Sign On San Diego - "Index finds economy in county ailing" (5-2-07)

"A think tank founded by health care entrepreneur and former mayoral candidate Steven Francis launched a new barometer yesterday for measuring the county's economic health. And the economy isn't looking too swift, according to Francis' San Diego Institute for Policy Research, which opened in January."

The Press Enterprise - "Home-buying season has weak start" (5-2-07)

"The home-buying season got off to such a weak start in Inland Southern California this year that homes are still being built faster than they are sold, according to a report released Monday. Metrostudy, a real-estate information firm based in Riverside, reported 5,414 new home sales in Riverside and San Bernardino Counties in the first quarter of this year, a 50 percent decline from the same period a year ago."

Voice of San Diego - "Report: Recession Unlikely But More Pain in Housing" (5-2-07)

"Despite "storm clouds" of near-record foreclosure and default rates, weakness in the real estate market won't be enough to trigger a recession locally, at the state level or nationwide, a team of California economists say. Real estate encompasses a vast majority of the economic concerns for San Diego County identified in a new report from the University of California, Los Angeles Anderson Forecast, a widely respected panel of thinkers on state and national economics. The report is to be released to paying subscribers of the Anderson Forecast on Tuesday, and discussed in a breakfast seminar at downtown's Manchester Hyatt hotel."

Sign On San Diego - "Index finds economy in county ailing" (5-2-07)

"A think tank founded by health care entrepreneur and former mayoral candidate Steven Francis launched a new barometer yesterday for measuring the county's economic health. Advertisement and the economy isn't looking too swift, according to Francis' San Diego Institute for Policy Research, which opened in January."

CNN - "The buyers: The Quams and the too-good-to-be-true mortgage" (5-2-07)

"Newlyweds Erik and Brandi Quam can't really afford their home. The monthly carrying costs on their two-bedroom condo in Arlington, Va. run about $2,500 a month, and they fear the bill could go higher still as their adjustable mortgage resets to higher interest rates. It's already a tight squeeze: They've taken in a roommate to help pay the bills. Unfortunately, they can't afford to sell either. Thanks to a falling housing market and a prepayment penalty of about $11,500, they'd owe the bank more than their place is worth. "It makes me want to cry every month," says Brandi, 26. The irony is that the Quams should be able to afford their place: It cost just $219,000 when a still-single Brandi, fresh out of the Air Force, bought it."



CNN - "The brokers: Would you get your mortgage from this man?" (5-2-07)

"Morning commuters in Boston, Chicago and Phoenix are slapped awake by the voice of a pugnacious Texan shouting out of the radio. "When your mortgage payment goes up 400 bucks a month, you can dislocate your jaw and swallow it like a snake eatin' an egg," the voice says. "Or spend another seven grand and have some predator redo your mortgage. Unacceptable." The voice belongs to Jon Shibley, 39, the president of Lenox Financial Mortgage. Over 13 years he's built his business from a one-man shop in Atlanta into a 200-employee company that arranges mortgages and refinancings in 24 states."

CNN - "The appraisers: Price estimates made to order" (5-2-07)

"Last summer Daniel Kim was feeling pinched. So when Kim, now 27, of San Leandro, Calif. got a call from a mortgage company, he was intrigued. The loan officer, Mia Yi of ALG Capital, sold Kim on refinancing, putting him an additional $81,000 in debt on his house. Kim says he was surprised he could borrow more. He had bought the two-bedroom the previous year for $560,000 with no money down, and everything he had read said the market in his area was cooling. But after Yi produced an appraisal in November that said his house was worth $642,000, Kim signed. I was excited,' he says, 'that my house had appreciated that much.'"

CNN - "The investors: How to get rich trading "idiot" loans" (5-2-07)

"The housing boom was good to John Devaney. Really good. He owns a Rolls-Royce, a Gulfstream Jet, a 12,000-square-foot mansion in Key Biscayne and a 143-foot yacht, as well as a few Renoirs and a valuable 1823 reproduction of the Declaration of Independence. Devaney's not a developer, and he's certainly not a flipper. The 36-year-old CEO of United Capital Markets is a bond trader. And one of his specialties is buying and selling bonds that are backed by the mortgage payments of ordinary homeowners."

