Today’s News Synopsis:
Mortgage applications decreased 8.9% this week, according to the MBA. Fannie Mae predicts 2010 sales will total 7.4% less than sales in 2009. UCLA economists predict the unemployment rate will remain above 10% until the end of 2012. GSEs have lost $226 billion since the end of 2007.
In The News:
Mortgage Bankers Association – “Mortgage Applications Decrease in Latest MBA Weekly Survey” (9-15-10)
“The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending September 10, 2010. The Market Composite Index, a measure of mortgage loan application volume, decreased 8.9 percent on a seasonally adjusted basis from one week earlier. This week’s results include an adjustment to account for the Labor Day holiday. On an unadjusted basis, the Index decreased 27.4 percent compared with the previous week.”
Reuters – “Fannie Mae now sees US home sales drop, not rise” (9-15-10)
“The company is predicting total U.S. sales of new and existing homes in 2010 will drop 7.4 percent from 2009, compared with expectations for a 0.8 percent rise in its forecast last month. It means sales would fall to about 5.12 million homes from 5.53 million units in 2009.”
The Press Enterprise – “UCLA economists say growth will be hard to notice” (9-15-10)
“Now UCLA’s economists say it’s unlikely there will be enough job growth to drive the state’s unemployment level below 10 percent until the end of 2012.”
Housing Wire – “Barr: GSEs won’t exist once reform takes root” (9-15-10)
“Fannie Mae and Freddie Mac won’t exist in their current state once financial reform takes root, according to a top Treasury Department official. Prior to conservatorship two year ago, the government-sponsored entities operated under a ‘heads I win, tails you lose’ system that is unacceptable, Michael Barr said Wednesday before a subcommittee of the House Committee on Financial Services.”
Housing Wire – “FHFA estimates GSEs final cost to taxpayers could reach $400 billion” (9-15-10)
“Speaking before the House Financial Services Committee today, Edward DeMarco, acting director of the Federal Housing Finance Agency maintains that the government-sponsored enterprises could still cost the taxpayers $400 billion. Fannie Mae and Freddie Mac were taken into conservatorship by the FHFA in September 2008. Since the end of 2007, the GSEs have lost $226 billion with 73% of that stemming from the single-family credit guarantee business. The Treasury has recorded losses of $148 billion attributable to its bailout of Fannie and Freddie.”
Housing Wire – “New project inquiries at residential architecture firms down 24% in 2Q: AIA” (9-15-10)
“Kermit Baker, the chief economist at AIA, said business conditions at architecture firms hit an all-time low in 2008 but had been making a steady recovery to the first quarter of 2010, when these companies reported the first increase in billings in nearly three years.”
Housing Wire – “Zillow 30-year mortgage rates go up, CEO steps down” (9-15-10)
“The 30-year, fixed-mortgage rate increased last week to 4.32% from a near-record low of 4.27% the week prior, according to the Zillow Mortgage Marketplace weekly update.”
Bloomberg – “U.S. Home Prices Face 3-Year Drop as Inventory Surge Looms” (9-15-10)
“Shadow inventory — the supply of homes in default or foreclosure that may be offered for sale — is preventing prices from bottoming after a 28 percent plunge from 2006, according to analysts from Moody’s Analytics Inc., Fannie Mae, Morgan Stanley and Barclays Plc. Those properties are in addition to houses that are vacant or that may soon be put on the market by owners.”
Looking Back:
One year ago, a survey from the National Association of Home Builders showed that buyers were unwilling to pay more for a new “green” home. DQNews reported that the total sales in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange Counties fell 10.8 percent from the previous month. Both Ben Bernanke and Bank of America believed the U.S. financial downturn was coming to an end. The Coopers Korpacz Real Estate Investor Survey estimated that U.S. commercial property would not recover until 2012.
California Real Estate Investing News is a post from: The Norris Group