Martha's News

Million-Dollar + Foreclosures

2012-02-24T09:21:00.000-05:00

America’s wealthiest families are now losing their homes to foreclosure at a faster rate than the rest of the country — and many of them are doing so voluntarily.

Over 36,000 homes valued at $1 million or more were foreclosed on — or at least served with a notice of default — in 2011.

Out of all foreclosure activity, the share of foreclosures on properties valued at $1 million or more has risen by 115% since 2007 while the share of multi-million dollar foreclosures — or homes valued at more than $2 million — jumped by 273%. Meanwhile, the share of foreclosures on mid-range properties valued between $500,000 and $1 million fell by 21%.

In Miami, homes priced over $1 million represented 9% of all foreclosures last year.

Many high-end homeowners have chosen to pursue a “strategic default.” Even though they can afford the monthly mortgage payments, they still decide to walk away from their home because they owe more on the property than it is worth.

In million-dollar homes, you’re looking at people who can afford it, but they have to make a business decision: Does it make sense to make payments on a mortgage when the home is worth less than they owe? In many cases, it often makes more financial sense to walk away.

But don’t expect a few depressed mansions to bring down the neighborhood. A single foreclosure in an otherwise wealthy area is unlikely to impact surrounding values.

We're feeling a little better

2012-02-16T11:49:00.001-05:00

The number of people seeking unemployment benefits fell to the lowest point in almost four years last week, the latest signal that the job market is steadily improving.

A surge in apartment building offset a drop in starts of single-family homes, pushing housing starts up 1.5% in January from December.

The Labor Department says the producer price index, which tracks price changes before they reach the consumer, rose 0.1 percent. Wholesale prices fell by the same amount in December. In the past 12 months, they have increased 4.1 percent, the smallest rise in a year.

Florida gets the most attention

2012-02-06T13:21:00.002-05:00

Many house hunters from locales such as New York and Chicago search for properties in the Sunshine State, according to a new report from Trulia.com.

The study used searcher’s IP addresses to identify location origin of prospective home buyers and renters from the Northeast and Midwest.

What they found was that for every home search that a resident made in another market, there were nearly nine home searches by out-of-towners for a place in Florida.

Developer / City still haggling over senior housing project

2012-02-03T05:00:00.000-05:00

In 2007 63 percent of voters authorized the city "to lease real property of approximately four acres (deeded to Key West by the Navy) at the Truman Waterfront to a qualified operator or management company ... for a period of 99 years for the exclusive use as a mixed-income senior citizens assisted living and independent living facility." The nonprofit Florida Keys Assisted Care Coalition Inc. then selected a Rick Dover company as the desired developer, with Senior Solutions management group as the operator of the project.

Dover's company originally suggested 60 assisted living rooms or apartments, with 10 low-income units. The plan now calls for 70 assisted-living units, with 42 priced at market rates and 32 with the "moderate" designation. An additional 18 units would be priced in the "low income" range. All determination of such values is based on Key West Housing Authority standards.

Some of the sticking points over the approval are:

*The City's desire for a 49 year lease at $1 per year and a cost of $50,400 per year thereafter. Dover wants the full 99-year lease at $1 per year.

*The city, wants appraisals of the fair market value costs for rooms, to determine what people will pay, with caps built into the lease. Dover rejects the idea of a cap.

*The city wants power over assignment of the lease, meaning the potential for Dover to have someone else take it over, for any reason or no reason at all. Dover wants the agreement to state that such assignment "shall not be unreasonably withheld."

Commissioners meet again on Feb. 7 and will discuss the project further.

Interest Rate Snapshot

2012-02-02T13:24:00.005-05:00

The 30-year fixed mortgage rate (national average) is at 3.72%, down from 3.82% last week. The rate for a 15-year fixed home loan is at 3.01% down from 3.12%. The rate for a 5-1 adjustable-rate mortgage is 2.63%, down from 2.76%; a 5-1 ARM has an initial rate that applies for the first five years of the loan and then adjusts annually.

Obama "No more red tape. No more runaround from the banks"

2012-02-01T13:59:00.001-05:00

With about 10.7 million U.S. borrowers, roughly 22 percent, of all outstanding loans underwater, the Obama Administration has declared that banks should cover the cost of a (new version) mortgage refinancing plan, "because they helped cause the crisis."

Three months ago, the White House loosened requirements on a federal effort, called the Home Affordable Refinance Program, or HARP, to make it easier for underwater homeowners with government-backed loans to lock into mortgages at lower rates. Cutting costs for borrowers whose mortgages are backed by government-run housing finance giants Fannie Mae and Freddie Mac, the new plan would be open to all borrowers who are current on their payments.

The Home Affordable Refinance Program, aka HARP 2.0, is a program to help underwater borrowers refinance to lower current rates. HARP 1 was announced in March 2009, allowing borrowers up to 105 or 125% of amount owed to current market value. But, less than 900,000 home owners have taken advantage of this program. So President Obama announced an 2.0 version of the HARP program, with the hope of reaching more underwater borrowers. The HARP 2.0 program essentially removed the 125% cap for the amount being underwater to unlimited. The program took effect in Dec. 1, 2011 with only bank servicers allowing refinance until Fannie Mae can update their software to allow non-servicing lenders to originate these loans, expected by March 2012.

Florida Housing Market Indicators

2012-01-31T14:37:00.000-05:00

*Florida existing home sales: -2% (month-to-previous-year comparison)

*Florida existing condo sales: -2% (month-to-previous-year comparison)

*Florida existing home median price: $134,300

*Florida existing condo median price: $91,900

National existing home sales: +5% (month-to-previous-month comparison; all housing types)

National existing home median price $164,500

Proposed settlement with Banks little help for homeowners

2012-01-28T19:07:00.000-05:00

A proposed $25 billion settlement between five big banks, state attorneys general and the Obama administration will do relatively little to stop the ongoing wave of home foreclosures or to revive the deeply depressed housing market. The program would help some “underwater" homeowners but there are currently about 11 million borrowers with an average shortfall of roughly $65,000 — or a total of $700 billion — in “negative equity.”

Talks got underway more than a year ago after a series of private lawsuits focused national attention on an outbreak of “robo-signing” and other shoddy and fraudulent document processing practices by mortgage servicers foreclosing on homes. Among the abuses regulators found were so-called “dual track processing” in which lenders working with a homeowner to modify a mortgage would (on the side) continue with legal proceedings to foreclose. In other cases, lenders had foreclosed without properly showing they had the right to do so.

The deal would require banks to devote roughly $17 billion of the total settlement to various types of loan modifications for homeowners. Rather than paying that amount in cash, lenders would receive a series of credit toward that amount based on a complex formula that would assign different levels of credit to different types of modifications. Decisions about which loans to modify would be left to bankers.

The program would apply mostly to the relatively small universe of home loans owned outright by the five lenders, including Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial (formerly GMAC). Loans held by government-controlled Fannie Mae or Freddie Mac — some 60 percent of the 31 million U.S. home loans outstanding — would not be covered in the deal.

Another $5 billion would be set aside to help support state foreclosure relief programs. A portion of those funds would be used to pay homeowners who can demonstrate they were victims of abusive or fraudulent foreclosure practices. Those awards would average about $1,800. The system for arbitrating those claims and distributing those checks has yet to be worked out.

Another $3 billion would be applied to a program to refinance mortgages at lower rates.

If enough states go along, lenders would emerge largely unscathed from the settlement, amounting to a slap on the wrist.

Critics have argued the proposal lets bankers off the hook too easily for the mortgage mess they created with sloppy underwriting during the housing boom.

Woo-Hoo! Low Interest Rates to 2014

2012-01-26T12:34:00.002-05:00

Federal Reserve officials said they expect to keep short-term interest rates near zero for almost three more years.

Florida housing sales stats positive

2012-01-22T05:47:00.003-05:00

Will wonders never cease?

Florida existing home sales (on a month to previous year comparison) has recently shown a rate of +11% significantly outpacing a rate of +4% for the rest of the Nation on average.

The stats are in and we Have a Winner!

2012-01-13T14:32:00.001-05:00

In the United States, last year, about 1.89 million properties received notices of default, auction or repossession. That's just one in 69 U.S. households. Foreclosure filings totaled almost 2.7 million, meaning some properties got multiple notices. More importantly, 804,000 + properties were actually seized by lenders last year.

Leading the pack (in foreclosure filings per household of 2011) as the Nation's highest rate for the fifth straight year, that's 1 in 16, it's Nevada again!

Lagging not fare behind, as #2 in agressive bank actions was Arizona with 1 in 24 households receiving a notice.

Rounding out the field for TOP 10 highest rates in 2011;

#3 California 1 in 31
#4 Georgia 1 in 37
#5 Utah 1 in 43
#6 Michigan
#7 Florida
#8 Illinois
#9 Colorado
#10 Idaho

In the category "Top 10 metropolitan areas with populations over 200,000" coming in first with 1 foreclosure filing per 14 households its -- wait for it ----- Las Vegas.

