KeNo's Housing and Economic Portal: Tuesday November 9 Housing and Economic stories

Monday, November 8, 2010

Tuesday November 9 Housing and Economic stories

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TOP STORIES:

Number of Californians entering foreclosure rises 19% - (www.latimes.com) Fresh data show the number of California homes entering foreclosure jumped nearly 19% in the third quarter from the previous quarter, the first time the Golden State has logged an increase in the key measure since hitting a peak early last year. It is too soon to tell whether the increase represents a further deterioration in homeowners' ability to pay their mortgages or just improved efficiency on the part of lenders, analysts said. Big banks were overwhelmed in 2009 by the sheer number of delinquent borrowers and efforts to work with troubled homeowners, and the lenders could be playing catch-up, analysts said. A total of 83,261 default notices were filed against California properties in the third quarter, the first formal step in the foreclosure process. Despite the uptick from the second quarter, the number was still down 25.5% from the same period last year and 38.5% off the peak reached in the first quarter of 2009, according to statistics released Tuesday by San Diego research firm MDA DataQuick.

Judge Judy: Before the Mortgage Crisis - (www.youtube.com) In this case from early 2007 you can see the high ethics and intelligence that permeated even the bottom reaches of the mortgage industry before the crisis. A Google search reveals that the defendant later appeared on Judge Joe Brown, and in 2009 was arrested for welfare fraud.

Beach house from list at $2,900,000 to selling for $900,000 - (www.doctorhousingbubble.com) It isn’t every day that you get to see a home inSouthern California that shows the manic pricing behavior of the peak years of the bubble followed by the desperate bid to chase the market lower in such extreme fashion. There were many sellers that held out for peak prices but were always one step behind when the correction hit. They wanted to sell their home for $600,000 but the market only would support $550,000. So a few months later they adjust to $550,000 and then, the market would only support a price of $500,000. Consider this the reverse of the bidding wars in the heyday of the bubble. Many for a year or even more attempted to chase the market lower and many eventually lost their homes this way. Now the typical case is of someone with some funky toxic mortgage and the often repeated story of buying more home than you can afford. There are many examples also of failed HGTV style flips. Today a reader sent me a home from the seaside community of Seal Beach that must be seen to be believed.

US should remove top bank execs over foreclosure mess - (voices.washingtonpost.com) Two economists, William K. Black and L. Randall Wray of the University of Missouri-Kansas City, are proposing a solution to the foreclosure mess: They want the federal government to take control of the banks and oust their top executives. "We should remove the senior leadership of the banks and replace them with experienced bankers with a reputation for integrity and competence, i.e., the honest officers that quit or were fired because they refused to engage in fraud," Black and Wray wrote in an essay on HuffingtonPost.com on Oct. 22. The posting has been circulated widely on the Internet and has prompted strong reaction from fans and critics of their radical proposal.

Mortgage Bankers Push Housing Recovery to uh, 2012 - (blogs.wsj.com) Remember the 2010 housing recovery? The Oracle of Omaha said that by the end of this year things would get better. He wasn’t the only one. Fitch also promised us stability in late 2010. Well, as the foreclosure mess spirals us toward Dec. 31, the chances for a happy housing new year seem pretty remote. On Tuesday, the nation’s mortgage bankers released a report saying that they expect the housing market to continue limping along into next year. Things could pick up, they say, in 2012. (That’s, what, five or so years of the housing bust…but who’s counting?) “Economic growth in 2010 has been subdued and this trend will likely continue for most of 2011. Households remain cautious given the weak job market,” says Jay Brinkmann, the Mortgage Bankers Association’s chief economist, in a forecast. More pain-yes, more-is expected before recovery arrives. Take unemployment. The rate, the trade group says, will increase from the current 9.6% to 9.9% by the first quarter of 2011. But it could slip back to 8.7% by the end of 2012. Mortgage delinquency and foreclosure rates should track the downward trend in the unemployment rate, the group says.