Orange County’s home pricing got hit with autmun’s chill, as builders had a record-worst sales month.
DataQuick reported this morning that 2,297 residence sold in November. That is up 1.8% from a year ago. That gain came at a price. Literally.
Read it allMedian selling price was $400,000 — the lowest since April 2009 and off 8.0% in a year. Orange County’s median first hit $400,000 in May 2003
The National Association of Realtors said a benchmarking exercise had revealed that some properties were listed more than once, and in some instances, new home sales were also captured.
"All the sales and inventory data that have been reported since January 2007 are being downwardly revised. Sales were weaker than people thought," NAR spokesman Walter Malony told Reuters.
This is companies like CoreLogic, DataQuick, and other have become popular. They less juice in the game."We're capturing some new home data that should have been filtered out and we also discovered that some properties were being listed in more than one list."
Last month the median price paid for all new and resale Southland houses and condos sold was $275,000, up 1.9 percent from $270,000 in October but down 4.2 percent from $287,000 in November 2010.
The regional median has declined year-over-year for the past nine months – since March. San Bernardino County’s 2.3 percent year-over-year gain in its median sale price in November marked the first time since January this year that any Southland County posted an annual gain in its overall median.
A total of 16,884 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in November. That was up 0.3 percent from 16,829 in October and up 4.2 percent from 16,208 in November 2010, according to San Diego-based DataQuick.
Last month 17.8 percent of all home sales were for $500,000 or more – the lowest portion since May 2009, when it was 17.4 percent. November’s share of $500,000-plus sales was down a hair from 17.9 percent in October and down from 21.1 percent a year earlier. The low point for $500,000-plus sales in this cycle was in January 2009, when only 13.8 percent of sales crossed that price threshold. Over the past 10 years, a monthly average of 27.9 percent of homes sold for $500,000 or more.
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But private banks own $50.4 billion worth of REO properties, too, according to the Federal Deposit Insurance Corp., and millions of these homes are sitting vacant.
Sturzenegger described how their idea would work.
"We and Fannie Mae are looking at programs where you can capture somebody before the REO process and offer a deed-for-lease. We would go to the customer and say, 'We'll do a short sale. Will you be interested in leasing your property back? We're still going to sell the property. You will no longer be the owner. But you can be a tenant now in that same property and save you from moving on,'" he said.
Read it allOn-time settlements were reported as declining from 65 percent to 47 percent," according to the Realtors. It's not why you think, or at least not why I thought. Inability to get a mortgage was reported by just 9 percent of respondents to the Realtor survey. Bigger issues were failed inspections, buyers with cold feet and adverse economic conditions. I'm sure appraisals figured in there as well.
After reviewing third quarter default and liquidation rates, the agency noted signs of improvement. S&P estimates it will take 45 months to clear the excess stock.
Read it allHowever, with constant changes to the foreclosure process, the number appears ever-shifting. Three months ago, for example, S&P said it would take 47 months to clear the shadow inventory, those properties not yet on market, but facing eventual resale.
And for California.“The October foreclosure numbers continue to show strong signs that foreclosure activity is coming out of the rain delay we’ve been in for the past year as lenders corrected foreclosure paperwork and processing problems,” said James Saccacio, chief executive officer of RealtyTrac. “However, recent state court rulings and new state laws keep changing the rules of the foreclosure game on the fly, creating more uncertainty in the housing market and threatening to prolong the road to a robust real estate recovery.”
Read it allCalifornia default notices increased 17 percent from the previous month to a 13-month high, helping the state post the nation’s second highest foreclosure rate: one in every 243 housing units with a foreclosure filing in October. A total of 29,240 default notices were reported in California in October, a 1 percent increase from October 2010 — the first year-over-year increase in defaults in California since November 2009.
On US totals, if you figure average house prices use conforming loan balances, then a repeat buyer has to have roughly 10 percent down to buy in addition to the 6 percent Realtor fee to sell. Thus, the effective negative equity target would be 85%. You also have to factor in secondary financing, which most measures leave out.
Read it allBased on that, over 50 percent of all mortgaged households in the US are effectively underwater — unable to sell for enough to pay a Realtor and put a down payment on a new purchase without coming out of pocket. Because repeat buyers have always carried the market as the foundation, this is why demand has not come back. It's as if half the potential buyers in America died over a two-year period of time.
The national delinquency rate for borrowers who are 60 days or more past due on their mortgages rose for the first time in two years during the recent third quarter, TransUnion said Tuesday.
The delinquency rate for seriously past due loans edged up to 5.88% in 3Q, TransUnion reported.
"Until this quarter, we had seen six straight quarters where progressively more people were able to make their mortgage payments on time," said Tim Martin, group vice president of U.S. Housing in TransUnion's financial services business unit. "We expected that trend to continue given recent, relatively more conservative lending policies and the apparent stabilization of both home values and unemployment."
Martin said the six quarters of relative stability were disrupted by unanticipated shocks to the American economy in the third quarter. Those shocks included the European debt crisis, high unemployment, falling home values and low consumer confidence.