#2 Stockton
#3 Modesto
#4 Vallejo-Fairfield
#5 Riverside-San Bernardino
#6 Phoenix
#7 Merced
#8 Reno
#9 Bakersfield
#10 Sacramento

Stay tuned as Year 2012 is promising to have even bigger numbers. Banks are expected to seize more than 1 million U.S. homes this year (up 25%) even while settlement talks continue between the lenders and state attorneys general over robosigning.

Foreclosure Heat Map for December by Realty Trac

2011-12-31T19:29:00.000-05:00

Highest December Foreclosure Numbers by State

2011-12-31T16:22:00.000-05:00

BofA offers up to $20,000 to shortsellers

2011-11-02T20:56:00.001-04:00

Foreclosure review program

2011-10-31T19:28:00.000-04:00

Homeowners who received a foreclosure filing in 2009 or 2010 may be eligible to have their cases reviewed for errors under a new federal program. Some may receive compensation for shoddy foreclosures.

Tens of thousands of South Florida homeowners who were in foreclosure in 2009 and 2010 will begin receiving letters this week asking if they would like to have consultants go through their case and check for errors.

Under a new federal foreclosure review program, major servicers must hire independent consultants to search for foreclosure errors and provide financial compensation if the reviewers find damages.

Fourteen mortgage servicers have been tasked with hiring reviewers to look over the foreclosures they processed in 2009 and 2010, after an audit by the Office of the Comptroller of the Currency found widespread evidence of shoddy home repossessions.

Here’s how the program will work:

Between now and December 31, homeowners eligible for the program will receive letters from their mortgage servicers asking if they would like to have their foreclosure cases reviewed. Homeowners have until April 30, 2012 to respond.

Eligible homeowners who request a review will have their cases looked over by an independent consultant and will receive a report with the findings of the review. If the reviewer finds that an improperly handled foreclosure caused financial injury, the homeowner will be eligible for financial compensation.

The 14 servicers involved in the review include major players in South Florida like Bank of America, Wells Fargo, Chase Bank and CitiMortgage.

The review initiative could cover more than 4.5 million foreclosure cases nationwide, and tens of thousands in South Florida.

There is no cost to participate in the review process, and only primary residences are eligible for the program.

Different types of financial losses could be eligible for compensation. For example, a homeowner who was foreclosed upon while actively engaged in the mortgage modification process could be eligible for compensation. Homeowners who were charged excessive fees by servicers may also receive some kind of refund.

For more information, visit independentforeclosurereviews.com or call 1-888-952-9105.

Banks bait-n-switch

2011-10-17T04:39:00.000-04:00

The top four banks JP Morgan, Bank of America, Citigroup and Wells Fargo have plenty of money to lend, They are all advertising new record-low mortgage rates. At first glance, one would think those very attractive rates would spur on both home buying and refinancings.

The problem is consumers often find (once in the door) they can't access those rates and are instead either pushed to higher rates or told they do not qualify altogether. Two of every three mortgage refinancings over the last three years have gone to higher income households with the bulk of refinancings going to higher coupon loans.

How is it that the banks can now disqualify Americans from refinancing at lower rates and lower payments when they are currently performing on loans at higher rates and higher payments?

Even more appalling, mortgage rates should actually be lower than advertised. The spreads between the average national rate on the 30-year fixed mortgage and the 10-year treasury rate seen over the past 10 years has been 153 basis points. On Friday 10/14, the 10-year treasury rate was at 2.26%, while the average national mortgage rate advertised by the banks was at 4.17%, a shocking 191 basis point spread.

The average rate presented to consumers should now be more around 3.79%.

Banks push to expedite Florida foreclosures

2011-10-16T09:44:00.000-04:00

Florida is among 26 states that requires banks to file foreclosures through the court system, a process that takes an average of 728 days to complete. In states where foreclosures aren't routinely handled by the courts, a foreclosure takes an average of 550 days to process, from default notice to repossession.

We don't want to be too quick to condemn the Florida judicial system.

One of the main reasons the foreclosure process has slowed here and elsewhere is because banks temporarily stopped adding cases to the court system about a year ago and pulled many others from the system when it became apparent that documents in some cases had been lost or illegally signed. Another reason is the delays are partially due to lenders not wanting to have the property on their real-estate rolls because they don't want to pay association fees.

Banks have also been criticized for agreeing to short-term, trial mortgage modifications for customers, only to later refuse to grant any kind of long-term solution for the strapped homeowners, many of whom are living in houses now worth half what they paid for them just a few years ago.

None-the-less, the Florida Bankers Association is pressuring state lawmakers to speed up the court process. Legislators are answering by considering proposals that would divert noncontested foreclosures from the courts, allowing banks to handle them in much the same way they repossess cars. If such a measure became law, it would likely affect houses entering foreclosure after June 2012.

Housing Market Indicators

2011-10-15T17:34:00.001-04:00

*month-to-previous-year comparison

Florida existing home sales: +15%

Florida existing condo sales: +17%

Florida existing home median price: $137,500

Florida existing condo median price: $91,900

Florida consumer confidence: 64

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*month-to-previous-month comparison; all housing types

National existing home sales: -3.5%

National existing home median price: $168,300

National (Freddie Mac) mortgage rate: (all housing types) 3.94%

Occupy Movement Meetups Everywhere

2011-10-13T08:27:00.000-04:00

According to the Meetup.com website, the Occupy Movement is growing internationally. As of Thursday, October 13th, the website has listed 1,641 cities holding scheduled events in support of the Occupy Wall Street group in New York City.

Another mortgage hurdle? Sheesh!

2011-09-28T21:29:00.000-04:00

On October 1, 2011, the cost of a mortgage could rise significantly. Current FHA and GSEs mortgage loan limits are scheduled to decrease, lessening the availability of mortgage credit. Lowering the loan limits will force buyers to come up with larger down payments.

The new limits, published by HUD and the Federal Housing Finance Agency (FHFA), show that more than 669 counties in 42 states and the territories will be negatively impacted. The average decline in loan limits will be more than $68,000. Monroe County will be the hardest hit within Florida. The current FHA loan limit in Monroe is $729,750, but as of October 1st the mortgage limit is scheduled to drop to $529,000 a difference of ($200,750)

The timing couldn't have come at a worse time, just when the housing market has shown just a bit of light. Now this move could again hold back the housing recovery.

An (Intense) Analysis of the Obama Jobs Plan

2011-09-25T09:01:00.000-04:00

President Obama's jobs proposal would help stabilize confidence and keep the U.S. from sliding back into recession.

The plan would add 2 percentage points to GDP growth next year, add 1.9 million jobs, and cut the unemployment rate by a percentage point.

The plan would cost about $450 billion, about $250 billion in tax cuts and $200 billion in spending increases.

Many of the president's proposals are unlikely to pass Congress, but the most important have a chance of winning bipartisan support.

Click here to read the full article

By Mark Zandi Moody's Analyst
September, 2011

Bipolar housing market

2011-09-24T21:26:00.001-04:00

In America, it’s starting to feel as if there are two housing markets. One for the rich and one for everyone else.

Consider Detroit. In the historic Green Acres district, a haven for hipsters, a pristine, three-bedroom brick Tudor recently sold for $6,000 – about what a buyer would have paid during the Great Depression. Yet just 15 miles away, in the posh suburban enclave of Birmingham, bidding wars are back. Multi-million-dollar mansions are selling quickly. Sales this August were up 21 percent from the previous year.

Think of this as two housing markets. In the luxury sector, occupied by 1.5 percent of the U.S. population, the recession is a memory and sales and prices are rising. “Luxury is the best performing segment of the housing market right now,” says Zillow.com chief economist Stan Humphries. But everywhere else, the market is moving sideways or getting worse.

In the housing market inhabited by most Americans, prices have fallen 30 percent or more since the peak in 2007. That’s a steeper decline than during the Depression. Almost a quarter of American homeowners owe more on their house than it’s worth. About half of homeowners couldn’t get a mortgage if they applied today.

The divide is also making credit a perk of the rich. Mortgage rates are the lowest in decades. But what good are absurdly cheap rates if you can’t get a mortgage?

Pickup in Foreclosure Activity

2011-09-21T13:24:00.000-04:00

Lenders foreclosed on 64,813 properties last month, and are now on track to repossess 800,000 this year. 228,098 U.S. homes received a foreclosure-related notice last month. That translates to one in every 570 U.S. households.

The increase in foreclosure processing by the banks could also mean a potentially faster turnaround for the U.S. housing market. Experts say a revival isn't likely to occur as long as there remains a glut of potential foreclosures hovering over the market.

Zillow: Key West Home Prices

2011-09-20T15:55:00.001-04:00

Key West Zillow Home Value Index

Key West Home Values - Interactive chart

New Foreclosure Wave

2011-09-15T14:37:00.001-04:00

Banks have stepped up their actions against homeowners who have fallen behind on their mortgage payments, setting the stage for a fresh wave of foreclosures.

The number of U.S. homes that received an initial default notice jumped 33 percent to 78,880 in August from July, the biggest monthly gain in four years.

California saw a 55 percent increase in homes receiving a default notice last month, while in Indiana they climbed 46 percent. In New Jersey, default notice increased 42 percent. Nevada still leads the nation, with one in every 118 households receiving a foreclosure-related notice last month.

