Big Buck Homes

Daily Real Estate News May 30, 2008
Priciest Homes on the Market
After trying to sell his Palm Beach home, Maison de L’Amitie, for two years at $125 million in March, Donald Trump knocked $25 million off the price.It was the largest discount ever for a single residence not involved in a bankruptcy proceedings.As Trump’s experience proves, even the most expensive homes aren’t immune to the current economy, but overall, "Inventory is relatively tight for trophy-type properties," says Jonathan Miller, president of Miller Samuel, a Manhattan real estate appraisal firmMiller says the inventory of Manhattan homes priced at $8 million and up has declined by 35 percent over the last year. "If we were having this conversation six to nine months ago, we'd say it was Wall Street bonuses," he says, "but the weak dollar has certainly played a role," by attracting foreign buyers.In addition, sellers like Trump are increasingly flexible. "The resistance has lessened,” says Nelson Gonzalez, a broker at Esslinger-Wooten-Maxwell in Miami Beach. “Smarter sellers are dropping their prices, and buyers are coming up a little bit more to make deals."Here are the top-nine priciest homes on the market now:
$125 million, Fleur de Lys Beverly Hills, Calif.
$125 million, Dunnellen Hall, Greenwich, Conn.
$100 million, Tranquility, Lake Tahoe, Nev.
$100 million, Maison de L'Amitié, Palm Beach, Fla.
$95 million, Hillandale, Stamford, Conn.
$88 million, BootJack Ranch, Pagosa Springs, Colo.
$85 million, Bel Air, Calif.
$80 million, Southampton, N.Y.
$75 million, The Portabello Estate, Corona del Mar, Calif.

I can't believe they didn't tell me I was behind on my payments!

Daily Real Estate News May 27, 2008

U.S. Rep Loses Home to Foreclosure
Even U.S. lawmakers aren't immune to the foreclosure crisis. Congresswoman Laura Richardson, a California Democrat, said Friday that her home was foreclosed and auctioned off without her knowledge, despite having reached an agreement with her lender Washington Mutual.Richardson fell behind in her mortgage payments because she used her money to win the House seat left vacant by the death of Rep. Juanita Millender-McDonald.Richardson bought the 1,600-square-foot home in Sacramento's desirable Curtis Park neighborhood for $535,500 in January 2007. It was sold at auction earlier this month to a Sacramento mortgage lender who paid $388,000, according to the Sacramento County Recorder's Office.A default notice sent to Richardson in March put her unpaid balance at $578,384. WaMu reused to discuss the case.Richardson voted in favor of a mortgage debt forgiveness bill, which subsequently became law. She was absent earlier this month for votes on a foreclosure prevention bill, because of her father's funeral.Source: The Associated Press, Erica Werner (05/24/08)

Light at the end of the tunnel ?

Daily Real Estate News May 27, 2008Home Sales Rise in Hard-Hit

Areas Although nationally, home sales are still on the soft side, new data shows an uptick in several of the areas — including Fort Myers, Fla.; Las Vegas; Sacramento, Calif.; and inner-city Detroit — hit hardest by foreclosures and falling prices. Americans generally remain wary of further declines in residential prices, but the data from these areas suggest buyers are finding the bargains too enticing to pass up. Thomas Lawler, a Virginia-based housing economist, says home sellers "have moved into the acceptance mode" and are pricing properties more realistically. DataQuick Information Systems calculates that sales of single-family homes in California's Sacramento County totaled 1,669 last month, a 41-percent jump from a year earlier as the median sales price fell 34 percent to $226,250. Meanwhile, the Greater Las Vegas Association of REALTORS® reports that properties being sold by lenders account for more than 50 percent of recent sales. Source: Wall Street Journal, James R. Hagerty (05/27/08)

