Archive for September 2013

Personal Income, Spending Surge in August

September 30, 2013

Image

It would seem that this “Surge” in income and spending could mainly be attributed to the fact that a lot of people had 5 paydays (Fridays) in August as opposed to 4 in July. This works out to, for those people that get paid on Fridays, a 20% boost in take home income for the month. Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

Personal income grew in August at its fastest pace since February and consumer spending grew faster than in July, the Bureau of Economic Analysis reported Friday. The growth matched economists’ forecasts of a 0.4 percent boost in income and a 0.3 percent increase in spending.BEA also revised up its estimate of both spending and income growth in July.

The report suggested strong growth in spending for the third quarter ending Monday, which would boost GDP. In the first two months of the second quarter – during which the economy grew at a seasonally adjusted annual rate of 2.5 percent – consumer outlays were essentially flat, dropping 0.2 percent in April and then increasing by the same amount in May. Spending rose 0.6 percent in June, contributing to the GDP growth.

Total employee compensation, which had fallen 0.2 percent in July, rose .04 percent or $34.2 billion in August. Wages rose an aggregate 0.4 percent or $30.4 billion in August after dropping $18.5 million. The calendar often affects wage and government transfer payments. There were four Fridays, traditional paydays, in July but five in August.

Farm income, which had struggled earlier the year due to droughts and flooding in different parts of the country, rose $7.9 billion or 6.8 percent in August, the second straight month of income growth after falling in April, May and June.

Government transfer payments – essentially Social Security and Medicare (along with a few other categories) – rose a collective 0.4 percent or $10.8 billion in August.

To read the complete article please use the link below.

Personal Income

HUD Delays Dual Agency Restrictions

September 30, 2013

Image

This is another case of the Government “Fixing” a problem that they had no evidence of it even existing. This rule would have produced wide spread havoc in the short sale market. At least they caught their foul-up in time to curtail the damage. Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

HUD has delayed its prohibition of dual agency listings on short sale properties according to a statement made this week by the National Association of Realtors (NAR).

The HUD prohibition had first been outlined in a July letter to mortgage servicers describing new anti-fraud requirements for short sales and deed-in-lieu of foreclosure transactions. The original policy was slated to go into effect October 1, 2013.

In response, NAR President Gary Thomas wrote a letter to HUD outlining NAR’s concern with both the reasoning behind the prohibition and the possible consequences of it.

“NAR has been told that the policy was implemented because the HUD Inspector General detected fraud and abuse in the pre-foreclosure sales process; however, no statistics or reports were provided to NAR detailing short sale fraud by real estate agents,” the letter said. “NAR takes fraud very seriously…If there is evidence of fraud by our membership, we would like to be part of an effort to develop policies that effectively address these issues.”

Thomas’s letter also raised concerns about how a prohibition on dual listing would affect agents’ and brokers’ ability to effectively serve their clients.

To read the complete article please use the link below.

Dual Agency Restrictions

Household Net Worth Growth Slows in Q2

September 29, 2013

Image

This is a great indication of how much the housing industry impacts the national economy. When home sales slow down so will the growth of net worth and vice versa. Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

Household net worth improved $1.3 trillion in the second quarter — half as fast as the first quarter — as real estate values grew $626.7 billion, the Federal Reserve reported Wednesday in its quarterly Flow of Funds report.

But, with a drop in mortgage debt — including home equity loans and lines of credit –- from $9.39 trillion in the first quarter to $9.34 trillion in the second, homeowner equity grew to 49.8 percent in the second quarter from 48.1 percent in the first.

Household investment in the stock market grew $265 billion in the second quarter compared with $929 billion in the first when overall net worth grew $2.8 trillion.

Owners’ equity as a percentage of real estate value has been on a steady upward trajectory since dropping to 36.3 percent in the first quarter of 2009. It rose to 45.4 percent at the end of 2012 and to 48.1 percent one quarter later. The 2.7 percentage point increase in the first quarter of this year is the fastest quarter-to-quarter growth this century. Even with the increase, though, the equity percentage remains sharply lower than 57.7 percent in 2000.

After falling $223 billion in the first quarter, disposable personal income grew $98.6 billion in the second. The first quarter drop reflected the rollback of the cut in payroll taxes which ended January 1. With the increase, second quarter disposable personal income — essentially after-tax income — was $12.39 trillion, about $130 billion less than the record $12.52 trillion in the fourth quarter last year.

To read the complete article please use the link below.

Household Net Worth

Pending Sales Index in 3rd Straight Monthly Drop

September 29, 2013

Image

A lack of inventory and the tougher requirements for getting a mortgage contribute as much to this drop in the pending sales index as the higher mortgage rates. New housing starts are up and that is reflected in the rise in the new home contracts. Please read the article below.

 

The FHA Condos Approval Company, Inc.

 

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

 

Continuing to respond to higher mortgage rates, the Pending Home Sales Index (PHSI) slipped for the third straight month, dropping 1.6 percent in August to 107.7 the lowest level since April, the National Association of Realtors which compiles the index reported Thursday. Economists had expected a more modest decline, 1.0 percent, to 108.3. NAR also revised the July index down to 109.4 from the originally reported 109.5.

 

The index covered the same month in which new home sales, reported Wednesday by the Census Bureau of Department of Housing and Urban Development, improved 7.9 percent. Like the PHSI, new home sales are tracked when buyers sign contracts. The existing home sales report for, also a product of the NAR, is based on closed transactions.