Rounding out the top 10 states with the highest foreclosure rate in August are California, Arizona, Georgia, Idaho, Michigan, Florida, Illinois, Colorado and Utah.

Better Strategy For the Economy

2011-09-06T01:13:00.000-04:00

A better strategy -- one that would truly be in the best interests of lenders and mortgage investors -- would be to avert foreclosures by writing down the principal on loans.

read more from Bloomberg article

FHFA filed lawsuits today against Bank of America & 16 more

2011-09-02T23:37:00.003-04:00

The Federal Housing Finance Agency alleged the banks mislead Fannie Mae and Freddie Mac about residential mortgage-backed securities.

The agency named Bank of America, Citigroup and JPMorgan Chase as well as Barclays PLC, Nomura Holdings Ltd., HSBC Holdings PLC, Societe General SA, Morgan Stanley, Ally Financial, Royal Bank of Scotland, Credit Suisse Group AG, Deutsche Bank AG and First Horizon National Corp.

The complaints say the banks misled Fannie Mae and Freddie Mac about the soundness of the underlying mortgages. The housing finance agency is seeking to have some defendants refund the investments with interest and pay other damages, including punitive damages for alleged misconduct.

What's the down payment on $30 Billion?

2011-09-01T13:37:00.002-04:00

White House officials are looking for private partners to remove as much as $30 billion in single-family properties currently on the books of Fannie, Freddie, and the Federal Housing Administration.

Among possible investors, officials said they were looking for private-equity funds, financial institutions, and perhaps local governments and nonprofits to buy foreclosed properties and offer them as rentals in stressed housing markets.

Another approach would allow investors to partner with Fannie and Freddie in a joint venture to buy a pool of converted rental homes, with an equitable split between the government entities and investors to reduce losses at the mortgage giants.

Such partnerships with private-sector investors "may reduce taxpayer losses" said Edward DeMarco, acting director of the Federal Housing Finance Agency.

Just the Facts

2011-08-31T23:00:00.000-04:00

Housing Market Indicators

Florida existing home sales: +12% (month-to-previous-year comparison)

Florida existing condo sales: +12% (month-to-previous-year comparison)

Florida existing home median price: $136,500

Florida existing condo median price: $90,900

Florida consumer confidence: 68

National existing home sales: -3.5% (month-to-previous-month comparison; all housing types)

National existing home median price $174,000

National (Freddie Mac) mortgage rate 4.15% (all housing types)

"Buy when there's blood in the streets"

2011-08-23T15:44:00.000-04:00

Overall nationally, housing prices (new and resale) have dropped more on a percentage basis, than during the Great Depression of the 1930s.

New-home sales are shaping up to be the worst on records dating back 50 years. A seasonally adjusted annual rate of 298,000, the Commerce Department said today. That's less than half the 700,000 that economists say represent a healthy market. Last year, 323,000 homes were sold -- the worst year on records that go back to 1963.

Although mid-priced home sales fell last month, sales actually increased in July for homes selling for more than $750,000.

Interest rate lowest in 40 years

2011-08-20T07:51:00.001-04:00

The average rate on a 30-year fixed mortgage fell to 4.15 percent this week -- the lowest level on records dating back to 1971.

Investors Buying Now

2011-08-19T13:36:00.001-04:00

Investors targetlng foreclosures and other deeply discounted properties accounted for 18 percent of sales in July.

Foreclosures and short sales made up about 29 percent of all home sales last month. That's up from about 10 percent in past years.

Home sales on pace to be the worst in 14 years

2011-08-18T13:35:00.000-04:00

Home sales fell 3.5 percent last month to a seasonally adjusted annual rate of 4.67 million homes, the National Association of Realtors said today. That's far below the 6 million that economists say must be sold to sustain a healthy housing market.

Many people are reluctant to purchase a home two years after the recession officially ended. Sales are lagging behind last year's 4.91 million sold -- the weakest in 13 years.

Bigger down payments, tougher lending rules, high debt and a shortage of desirable starter homes have kept many would-be buyers away. Even people with good credit and enough money for a down payment are holding off because they are worried home prices will keep falling.

The Housing Slump Gonna End?

2011-08-10T01:30:00.001-04:00

A study, released today by Fiserv, predicted "a broad-based recovery for housing that will begin in early 2012," and home prices for more than 95 percent of metro areas will rise by the beginning of 2013.

"Between the first quarter of 2012 and the first quarter of 2013, homes are projected to increase by an average of 2.7 percent, with gains in 365 out of 384 metro areas," Fiserv said in a press release.

S&P downgrades US credit rating

2011-08-06T00:24:00.000-04:00

The United States has lost its sterling credit rating from Standard & Poor's. The credit rating agency on Friday lowered the nation's AAA rating for the first time since granting it in 1917.

Stocks drop but hiring better than expected

2011-08-05T10:02:00.000-04:00

Hiring picked up slightly in July and the unemployment rate dipped to 9.1 percent, an optimistic sign after the worst day on Wall Street in nearly three years.

The Labor Department says employers added 117,000 jobs last month. That's an improvement from the past two months.

The mild gain may ease investors' concerns after the Dow Jones industrial average plummeted more than 500 points over concerns that the U.S. may be entering another recession.

Agreement reached to raise the debt ceiling

2011-07-31T22:58:00.001-04:00

Republican and Democratic leaders have agreed on a plan to raise the debt ceiling.

The announcement arrives after months of intense closed-door negotiations, and just two days before the deadline set by the Treasury Department.

The agreement would slow the growth of government spending over the next decade by $2-$3 trillion and allow enough borrowing to put off another vote to raise the ceiling to 2013. About $1 trillion will be cut immediately, and the details of the remaining spending reductions will be handled by a bipartisan committee of 12 lawmakers from both chambers, who will recommend cuts for Congress to vote on. To appease the GOP's conservative wing, the deal would also require a vote in both chambers on an amendment to the Constitution requiring the federal government to balance its budget each year.

Jobless Claims Dropped Last Week

2011-07-28T16:44:00.000-04:00

Lets go all in, if we can get in

2011-07-10T22:12:00.000-04:00

Economists say that by early 2006, we (the American Middle Class) started losing big. Here we thought we were on a roll. We got suckered into thinking we had the game beat and borrowed to the max. Where'd we get the money? Well, about 90% of our life savings was in our homes, so from 2003 to 2007, we took $2.3 trillion out through refinancing and equity loans and spent about $1.3 trillion of it just on stuff.

How's the game going now? Well, in terms of income, we've been falling behind for decades. So far we're told we've taken losses to the tune of 55% of the value of our homes. How much is that? In this game, the Federal Reserve keeps the books and they say $7.38 trillion of our wealth is now gone. Most of us didn't have much wealth to begin with — on average about $100,000. Now it's a much lower number, and we're debating whether it can still be called "wealth" at all?

Most of the middle class still want to play, but an unusually large number of us have been kicked out of the game altogether. The "unemployed" now amounts to over 9% of the total labor force. That's the number the government tells us anyway. There are also quite a few though that have given up and quit trying. When they do that, the government won't even consider counting them in the stats. If you're not a player, or you've quit trying to be a player, it appears you become nobody.

In the movie "Wallstreet," Gordon Gecko said "It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another." For a long time now, that transfer of money has gone to the perception of the already rich and their stand-in corporations.

With the upper classes prospering and global markets booming, they don't need the U.S. middle class to play any more. If we do get in the game for another hand, what say we go all in. Heck, it's too late to play it close to the vest if we've already lost our shirt.

Obama helps a few more out-of-work homeowners

2011-07-07T21:25:00.000-04:00

On Aug. 1, the FHA will extend the period for unemployed homeowners to miss mortgage payments to a full year from three or four months. That will allow qualified homeowners to go without making a monthly payment for 12 months before the foreclosure process begins.

The extended grace period only applies to FHA-backed loans, which are usually given to low- and middle-income borrowers and represent about 14 percent of all active mortgages and roughly 25 percent of new mortgages.

Last year, roughly 17,000 homeowners received a government-supported delay on their mortgage payments. About 3,500 borrowers with FHA-insured loans fall behind on their mortgages each month due to unemployment. Another 10,000 unemployed homeowners have taken advantage of a three-month delay in mortgage payments in the past year.

Administration officials hoped private lenders and government-controlled mortgage companies Fannie Mae and Freddie Mac would adopt a similar policy.

Fannie and Freddie signaled they would not.

The Great Recession lingers on Main Street

2011-07-03T08:54:00.001-04:00

Economists say the recession ended two years ago, but if this is a recovery, its been the weakest and most lopsided of any since the 1930s.

Corporate profits are up by almost 50% since the recession "ended" in June 2009. Compare that to the first two years after the recessions of 1991 and 2001, profits rose 11 percent and 28 percent, respectively. Where do those profits go? Surprise, the wealthiest 10 percent of Americans own more than 80 percent of outstanding stock.

The typical CEO of a major company earned $9 million last year, up approximately 25% from 2009.

