KeNo's Housing and Economic Portal: Saturday June 4 Housing and Economic stories

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TOP STORIES:

Huge Drop in Realtor Membership - (www.housingpredictor.com) Slammed by the real estate crash, the National Association of Realtors membership has dropped 21% since 2006 when real estate agents and brokers began to realize markets were heading down to just 1.06-million members, according to a real estate survey conducted annually. Real estate agents and brokers are also finding that the dramatic changes in the housing market has led them to work more, earn less and deal with more troubled properties like foreclosures and lenders’ short sales in order to make a living, the study by Inman News found. The huge drop in Realtor membership represents a major shift in the industry. Foreclosures and bank-assisted short sales do not pay agents as much as sales of homeowners’ properties because banks require a discount to sell bank owned (REO) properties. “The findings in the report, show in the past five years the national median sales price for existing homes has fallen 27% to $177,000,” said Inman News CEO Tim Smith, whose company specializes in news for agents and industry professionals.

Foreclosure rate slows because banks taking longer to foreclose - (www.latimes.com) Increased scrutiny of how lenders foreclose on Americans has dragged the repossession process out to unprecedented lengths, driving down the pace at which banks are taking back homes. Big banks are taking longer not only to push borrowers into foreclosure, but also to move homeowners through each stage of the process than in previous years, according to a report by Irvine-based RealtyTrac. The extended timelines have meant a reprieve for troubled borrowers. But economists said the delays could hold back a national housing rebound if foreclosures remain a significant part of the market for years to come. In April, U.S. foreclosure activity fell for the seventh month in a row on a year-over-year basis to the lowest point in more than three years, RealtyTrac said. The sharp April drop was the result of the foreclosure-processing slowdown and not an indication of a housing rebound lifting people out of default, experts said. "The banks have had to slow down and get more lawyers involved because of all of the fuss over the robo-signing scandal," said Christopher Thornberg, principal of Beacon Economics, referring to the revelations last year that banks foreclosed on properties using faulty paperwork.

McMansions dead at last. The kind of houses well build in the future - (www.slate.com) The U.S. housing market is going through an adjustment of historic proportions. Before 2006, when the housing slump commenced, American home builders regularly built as many as 2 million new houses annually, rarely less than a million. This amount was needed to keep up with new household formation, immigration, homeowners moving up, and replacement due to obsolescence. Since then the number of new houses built has dropped drastically—the seasonally adjusted annual figure announced by the federal government in February 2011 was about 400,000! What's going on? The recession, obviously. High unemployment and unease about the economy have made potential first-time homebuyers leery of entering the market, and many have decided to wait on the side lines.

The People vs. Goldman Sachs - (www.rollingstone.com) They weren't murderers or anything; they had merely stolen more money than most people can rationally conceive of, from their own customers, in a few blinks of an eye. But then they went one step further. They came to Washington, took an oath before Congress, and lied about it. Thanks to an extraordinary investigative effort by a Senate subcommittee that unilaterally decided to take up the burden the criminal justice system has repeatedly refused to shoulder, we now know exactly what Goldman Sachs executives like Lloyd Blankfein and Daniel Sparks lied about. We know exactly how they and other top Goldman executives, including David Viniar and Thomas Montag, defrauded their clients. America has been waiting for a case to bring against Wall Street. Here it is, and the evidence has been gift-wrapped and left at the doorstep of federal prosecutors, evidence that doesn't leave much doubt: Goldman Sachs should stand trial.

Why Military Spending Remains Untouchable - (www.countercurrents.org) In defense circles, “cutting” the Pentagon budget has once again become a topic of conversation. Americans should not confuse that talk with reality. Any cuts exacted will at most reduce the rate of growth. The essential facts remain: U.S. military outlays today equal that of every other nation on the planet combined, a situation without precedent in modern history. The Pentagon presently spends more in constant dollars than it did at any time during the Cold War -- this despite the absence of anything remotely approximating what national security experts like to call a “peer competitor.” Evil Empire? It exists only in the fevered imaginations of those who quiver at the prospect of China adding a rust-bucket Russian aircraft carrier to its fleet or who take seriously the ravings of radical Islamists promising from deep inside their caves to unite the Umma in a new caliphate.