS in June 2005" (6-6-07)

"Adjustable rate mortgage loans can be very enticing for home shoppers who are looking to keep their payments low. These types of mortgage loans are especially attractive to buyers who live in a high-priced housing market and can't afford the payments on a traditional mortgage loan."

Orange County Register - "O.C. real estate agencies a half-billion buck business" (6-6-07)

"Register real estate reporter Jeff Collins tipped me off to this fresh Census business data (sadly, as of 2005) that shows what's at risk in the local housing crunch in terms of real estate agencies/brokerages and their employees in The O.C. From 1998 to 2005, the number of separate agencies grew by 127 percent to 1,658 as the number of employees (not independent agents) grew by 79 percent to 7,218 while payrolls (not including commissions to independent agents) grew by 141 percent to $511.6 million."

USA Today - "Taos, N.M.: Single-family homes can take almost 1 year to sell" (6-6-07)

"The "hippie invasion" of Taos occurred in the late 1960s, according to the timeline on the Taos County Historical Society's website. This small town, with a population of about 5,000, still has a funky edge and a relatively low bling factor, despite a few part-time residents like Julia Roberts and Lauren Hutton. But Taos began evolving about six years ago as condos sprang up and baby boomers (no longer in tie-dyed T-shirts) started buying second homes to enjoy the nearby skiing and outdoor lifestyle, says Harvey Blaustein, owner of a local realty firm."

The Modesto Bee - "Con artists try to get foot in the door" (6-6-07)

"Con artists are a clever and endearing bunch, and they're making a fortune ripping off homeowners and lenders through assorted fraudulent real estate schemes. That's the message fraud investigators are trying to get out, along with tips for spotting scams."

San Diego Predatory Lending - "COUNTRYWIDE’S REO’S UP 251% FROM FEB & 30% LAST MONTH!" (6-6-07)

"This story is going from interesting to scary. In May, Countrywide added 374 properties (net of sales) to their website here. Since February 17, 2007 when I started tracking California REO’s at Countrywide Financial they have gone up by 251%. That’s an annualized rate of 880% or almost 9 times the amount of REO’s they will have had 12 months ago if the trend holds."

Financial News - "A brief history of blowing bubbles" (6-6-07)

"Most economists are suspicious of the notion of bubbles, or irrational manias in which the price of an asset is driven up irrespective of underlying fundamentals. They think they are rather like fairy stories, whose tellers are driven by a perverse propensity to deny the fundamental rationality of human behaviour. Their views are again being put to the test by the apparent bubbles – rational or otherwise – in the Chinese stock market, real estate in many parts of the world, and others besides."

Los Angeles Times - "Title Insurance Is A Scam. Help Is Coming. In 2009." (6-6-07)

"We've wanted to weigh in on the title insurance scam for a while now, but Blown Mortgage beat us to the punch with this excellent piece that should make your blood boil, unless of course you are part of the title insurance game. As Kenneth Harney pointed out here six weeks ago, a Congressional report concluded that title agents pocket up to 90% of your premiums, and the business is rife with scams, kickbacks, and inside deals that prevent competition and consumer choice."

Real Estate Journal - "Using Real Estate to Build Your Retirement Portfolio" (6-6-07)

"Four years ago, Vincent McCord was approached by a developer about investing in the construction of a Las Vegas shopping center. He liked the project and wanted to diversify his portfolio beyond stocks, bonds, and mutual funds. But the bulk of his investment assets were in an individual retirement account at a firm that, like most custodians, does not permit real estate other than publicly-traded real estate investment trusts or mutual funds that invest in them."

CAR - "California REALTOR® Showcase opens in Sacramento" (6-6-07)

"Taking place at the Sacramento Convention Center from June 6 - 7, the California REALTOR® Showcase will feature nearly 100 exhibitors highlighting the latest real estate products and services to help REALTORS® stay informed. Presented by the CALIFORNIA ASSOCIATION OF REALTORS®, the California REALTOR® Showcase will be open on June 6 from 12 noon to 5 p.m. and on June 7 from 9 a.m. to 5 p.m. Nearly 3,000 REALTORS® are expected to attend."