On the other side, new jobs pay less than the ones that vanished in the recession. The average worker's hourly wages, after accounting for inflation, were 1.6 percent lower in May than a year earlier. Despite cutting what they owe the past three years, the average household's debts equal 119 percent of annual after-tax income. At the same point after the 1981-82 recession, debts were at 66 percent; after the 1990-91 recession, 85 percent; and after the 2001 recession, 114 percent.

The working class continues to set records. Social programs accounted for a record 18 percent of personal income in the last three months of 2010. Almost 45 million Americans are on food stamps, another record.

Is it much of a surprise that a majority think the recession continues? Some 29 percent of that majority will go even further -- they say it feels more like a depression.

Emergency Homeowners Loan Program

2011-07-02T14:30:00.001-04:00

HUD and the nonprofit housing advocacy group NeighborWorks America started a program last week offering loans that don't actually need to be repaid, if applicants meet certain requirements.

The loans available to around 30,000 applicants, are interest-free. Payments go directly to the lender for a portion of the borrower's monthly mortgage, including missed payments or past due charges. And when the assistance period -- which runs for up to two years -- ends, 20% of the loan is forgiven with each passing year. In other words, for qualified borrowers who stay in their home for at least five years after the assistance period and who don't fall behind on their mortgage again, this money doesn't have to be paid back.

If they sell their home before the entire loan is forgiven, they'll be on the hook for the remaining amount. The same holds true if they fall behind on their mortgage payments again: they'll need to repay the remaining balance of the loan when they sell or refinance their home. Separately, borrowers aren't required to have equity in their home to receive this money.

While the limit each person will get is up to $50,000, loans will average about $35,000 per person, according to NeighborWorks America.

To be eligible, homeowners must have lost income and be at risk of foreclosure due to involuntary job loss, underemployment or a medical or other economic condition; details on the application process are available online through NeighborWorks America.

Applications will be taken through July 22nd.

Banks finally getting the picture?

2011-07-01T14:03:00.000-04:00

Approximately 23% of homeowners with a mortgage are underwater. Another 2.4 million homeowners are teetering on the brink, with less than 5% equity in their home. If home prices drop further over the next year many of those owners could end up with negative equity.

Now --- Half of homeowners who owe 50% or more on their home than it's worth and default do so strictly because of negative equity, according to a Federal Reserve Board study.

So --- Both GMAC Mortgage and Wells Fargo have started either reducing some mortgage balances, deferring payments or offering subsidized refinancing in areas with large declines in home values -- like Miami and Las Vegas.

and now something completely different

2011-06-30T13:29:00.002-04:00

Home Prices Over The Past Year

2011-06-29T09:36:00.000-04:00

click graph to enlarge

What was that?

2011-06-28T20:08:00.000-04:00

National News

Prices rose in 13 of the 20 cities tracked by the Standard & Poor's/Case-Shiller home-price index, according to the April report released today. The index covers metro areas that together make up about 50 percent of U.S. households. It measures sale prices of select homes in those cities compared with prices in January 2000. It then provides a three-month average. The April data is the latest available.

The sharpest increases were in Washington, D.C. The next-largest were in Seattle, San Francisco, and Atlanta.

It's much too early to tell if this is a turning point or simply due to the usual spring market increase. The only times in recent history when prices didn't see a spring uptick was in the thick of the crash. Remember there's still nearly 2 million foreclosures could hit the market over the next two years.

Freddie & Fannie Summer Clearance Sale

2011-06-24T14:57:00.001-04:00

filed under foreclosures national news

Both Fannie Mae and Freddie Mac have massive numbers of properties taken back through foreclosures. Fannie Mae had 153,549 of them at the end of the first quarter, and Freddie Mac owned 65,174. They need to quickly find new owners.

Both have now begun time-limited sales campaigns with significant incentives for new owner-occupant purchasers, and are now offering to pay up to 3.5 percent of the price of the house toward buyers’ closing costs.

Fannie and Freddie both do repairs to bring houses up to what they believe are marketable standards, but all homes are sold as is. Fannie also has what it calls a “renovation mortgage” option that provides additional mortgage amounts to cover fix-ups. Fannie’s program even offers mortgage money to help finance purchases, sometimes with as little as a 3 percent down payment. Freddie does not offer special mortgage financing for buyers during the sale period, but has other inducements, including two-year home warranties and 30 percent discounts on appliances. There's even an extra $1,200 cash for the real estate agent.

Fannie’s program covers properties on which contracts are accepted and close no later than Oct. 31, while Freddie’s sale requires contracts no later than July 31 and closings by Sept. 30.

No investors allowed

Notorious Hacker's Den discovered in Wickford, Essex UK

2011-06-20T13:40:00.021-04:00

Click picture to enlarge
Up to a dozen officers from the London Metropolitan Police raided a hacker's den, arrested and charged one Ryan Cleary with offences relating to his alleged involvement with the group Lulzsec.

The primary offence, was a conspiracy to hack computers and to then disseminate a program that would commit Distributed Denial of Service (DDoS) attacks. In all, Cleary was charged with four UK offences under Section 3 and 3A of the Computer Misuse Act of 1990 and one offence under Section 1 of the Criminal Law Act of 1997.

Obviously technically overmatched, a number of Cleary's targets included the UK's Serious Organised Crime Agency (SOCA), the International Federation of the Phonographic Industry (IFPI), and the British Phonographic Industry (BPI). Cleary could also face extradition to the US, where he may face offences relating to attacks on the Sony Corporation, the US Senate, the FBI and the CIA.

Apparently angered by the recording industry's attempts to limit the downloading of certain popular songs on the Internet without what he referred to as "highway robbery prices," the 19-year-old Cleary determined to "fight back against those agencies that were at fault."

Cleary operated from a deceptively non-descript beige bedroom with one feline co-conspirator. The Met Police had been monitoring the activities within the den for weeks. According to Police Sargent William Finkle, the optimum time for the raid was chosen when Cleary left the den and traveled to the kitchen where he was baking a pizza.

Fortunately there were no injuries reported by the police.

Happy Monday ;-)

Good Strategic Default Video from CBS

2011-06-16T23:01:00.000-04:00

Gov gives Banks 30 more days to submit plans to fix foreclosure practises

2011-06-15T12:18:00.000-04:00

In April of this year, Federal regulators told Citibank, Bank of America, JPMorgan Chase, Wells Fargo and a dozen more mortgage lenders and servicers that they had 45 days to hire auditors showing how many people could have avoided foreclosure in 2009 and 2010. They were also told by to reimburse homeowners who lost their homes through the banks "incorrect" foreclosure methods.

On Monday, the Department of Justice asked Regulators to give the financial firms another 30 days to coordinate with state and federal agencies.

Foreclosure Limbo

2011-06-10T21:39:00.000-04:00

Millions are staying in their homes without paying their mortgages.

Some 4.2 million mortgage borrowers are either seriously delinquent or have had their cases referred to lawyers to pursue foreclosure auctions, according to LPS Applied Analytics. Of those, two-thirds have made no payments at all for at least a year, and nearly one-third have gone more than two years.

These cases can go on and on. Nationwide, it takes an average of 565 days to foreclose on borrowers in default from their first missed payments to the final auction. In New York, the average is 800 days and in Florida, where the "robo-signing" issue is particularly combative, it's 807.

Florida couple threatens bank with foreclosure

2011-06-07T17:27:00.000-04:00

Eric Strachan AP ST. PETERSBURG, Florida — Months after Bank of America wrongly foreclosed on a house Warren and Maureen Nyerges had already paid for, they were still fighting to get reimbursed for the court battle.

So on Friday, their attorney showed up at a branch office in Naples with a moving truck and sheriff's deputies who had a judge's permission to seize the furniture if necessary. An hour later, the bank had written a check for $5,772.88.

After the moving company and sheriff's deputies get their share, the Nyerges should receive the rest of the money this week, ending a bizarre saga that started when they paid Bank of America $165,000 cash for a 2,700-square-foot foreclosed home in Naples in 2009.

About four months later, a process server knocked on their door and handed Warren Nyerges a notice of foreclosure.

"This is a big mistake," he recalled saying. "You must have the wrong house. We bought a foreclosure and don't have a mortgage."

That started 18 months of frustrating phone calls, paperwork and court hearings. Whenever Nyerges called the bank, representatives told him to "come up to date" with his payments. When he called 25 different law firms, no attorney would take the case. When he went to court, the lawyers for the bank filed incorrect motions and were woefully unprepared for the hearings.

Eventually the Nyerges fought the foreclosure and won, proving that they owned the home outright.

In September 2010, a judge ordered Bank of America to pay the couple's $2,534 attorney fees. But by last week, the bank hadn't paid up, so Allen got a judge's permission to seize assets.

This isn't the first time that Bank of America has tried to foreclose on a property that was owned by a person without a mortgage. In 2009, a Fort Lauderdale man named Jason Grodensky bought a home in cash from Bank of America in a short sale. But in court, the foreclosure case continued and a judge ordered the property to be sold. Bank of America acknowledged the error and rescinded the foreclosure.

The Nyerges case is symbolic of the foreclosure crisis. Courts are backlogged, and banks and their attorneys aren't scrutinizing foreclosure paperwork. And Nyerges said he's still upset with Bank of America.

