KeNo's Housing and Economic Portal: Wednesday May 25 Housing and Economic stories

Tuesday, May 24, 2011

Wednesday May 25 Housing and Economic stories

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TOP STORIES:

LA says Deutsche Bank among city's largest slumlords - (latimesblogs.latimes.com) The Los Angeles city attorney's office accused officials at Deutsche Bank, a German financial institution, of being among "the largest slumlords in Los Angeles" and filed an unusual lawsuit Wednesday asking a judge to fine the company hundreds of millions of dollars and issue an injunction forcing it to clean up the foreclosed properties it owns in Los Angeles, which have numbered 2,000 over the last four years. After a yearlong investigation, city officials claimed in court papers that Deutsche Bank has illegally evicted tenants, shut off their water and power and then let hundreds of properties turn into graffiti-scarred dens for squatters, gang members and other criminals, destroying quality of life and driving up crime in the process. “The Los Angeles city attorney’s office has filed this lawsuit against the wrong party," Deutsche Bank spokesman John Gallagher said in a statement. "As we have repeatedly advised the Los Angeles city attorney’s office, loan servicers, and not Deutsche Bank as trustee, are contractually responsible for both the maintenance of foreclosed properties and any actions taken with respect to tenants of foreclosed properties.

English property market in 'state of rigor mortis' as prices drop further - (www.telegraph.co.uk) Economists said the figures illustrated how Britain’s property market remained in a ‘fragile state’. One analyst even described the lower end of the market as being in a 'state of rigor mortis' because the lack of affordable mortgages is preventing first-time buyers stepping onto the property ladder. Nationwide said the typical value of a home in Britain fell 0.2 per cent to £165,600 in April. At the same time, the Land Registry said prices fell at their fastest rate for two years at 1.1 per cent in March. A further £11,000 could be knocked off average prices by the middle of next year, according to the latest estimates. Separate figures released by the Bank of England showed a slight improvement in the number of mortgages approved for those buying a new home, rising to 47,557 in March,

Financial land of perpetual bubbles- California - (www.doctorhousingbubble.com) For a few years I have discussed the potential of a higher education bubble and the fallout it will have on the housing market. Logically you would assume that young adults with back breaking amounts of student loan debt would have a harder time taking on another giant commitment through a 30 year mortgage. At the very least this would stifle home sales from young households given that the vast majority of mortgage originations are now stemming from government backed sources that require income verification. Even with ultra low down payment programs like loans backed by the FHA many people are still struggling with the idea of saddling debt on top of already large piles of debt like a poorly played hand of Jenga.

Obama seeks to accelerate sales of surplus real estate - (seattletimes.nwsource.com) The real estate market may be in a slump, but few sellers have it tougher than the federal government. The nation's biggest property owner, the U.S. government has 14,000 office buildings, warehouses and other properties that have officially been deemed unneeded. Yet speedy disposal historically has been stymied by layers of red tape, political interference and bureaucratic inertia (not to mention the dread of packing and moving). On Wednesday, the Obama administration proposed creating an independent commission to streamline the process of physically downsizing the federal government. The legislation is meant to help reach the White House target of saving $15 billion over three years by selling, consolidating or closing excess holdings from the government's inventory of more than 1 million properties. Several hundred of the surplus properties are located in Washington state, including a 75,000-square foot Justice Department building just east of Qwest Field. Many of the properties are inside national parks operated by the Interior Department.

The allure of dying broke - (blogs.reuters.com) With the economy still struggling, unemployment still lofty, and retirement savings lacking, more Americans than ever are terrified of the idea of dying penniless. Financial adviser and author Stephen Pollan wants to remind you: That’s the whole idea. Not the prospect of outliving your cash; no one wants that. But the idea of using up all of your savings while you’re still here to enjoy it? That’s the mark of a well-lived life. Says Pollan, always outspoken: “You’re a jerk if you leave a single penny.” First published almost 15 years ago, Pollan’s book Die Broke seemed like pure heresy at the time, overturning just about every accepted tenet of personal finance. The old model of success: Work yourself to the bone, and scrimp and save every nickel in order to leave a vast estate to your heirs.