"All of this affects a borrower's net worth and desire, or ability, to continue making house payments — especially if they are facing negative equity in their homes due to price depreciation," said Martin.
All but 10 U.S. states and the District of Columbia experienced a jump in mortgage delinquency rates when comparing the third quarter to the second, TransUnion saidLink Here
Rising foreclosure start rates will add to the distressed property inventory and drive home prices further down, according to a report from Fitch Ratings, reflecting the impact of last year's robo-signing scandal.
More than 10% of severely delinquent loans in private-label residential mortgage-backed securities are now moving into foreclosure each month, the ratings agency said. That's nearly double the rate from a year ago when the moratoria instituted by lenders and servicers in the wake of the robo-signing debacle were in place. It's also edging closer to the 14% rate seen between 2000 and 2010.
Link Here"Rising foreclosure start rates are likely a sign that servicers are playing catch-up on actions that have been delayed over the past year," Fitch Managing Director Diane Pendley said in the report. "Mortgage servicers now generally feel they have implemented the corrective actions that they determined were needed."
Officially, there are 3.5 million homes for sale nationwide. But there are millions more lurking in the shadows -- hidden neatly away on banks' balance sheets, stalled in foreclosure court proceedings, or simply occupied by nonpaying owners as lenders wait months or years before taking action.
The housing market's ballooning shadow inventory -- buoyed by a yearlong foreclosure slowdown -- stands as its most menacing problem, threatening to stifle recovery for several years.
Economists insist that the housing industry will not normalize and recover until most of the foreclosures work their way through the system -- a process that will likely last several more years.
Shadow inventory can be broken into three categories:
• Properties lenders have repossessed, but have not put up for sale. These homes are referred to as real-estate owned, or REOs.
• Properties caught up in the clogged foreclosure process.
• Properties that are severely delinquent in loan payments -- almost certainly headed for foreclosure -- but have not yet entered the process.
Calculating the size of the shadow market has proven difficult, and estimates range from 1.6 million to seven million homesRead it all
Sharga said based on lender behavior, he doesn't see a spike happening, rather a slow, steady burn in order to spare home prices from further reductions. Today, roughly 4 million homes sell per year. If 1.5 million REO sold, that would be almost 40% of the market, which would be double the current market share of these properties.
Read it all"I think it’s less likely that we’re going to see a 'peak' year in REO sales that looks dramatically different than what we’ve been seeing over the past few years. This is partly due to relatively weak demand, partly due to what I’d call 'inventory control' being executed by the lenders and servicers, and partly due to the fact that foreclosure processing, evictions and redemption periods have all become extended, and often appear to be in a state of flux," Sharga said.
Analysts studied the destinations of more 355,000 properties that hit foreclosure auctions in 2006. Investors bought about one-third of them at the courthouse steps, and the remaining 233,000 went back onto lenders' books as real estate owned.
Of those, 90%, or 210,000 homes, sold as REO to third-party buyers. Of these, half took six months to sell and 21% took more than one year to unload.
But 23,200 sat unsold for four years, CoreLogic found. These are properties that entered the foreclosure process before the system surpassed its maximum capacity in many states. REO sales have yet to peak, meaning the time banks and the U.S. government will have to hold these homes could go even longer.And....
Such stagnant pools of inventory have crippled any recovery in home prices. Most analysts predict even more depreciation in 2012. Billions in government initiatives such as the Neighborhood Stabilization Program and the Hardest Hit Fund went to help states and nonprofits resell vacant and abandoned foreclosures even as Republicans in the House moved to cut these programs.Link Here
After dropping to a three-year low in the second quarter of this year, the number of California homeowners being pulled into the foreclosure process snapped back to prior levels over the last three months, a real estate information service reported.
A total of 71,275 Notices of Default (NoDs) were recorded at county recorders offices during the third quarter. That was up 25.9 percent from 56,633 for the prior three months, and down 14.4 percent from 83,261 in third-quarter 2010, according to San Diego-based DataQuick.
Last quarter's 71,275 NoDs, which mark the first step in the formal foreclosure process, jumped back to levels seen earlier this year and late last year. Lenders filed 68,239 NoDs during first-quarter 2011 and 69,799 in fourth-quarter 2010. NoDs peaked in first-quarter 2009 at 135,431.
Most of the loans going into default are still from the 2005-2007 period: the median origination quarter for defaulted loans is still third-quarter 2006. That has been the case for almost three years, indicating that weak underwriting standards peaked then.
The most active beneficiaries in the formal foreclosure process last quarter were Bank of America (14,325), Bank of New York (11,052), and Wells Fargo (9,740).
The most active trustees, companies doing the actual foreclosing, last quarter were ReconTrust Co (mostly for Bank of America and Bank of New York), Quality Loan Service Corp (Bank of America), California Reconveyance Co (JP Morgan Chase), Cal-Western Reconveyance Corp (Wells Fargo) and NDEx West (Wells Fargo).
Read it allDefaults by price segment show that distress is not spread evenly, with lower-cost neighborhoods bearing the brunt. Last quarter, zip codes with year-to-date median sale prices below $200,000 collectively saw 11.0 default notices filed per 1,000 homes. That compares with 8.1 NoDs filed per 1,000 homes for all zip codes statewide, and just 2.8 NoD filings per 1,000 homes in zips with medians above $800,000.