"They couldn't even spell our name right in the apology," he said.

Record Low Equity

2011-06-01T11:19:00.000-04:00

Standard & Poors signals double dip in housing

2011-05-31T10:46:00.001-04:00

U.S. home prices fell in March for the eighth straight month, confirming the beleaguered housing market has entered a double-dip recession.

Home prices in 20 major U.S. cities declined 0.8% in March on a non-seasonally adjusted basis, according to the Case-Shiller home-price index. The S&P/Case-Shiller index is based on a three-month moving average of home prices. So the March data reflect price data for January, February and March. This makes the index less volatile than other house-price gauges.

How each of the 20 cities fared over the past year:

Minneapolis, down 10%
Phoenix, down 8.4%
Chicago, down 7.6%
Portland, OR, down 7.6%
Seattle, down 7.5%
Tampa,down 6.9%
Charlotte, down 6.8%
Cleveland, down 6.3%
Miami, down 6.1%
Las Vegas, down 5.3%
Atlanta, down 5.2%
San Francisco, down 5.1%
San Diego, down 4.0%
Denver, down 3.8%
New York, down 3.4%
Boston, down 2.7%
Dallas, down 2.5%
Los Angeles, down 1.7%
Detroit, down 0.9%
Washington D.C., up 4.3%

U.S. home purchases by foreigners surge $16 billion

2011-05-30T13:58:00.000-04:00

Total residential international sales in the U.S. for the year ending March 2011 equaled $82 billion, up from $66 billion in 2010.

The U.S. has always been a desirable place for foreign buyers to own property. U.S. homes are generally less expensive than comparable foreign properties, homes in this country are viewed as a secure investment, and the U.S. market offers rental opportunities and long-term appreciation potential.

Foreign buyers are primarily interested in three factors when deciding where to buy in the U.S.: proximity to their home country, convenience of air transportation, climate and location. Generally, the East Coast attracts European buyers. The West Coast remains popular for Asian purchasers. Mexican buyers are traditionally attracted to the Southwestern markets. Florida is most popular among South Americans, Europeans and Canadians.

Recent international buyers came from 70 different countries, up from 53 countries in 2010. For the fourth consecutive year, Canada was the top country of origin, with 23 percent of sales to foreigners. China was second most popular, with nine percent of international sales this year. Tied for third were Mexico, the U.K. and India. Argentina and Brazil combined reported an increase in foreign sales with five percent, up from two percent in 2010. The top five countries of origin accounted for 53 percent of international transactions in 2011.

The average price paid by an international buyer was $315,000 compared to the overall U.S. average of $218,000. However, 45 percent of international purchases were under $200,000. Sixty-one percent of foreign buyers purchased a single-family home while 36 percent bought a condo/apartment or townhouse.

In addition, 62 percent of international purchases were reported as being all cash. This percentage is significantly higher than all-cash purchases for domestic buyers, mostly due to the differences in international credit reporting standards.

Florida had 31 percent of total international transactions this year, the most of any state. California had 12 percent, Texas had nine percent, and Arizona rounded out the top four with six percent of international transactions.

Opportunity calling! Buy Foreclosures Now!

2011-05-27T20:12:00.000-04:00

Homes are selling at steep discounts, especially bank-owned homes that have been taken in foreclosures. The average Bank owned property cost about 35% less than comparable properties. Also weighing on market prices are short sales, meaning homes where the selling price is less than what is owed by the borrowers. These sold at an average 9% discount.

There were 158,000 deals involving distressed properties nationwide during the first quarter of 2011, but that was less than half the nearly 350,000 deals during the same period two years earlier. So now, there's a three-year inventory of homes in foreclosure for sale, a whole 1.9 million distressed properties.

*Las Vegas has so many foreclosures that 53% of all the homes sold in Nevada are in some stage of foreclosure.

*Foreclosures represent 45% of sales in California and Arizona, and 28% of all existing home sales during the first three months of 2011.

*In New York State, the discount for REOs was 53% during the first quarter. And it was nearly 50% in Illinois, Ohio, and Wisconsin.

Ouch! Time to Buy!

RENTS UP!

2011-05-24T22:15:00.000-04:00

A growing number of Americans can't afford a home or don't want to own one. Permits for single-family home construction are on pace for their lowest annual level on records dating to 1960.

From the 1940s until 2007, homes appreciated an average of nearly 5 percent a year, adjusted for inflation. In the past four years, the median price of a single-family home has sunk 37 percent, by $57,500, to its lowest since 2002.

Before the housing bust, mortgage rates were so low it was often cheaper to buy than rent. That was true a decade ago in more than half the 54 biggest metro areas, according to Moody's Analytics. Today, by contrast, it's cheaper to rent in about 72 percent of metro areas.

The proportion of U.S. households that own homes is at its lowest point since 1998. When the housing bubble burst four years ago. Since the housing meltdown, nearly 3 million households have become renters. At least 3 million more are expected by 2015, according to census data analyzed by Harvard's Joint Center for Housing Studies and The Associated Press. All told, Nearly 38 million households are renters.

The number of completed apartments averaged about 250,000 a year before the boom. They fell to 54,000 last year and will probably number around the same this year. But then the number will likely double to about 100,000 in 2012 and hit 250,000 by 2013 or 2014, according to the CoStar Group, a research firm. The lag is due to the time it takes for an apartment building to be completed: an average of 14 months.

Looks like demand is going to push rents up for a while.

Mortgage Rate Trend Index

2011-05-20T12:37:00.001-04:00

Fixed mortgage rates fell this week to the lowest point of the year, offering incentive for homeowners to save money by refinancing their loans. Freddie Mac said Thursday that the average rate on the 30-year loan fell to 4.61 percent. That’s down from 4.63 percent and the lowest level since mid-December.

Don’t expect much change in mortgage rates over the short term. 44% of experts polled this week by Bankrate.com Only 17% expect further declines, however, with 37% predicting an increase.

The average rate on the 15-year fixed mortgage, a popular refinance option, slipped to 3.80 percent. That marked the lowest point since late November. Rates track the yield on the 10-year Treasury note, which fell to the lowest level of the year this week. The number of borrowers looking to refinance is now at the highest level since the second week of December, according to the Mortgage Bankers Association. Refinancing though, is only at half the level it reached in the fall of last year when mortgage rates fell to record lows. The rate on the 30-year home loan hit a four-decade low of 4.17 percent in November. The 15-year mortgage rate reached 3.57 percent that same month, the lowest level on records dating back to 1991.

Weak Housing Market Still

2011-05-19T12:54:00.000-04:00

Here's a news flash for ya. Fewer people bought previously occupied homes in April, the National Association of Realtors said Thursday. Sales fell to a seasonally adjusted annual rate of 5.05 million units, far below the 6 million homes a year that economists consider a healthy market.

Finding buyers for high-end homes is about to become a tad harder

2011-05-14T15:09:00.000-04:00

On 9/30/2011, the lending limits for Fannie Mae (FNMA), Freddie Mac (FHLMC) and FHA are scheduled to be cut. The idea behind the change is to get federal taxpayers out of the business of subsidizing home sales in high-priced areas. What that means for Key West is that the availability of mortgages for high end homes is going to drop in a few months. That is of course unless some in Congress are successful in their push to extend the limits.

The biggest change in limits will come from the areas that have the highest home values. These are pretty significant drops. There are 88 counties across the country that will see their mortgage limit cut by more than $100,000. In Monroe County, FL the current FHA maximum loan limit of $729,750 (for a single family home) will drop $201,000 (28%) to 528,750. For example: The down payment requirements on an $800,000 home will increase from approximately $70,000 (just under 9%) up dramatically to over $270,000 down (just under 34%.

Well, there's always seller financing?

Zillow says Key West Home Prices / Values UP?

2011-05-12T11:35:00.037-04:00

According to the Zillow Home Value Index, Key West was one of only two regions in the area to show a gain in home prices and home values year over year in the last report of March 2011. The other being Chokoloskee based on limited sales data.

Does the move indicate a turnaround or is it a dead cat bounce as they say in the stock market? Stay tuned.

Region Y-o-Y change

Monroe Y-o-Y change -3.2 %

Big Coppitt Key Y-o-Y change -3.2 %

Big Pine Key Y-o-Y change -7.7 %

Chokoloskee Y-o-Y change +5.4 %

Islamorada Y-o-Y change -4.7 %

Key Colony Beach Y-o-Y change -3.8 %

Key Largo Y-o-Y change -14.2 %

Key West Y-o-Y change +7.0 %

Marathon Y-o-Y change -7.1 %

Summerland Key Y-o-Y change -3.5 %

Tavernier Y-o-Y change -4.2 %

Banks propose billions to close foreclosure probe

2011-05-11T02:10:00.000-04:00

Major banks are willing to pay to settle claims by federal and state officials of improper mortgage foreclosure practices, offering as much as $5 billion be used to compensate any borrowers previously wronged in the foreclosure process and provide transition assistance for borrowers who are ousted from their homes.

