KeNosHousingPortal.blogspot.com
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Stockton Finds Itself Caught Up in Chap. 9 Chatter - (www.bondbuyer.com) Stockton may not exactly be the next Vallejo, but similarities between the two California cities have started people talking. Stockton, located 80 miles east of San Francisco, is more than twice the size of the Bay Area’s Vallejo and also has much more debt outstanding, making it one of the largest and more significant municipalities in the country teetering on the edge of bankruptcy. As in Vallejo, Stockton officials say its finances are severely strained from a steep drop in revenues due mainly to the housing bust, while labor costs locked into contracts continue to rise. Jeff Michael, director of the business forecasting center at the University of the Pacific’s business school in Stockton, said development and construction in the housing sector had been a major driver of the city’s economy, and was essentially wiped out. “Basically, it comes down to the housing collapse,” Michael said. “You have a city that overextended itself and had unrealistic expectations.” Stockton recently hired former Vallejo assistant finance director Susan Mayer as its chief financial officer and tapped Vallejo’s bankruptcy attorney, John Knox of Orrick, Herrington & Sutcliffe, to help it deal with its fiscal woes.
OC realtors seek to silence free speech by accusing Irvine blogger of lying - (www.irvinehousingblog.com) The Orange County Association of realtors has accused IrvineRenter of "knowingly telling lies about competitors." They demand I appear in front of their grievance committee for disciplinary action. My issues with the association of realtors is well documented:
5-23-2011 -- More self-serving bullshit from the National Association of realtors
5-13-2011 -- NAr: sales decline in 78% of markets and prices fall 4.5% nationwide
3-26-2011 -- The future of IHB news and real estate analysis.
3-9-2011 -- The OC Register Says California had no real estate bubble.
2-24-2011 -- National Association of realtors caught lying about home sales
4-9-2010 -- The National Association of realtors Latest Scare Tactic: Rising Interest Rates
1-26-2010 -- Urgency Versus Reality: realtors Win, Buyers Lose
I don't like how this trade association operates. As I stated in More self-serving bullshit from the National Association of realtors,
Walk away from your mortgage: Time to get ruthless - (money.cnn.com) Should you keep paying your mortgage on a home that's dwindling in value? No way, say an increasing number of underwater homeowners who are voluntarily choosing to "walk away" from their home loans, a practice known as "strategic default." Jon Maddux, CEO of YouWalkAway.com, reports 10% more clients this year to his company, which advises people how best to handle the walk away process. Charles Gallagher, a real estate attorney in St. Petersburg, Fla., has also seen an uptick. And a recent survey by home finance company Fannie Mae found that while only about 27% of homeowners would even consider walking away, that's up from 15% last year.
More Homeowners With Second Mortgages Are Underwater - (online.wsj.com) Almost 40% of homeowners who took out second mortgages—extracting cash from their residences to cover everything from vacations to medical bills—are underwater on their loans, more than twice the rate of owners who didn't take out such loans. The finding, in a report to be released Tuesday by real-estate data firm CoreLogic Inc., illustrates the consequences of easy borrowing amid the housing boom's inflated prices. The report says 38% of borrowers who took cash out of their residences using home-equity loans are underwater, or owe more than their home is worth. By contrast, 18% of borrowers who don't have these loans were underwater. It's not clear how much cash withdrawn from homes during the boom was used to acquire luxuries such as expensive automobiles, and how much went to basic necessities, including tuition expenses, or renovations intended to raise a property's value. What is clear is that home-equity loans, which account for about 10% of the U.S. mortgage market, have been a headache for homeowners and lenders alike. Second mortgages refer to any loan taken out on a property that is subordinate to the first mortgage, and include home-equity loans or lines of credit. Second mortgages are weighing on a fitful recovery, in which housing has figured as particularly weak spot. The S&P/Case-Shiller National Index last week showed that home prices tumbled 4.2% nationwide in the first quarter, its third straight quarter of price declines after a modest recovery in early 2010. Nationwide, prices have fallen 34% since their peak in 2006. The inventory of unsold homes will take 9.2 months to sell, the National Association of Realtors said recently, about 50% higher than what is considered a healthy level. "When a homeowner's house is underwater, "it's harder to get a credit card or a car loan, you can't put your home up for a small business loan," said Mark Zandi, chief economist at Moody's Analytics. "There are all sorts of little, pernicious effects that you don't necessarily think about."
Large swaths of Central Valley under water -- mortgage-wise - (www.centralvalleybusinesstimes.com) There are 10.9 million homes in the United States, or 22.7 percent of all residential properties with a mortgage, that were in negative equity at the end of the first quarter of 2011, according to a new report Tuesday from CoreLogic Inc. (NYSE: CLGX), a Santa Ana-based financial information company. That means the owners owed more on their mortgages than their houses were worth. But the Central Valley sets the nation’s deepwater mark for underwater homes, with as many as 501,142 homes underwater at the end of the first quarter, according to CoreLogic. Stockton is in the deep end of the pool with 55.6 percent of all homes with a mortgage worth less than the paper on them. That’s second in the nation after Las Vegas’ 66 percent. Modesto ranks third, tied with Phoenix, Ariz., at 55 percent.
OTHER STORIES:
Archaeology dating technique uncovers property boom of 3700 BC - (www.guardian.co.uk)
If it looks like a bubble and walks like a bubble... - (tech.fortune.cnn.com)
Low Yields on US Treasuries No Guarantee Against Fiscal Crisis - (www.bloomberg.com)
Lying Realtors go after blogger who says they lie - (irvinehomes.ocregister.com)
Hong Kong Rate Hikes Deflate Housing Boom - (www.bloomberg.com)
Health Care Costs and the Tax Burden - (economix.blogs.nytimes.com)
English House prices drop 7,000 pounds amid fragile economy - (www.telegraph.co.uk)
The hard truth about health care - (www.washingtonpost.com)
Why the US housing market will keep falling - (www.theglobeandmail.com)
Housing Market Has Persistent Case of the Blahs - (www.bloomberg.com)
South Florida House prices best (lowest) since crash - (www.palmbeachpost.com)
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