Market Trends and Condition

New federal report shows large role investors played in the implosion

Read the whole report and you will see that investors added fuel to the fire. Read the whole story here:

http://www.msnbc.msn.com/id/45644929/ns/business-real_estate/

This week the FHFA released the house price index was released November 29th and we’ll highlight some of the top points in the 78 page document. You can get your own PDF copy at http://fhfa.gov. This report is for the third quarter of 2011. Overall, the nation’s house price purchase-only index rose by 0.2%. The monthly index for September was up 0.9%. Let’s look at some of the high points:

• There were declines in 21 states and the District of Columbia.

• Of the nine census divisions tracked, the West North Central division experienced the strongest price gains in the third quarter, at +1.5%.

• Prices were weakest in the Pacific census division, where they were down 0.5%.

Here are some interesting real estate related news stories this week:

Massachusetts Attorney General Sues Five Major Banks

The top law enforcement officer in Massachusetts has filed suit against Bank of America, Wells Fargo, JP Morgan Chase, Citigroup, and GMAC claiming they foreclosed on many homes illegally, and used deceptive loan servicing practices, including robo-signing.
The attorneys general of all 50 states have been negotiating with the major banks to reach agreement as to some financial relief to be provided to those who lost their homes due to poor lending and foreclosure practices. These talks have been stalled for months, and some states have chosen to take an independent approach.

New Home Sales Higher in October

Here are some short reports in the news this week related to real estate and investing.

*** Banks Chipping Away at Foreclosures ***

The inventory of foreclosures held by private banks dropped for the fourth straight quarter to $50.4 billion in property value according to the Federal Deposit Insurance Corporation. The REO level at the end of the third quarter is down 1.5% from $51.3 billion in the previous quarter and 5% lower than the $53.1 billion a year earlier.

BuildFax monitors remodeling activity and releases their periodic BFRI, BuildFax Remodeling Index. The September 2011 BFRI shows that remodeling activity reached a record high that month. The report also gives the type of projects most popular over the last five years. The September 2011 BFRI showed the highest level of remodel activity since the inception of the Index in 2004.

Since 2006, here are the top eight types of remodel projects:

• Roof 21.4%
• Deck 7.9%
• Bathroom 6.9%
• Garage 6.1%
• Kitchen 4.8%
• Basement 2.9%
• Office 1.7%
• Sunroom 0.7%

knowing the difference is important- read more from the HOOK:

http://www.readthehook.com/102154/assessments-appraisals-and-market-valu...

An MSNBC article this week equated the foreclosure crisis to a baseball game in the bottom of the fourth inning. While the third quarter of this year saw some easing of the number of homeowners falling behind on their payments, the pace of new foreclosures edged up a bit. The rate of borrowers who have fallen three or more months behind on their payments has fallen to about 3.5% of all mortgages. That’s down from a peak of 5% in late 2009.

The Department of Housing and Urban Development will operate on $3.8 billion less next year than it did in 2011, equating to a more than 9% budget cut.

HUD's 2012 budget of $37.3 billion is $4.7 billion lower than President Obama's initial request. The minibus spending bill, signed by President Obama Friday, also eliminated HUD funding for the Partnership for Sustainable Communities program. The agency distributed 2011 grants through the program Monday, amounting to $96 million.

HUD contributed $100 million to the program this year, spokesman Brian Sullivan said, and the initial request for 2012 was $150 million.

CNNMoney published an article this week titled “A smaller house will make a big difference.” It actually had a lot more information unrelated to home size. The first good news statement was that Fiserv expects 95% of the 384 metro areas it tracks to see home price increases in 2012. It’s not a big thumbs-up though, because the average is for only a 0.25% increase.

This email came from a realtor friend of mine. Thought it might be of interest to everyone.

Dear Rick,

YOU DID IT!

Last night Congress restored the loan limits for the Federal Housing Administration (FHA) for two years.

As you know, in late September the FHA, Fannie Mae; and Freddie Mac loan limits were reduced in 42 states pricing potential home buyers out of the American Dream of home ownership and holding back the housing recovery.

NAR immediately went to work with the goal to get the loan limits restored in Congress. For weeks that goal seemed unlikely.