The banks' offer comes as mortgage companies and state and federal officials continue their efforts to strike a settlement of investigations sparked by allegations of "robo-signing" and other questionable foreclosure practices that came to light last fall.

Housing Market Indicators

2011-05-04T10:26:00.000-04:00

Florida existing home sales: +12% (month-to-previous-year comparison)

Florida existing condo sales: +24% (month-to-previous-year comparison)

Florida existing home median price: $126,300

Florida existing condo median price: $84,300

Florida consumer confidence: 72

National existing home sales: +3.7% (month-to-previous-month comparison; all housing types)

National existing home median price $159,600

National (Freddie Mac) mortgage rate 4.78% (all housing types)

New Uniform Foreclosure Guidelines

2011-04-30T17:51:00.000-04:00

By the end of 2011, foreclosures under Fannie Mae and Freddie Mac – which hold or guarantee roughly 90% of all U.S. loans – must follow the same procedures. Loan servicers under Fannie and Freddie will be rewarded if they perform well and punished if they do not, according to the Federal Housing Finance Agency.

This initiative will direct servicers to reach families earlier, communicate more frequently and clearly, and provide relief.

Changes under the new guidelines:

• Loan servicers cannot work with homeowners on their loans while simultaneously moving forward with a foreclosure, called a “dual track” by FHFA.

• Loan servicers must contact homeowners as soon as they become delinquent and focus solely on remediating that delinquency. As long as the “borrower and servicer are engaged in a good-faith effort to resolve the delinquency,” a foreclosure cannot move forward.

• The servicer must formally review each case before taking any actions to consider the homeowner for any foreclosure alternatives.

• Loan servicers will be rewarded for speed. If a loan is modified in some way within four months, for example, the servicer receives $1,600. If it takes over seven months, however, the servicer gets only $400.

• Even if the foreclosure process has already begun, loan servicers will be paid a “financial incentive” if they continue to help the homeowners find an alternative to foreclosure.

• There will be fewer forms to fill out. It will simplify the process … by giving borrowers one application to fill out and servicers one application to review for all Freddie Mac loan modifications and foreclosure alternatives.

Investors buying as home prices are falling

2011-04-26T15:44:00.000-04:00

Most major U.S. cities are seeing their home prices continue to fall, and at least 10 major markets are at their lowest point since the housing bubble burst.

The Standard & Poor's/Case-Shiller 20-city index (released today) showed home prices declined in 19 metro areas from January to February and 11 markets experienced faster price declines compared with the previous month. The index measures sales of select homes in those cities compared to January 2000. For each of the 20 metro areas it studies, the index provides an updated three-month moving average price. By measuring the sales price of the same homes over time, the index attempts to gauge true market values. Analysts expect the March index will fall past the low point.

The cities with the steepest declines from January were Minneapolis, San Francisco, Chicago and Miami.

New Florida Short Sale Bill

2011-04-23T11:19:00.000-04:00

The number of short sales in Florida is rising, but lenders haven’t kept pace.

Bipartisan legislation was introduced last week to speed short sales by requiring lenders to decide whether to accept an offer within 45 days. The bill addresses the biggest obstacle for homebuyers and owners in short sale situations. By requiring lenders to make decisions on short sales within 45 days, this legislation would speed transactions and help prevent homes from going into foreclosure.

H.R. 1498 – the “Prompt Decision for Qualification for Short Sale Act of 2011” – would bring the processing time for short sale price approvals in line with the time required for other types of real estate deals by mandating a quicker response from the lender – at most 45 days after submitting the request for short sale approval.

Miami-Dade Jobs Picture Worse than Detroit?

2011-04-20T13:53:00.011-04:00

Looking through Tuesday's (4-19) Labor Department jobs report, the unemployment picture for the Miami-Dade area of Florida appears more dire than that of even Detroit. The print media grabs that data and runs up stories about it being harder to find a job in Miami now than even in the Detroit.

How could that be? After all, in March 2006, Michigan’s unemployment rate stood at 6.8 percent while Florida’s was less than half that at 3.1 percent.

Well, it's all there in the numbers folks, if you accept those as declared without review. The States with the highest unemployment rates in Tuesday’s Labor Department report are — California, Florida and Nevada. Detroit comes in at a rate of 11.1 percent, down from 14.5 percent a year earlier. Miami on the other hand is reported at 12.9 percent with a reported increase in unemployment from 12.5 percent a year ago. Motor City auto sales stats have influenced the reports having rebounded since they collapsed during the financial meltdown of 2008. On Tuesday, J.D. Power reported that car sales hit 11.1 million in April, almost 2 million higher than a year ago. Also, on the real estate front, the Federal Housing Finance Agency shows Detroit had a 25-point negative swing on its housing price index since 2000, while Miami-Dade was a much worse 55-point downward swing.

Keep in mind that the unemployment rate is is not as definitive as it might sound. Wouldn't it be much easier for us if a person was considered employed simply by the fact of them having a job? Instead, the powers that be throw in complications galore. For example: (1) A person who loses a 40 hour per week job, but works for one hour mowing a lawn for pay is classified as employed. (2) A person who simply expresses interest in having a job is classified as unemployed, while discouraged workers" who have lost a job, but do not make an effort to find a new job in a given week are not classified as unemployed or even as in the labor force.

One of the main reasons that Detroit’s unemployment rate went down is because its labor pool dropped, too. That is, the number of people either looking for a job or working declined from a year ago — down 2.8 percent. Hiring only went up 1 percent. That’s usually not a good sign, suggesting either people are moving out of town or are so discouraged by the hiring climate they’ve given up looking.

In Miami-Dade, though, the labor pool grew 1.1 percent in a year, while hiring went up 3.3 percent. That’s an encouraging trend when both measures increase, but the combination makes it harder to lower the unemployment rate.

Mortgage Lenders Told to Reimburse Homeowners

2011-04-15T00:45:00.000-04:00

More than a dozen of the nation's largest mortgage providers have been told to reimburse homeowners over their mishandling of foreclosures.

These comprehensive enforcement actions, coordinated among the federal banking regulators, require major reforms in mortgage servicing operations.

Lenders were targeted over "a pattern of misconduct and negligence related to deficient practices in residential mortgage loan servicing and foreclosure processing," said the Federal Reserve Board, which teamed with the Treasury's Office of Thrift Supervision (OTS) and the Treasury's Office of the Comptroller of the Currency (OCC) in issuing enforcement orders against the banks.

Among the banks targeted for their foreclosure practices are Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo. Officials said that "unsafe and unsound practices, violations of law and foreclosure processes geared toward speed and quantity, instead of quality and accuracy" will include fines and other types of sanctions and oversight.

"These comprehensive enforcement actions, coordinated among the federal banking regulators, require major reforms in mortgage servicing operations," said acting Comptroller of the Currency John Walsh.

Homeowners who were illegally foreclosed upon will be paid back for losses incurred during the foreclosure processes, and auditors will further investigate for improper foreclosures and other mishaps.

"These reforms will not only fix the problems we found in foreclosure processing, but will also correct failures in governance and the loan modification process and address financial harm to borrowers," Walsh added. "Our enforcement actions are intended to fix what is broken, identify and compensate borrowers who suffered financial harm, and ensure a fair and orderly mortgage servicing process going forward."

An estimated 2.4 million first-lien mortgage loans were in foreclosure in 2010.

Good News (No, Really)

2011-04-10T14:34:00.008-04:00

OK, looks like Real Estate Pros have finally stopped jumping from the 8th floor windows. Across the country, there are reports of a rise in traffic at open houses. Buyers are waking up to the idea that this is it. It's like a big spring clearance sale on real estate. Prices are low, and so are mortgage rates. The Mortgage Bankers Association (MBA) reports that mortgage applications are at the highest level in months. There is even some willingness of politicians to further juice the system to get over the next finish lines. Now if you have a secure job and the economy around is actually growing, then it's a great time to buy.

"Buy when there's blood in the Streets" Baron Rothschild

2011-04-08T18:10:00.006-04:00

It's still tough out there for a lot of folks. Even though foreclosures are expected to peak this year nationally, they are still looking to come in at numbers of 1 million a year through 2013. A full third of all "homeowners" now owe more than their homes are worth. Under normal conditions, the number of people with negative equity has averaged closer to 5 percent. A total of 831,574 foreclosures or bank-owned properties sold in 2010. They sold at an average discount of more than 28% compared with properties not in foreclosure. That action has helped force down home prices to their lowest level in nearly 9 years.

More and more people are forced to make a choice of walking out (strategically defaulting) on their underwater mortgages and suffering the negative impacts to their credit ratings, or continuing to throw money at a depreciating investment. In Florida alone, there were 485,286 properties subject to a foreclosure filing during 2010. That means there is a lot of housing supply (shadow inventory) sitting with the banks waiting to be placed on the market.

While the picture is certainly dire for some, the Vulture Investors are very busy. Nearly 40 percent of all sales last month were either foreclosures or short sales. The Flippers are also making hay while the sun shines. Of the 831 thousand+ distressed sales of last year, a significant percentage (7.9%) of those foreclosed homes sold again within 180 days.

As the fictional character (Gordon Gecko) from the movie "Wall Street" exclaimed, "It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another."