NAHB - "Nearly 100,000 Green Homes Certified Through Market-Driven Green Building Nationwide, Says NAHB" (6-6-07)

"A new survey of local home building associations reveals that more than 97,000 homes have been built and certified by voluntary, builder-supported green building programs around the country since the mid-1990s, according to the National Association of Home Builders. That’s more than a 50 percent increase from the last survey of green homes: In 2004, the National Association of Home Builders Research Center counted 61,000 green homes in the United States."

NAHB - "NAHB 50+ Housing Council Recognizes 2007 Best Of 50+ Housing Award Winners" (6-5-07)

"The NAHB 50+ Housing Council, which has promoted excellence in the seniors housing industry for the past 15 years, presented gold and silver awards in 58 categories to current and on-the-boards projects from across the United States and as far away as Japan. Design categories covered a range of product types such as active adult, assisted living, continuing-care retirement community, clubhouse design, rental apartments and renovated seniors housing. Winners were also honored for excellence in marketing strategies focused on the mature market. Two Special Judges’ Awards for Innovation were also presented to projects that demonstrated extraordinary creativity and insight."

North County Times - "Real estate scam emerges -- 'Crash and inflate' method generally leads to foreclosure" (6-5-07)

"Real estate appraiser Todd R. Lackner's second job as mortgage fraud investigator began when he stumbled onto a suspicious-looking transaction while online one day last March, he said last week. Within weeks, he was chest-deep in dozens of investigations of suspected mortgage fraud, and was helping federal investigators get the goods on real estate scammers who commit what are known as inflated-sale and-crash schemes, Lackner said."

Yahoo - "A Look At U.S. Home Price Performance in 20 Markets" (6-5-07)

"S&P/Case Shiller recently released the March figures for median home prices in the 20 cities they analyze. As many of you know, the Chicago Merc trades futures contracts based on these home-price indices. Below we highlight the difference between the actual March home price figures and the contract price of the home-price futures expiring in May 2008. As shown, all eleven contracts are indicating increased weakness in the housing market. Las Vegas is expected to decline the most, while San Francisco is expected to decline the least."

Bloomberg - "Bernanke Says `Tighter' Lending to `Restrain' Housing" (6-5-07)

"Federal Reserve Chairman Ben S. Bernanke said 'tighter' lending standards for mortgages will 'restrain' housing demand for longer than policy makers anticipated. The Fed chairman said the housing slump hasn't spilled over into other parts of the economy and he maintained a forecast for 'moderate' growth. Government and industry reports this month showed acceleration in job growth, manufacturing and personal spending and gains in services industries."

Bloomberg - "Treasuries Fall, Pushing Yields to Highest Level Since August" (6-5-07)

"Treasuries fell, pushing the benchmark 10-year note's yield to the highest level since August, after a private-sector survey showed U.S. service industry expansion last month reached the highest in more than a year. The yield on the 10-year note rose more than 4 basis points, or 0.04 percentage point, to 4.97 percent at 10:29 a.m. in New York, according to bond broker Cantor Fitzgerald LP. It was the highest since reaching 5 percent on Aug. 15. The price of the 4 1/2 percent security due in May 2017 declined 11/32, or $3.44 per $1,000 face amount, to 96 10/32."

Bloomberg - "Fannie, Freddie May Enrich Shareholders in Subprime's Shakeout" (6-5-07)

"Fannie Mae and Freddie Mac, the once- derided white elephants of the mortgage market, are benefiting from the subprime lending debacle and trampling just about anything in their way. The government-chartered companies, the biggest source of money for Americans buying houses, accounted for 46.9 percent of all mortgage bonds sold through April, newsletter Inside Mortgage Finance says. Their share rose from a record low 37.3 percent in last year's second quarter."

