Posts Tagged ‘real estate values’

HARP Mortgage Refinancing Up 20% in September

December 6, 2011

Jon Prior via Housing Wire

Lenders and servicers refinanced nearly 35,000 Fannie Mae and Freddie Mac mortgages through the Home Affordable Refinance Program in September, a 20% monthly increase just before major guideline changes were announced.

The Federal Housing Finance Agency launched HARP in March 2009 to allow borrowers with mortgages that have loan-to-value ratios between 80% and 125% to refinance their loans if they are held by the government-sponsored enterprises.

Participating lenders and servicers have refinanced 928,600 GSE loans through HARP as of the end of the third quarter, the FHFA said Tuesday. It is an 11% increase from the previous quarter. Nearly 11 million borrowers owe more on their mortgage than their home is worth, trapping them out of refinancing at interest rates hovering around 4%.

"Monthly HARP volume grew in the third quarter as interest rates decreased to new historic lows," the FHFA said.

In October, the FHFA eliminated the LTV cap, upfront fees charged to borrowers and representation and warranty risk in order to provide more assistance to underwater borrowers.

Fannie and Freddie released specific guidelines in November.

Before the changes, borrowers who owed more on their mortgage than their home was worth made up a sliver of HARP totals. In September, 83% of HARP re-financings — nearly 29,000 loans — went to borrowers between 80% and 105% LTV, compared to 5,700 between 105% and 125% LTV, according to FHFA data.

The majority of Fannie and Freddie ‘refis’ go through other programs outside of HARP. In all, lenders refinanced 263,780 GSE loans.

Servicers completed more than 140,000 foreclosure prevention actions for the GSEs, including 83,500 mortgage modifications, in the third quarter. Short sales and deeds-in-lieu of foreclosure added another 30,800 for a total of more than 171,000 foreclosures prevented during the period.

Lenders started foreclosures on more than 224,000 properties, down nearly 11% from the previous quarter, according to the FHFA.

 

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Zillow: 30-Year Mortgage Rate Rises To 3.86%

November 29, 2011

by Natalie Tadena, WSJ

Real-estate website Zillow Inc. (Z) said Tuesday its real-time rate on 30-year fixed mortgages rose slightly in the last week.

Zillow said the 30-year fixed mortgage rate on its Mortgage Marketplace is at 3.86%, up from 3.8% a week earlier. The company said the 30-year fixed mortgage rate hovered between 3.82% and 3.85% for most of the week and peaked at 3.93% on Monday before dropping to the current rate.

Many mortgage trackers have reported low rates lately, as worries about European debt pressure yields on U.S. Treasury bonds. Mortgage rates tend to follow the yields. Zillow said this is the fifth-consecutive week the 30-year fixed mortgage rate has stayed below 4%.

"Talk of a possible third round of economic stimulus and some optimism around progress in European Union debt purchase plans spiked interest rates on Monday," said Erin Lantz, director of Zillow Mortgage Marketplace. "However, that spike has already been offset as of Tuesday morning, and we expect continued volatility as we await news from Europe and the Federal Reserve in the coming weeks."

Tuesday, Zillow also said the rate for a 15-year fixed home loans is 3.21%, up from 3.16% a week earlier. The rate for a 5-1 adjustable-rate mortgage is 2.68%, up from 2.57%; a 5-1 ARM has an initial rate that applies for the first five years of the loan and then adjusts annually.

 

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Clever Small Home Architecture Derived From Site Restrictions in Tokyo

November 22, 2011

By Amazing Architecture | Joseph Rossi

River Side House 5 Clever Small Home Architecture Derived From Site Restrictions in Tokyo

The River Side House is an impressive project designed by Mizuishi Architect Atelier and located in Tokyo, Japan. The small home was constructed on a triangle site and occupies a building area of 29.07 square meters. According to the architects, the structure of the residence includes functionally separate areas, as follows. The first is the dining & kitchen area, situated up the stairs and having high ceilings with a feeling of rise towards the roof top. The living space is low ceilinged and has full-opening windows on both sides of the bay, ensuring a feeling of floating. There is also a generous spare room to the east, for having guests over. The interior arrangements of this residence are minimalist and tasteful. The walls are painted entirely in white, inspiring openness and tidiness. Wooden accents and splashes of color here and there add a happy tone to the design. Do you find this project as intriguing as we do?

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River Side House 14 Clever Small Home Architecture Derived From Site Restrictions in Tokyo

 

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Not Every Real Estate Market Is Struggling

November 22, 2011

In the Obama years, home values lagged throughout the U.S., with a few exceptions.

Venessa Wong via Business Week

Want to know how bad the real estate market is? Just drive down almost any street in the U.S. and you’re likely to see “for sale” signs lining the road. Come back a month later, it’s a good bet the same signs are still there—and quite possibly a few new ones, too. But while there’s a lot of housing pain, there’s also some good news. That’s because in some markets across the country not only have home values improved, a few have even seen double-digit growth.

So where is this miracle occurring? Believe it or not, the city that has seen the biggest increase in home value is in Florida. That’s right—the state that has seen home values plummet 52.3 percent from 2006 peak levels. Nearly 96,000 loans were modified in Florida through August 2011 under President Obama’s Making Home Affordable program. Joblessness, foreclosures, and high inventory hamper recovery in nearly every corner of the state, with rare exceptions. In this case, the rare exception is Weston, a high-income city of more than 65,000 people near Fort Lauderdale where the median home value has risen 15.1 percent to $280,000 from February 2009 to August 2011.