New Trend Towards Smaller Homes

2011-04-03T14:51:00.013-04:00

A recent study from the National Association of Home Builders (NAHB) indicates that the recent housing slump has meant buyers are looking for smaller houses. The McMansions of the boom era are quickly losing their style.

The NAHB reports that the builders they "surveyed expect homes to average 2,152 square feet in 2015, 10 percent smaller than the average size of single-family homes started in the first three quarters of 2010. To save on square footage, the living room is high on the endangered list – 52 percent of builders expect it to be merged with other spaces in the home by 2015 and 30 percent said it will vanish entirely.

Key West Fan Christian Slater has a New Series

2011-04-01T00:40:00.000-04:00

Christian Slater with Martha Robinson in Key West

SERIES PREMIERE on FOX WED 9:30/8:30c APR 6th

BREAKING IN is an offbeat half-hour workplace comedy about a high-tech security firm that takes extreme - and often questionable - measures to sell their protection services. The series centers on a team of uniquely skilled oddball geniuses hand-picked to work for a manipulative mastermind.

Contra Security, corporate America's answer to "The A-Team," gives clients a sense of security by first ripping it away. The firm is led by OZ (Christian Slater), a larger-than-life head honcho who is a man of mystery and master of manipulation. The members of the odd squad include alluring bad girl MELANIE (Odette Annable), who is in charge of lock-picking, safe-cracking and heart-breaking; and CASH (Alphonso McAuley), a fanboy who specializes in strategy, logistics and office pranks.

Real Estate Crash catching up to U.S. Municipalities

2011-03-30T13:43:00.000-04:00

Cities, counties and school districts had been sheltered from the full impact of the real-estate slump because of the lag between when realty prices fluctuate and values are reset by local tax assessors. That’s changing as property rolls are adjusted to the current market and residents push to have their taxes cut.

This is the first year that most local governments are seeing a decline in their property-tax revenues. Local and state property-tax revenue slid $5.3 billion, or 2.9 percent, in the fourth quarter from a year earlier to $177.1 billion. All but $3.7 billion went to municipalities. The decline may continue as values fall further, adding strains to cash- strapped localities that already fired workers, halted projects and cut spending because of the recession that began in 2007. Only 15 percent of counties raised property taxes to make up for the lost revenue, according to a survey by the National Association of Counties.

Local officials are now facing the consequences. The strain may mean credit-rating cuts this year for local- government debt, which trades in the $2.93 trillion municipal bond market, Moody’s Investors Service said in a report this month.

Residential real estate prices in 20 U.S. cities dropped by the most in more than a year in January. The S&P/Case-Shiller index of property values fell 3.1 percent from January 2010, the biggest year-on-year decrease since December 2009. That’s prompting homeowners to seek reductions in the assessed value of their properties.

One of the symptoms of the depressed real estate market has been a proliferation of successful tax appeals. They’ve come after a municipality has already assessed a property, collected taxes and made payments to local school boards and county governments.

Municipalities have been anticipating the revenue slide and cutting costs to compensate. They are looking further at a whole series of significant cuts to balance their budgets. They may be forced to stop providing additional books and periodicals in the libraries, abolish community pre-kindergarten and lay off municipal workers along the way. So far 377,000 jobs, or 2.7 percent of payrolls, have been eliminated since employment peaked in September 2008, according to the U.S. Labor Department.

Cities are by no means out of the woods yet either. They have got another year or two of dealing with either declining revenues or pretty slow growth. In Florida, after four years of falling property values, cities are even cutting into core services like police.

Editor's Note: The decline for local governments contrasts with a recovery for U.S. states led by income and sales taxes. Their collections in the fourth quarter climbed by $13 billion to $177.8 billion, the biggest jump since 2006, according to the census data released yesterday.

First-time homebuyers getting shut out

2011-03-27T16:23:00.000-04:00

Many first-time homebuyers are sitting on the sidelines of the U.S. housing market, hampering its ability to gain traction.

Last month, 34 percent of existing-home purchases were made by first-time buyers, according to the National Association of Realtors. In January, they were 29 percent of the market, the lowest since NAR surveys started tracking them monthly in late 2008.

In healthy markets, first-time buyers make up 40 percent to 45 percent of all purchasers. They play a critical role in buying starter homes so those owners can buy more expensive homes.

Despite low mortgage rates and falling prices in many markets, existing-home sales have been weak for months and were down 2.8 percent in February from a year ago.

What’s keeping more first-timers at bay:

Federal credits boosted home sales in 2009 and 2010 and lured some first-time buyers into the market sooner than normal. Last March, 48 percent of buyers were first-timers. The credits expired in April last year.

Tighter lending standards since the housing bust are edging out first-timers who can’t meet credit or employment history requirements in a still-weak economy.

Higher credit standards are reflected in loans bought by government-backed mortgage giants Freddie Mac and Fannie Mae. Last year, loans in Freddie Mac’s portfolio had an average credit score of 758, it says. That was up from 720 five years ago.

Many lenders are also requiring higher downpayments. The best terms kick in with 20 percent or more down. Higher down payments are driving more buyers to Federal Housing Administration loans. The FHA requires as little as 3.5 percent down for borrowers with good credit scores. In fiscal year 2010, FHA loans were 19 percent of the home purchase market vs. 14 percent a decade before.

Competition. In February, cash buyers accounted for a record 33 percent of existing-home sales, NAR says. In some areas, including Southern Nevada, cash buyers now account for more than half of existing-home sales. Sellers often prefer cash offers, over offers from first-time buyers involving loans, because they’re more likely to close.

18% of Florida Homes Are Vacant

2011-03-25T11:31:00.000-04:00

The Census Bureau recently revealed that 18% -- or 1.6 million -- of the Sunshine State's homes are sitting vacant. That's a rise of more than 63% over the past 10 years.

The vacancy problem is more dire in Florida than in any other bubble market: In California, only 8% of units were vacant, while Nevada, the state with the nation's highest foreclosure rate, had about 14% sitting empty. Arizona had a vacancy rate of about 16%.

In Florida, the worst-hit county is Collier -- home of Naples -- with a whopping 32% of homes empty. In Sarasota County, 23% of the housing stock sits vacant, while Lee County (Cape Coral) has a 30% vacancy rate. And Miami-Dade County has a vacancy rate of about 12%.

The state's rate of population growth slowed in the second half of the last decade to just 5.7%. Still, the 2000s saw the state population grow overall by nearly 18%, the Census Bureau reported.

It could take about eight years just to put the vacancy numbers back into the single digits.

Florida court system facing $72.3 million deficit

2011-03-23T14:22:00.001-04:00

Florida's court system has frozen hiring and is bracing for possible staff furloughs due to a $72.3 million deficit blamed on a shortfall in filing fees after mortgage foreclosure cases dramatically declined.

In 2009 the Florida Legislature increased fees and funneled them into a trust fund to pay for most of the court system's expenses. The trust fund was expected to cover $370 million of the $462 million court system budget.

Most of the fees -- $293.7 million -- were expected to come from foreclosure filings, but they've dropped well below that estimate due to self-imposed moratoriums by many lenders over such issues as lost paperwork and erroneous filings.

Florida foreclosure mediation programs (a sampling)

2011-03-20T19:29:00.001-04:00

In December 2009 the Florida Supreme Court issued an administrative order directing all circuits to develop foreclosure mediation programs. The Supreme Court’s order requires courts to allow homeowners to participate automatically in these programs. There are twenty circuit courts in Florida, and each one may select an entity of its choice to administer its mediation program. Circuit courts throughout the state implemented mandatory mediation programs during 2010.

The Collins Center, a state non profit organization, is the mediation manager for six Florida circuits. The data below is from the Eleventh Judicial Circuit, comprising Miami-Dade County. The Eleventh Circuit has by far the highest volume of foreclosures of any circuit in Florida. All foreclosure cases filed in the Eleventh Circuit are automatically eligible for mediation and referred to Collins Center for mediation. Collins Center attempts to contact all homeowners and refer them to housing counselors to prepare for a mediation session.

The Clerk of the Court reports that there were 34,400 foreclosure filings in Miami-Dade Country during 2010.

The following Collins Center data reported for Miami-Dade County only, is for the six months from June 2010 through December 2010:

13,265 cases received (cases referred to mediation upon filing)

6681 unable to contact homeowner

6044 homeowner successfully contacted

2178 mediations conducted (16.4 % of cases received)

Of the 2178 mediations conducted:

1392 reached impasse - foreclosure allowed to proceed

745 homeowner reached written agreement (could be modification or vacate)

219 settled before mediation session

Housing Market Indicators

2011-03-16T14:34:00.000-04:00

*** Florida Housing Market Indicators

Florida consumer confidence: 77

Florida existing home median price: $122,200

Florida existing condo median price: $79,400

Florida existing home sales: +14% (month-to-previous-year comparison)

Florida existing condo sales: +36% (month-to-previous-year comparison)

*** National Housing Market Indicators

National existing home median price $158,800

National existing home sales: +2.7% (month-to-previous-month comparison; all housing types)

National (Freddie Mac) mortgage rate 4.87% (all housing types)

GOP back Banks over Homeowners

2011-03-12T09:18:00.000-05:00

Leading House Republicans challenged a deal Wednesday that federal and state officials have offered to five big U.S. banks that would change the handling of foreclosures and force lenders to modify more mortgages.