The Daily Reckoning - "Collapse of U.S. Housing Bubble Will Balance Income & Consumption" (5-2-07)

"Richard Suttmeier on Real Money hit the nail on the head when he said yesterday that the real estate explosion is about to implode. Like him, I believe that the subprime collapse is not just a speed bump in the 'New Economy.' Instead, it is a sign of wider problems in mortgage lending that threaten the viability of the New Economy itself. That’s because the collapse of the housing bubble means that a major 'band-aid' has been ripped off of America’s Achilles heel, the cash-strapped, savings short American consumer, exposing the scab underneath."

Herald Tribune - "Appraisers felt pressure during boom" (5-2-07)

"Real estate appraisers were under tremendous pressure during the boom to provide appraisals that would allow bankers to make mortgage loans. Now that the boom is over, appraisers find themselves being blamed for loans that went bad."

eFinanceDirectory.com - "The Second Great Depression: Interview With Author Warren Brussee" (5-2-07)

"Starting in 2001, in response to the stock market's sudden drop and to make sure the US did not go into a deep recession, the Fed lowered its federal funds rate from 5.5% all the way down to 1%. This enabled lower mortgage rates. At the same time, lending institutions started using creative mortgage loans, including negative amortization, interest only, low initial teaser rates, zero down, and adjustable rate mortgages. This dramatically increased the potential number of home buyers and the ability of buyers to buy more expensive homes. This increased demand caused bidding for available homes and drove up prices: the old demand versus supply thing! As prices rose, people began to look at homes as investments, bringing even more people into the market. Between 2000 and 2005, the median price of homes went up 49% over the historical expected price rise."

Bloomberg - "Bond Demand Put Risky Subprime Borrowers Into Homes" (5-2-07)

"Demand for bonds, and investors' complacency toward risk, can be blamed for the record early delinquencies and defaults on subprime home loans, speakers at an industry conference in Miami said. The poor performance of subprime home loans made last year stems from an average drop of at least 0.50 percentage point in the yield premiums for credit risk on all types of fixed-income assets since 2000, Mortgage Bankers Association Chief Economist Doug Duncan said, citing research by other economists."

The Motley Fool - "Lipstick on the Housing Pig" (5-2-07)

"Consider it an unsightly, smeared, parting smooch from housing's biggest , the National Association of Realtors' ex-economist, David Lereah. The NAR's newest pending sales report is an absolute hog. March pending sales were down a whopping 10.5% from 2006, and they even managed to score a sequential drop of 4.9%, something that should not happen as we head into the spring buying season. But the NAR is ever willing to put lipstick on the pig."

Mortgage Bankers Association - "Robbins Announces MBA's Support for Senate Banking Committee's Principles for Mortgage Servicers" (5-2-07)

"John M. Robbins, CMB, Chairman of the Mortgage Bankers Association, today stated MBA's support for principles for mortgage servicers identified during the recent Homeownership Preservation Summit hosted by Senate Banking Committee Chairman Christopher Dodd. 'The Mortgage Bankers Association endorses the homeownership preservation principles developed under Chairman Dodd's leadership,' said Mr. Robbins. 'We appreciate the Chairman's efforts in bringing together important elements of the mortgage finance industry to ensure that all that can be done on behalf of borrowers facing foreclosure is being done.'"

Orange County Register - "Readers rank O.C. communities" (5-2-07)

"Builder consultants Real Estate Economics of Irvine recently ranked 12 clusters of O.C. communities by their housing market's potential based on several economic factors. Below, is Real Estate Economics' five most promising, in order from the top. We asked visitors to the Lansner on Real Estate how they saw this list, and three-quarters of them agreed with these consultants. Though, their order of the top five was a different."

Real Estate Journal - "Vacation-Home Sales Hit Record; Investment Purchases Fall" (5-2-07)

"A sharp drop in investment-home sales offset a record number of vacation-home purchases to bring down the overall number of second-home purchases in 2006, the National Association of Realtors reported. Vacation-home sales rose 4.7% to a record 1.07 million homes in 2006 from 1.02 million in 2005. Investment-home sales fell 28.9% to 1.65 million homes in 2006 from 2.32 million in 2005, according to the group's annual survey of investment- and vacation-home buyers."

Real Estate Journal - "Real-Estate Professionals Say IRS Snares Them by Mistake" (5-2-07)

"Some real-estate professionals say they are being mistaken for sometime investors by the Internal Revenue Service, and that could prohibit them from taking advantage of certain tax and economic benefits. Consider the case of David Friedman, a real-estate broker and property owner in Los Angeles. Like many professionals in the business, he not only sells homes to consumers, he also buys and sells undeveloped land and owns single-family homes that he rents out. He says he works every day and has amassed holdings in Southern California and Oklahoma that are valued at $20 million."