KeNo's Housing and Economic Portal: Sunday October 3 Housing and Economic stories

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TOP STORIES:

Now scavengers have started stealing bricks from houses - (www.nytimes.com) By the time Raymond Feemster awoke to the pounding of firefighters at his door, flames were already licking his shotgun-style home. The vacant house next door, which neighbors said was frequented by squatters, had burst into flames and was now threatening to engulf houses on each side. Mr. Feemster, who gets around on an electric scooter, had to be carried out of the burning building, but today he considers himself lucky that the damage was contained to just two rooms. “My neighbor’s house was completely destroyed,” said Mr. Feemster, 58. “I guess it was one of the crackheads in that vacant house.” Perhaps. But the blaze, one of 391 fires at vacant buildings in the city over the past two years, may have had a more sinister cause. Law enforcement officials, politicians and historic preservationists here have concluded that brick thieves are often to blame, deliberately torching buildings to quicken their harvest of St. Louis brick, prized by developers throughout the South for its distinctive character.

Middle class running as fast as it can - (www.marketwatch.com) This recession has strangled the American middle class, but it was in a weakened state long before anyone heard of subprime mortgages. The great middle of American society has been falling for 30 years or more, a product of vast economic, social and political forces, both foreign and domestic. It won’t be restored with one congressional election, or even a presidential one. Its troubles are much more serious than that. The Census Bureau reported this week that the inflation-adjusted median household income had fallen 0.7% in 2009 to the lowest level since 1997. The typical household earned just under $50,000 a year. Read more about the increase in poverty last year. The Great Recession has taken away the small gains made during the 1980s and 1990s and ripped open wounds that were festering for 30, 35, or 40 years. The middle class is more anxious now than at any time in generations. The worries aren’t new; they are just on another level.

Defaults Account for Most of Pared Down Debt - (blogs.wsj.com) 0.08% — The annual rate at which U.S. consumers have pared down their debts since mid-2008, not counting defaults. U.S. consumers might not be quite as virtuous as they seem. The sharp decline in U.S. household debt over the past couple years has conjured up images of people across the country tightening their belts in order to pay down their mortgages and credit-card balances. A closer look, though, suggests a different picture: Some are defaulting, while the rest aren’t making much of a dent in their debts at all. First, consider household debt. Over the two years ending June 2010, the total value of home-mortgage debt and consumer credit outstanding has fallen by about $610 billion, to $12.6 trillion, according to theFederal Reserve. That’s an annualized decline of about 2.3%, which is pretty impressive given the fact that such debts grew at an annualized rate in excess of 10% over the previous decade.

GMAC denies reports of foreclosure moratorium - (www.marketwatch.com) GMAC Mortgage on Monday denied reports that it was instituting a mortgage foreclosure moratorium in 23 states. "The speculation likely emanates from a direction previously given by GMAC Mortgage to certain of its outsource vendors to allow time to address a potential issue that was raised in a number of existing foreclosures challenging the internal procedure we used for executing one or more judicially required forms," GMAC said in a statement. GMAC said that "all new residential foreclosures are continuing in the ordinary course of business with no interruption in our usual practice."

GMAC's Full Letter To Agents... Something Does Not Add Up - (www.zerohedge.com) Zero Hedge has obtained the GMAC Letter referred to earlier by Bloomberg, and contrary to subsequent reports by the bailed out lender that this is merely a procedural adjustment, something does not add up. To wit, note statements such as: Do not proceed with evictions, cash for keys transactions, or lockouts. All files should be placed on hold, regardless of occupant type. Do not proceed with REO sale closings. GMAC Mortgage will communicate instructions to the assigned agent regarding the management of the properties in Pending status. If the contract has already been executed by both parties, the Asset Manager will request an amendment to extend the closing date by 30 days or as otherwise designated by the Asset Manager. Please provide appropriate notice to the REO purchaser that, pursuant to Section 1 of the GMAC Mortgage Addendum to Standard Purchase Contract, GMAC Mortgage is exercising its sole discretion to extend the Expiration Date of the Agreement by 30 days at this time. If the REO purchaser wishes to cancel the contract, GMAC Mortgage will terminate the Agreement and return the earnest money deposit. And mostly: "There could be asset level exceptions and you will receive direct communication from GMAC on the handling of those exceptions."

In other words, the new revision is the de facto new standard, and not the exception to the rule, as GMAC's subsequent refutation would like to make it seem.

OTHER STORIES:

SF Bay Area House Sales Hit 18 Year Low - (www.sfappeal.com)

More than half of Reno-area mortgages underwater - (www.sfgate.com)

More foreclosures reason for fewer upside-down houses in Reno - (www.rgj.com)

Good News: The Great Recession is Over; Bad News: It Doesn't Feel Like It - (www.Mish)

Recession is over? Not for the housing market - (www.money.cnn.com)

Latest prices, sales figures show that US real estate market stagnating - (www.propertywire.com)

U.S. house prices will resume decline - (www.mybudget360.com)

House Equity Lines of Credit, the Next Looming Disaster? - (www.realestatechannel.com)

GMAC and Foreclosure Fraud Mess: Shit Hitting Fan - (www.nakedcapitalism.com)

Consumer debt decline because banks give up on collecting - (www.contracostatimes.com)

US Government hiding true amount of debt - (www.news.com.au)