 

NAR Chief Economist Lawrence Yun said the drop was expected as a consequence of buyers accelerating purchase decisions while mortgage rates were increasing. Indeed, existing home sales jumped in both July and August. The corresponding PHSI rose a sharp 5.8 percent in May – the strongest month-month increase in two years. The index dropped a scant 0.4 percent in June.

 

Yun downplayed expectations for home sales.

 

“Moving forward, we expect lower levels of existing-home sales,” he said, “but tight inventory in many markets will continue to push up home prices in the months ahead.”

 

To read the complete article please use the link below.

Pending Sales Index

FHFA OIG Recommends More Efficient Pursuit of Deficiencies

September 28, 2013

Image

Reports like this are getting old. Freddy Mac lets 4 Billion dollars just melt away with no effort to recover it and Fanny Mae does the same thing with over 2 billion dollars of your tax money. They blame it on the people that are servicing the foreclosures but in reality they are the ones that these people work for.

If you can’t oversee your employees then you’re should be out and let’s find someone who can. As far as anything can be found by searching records no one has been disciplined for this foul up let alone fired. What would your boss do if you lost 4 billion dollars without any effort to recover it? GSE’s answer is – we’re sorry we will try to fix it by next year. Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

The Office of the Inspector General (OIG) of the Federal Housing Finance Agency (FHFA) has issued a pair of reports critical of the GSEs’ efforts to collect billions of dollars in deficiencies from underwater homeowners who walked away from their mortgages.

“If either the foreclosure sale’s proceeds or the value at which [the GSE] records a property in its real estate owned portfolio is less than the borrower’s mortgage loan balance, the shortfall (or deficiency) represents a loss to [the GSE],” one of the reports explained. “Such losses can be reduced if the enterprise recovers deficiencies from borrowers who possess the ability to repay. Enhanced deficiency management practices can also serve as a deterrent to those who would choose to strategically default on their mortgage obligations.”

The reports found that Freddie Mac did not refer nearly 58,000 foreclosures with estimated total deficiencies of approximately $4.6 billion to its deficiency collection vendors. Between January 2010 and June 2012 Fannie Mae failed to pursue 26,000 foreclosures that had an average deficiency of $79,000.

In most cases the collection of deficiencies was abandoned because of state laws limiting the amount of time that can pass between a foreclosure sale and a collection action. Delays in collecting and processing paperwork often allowed this statute of limitations to pass.

To read the complete article please use the link below.

Efficient Pursuit of Deficiencies

Report: Recovery Driven by Cash Buyers, Investors

September 28, 2013

Image

As prices rise the incentives, for investors and all cash buyers, to purchase properties decreases. To keep the recovery rolling their place in the housing market needs to replace by single family purchasers.  Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

The median sale price for a distressed residential property was $116,000, up one percent from a month ago but down three percent from a year ago, according to the August 2013 U.S. Residential Foreclosure and Sales Report released Thursday by RealtyTrac. The national median sales price for other residential properties was $175,000, up three percent from last month and up six percent from a year ago, making August the 17th consecutive month that home prices have increased annually.

“Seven years after the housing bubble burst, U.S. home prices are clearly on the rise again, up 23 percent from the bottom in March 2012 although still 26 below the peak of the housing price bubble in August 2006,” said Daren Blomquist, vice president at RealtyTrac. “This recovery in home prices and sale volume continues to be driven in large part by cash buyers and institutional investors, as evidenced by the increasing share of sales represented by those two categories in August.”

Sales volume increased from the previous month in 39 out of the 42 states tracked in the report and was up from a year ago in 37 states, including Texas, (up 31 percent), Illinois (up 29 percent), Pennsylvania (up 28 percent), Virginia (up 26 percent), and Florida (up 22 percent). Notable exceptions where sales volume decreased from a year ago included California (down 17 percent), Arizona (down 12 percent), Nevada (down 6 percent).

To read the complete article please use the link below.

Recovery Driven by Cash Buyers

Report Shows Home Price Rebound in Nearly 25 Percent of Key Markets

September 27, 2013

Image

These markets are really localized examples. Nationwide we are nowhere near that type of recovery but we are slowly getting there. Please read the article below.

The FHA Condos Approval Company, Inc.

Please +1 Us on Google, Follow Us on Twitter or Like Us on facebook

Property data through July shows home prices have rebounded completely in more than one-fifth of the nation’s top regional markets, according to a report from Homes.com.

According to the site’s latest report, 22 of the top 100 markets in the United States reported price increases of more than 100 percent from their respective troughs, up from 19 the month prior.

Marketing analyst Nicole Selvaggi explained that most of the markets that have come back completely “never suffered the significant numbers of foreclosures and short sales that characterized the housing economy from 2007 to 2012,” and seven of the top 20 have benefited greatly from energy development from oil, gas, shale, or coal.

“As a result, these markets experienced a very different housing scenario, with lower peaks and higher troughs than other markets in the same region,” Selvaggi said.

At this point, 44 markets have seen a rebound of at least 50 percent, up from 41 in the last report.

In addition to the rebound, all 100 of the markets tracked in the Homes.com Local Market Index Report reported increases in home prices on both a monthly and yearly basis.

In terms of yearly growth, many of California’s most highly populated markets (including the Los Angeles, San Diego, and San Francisco areas) were among the top metros, with five additional smaller cities making the top list.

To read the complete article please use the link below.

Home Price Rebound