Realty Times - "Conditions Worsen For Summer Home Sales" (6-5-07)

"Home prices have fallen for the first time in 16 years according to the National Association of Realtors and the S&P/Case-Shiller national home price index, but that's not the only bad news for buyers and sellers -- mortgage interest rates are rising, and quickly."

Forbes - "Home Builders Hit The Hill" (6-5-07)

"On Wednesday, 1,300 home builders will call on Capitol Hill as part of a legislative conference organized by their trade group, the National Association of Home Builders. They'll do so against a grim industry backdrop. 'For the first summer in many summers, we're not helping to keep unemployment numbers down,' says Jerry M. Howard, 51, the NAHB's chief executive. 'For the first time in six years, we are a drag on the economy rather than a plus.'"

New York Post - "HEDGE FUND BEAR-ISH ON SUBPRIME RELIEF" (6-5-07)

"A big hedge fund on one whopper of a winning streak is picking a bitter fight with Bear Stearns over whether renegotiating loans for homeowners struggling with subprime mortgages is fair play. Paulson & Co., an $11 billion hedge fund, has written regulators over concerns that Bear and other investment banks may be engaged "in market manipulation" when the banks' mortgage-issuance units modify loans so that homeowners can avoid foreclosure."

MSNBC - "ECB inflation fears make rate rise likely" (6-5-07)

"The European Central Bank is poised this week to raise its 2007 forecasts foreurozone inflation and growth, heightening the chances that further interest rate rises will follow an increase likely to be announced on Wednesday. An upwards revision to its eurozone inflation forecast would highlight the risk that the ECB will again this year fail to meet its target for price stability – an annual inflation rate 'below but close' to 2 per cent. Its last forecast, published in March, was for a rate in a range with a mid-point of 1.8 per cent."

Housing Predictor - "Foreclosures Will Affect 2 Million Homeowners" (6-5-07)

"Rooted in society’s insatiable desire for wealth and the pursuit of the American dream of home ownership, the fall out from the sub-prime loan market fiasco has evolved into the nation’s largest foreclosure crisis since the 1980's."

Patrick.net - "Factors Forcing Housing To Crash" (6-5-07)

"There are 2.2 million vacant houses -- or 2.8% of housing supply. Housing prices are dropping and every factor is accelerating the drop. Mortgage underwriting is tightening and will tighten more as foreclosures increase. Foreclosures are increasing and increasing dramatically in bubble areas.Foreclosure auctions are relatively unsuccessful and inventory is becoming REOs. Builders have 180,000 vacant new houses to sell"

Bloomberg - "Fed Faces Pressure to Raise Rates, Options Show" (6-5-07)

"In the options market where the savviest investors take apart conventional wisdom, the Federal Reserve is facing growing pressure to consider raising interest rates as soon as December. Options on Federal Fund futures at the Chicago Board of Trade indicate a 41 percent chance the central bank will lift its target rate for overnight loans between banks to 5.5 percent from the current 5.25 percent, according to data compiled by Bloomberg. A month ago, they showed no expectations for an increase."

Yahoo - "Paper Chase" (6-5-07)

"In 2006 Michelle Tucker, a 35-year-old UPS package processor and mother of two, was hit by a one-two punch. Her husband had surgery on his shoulder and was forced to stop taking construction jobs around town that helped pay the bills. Worse, the adjustable mortgage with the low teaser rate she took out on her three-bedroom home in Jacksonville, Fla. adjusted, now to 10%, nearly double her old rate. She defaulted. Soon after, the lender filed suit to foreclose."

LA Times - "'We Are Already In a Recession,' Says SoCal Housing Bear" (6-5-07)

"As bracing as a cold shower, this interview with SoCal housing bear Schahrzad Berkland is worth reading -- notably for the assertion, 'We are already in a recession.' (Aside: corporate economists generally can't be relied on tell you whether a recession is coming, or has arrived).