Existing-Home Sales Dip 1% in April Existing-home sales slowed in April, partly because tight lending guidelines hampered home buyers. But there are some things to be happy about: A greater number of market areas are showing sales gains from a year ago, and a recent reversal in mortgage policy means the market is better positioned for a turnaround, according to the NATIONAL ASSOCIATION OF REALTORS®. Existing-home sales – including single-family, townhomes, condominiums and co-ops – declined 1.0 percent to a seasonally adjusted annual rate of 4.89 million units in April from an upwardly revised pace of 4.94 million in March, and are 17.5 percent below the 5.93 million-unit level in April 2007. More Favorable Mortgage Options Will HelpWith less-restrictive mortgage options opening up for buyers, “we could see an upturn in home sales this summer,” says NAR President Richard F. Gaylord. Last week, Freddie Mac and Fannie Mae announced that they were eliminating their “declining market” policies, effective June 1. NAR and others believed the policy was bad for the housing market because it discouraged consumers from buying homes in areas hardest-hit by foreclosures.“This means consumers across the country will have access to safe, affordable financing with down payments of only 5 percent on most mortgages, with 100 percent financing available on some loan products.” Lawrence Yun, NAR chief economist, said eliminating restrictive policies should be a big help to home buyers. “I would encourage buyers who were disappointed by poor mortgage options to take another look at the market because the lending changes are significant,” he said. “Also, a recent notable drop in interest rates on conforming jumbo loans will help consumers in high-cost markets like California and New York.”National Prices, Inventory LevelsNationally, the median existing-home price for all housing types was $202,300 in April, which is 8.0 percent below a year ago when the median was $219,900. Because the slowdown in sales from a year ago is greatest in high-cost areas, there is a downward distortion to the national median with relatively more sales in low- and moderate-priced markets.
Total housing inventory at the end of April rose 10.5 percent to 4.55 million existing homes available for sale, which represents an 11.2-month supply at the current sales pace, up from a 10.0-month supply in March.
Mortgage rates declined, according to Freddie Mac. The national average commitment rate for a 30-year, conventional, fixed-rate mortgage slipped to 5.92 percent in April from 5.97 percent in March; the rate was 6.18 percent in April 2007.
Single-family home sales slipped 0.5 percent to a seasonally adjusted annual rate of 4.34 million in April from 4.36 million in March, and are 16.1 percent below the 5.17 million-unit level recorded one year ago. The median existing single-family home price was $200,700 in April, down 8.5 percent from April 2007.
Existing condominium and co-op sales fell 5.2 percent to a seasonally adjusted annual rate of 550,000 units in April from 580,000 in March, and are 27.9 percent below the 763,000-unit pace in April 2007. The median existing condo price was $214,900 in April, which is 3.7 percent below a year ago. Regional Sales Volume, PricesThe unusual mix of market conditions around the country continues, but areas showing healthy price gains include Greenville, S.C., and Springfield, Mo., both with solid local economies. “On the other hand, some markets like San Diego, Calif., and Fort Myers, Fla., are experiencing rising sales after sudden double-digit drops in local home prices, so lower prices and low interest rates are starting to generate results,” Yun said.
In the West, existing-home sales rose 6.4 percent in April to a level of 1.00 million but are 15.3 percent below a year ago. The median price in the West was $285,700, which is 16.7 percent lower than April 2007.
In the South, existing-home sales were unchanged from March at an annual rate of 1.92 million in April, but are 18.6 percent below April 2007. The median price in the South was $170,800, down 5.1 percent from a year ago.
In the Northeast, existing-home sales fell 4.4 percent to an annual pace of 870,000 in April, and are 14.7 percent below a year ago. The median price in the Northeast was $262,000, which is 7.7 percent below April 2007.
In the Midwest, existing-home sales were at an annual rate of 1.10 million in April, which is 6.0 below March and 19.7 percent lower than April 2007. The median price in the Midwest was $159,100, down 2.9 percent from April 2007.— NARBrowse all of today's news
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no more declining market stuff

Daily Real Estate News May 16, 2008

Fannie Mae Scraps Declining Markets Policy Fannie Mae will no longer require borrowers to put up an extra 5 percent down payment when purchasing homes in areas deemed "declining markets," the country’s largest secondary mortgage market company said Friday. Fannie Mae had been hearing concerns from REALTORS® and others for months that its declining-markets policy was bad for the housing market because it discouraged consumers from buying homes in markets hardest-hit by foreclosures. "It stigmatized communities with lower sales and prices," said Dick Gaylord, president of the NATIONAL ASSOCIATION OF REALTORS®. NAR met several times this spring with Fannie Mae officials and sent letters reflecting members' unease with the policy. “We heard the concerns of NAR and we reviewed and determined that changes in our policy were needed,” Gwen MuseEvans, Fannie Mae vice president for credit policy and controls, said in a statement Friday. Fannie Mae's announcement comes as more than 8,000 REALTORS® are gathered in Washington, D.C., where Fannie Mae is headquartered, for NAR's 2008 Midyear Legislative Meetings & Trade Expo. Under the policy change, borrowers can get loans up to 95 percent loan-to-value, even in markets in which prices have been falling. Prior to the change, borrowers could only get loans up to 90 percent to give lenders a 5-percentage-point cushion to protect against possible price declines in the future. “This new down payment policy reinforces our goal to support successful home-owning,” says Marianne Sullivan, Fannie Mae's senior vice president of credit policy and risk management for single-family homes.The new policy takes effect June 1.