A survey of the 1,000 largest cities nationwide by online real estate marketplace Zillow for Businessweek.com identified the markets with the biggest gains and losses in home value, ranking Weston the best-performing city since Obama took office. In contrast, the U.S. median home value fell by 9.9 percent over the same period.

What’s behind Weston’s success? Ines Garcia, an agent for EWM Realtors in Weston, describes the city as “Broward County’s cul-de-sac.” “It’s like driving into a gated community: the landscaping, the manicuring all around the city,” she says. “We were very lucky. Weston was one of the last communities to fall and one of the first to recover.”

Other winners: Arlington, Mass., where the median home value increased by 14.8 percent since February 2009; Brookline, Mass., at 13.6 percent; and the D.C. suburbs of Burke, Va., at 13.5 percent, and Vienna, Va., at 12.8 percent, Zillow data indicate.

Of course, the winners are far outnumbered by the losers. The city with the worst-performing market in the survey is only 50 miles from Weston in Homestead, Fla., where the median home value dropped by 48.8 percent since February 2009. Rounding out the bottom worst-performing markets: former manufacturing city Pontiac, Mich., with a 47.4 percent decrease, and New Jersey capital Trenton, at 46 percent.

While those in depressed housing markets hope for solutions from the White House, “I don’t see how any President is responsible for the housing market in a particular area,” says Steven Blitz, director and senior economist at ITG Investment Research in New York. The federal government and national housing policies have a limited impact on a local level.

OBAMA ACCOUNTABLE?

The Obama Administration, the inheritor of a collapsed housing market and financial crisis, has tried to help the hardest-hit housing markets through refinancing and loan modifications. Yet individual markets are influenced heavily by local conditions, such as jobs, school districts, and population growth. Both the best-performing market, Weston, and the worst, Homestead, are in the Miami-Fort Lauderdale metro area, for instance. As housing trends at their core are hyper-local, it makes it difficult to even craft regional solutions. Developing a catch-all national policy is even more challenging.

“The foreclosure prevention efforts by the Obama Administration have helped to slow the bleeding when it comes to foreclosures but have done little to help get the housing market off life support,” says Daren Blomquist, a spokesperson for RealtyTrac.

To stimulate buying, the housing industry has called on the federal government and lending institutions to facilitate mortgages to qualified home buyers. Rather than address housing specifically, says Jeffrey Lubell, executive director of the Center for Housing Policy, a research group in Washington, “the single most important thing that needs to be done now is get the economy back on track. Nothing can help housing more than putting people back to work.” The U.S. unemployment rate stood at 9.1 percent in September, according to the U.S. Bureau of Labor Statistics.

Job creation in the D.C. area, for example—driven by the government—helped nine cities in the capital region rise to the list of top 25 housing markets in Zillow’s research. The unemployment rate in the D.C. metro area was 6.2 percent in August, estimates the BLS.

“Housing will rise with jobs and income. Anything that improves confidence in the future trajectory of jobs and income will raise the arc of growth for housing,” says Blitz.

ONE METRO, MANY MARKETS

Weston, following patterns in the rest of the country, saw the median home value peak in 2006 at $478,000 before plunging. The median value bottomed out in May 2009 at $235,600, according to the Zillow Home Value Index, and has since climbed steadily.

By August 2011, the unemployment rate in Weston was down to 7 percent from a peak of 8.3 percent and the median home value had only recovered to $280,000, well below the peak. Still, among cities it was the best housing rebound in the last two and a half years. The foreclosure rate in September, about 1 in 338 housing units, remains far above the U.S. rate, though it is down 60.7 percent from a year earlier, show RealtyTrac data.

Helping this meticulously landscaped planned community—which offers bike trails, golf courses, scenic lakes, highly ranked schools, a low crime rate, and active homeowner associations—was a rebound in demand from young families, according to Susan Penn, an agent at EWM Realtors. The median household income is $78,030.

Weston also experienced an influx of middle- and upper-class immigrants from Venezuela and other parts of South America. The U.S. Census Bureau estimates the city’s foreign-born population increased to 43.9 percent in 2010 from 37.1 percent in 2006.

As Weston recovered some housing value, Homestead, a city only 50 miles south, was less fortunate. A Miami suburb and agricultural area with an Air Reserve Base, Homestead has struggled since being devastated by Hurricane Andrew in 1992. It has a poverty rate of 29.4 percent and median household income is $36,279 (lower than both the Florida and U.S. medians), according to 2009 Census data.

Lower-income areas and exurbs were generally hit harder by the recession. In Homestead, unemployment skyrocketed to 11.7 percent in August from 6.3 percent in February 2009, estimates the BLS. By August, the foreclosure rate remained high at 1 in 125 housing units and the median home value was 66.7 percent below peak at $76,600.

According to Zillow Senior Economist Svenja Gudell, under current conditions the median U.S. home value will likely fall another 3 percent to 5 percent and not reach trough until 2012 at the earliest. “We need to identify creative solutions,” such as repurposing foreclosed homes as rental housing, refinancing loans, and loosening credit, which involves many players, says Lubell of the Center for Housing Policy.

The Obama years have been bad ones for housing, yet government was not alone in breaking the housing market—and it cannot be alone to fix it.

Click here to see the 25 best- and 25 worst-performing housing markets under the Obama Administration.

 

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