Real Estate Journal - "What's Wrong With This House? Finding a Good Home Inspector" (6-5-07)

"Buying a house means buying its problems. That's where home inspections come in. Many states and real-estate companies require sellers to disclose what they know about a home's problems, such as mice in the attic. But inspections, which are the buyer's responsibility, can reveal what the seller either doesn't know or isn't telling you. Big-ticket flaws can run the gamut from foundation cracks to a faulty septic system. Before closing on a property, buyers can ask sellers to fix problems, negotiate a credit for repair costs or agree to buy the house "as is." Walking away from the deal entirely can be a final option."

Bloomberg - "Citadel Bet Signals Return of Subprime Bond Market" (6-4-07)

"Citadel Investment Group's purchase of Resmae Mortgage Corp. is the latest evidence that investors' appetite for bonds backed by subprime mortgages is returning five months after the industry crashed. The $180 million acquisition by Citadel, a $14 billion hedge fund, shows that the market for loans to people with weak, or subprime, credit isn't dead, said Sharon Greenberg, vice president of asset-backed securities research for Credit Suisse Group in New York."

Yahoo - "Accredited Home OK's $400M Buyout Offer" (6-4-07)

"Accredited Home Lenders Holding Co., which makes mortgage loans to residential buyers with shaky repayment records, on Monday said it agreed to be acquired by a private-equity buyer for about $400 million in cash. Lone Star Fund V LP will pay $15.10 per share for the company, a 10 percent premium over the stock's closing price of $13.76 on Friday."

NAR - "NAR Joins Nation in Celebrating National Homeownership Month in June" (6-4-07)

"As the nation’s leading advocate for homeownership, the National Association of Realtors® understands the value and joy of owning a home. This month, as the nation celebrates National Homeownership Month, NAR and state and local Realtor® associations across the county will do their part to help raise awareness of homeownership and encourage more Americans to consider the benefits of owning their own home."

Bloomberg - "Treasury Yields Touch Nine-Month High on Jobs, Manufacturing" (6-4-07)

"Treasuries declined, pushing 10- year note yields to the highest level in more than nine months, as larger-than-forecast gains in employment and manufacturing suggested economic growth is accelerating. Ten-year securities fell for a fourth week as traders erased bets the Federal Reserve will cut interest rates later this year."

Financial News - "A brief history of blowing bubbles" (6-4-07)

"Peter Garber, an economist at Deutsche Bank, demonstrated that there were rational underpinnings of the world’s most celebrated mania – the tulip craze in Holland in the 1630s – and that the apparently grossly overvalued prices were paid only for particular kinds of tulip with a beautiful patterning derived from a mosaic virus infection that could not be grown from bulbs. Garber’s point sounds analogous to the contemporary voices who claim that not all modern art is bubbling, but only the very best pieces, or that the real estate boom is confined to particular high-end locations."

North County Times - "Real estate scam emerges -- 'Crash and inflate' method generally leads to foreclosure" (6-4-07)

"Real estate appraiser Todd R. Lackner's second job as mortgage fraud investigator began when he stumbled onto a suspicious-looking transaction while online one day last March, he said last week. Within weeks, he was chest-deep in dozens of investigations of suspected mortgage fraud, and was helping federal investigators get the goods on real estate scammers who commit what are known as inflated-sale and-crash schemes, Lackner said."

Financial Times - "Fears over helping hand for mortgage defaulters" (6-4-07)

"A generation ago, a mortgage was still a simple contract negotiated face-to-face between a borrower and a local bank manager. But the business of home lending has changed dramatically. The crisis in the US subprime mortgage market has revealed a tangled web of relationships and competing interests between lenders and mortgage brokers, investment bankers and bond investors, and bank trading desks and hedge funds."

