Thursday October 15 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Sign of the Times: Cash-strapped sell their kidneys to pay off debts - (www.timesonline.co.uk) British victims of the credit crunch are offering to sell their kidneys for £25,000 or more to help pay debts, an investigation by The Sunday Times has revealed. At least a dozen adverts have appeared on the internet offering kidneys for sale from British “donors”. Five of the sellers corresponded with undercover journalists, who posed as friends and relatives of sick patients to negotiate sales. One person willing to sell a kidney is a 26-year-old mental health nurse who said he needed the money to pay debts after a business he set up went bankrupt. Another is a 43-year-old taxi driver from Lancashire, who wants to raise cash to pay off some of his mortgage and buy a new kitchen. Both men said they wanted to help those in need of kidney transplants at the same time as relieving their financial difficulties. A leading doctor said the phenomenon highlighted the need for a public discussion of the issue of selling organs. Professor Peter Friend, a former president of the British Transplant Society, said: “The West has outlawed it for all sorts of good reasons, but the result is it goes underground. It is really important to have a debate.” Nearly 7,000 people in the UK are waiting for kidney transplants and 300 died last year while on the waiting list. Offering to sell an organ in England, Wales and Northern Ireland is an offence under the Human Tissue Act even if the seller is planning to travel to another country for the transplant operation. Yesterday William Henderson, the taxi driver, justified his offer to sell a kidney by saying: “I thought I was going to give another man a chance of life. I wanted to help myself at the same time. We are in the middle of a giant credit crunch.” He added: “A guy from Pakistan wanted one, but I turned him down. I think he was more buying it to sell it on. I’d rather . . . it’s got somewhere good to go.”

Realtor becomes Squatter - (www.trialbyblog.com) I found out today that I have a dear friend in trouble (Marge)- the woman volunteers for The Society of St. Vincent DePaul (our mission is to provide all kinds of help to those in real need), she is retired and a good friend of my family.My mother and she are neighbors in a gated community in Naples, Florida. Long story short - they are neighbors of a man who was diagnosed with stage 4 bone cancer. He is British and wanted to return to England to live out what time he has left. He hired a realtor from Downing Frye to sell his home. The realtor allegedly asked the owner if she could Live in the house while she showed it???? He supposedly said yes. She has no lease- she pays no rent. She apparently neglected to tell him that she was bringing along at least two other people and three large dogs. Marge and other neighbors called the owner - who asked the realtor to leave. She promptly told them that she has squatter's rights and needs notice. When the squatters rights for Florida scenarios was checked out - they found out that she was right and could be in the house anywhere from 3 mos. to a year and has to be served official papers and given ample time to be evicted. Apparently this past weekend - Marge and another neighbor found out that this realtor had changed all of the locks on the premises and rearranged all of the furniture and the house. They informed the owner. He asked Marge and Nancy to please change the locks (he is still in England with bone cancer)They saw that a back window was open - (they both had original keys to the house since they had cared for it before) . They called the locksmith and had the locks changed. The squatter/realtor comes home. Calls the police - tells police that someone broke into the house and stole valuable items including all of her jewelry. One cop sided with Marge and Nancy - the other with said realtor. She is pressing charges for breaking and entering and theft. Nancy and Marge are each meeting with attorneys tomorrow.

Fannie Mae Serious Delinquency Rate Increases Sharply - (www.calculatedriskblog.com) Fannie Mae reported that the serious delinquency rate for conventional loans in its single-family guarantee business increased to 4.17 percent in July, up from 3.94 percent in June - and up from 1.45% in July 2008. "Includes seriously delinquent conventional single-family loans as a percent of the total number of conventional single-family loans. These rates are based on conventional single-family mortgage loans and exclude reverse mortgages and non-Fannie Mae mortgage securities held in our portfolio." Just more evidence of some shadow inventory and the next wave of foreclosures.