The economics and mortgage market think tank within Fannie Mae estimates a 50% chance the country will slide back into a recession by the end of the year.
On the bright side, there is an equal chance the economic recover will continue unabated, according to the group's October 2011 Economic Outlook.
“Home prices are a key factor for any positive movement in the housing market, and the large inventory of distressed homes working their way through the market is putting downward pressure on prices," Fannie Mae Chief Economist Doug Duncan.
"Now that we are entering a traditionally weak seasonal sales period, we expect home prices to show renewed declines after firming for several months," Duncan added.
Other dragging factors outside of housing include the Greek debt crises spreading to other economies in Europe. Closer to home, fiscal austerity measures including the scheduled expiration of various tax cuts and unemployment benefits will likely dampen monetary spirits. Continuing financial reform is also stifling business growth.
The estimations are largely in line with other predictions.
Moody's Analytics Chief Economist Mark Zandi said in September there is a 40% chance the economy will slide back into recession within the next year.
Link HereHe listed the same reasons as Fannie for drawing his conclusion
Clustered mostly in hard-hit cities and states, there are more than 4.5 million homes either owned by lenders or headed for foreclosure. In Miami, for example, there are about 200,000 shadow homes, dwarfing the 30,000 properties that are listed on the active market. Even as prices in Miami have shown signs of stability this year, an impending wave of foreclosures threatens to keep real estate values deflated.
"A lot of people don't understand how much inventory is set to come on line in the next 18 to 24 months," said Jack McCabe, the CEO of McCabe Research & Consulting in Deerfield Beach, Fla. "When you compare what the Realtors show as inventory to what's out there, you realize we have a long way to go."
A McClatchy Newspapers analysis of four years of foreclosure data and thousands of property records found record-high levels of shadow inventory in several housing markets across the nation.
And a fresh drop in home prices is likely to result.
Banks have stepped up the pace of home seizures after a year-long slowdown brought on by the "robo-signing" scandal in which banks were accused of seizing properties without a proper review of loan documents.
The number of foreclosure filings -- which include default notices, scheduled auctions and bank repossessions -- edged up 0.3 percent in the third quarter, reversing a trend of three straight quarterly declines, according to real estate data firm RealtyTrac.
RealtyTrac warns that as many as 1 million foreclosure actions that would have taken place this year will be pushed into 2012.
The firm also says they do no expect to see home price appreciation until the housing market works through the backlog of distressed assets, and the overall malaise in the sector could continue for the next three to four years.
"Banks are beginning to process foreclosures again after taking the time to get their paperwork in order. They've done the diligence they needed to do," said RealtyTrac chief executive James Saccacio. "Now there's this wave coming back in and more defaults are being processed."Read it all
After months of a foreclosure slowdown caused by investigations into improper practices, the nation's home-repossession machinery is beginning to move again — particularly in states such as California where courts don't oversee the process.
The number of homes entering the foreclosure process surged 19% in the third quarter compared with the previous quarter in states where foreclosures take place largely outside of the courtroom, according to RealtyTrac, an Irvine information firm. These nonjudicial states include California, Nevada, Arizona, Oregon and Washington.
Read it all"[The banks] are generally working through more of these loans, but the places where they can file the most quickly are going to be the nonjudicial states," said Celia Chen, a housing economist with Moody's Analytics.
Data firm RealtyTrac says foreclosure filings plummeted 34% in the third quarter from a year earlier. However, the CEO said the market may be a bottom, with signs activity will likely begin to grow.
On average, properties stayed on the market longer in the third quarter. U.S. foreclosures spent on average 336 days in the default process. That's up from 318 days in the second quarter and the highest hold time reported in four years.
In the third quarter, foreclosure filings were reported on 610,337 properties, up less than one percent from the previous quarter and a drop of 34% from the third quarter of 2010.
"U.S. foreclosure activity has been mired down since October of last year, when the robo-signing controversy sparked a flurry of investigations into lender foreclosure procedures and paperwork," said James Saccacio, chief executive officer of RealtyTrac.
Read it all"While foreclosure activity in September and the third quarter continued to register well below levels from a year ago, there is evidence that this temporary downward trend is about to change direction, with foreclosure activity slowly beginning to ramp back up," he said
Foreclosure starts rose 20% in August from the prior month to the highest level of the year and mortgages facing foreclosure are delinquent an average of 611 days, the highest level yet.
Lender Processing Services' (LPS: 13.03 -0.61%) mortgage monitor report for August showed foreclosure starts fell more than 12% from a year earlier, and the national delinquency rate is 8.13%, which is 2.5% lower than the prior month.
In late August, the Federal Deposit Insurance Corp. said the combined delinquency rate on mortgages held by major banks dropped to 6.68% in the second quarter, the lowest level since the third quarter of 2009.
Read it allFirst-time delinquencies accounted for nearly one-quarter of new delinquencies in August, according to LPS. And 23% of the nearly 46 million loans that were current at the end of August are at risk of foreclosure due to negative equity.