San Francisco Chronicle - "Subprime borrower rescue bill is dead" (6-4-07)

"A bill that would have created a pool of money to help subprime mortgage borrowers facing foreclosures to refinance their loans died in the state Assembly Appropriations committee Thursday. The measure, AB1538, was introduced by Assemblyman Ted Lieu, D-Torrance (Los Angeles County) in response to potential mass foreclosures of homes financed with controversial loans to consumers with little or subpar credit history."

Omaha World-Herald - "Owning home may not be best move for some people" (6-4-07)

"Nearly one-third of all homeowners move within five years, the council said, before they start building any real equity in a home. In cases like those - and even longer term - putting money into the stock market instead of into a house could provide superior returns, council officials said."

The Hankyoreh - "The U.S. economy: Where is it going?" (6-4-07)

"While the stock market has been booming, this seems to be primarily the result of the sort of irrational exuberance that infects people who speculate on stock markets at regular intervals. Many investors are fishing for the next big company that will be bought out by a private equity firm; they are not looking at the prospect for long-term profits. Those who do care about future profits would probably not keep their money in the stock market. The United States Congressional Budget Office projects that, after adjusting for inflation, corporate profits will be 5 percent lower in ten years than they are today. That is not the sort of forecast that ordinarily leads to a booming stock market."

MSN - "3 bad reasons to buy a home" (6-4-07)

"Fear stampeded a lot of people into buying a home during the recent real estate boom. Now we're seeing the even more fearsome fallout. People who were terrified about being priced out of the real estate market are now horrified by their ever-rising mortgage payments. People who were afraid of missing out on the "easy money" of home-price appreciation are now anxiously realizing that what goes up can also come down."

Yahoo - "US economy shows signs of vigor, but questions remain" (6-3-07)

"The latest economic data point to an acceleration in the US economy after the weakest growth in over four years, but some analysts say a full recovery is not yet in sight. Friday's Labor Department report showing a surprise gain of 157,000 jobs in May along with other robust data appeared to validate the view of the Federal Reserve that the world's biggest economy will gather steam over 2007, with strong consumer spending offsetting a slump in housing."

Orange County Register - "House prices falling from peak" (6-3-07)

"Fresh local housing statistics confirm what's been suspected: Prices are off their peaks and the top occurred sometime in the second half of last year. After nearly a decade of eye-popping profits, this pullback in overall Orange County home values should be no grand surprise. It might even be considered expected. But the market has surprised many watchers with just how fast it turned to what in most cases is the weakest pricing climate in a decade or more."

The Union-Tribune - "Who's to blame?" (6-3-07)

"There is plenty of blame to go around for the subprime mortgage meltdown that has reduced access to credit and sent lenders scrambling to tighten loose underwriting standards."

North County Times - "Home sales may be nearing bottom" (6-3-07)

"San Diego County's sluggish housing market is churning out single-family home sales at a pace barely above the low point of the recessionary 1990s, according to an analysis of regional statistics. At the height of the recent housing boom, about 4 percent of county homes were being sold every year. Today, a little more than half that are changing hands. And analysts say the market, when it comes to sales, is about to reach bottom in the current downturn."

Yahoo - "'Piggybacking' Roils Credit Industry" (6-3-07)

"Only a low credit score stood between Alipio Estruch and a mortgage to buy a $449,000 Spanish-style house in Weston, Fla., a few miles west of Fort Lauderdale. Instead of spending several years repairing his credit rating, which he said was marred by two forgotten cell phone bills and identity theft, the 37-year-old real estate agent paid $1,800 to an Internet-based company to bump up his score almost overnight."

Orange County Register - "Most won't tap home equity for retirement, poll says" (6-3-07)

"Pollsters from the Center for Retirement Research at Boston College found that 72 percent of homeowners surveyed nationwide, ages 50 to 65, said 'No!' to the question "Are you planning to use any of your home equity to finance ordinary living expenses in retirement (such as food, clothing and travel)?" Only 6 percent said 'Yes!' and 22 percent were unsure. We asked visitors to the Lansner on Real Estate online blog if they planned (regardless of age) to tap into home equity in retirement."