Vacation Timeshares Drop at Record Pace as Americans Cut Back - (www.bloomberg.com) U.S. vacation timeshare sales may fall the most this year since the industry gained popularity in the 1970s as consumers forgo spending to ride out the recession. Sales may drop 30 percent this year from 2008, said Howard Nusbaum, president and chief executive officer of the American Resort Development Association, a Washington-based trade group. The market “will be a challenge for at least the next 18 months,” Patrick Scholes, senior equity research analyst at FBR Capital Markets & Co. said this month. “Timeshares are just very, very discretionary items,” said Chris Woronka, an analyst at Deutsche Bank Securities in New York. “It’s the perpetual vacation. I am prepaying for the ability to take a vacation every year. Under the current circumstances, people are more reluctant to pay for that.” U.S. timeshare sales dropped 8.5 percent last year to $9.7 billion from a peak of $10.6 billion in 2007, excluding the luxury fractional business and private residence clubs, according to an Ernst & Young LLP study prepared for ARDA. The decline was the industry’s first since 1975 and is being driven by tighter credit, a higher personal savings rate and the loss of 6.9 million jobs since the recession started in December 2007. Marriott’s Charge: Marriott International Inc., the largest U.S. hotel chain, said last week it will take a third-quarter pretax charge of $760 million in its timeshare business. The company will cut prices, halt development at some residential resorts and at some luxury fractional ownership properties, and sell some undeveloped land. “We have enough inventory to last a few years,” Laura Paugh, senior vice president of investor relations at Marriott, said in a telephone interview. “Prices are not likely to turn around in the near term. Given the development risk, we plan to complete the inventory we have under way, but not develop anymore.” Wyndham Worldwide Corp., the largest seller of timeshare vacation units, in December said it would cut 40 percent of those sales in 2009. Timeshares give owners the right to use a property for a set period of time each year, typically a week. Fractional ownership plans usually offer longer stays at a property and tend to include more services and amenities, according to ARDA. For hotel companies, the businesses can build customer loyalty, Marriott’s Paugh said.

Are we getting ready for subprime 2.0? - (www.dnaindia.com) Mumbai: Old habits are hard to break. When the Nasdaq tech-bubble burst, the US government and the Federal Reserve chairman "Bubbles" Greenspan created an even bigger asset-bubble to replace it (the US housing bubble). It was characterised by a 1% "benchmark" interest rate, ridiculously lax lending standards, rampant fraud -- and non-existent oversight. By refusing to allow its economy to purge itself of bad debt and excessive credit, the US government created a much more damaging bubble -- aggravated by Wall Street's multi-trillion dollar, global Ponzi-scheme. With the US housing market now experiencing its worst collapse in history as the aftermath of that bubble, and with no "bottom" in sight, the US government is once again trying to take the easy way out -- this time by trying to re-inflate the same bubble which has just burst. This time, the Fed's benchmark interest rate is at 0%. This time, it's the US government itself which has lowered the bar with its lending standards. This time, there is even more mortgage-fraud (up 23% from last year) -- and there is still no oversight. Now it is the Federal Housing Administration (FHA), a government agency, which is handing out subprime loans like a financial "Pez-dispenser". An illuminating article by business consultant David DePhillips provides a long list of ugly numbers. The FHA's market share of the US mortgage market has risen from 2% to 23% in just four years It already has a 7% delinquency rate on its loan portfolio, despite the fact that most of these are new loans. It has become the new employer for thousands of private sector "mortgage brokers", who were the instigators of most of the mortgage-fraud during the first housing bubble, with the number of "FHA approved" lenders rising by more than 40% since the end of 2007 -- from 9,600 to nearly 14,000. If this was an otherwise-healthy market, then perhaps the FHA's reckless expansion into this sector could be seen as "support" for struggling US homeowners. In fact, nothing could be further from the truth. US banks are holding millions of already-foreclosed/ repossessed homes off of the market. The most recent statistics show that total foreclosures and repossessions are on pace to go well over 4 million units this year. Meanwhile, sales statistics over the last two months show US "REO" (bank-owned real estate) sales will be less than 2 million units. This adds to the existing glut of 20 million empty homes. What is worse is that the US housing sector hasn't even gotten to the peak of its mortgage-resets of bad loans from the last bubble. This upcoming spike in resets begins next year and will continue through 2011, before beginning to tail-off in 2012. To make this upcoming "train-wreck" even worse still, the US's spendthrift baby-boomers are starting to retire, and their retirements are grossly under-funded -- even if the US's pension system can remain solvent.

OTHER STORIES:

Schumacher's Small is Beautiful Revisited - - (www.www.guardian.co.uk)
Just let the housebuyer tax credit die - (www.msnbc.msn.com)

California Housing Still Over Priced - (www.financemymoney.com)

Banks hold record delinquent mortgages - (mortgage.freedomblogging.com)

Federal Reserve Admits Hiding Gold Swap Arrangements - (finance.yahoo.com)

Pimco's Gross Changes Mind, Bets On Deflation Instead - (www.bloomberg.com)

How the Fed Failed to Protect Consumers - (www.cjr.org)

Bailed-Out Banks Still Making Billions Off Risky Bets - (www.huffingtonpost.com)

FDIC Discloses Deposit Insurance Fund Is Now Negative - (www.zerohedge.com)

Progressives and the Budget Deficit - (tpmcafe.talkingpointsmemo.com)

World Bank Head Sees Dollar's Role Diminishing - (www.nytimes.com)

Unprecedented U.S. corp. defaults seen for '09 - (www.reuters.com)

How Foreclosures Get Stripped - (www.youtube.com)

Why The Current Healthcare Bills Fail - (www.huffingtonpost.com)