Greed Overcomes Integrity and Now We Have Mess

Daily Real Estate News May 8, 2008

Senate Hearing Puts Blame on Lenders Witnesses testifying before the Senate Subcommittee on Administrative Oversight and the Courts battered mortgage lenders Tuesday during an investigation in foreclosure and bankruptcy."While bankruptcy is supposed to offer families one last chance to save their homes from foreclosure, the reality is that bankruptcy gives mortgage servicers new opportunities to engage in abusive practices," testified Katherine Porter, a University of Iowa law professor who has analyzed the system.Sen. Charles Schumer (D-N.Y.), the subcommittee chairman, focused his criticism on Countrywide Financial, accusing the company of being "at the top of the list" of firms responsible for the national mortgage crisis.Steve Bailey, Countrywide's chief executive for loan administration, said the company plans to hire an independent auditor to select random samples of loans in bankruptcy to review the accuracy of the company's accounting for payments by borrowers. If the company made mistakes that hurt borrowers, it will compensate them, he said.Source: USA Today, Kevin McCoy (05/07/08)

NAR Steps Up Again !

Daily Real Estate News May 6, 2008

NAR Joins in Call to Stabilize Markets The NATIONAL ASSOCIATION OF REALTORS®, in a letter to members of the U.S. House of Representatives, urged Congress to make the FHA and conforming loan limit increases permanent as part of the 2008 Housing Stimulus bill, which is expected to be marked up this week.Yesterday, Reps. Jerry McNerney, D-Calif., and Gary Miller, R-Calif., introduced H.R. 5958, the Homeowner Opportunity Act, making permanent the increase to FHA and conforming loan limits for high-cost areas. The bill will be considered as an amendment to the larger housing stimulus bill. “By making the loan limit increases to FHA, Fannie Mae and Freddie Mac permanent the mortgage market will achieve an immediate increase in liquidity,” said NAR President Dick Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif. “This increased liquidity should help drive down mortgage costs and create stability in the mortgage market.“As the leading advocate for homeownership, NAR applauds the bipartisan efforts by Congressmen McNerney and Miller in sponsoring this amendment. That can also help veterans, teachers, nurses, police officers and other working families to achieve the dream of homeownership by offering a safe and affordable alternative to risky subprime loans,” Gaylord said.NAR urges members of Congress to support the McNerney-Miller amendment. Higher loan limits are critical to ensure that homeowners and those who aspire to own a home are given the same safe alternatives for mortgages regardless of where they live. “It is simply a matter of equity for American families who live in high-cost communities,” according to Gaylord.Source: NAR

Greenspan Speaks

Daily Real Estate News May 5, 2008

Greenspan: This Recession Is Mild Speaking during a television interview, former Federal Reserve chairman Alan Greenspan declared that the country has slipped into a mild recession that is not likely to improve until residential property prices begin to stabilize and the pressure on financial institutions to write off mortgage-related losses eases up. "We're in a recession," the economist said. "But this is an awfully pale recession at the moment. The declines in employment have not been as big as you'd expect to see." Still, Greenspan was firm in his belief that the economy would not see a turnaround anytime soon and would likely be stagnant for the remainder of 2008.

Fed Cuts Rate Again !

Daily Real Estate News May 1, 2008

Fed Cuts Rates One-Quarter Point The Federal Reserve cut interest rates Wednesday 25 basis points to 2 percent. It’s the lowest point in four years. The Fed was divided 8-2 on the cut. A statement from the majority of Fed members said: "The substantial easing of monetary policy to date ... should help to promote moderate growth over time and to mitigate risks to economic activity."Observers believes this means that the Fed is unlikely to make any more cuts – at least through the end of this year. "The Fed didn't completely shut the door on rate cuts, but they closed it part way," said Mark Zandi, chief economist at Moody's Economy.com. "I think the overall message was they've done a lot already to help the economy and think this will be enough. But they stand ready to do more if that is needed."Source: The Associated Press, Jeannine Aversa (04/30/2008)