Los Angeles Times - "Surprise, it's solar" (6-3-07)

"At first glance, Paul Rupert's Livermore, Calif., home looks like any other residence. But the 2,900-square-foot house has a powerful secret. Last year, Rupert installed a solar energy system that cut his monthly electricity and heating bill from $400 to $25. Rather than use traditional photovoltaic panels that mount to a rack and are sometimes considered unsightly, Rupert choose integrated solar roof tiles that interlock with his new concrete roof tiles and lie flat. 'Most people don't even notice that it's a solar roof,' said Rupert, 67, an aerospace systems engineer."

The News Tribune - "FDIC warns banks to keep safety net" (6-2-07)

"Noting an operating environment that is 'more challenging than it has been in recent years,' Federal Deposit Insurance Corp. Chairman Sheila Bair warned Thursday that regulators and bankers 'need to ensure that new global capital standards do not threaten the safety net.' That net of capital on hand stretched during the first quarter as bank income fell. The FDIC said income fell because of 'the housing slump, unfavorable interest rate conditions, slower growth in the U.S. economy and higher levels of problem loans.'"

The Mercury News - "Housing market hurt by hesitation, builder says" (6-2-07)

"In addition to the glut of unsold homes on the market, the chief executive of Hovnanian Enterprises blames some of the housing industry's woes on the mind-set of buyers. 'A lot of the issue is psychological,' Ara K. Hovnanian said in a conference call Friday. Hovnanian said buyers continue to be rattled by the collapse of the subprime-mortgage market, which affects people who otherwise couldn't buy houses because they have weak credit, and by the ongoing uncertainty in the market."

OFHEO - "U.S. HOUSE PRICE APPRECIATION RATE REMAINS SLOW, BUT POSITIVE" (6-1-07)

"The rate of home price appreciation in the U.S. remained slow but positive in the first quarter of 2007. The OFHEO House Price Index (HPI), which is based on data from sales and refinance transactions, was 0.5 percent higher in the first quarter than in the fourth quarter of 2006. This is moderately below the revised growth estimate of 1.3 percent from the third to the fourth quarter of 2006. Prices in the first quarter of 2007 were 4.3 percent higher than they were in the same quarter in 2006."

NAR - "Pending Home Sales Index Shows Market May Be Stabilizing" (6-1-07)

"A forward-looking indicator based on pending home sales shows the housing market could edge down but appears to be in the process of leveling out, according to the National Association of Realtors®. The Pending Home Sales Index*, based on contracts signed in April, stood at 101.4, down 3.2 percent from an upwardly revised March reading of 104.8, and is 10.2 percent lower than April 2006 when it registered 112.9. The revised March index was 10.0 percent below a year earlier."

Bloomberg - "CDO Boom Masks Subprime Losses, Abetted by S&P, Moody's, Fitch" (6-1-07)

"The numbers looked compelling. Buy this investment-grade collateralized debt obligation and you'll get a return of up to 10 percent, Credit Suisse Group said. That was almost 25 percent more than the average yield on a similarly rated corporate bond. Investors snapped up the $340.7 million CDO, a collection of securities backed by bonds, mortgages and other loans, within days of the Dec. 12, 2000, offering. The CDO buyers had assurances of its quality from the three leading credit rating companies --Standard & Poor's, Moody's Investors Service and Fitch Group Inc. Each had blessed most of the CDO with the highest rating, AAA or Aaa."

Bloomberg - "HSBC to Sell Bonds of New Century Subprime Mortgages" (6-1-07)

"HSBC Holdings Plc plans to sell bonds backed by some of the last subprime mortgages made by bankrupt New Century Financial Corp., once its biggest rival in the business. The $1 billion of home loans made by Irvine, California- based New Century that HSBC plans to package and sell as securities on June 5 have an average age of about three months, Fitch Ratings said in a May 29 report. New Century, whose $51.6 billion in lending last year to borrowers with poor credit records or high debt burdens was topped only by London-based HSBC, stopped taking loan applications in early March."

Boston - "Lawyer eyes Ameriquest: Clients: Home loan paperwork faulty" (6-1-07)

"A Rhode Island lawyer claims he has found a chink in the legal armor of subprime mortgage giant Ameriquest, one that could give hundreds of thousands of homeowners grounds to wriggle out of their loans. Attorney Christopher Lefebvre said he is representing 200 current and former Ameriquest homeowners in Massachusetts and other states - many now facing foreclosure - who are suing to undo mortgages taken out through the California-based lender."

Bloomberg - "Bernanke Pulled in Different Directions by Economy" (6-1-07)

"Federal Reserve Chairman Ben S. Bernanke is pulled in opposite directions by worries over inflation and housing, leaving him little choice other than to keep interest rates unchanged. Fed officials said they still expect a pickup in the economy this year and view inflation as their main concern, minutes of their May 9 meeting showed yesterday. They listed several caveats, including the risk that the housing recession may ``weigh heavily'' on growth."

Financial Times - "Funds attack banks’ aid for subprime borrowers" (6-1-07)

"Hedge funds are attacking bank decisions that help delinquent US mortgage borrowers remain in their homes in a move that pits some of the country’s richest people against its least well-off. The dispute centres on derivatives contracts that pay money to investors when bonds backed by subprime mortgage loans – extended to people with past credit problems – run into trouble. The $1,200bn (€890bn) US subprime mortgage bond market has been hit recently by rapidly growing defaults, and hedge funds have profited from the crisis by buying such derivatives."

The San Diego Union-Tribune - "Housing forecast links slump to pump" (6-1-07)

"High gas prices have started to discourage new-home buying and construction in the Inland Empire, the California Building Industry Association said in a report yesterday. Officials released a midyear housing forecast at the group's annual convention in San Francisco that projects 135,000 to 150,000 building permits this year statewide, down from the 155,000 to 175,000 permits the association had projected in January."

LewRockwell.com - "It’s a Mad, Mad, Mad, Mad World" (6-1-07)

"The lure of easy money begins with the government printing press. First, the central banker buys an asset – typically a government debt instrument – writes a check on itself and deposits it into the banking system. Since the bank never 'redeems' the check, this is equivalent to creating money out of thin air. The banker, happy to receive fresh 'reserves,' loans out all but a sliver. This new money ends up back with the banks, is counted again as reserves, mostly lent out, and so on and so on. Through this process of fractional reserve banking, credit is expanded at a multiple of the initial central bank deposit. Through such a system, the creation of money and credit (the promise to pay money) looks like an upside-down pyramid – essentially a pyramid scheme on top of a counterfeiting operation."

CNN - "Mortgage rate rise pressures housing recovery" (6-1-07)

"Mortgage rates went up again this past week, putting more pressure on a weak housing market and further dimming prospects for a quick recovery. Low rates helped create and sustain the last housing boom. And rates remained manageable over the past two years as the market fell, buoying prices and enabling the bubble to deflate gradually rather than with a sharp pop."

eFinanceDirectory.com - "How to Raise Your Voice Against Inappropriate Loan Approvals" (6-1-07)

"Foreclosure activity is at its highest point since The Great Depression. The Center for Responsible Lending is estimating the 2.4 million people will lose their home as a result of adjusting interest rates. There are obviously some people out there who shouldn't have been approved for the loan that they received. It's tragic, because it didn't have to be that way. If borrowers would have been more honest with themselves and with lenders about what they could reasonably afford when the loan was granted, and later when interest rates adjusted, the problem may not be happening."