Federal regulators and attorneys general of the 50 states offered the terms to the large banks last week, following extended talks over revelations that the lenders had cut corners and used flawed documents to foreclose on many home borrowers.

Asked about the GOP letter, Treasury, in a statement, said: “The mortgage servicing system we have today is broken, and we should work together to establish a stronger set of standards.”

Under the proposal, which would not need Congress’ approval, lenders could be required to write down the value of their loans to borrowers who owe more than their homes are now worth. They reportedly would be forbidden from starting foreclosure proceedings while a homeowner is trying to modify their mortgage terms, and there would be an independent review if they denied a mortgage modification.

The banks are Bank of America, Citigroup, JPMorgan Chase, Wells Fargo and GMAC, which together have about 6 in 10 U.S. home mortgages.

Soaked <$751 Billion> Nationwide

2011-03-09T06:36:00.000-05:00

The number of American homeowners underwater (those who owe more on their mortgages than their homes are worth) increased at the end of last year.

About 11.1 million households, or 23.1 percent of all mortgaged homes, were in a negative equity position in the October-December 2010 quarter. Another 2.4 million are nearing that point now, due to high levels of foreclosure and unemployment.

While the picture isn't very pretty for homeowners here in Florida, it's not nearly as ugly as it is in Nevada where roughly two-thirds were underwater in that last quarter, the worst in the country.

Top Florida foreclosure lawyer shutting down firm amid probe

2011-03-07T17:32:00.000-05:00

A law firm that once led Florida in foreclosures is shutting down amid an investigation into "robo-signing" and other questionable practices.

A Securities and Exchange Commission filing Monday indicated that David Stern's Plantation-based practice will end operations March 31. The firm once had more than 1,200 employees and handled tens of thousands of foreclosures each year.

Stern's firm is one of several under investigation by Florida's attorney general. The probe focuses on whether false or improper affidavits were filed in foreclosures and whether employees were robo-signers who signed documents without reading them.

A broader national probe is examining how foreclosures were handled during the economic downturn.

Could the 30 year mortgage go away with Fannie & Freddie?

2011-03-03T14:12:00.000-05:00

Congress has continually subsidized middle-class mortgages. Fannie and Freddie guarantee that investors will be repaid even if borrowers default -- a promise ultimately backed by taxpayers. Fannie, Freddie and other federal programs now support roughly 90 percent of new mortgage loans because lenders cannot raise money for mortgages that do not carry government guarantees.

If Freddie Mac and Fannie Mae were closed, the rare goal shared by the Obama administration and House Republicans, homeownership in America could change greatly. The 30-year fixed-rate mortgage loan, the steady favorite of American borrowers since the 1950s, but not available in most other countries, could become a luxury product. Interest rates would rise for most borrowers, but urban and rural residents could see sharper increases than customers in the suburbs. Lenders could charge fees for popular features now taken for granted, like the ability to "lock in" an interest rate weeks or months before taking out a loan.

It won't happen soon. Congress must agree on a plan, which could take years, and then the market must be weaned slowly from dependence on the companies and the financial backing they provide.

Little light shining thru, but not out of the woods yet.

2011-02-28T11:24:00.000-05:00

Economists are forecasting faster growth, (3.3 percent this year) according to a quarterly survey from the National Association for Business Economics. For 2012, the panel expects the economy to grow 3.4 percent. Editor's note: It may have reached 3.7 percent if not for rising oil prices.

Personal incomes received a 2 percentage point reduction from the Social Security tax cut, giving consumers the biggest jump in their incomes in nearly two years. Personal savings also rose in January, with households saving 5.8 percent of their after-tax incomes.

Unemployment will stay high though, with the rate averaging 9.3 percent in the first quarter of this year and inching slightly lower to 9 percent in the fourth. By the last quarter of 2012, the joblessness rate will still be high -- 8.2 percent.

The outlook for consumer spending has improved, and is expected to grow 3.2 percent this year. In 2012, spending is expected to rise by 2.9 percent, which is the same as the annual growth rate over the past 20 years. Economists closely watch consumer spending because it accounts for 70 percent of economic activity. Business spending is a bright spot in 2011 and 2012, with double-digit percentage growth in spending on equipment and software.

BP will pay for Florida Agent's Losses & Extension

2011-02-27T18:31:00.000-05:00

After months of negotiations between Florida Realtors and representatives from the Gulf Coast Claims Facility (GCCF), oil spill czar Ken Feinberg has reversed his decision to not pay real estate licensees for losses related to residential transactions as a result of the Gulf of Mexico oil spill.

Last August, Feinberg took over the oil spill compensation process from BP. He decided early on that the GCCF would only cover losses for lost rental income, not for losses incurred because buyers didn’t go to contract on a home or cancelled a sales contract.

For these individuals, Florida Realtors and other gulf coast state Realtor associations convinced Feinberg to set up a special fund for real estate industry claims. But the deadline for filing claims against the real estate industry fund was Nov. 23, 2010.

With the new decision, licensees have another opportunity to file claims for damages due to the oil spill. Here are the options:

• Interim Claim. This claim may be filed at the end of each quarter from April 2010 until the GCCF claims process ends in August 2013. Claims reviewers will consider documented losses due to the oil spill back to April 2010. There is no cap on documented loss of income on previous earnings, and claimants to do not have to sign a Release of Claims against BP.

• Quick Final Payment Claim. This claim pays $5,000 per individual and $25,000 per business. You must sign a document releasing BP and all others from future claims relating to the oil spill.

NOTE: In order to receive a Quick Final Payment, a claimant must have received a prior payment from BP, GCCF or the Real Estate Fund. There is no emergency payment requirement for an interim or a full final payment.

• Full Final Payment Claim. This is a negotiated final settlement between you and the GCCF based on a specific formula, and requires that you sign a document releasing BP and all others from future claims relating to the oil spill.

A Few Recent Housing Stats and Trends

2011-02-23T10:30:00.000-05:00

$113 billion worth of home equity in the USA has evaporated since the housing market peaked in 2006.

Home prices are down almost 55% on average from the real estate market peak.

An amazing 43% of homeowners in Miami-Dade and Broward Counties of Florida have negative home equity.

25% of the country’s foreclosed homes are located in Florida

Nearly 1 in 5 homes are in foreclosure or are delinquent on their mortgage payments

Of all the foreclosures in Florida, 25% are strategic defaults (an economic decision by the owner). The Mortgage Banker’s Association says there are 50 times more walk-aways then there were five years prior.

It takes a lender nearly 25 months on average to go from initiating foreclosure to actually seizing a home.

Lenders in Florida can pursue defaulters for deficiency judgements for the difference in the value of the mortgage and the value of a foreclosure sale for up to five years after the default.

Short sales accounted for 20% of existing home sales in South Florida in 2010. Almost half of all home sales were at a loss.

Mortgage rates are expected to increase in 2011

Home prices are expected to bottom out this year, and, by 2012, the house-price metric shows a gradual increase

Home construction is expected to increase 21 percent from last year

The vacation rental market is expected to grow 13.1% in 2011

Home sales in 2010 were up 14 percent in Hilton Head Island, SC, 40 percent in Palm Beach, FL, and 300 percent on Mercer Island, WA.

Eight out of 10 owners of vacation homes who rent them expect their rental business will be the same or stronger in 2011 than last year.

Florida Hardest Hit Fund for Keys Homeowners

2011-02-18T12:28:00.000-05:00

A $7.6 billion federal effort to help unemployed homeowners avoid foreclosure will soon be running in all 18 states sharing the funds.

The Hardest Hit Fund, announced by President Obama a year ago and expanded to more states since then, largely targets lower-income jobless or underemployed homeowners. Those eligible receive forgivable loans for mortgage payments, or they may tap other programs, such as one to help them get current on mortgage payments. Generally, the loans are forgiven after five years if borrowers stay in the homes and keep current on payments.

The government targets areas hit hard by unemployment or fallen home prices. States’ programs have different rules and benefits.

In Florida, the most a homeowner will get is $35,000.

An eligible Florida homeowner:

•Must be a Florida resident;

•Must occupy property as primary residence (the property cannot be vacant, abandoned or rented);

•Must have suffered an approved hardship that makes the first mortgage unaffordable;

•Must have documented total income at or below 140% of the area median income (AMI), adjusted for household size (in Lee County, the total income for a household of four cannot be more than $86,240);

•May not have unencumbered assets of $5,000, or three times the current monthly mortgage payment (whichever is greater);

•Cannot have a bankruptcy that has not been discharged or dismissed; and

•Cannot have been convicted of a mortgage-related felony in the last 10 years.

The current mortgage:

•Must be serviced by a participating lender, who agrees to accept payments on behalf of the homeowner;

•Must not be more than 180 days past due at the time of application;

•Must have been originated on or before January 1, 2009; and

•Must have an existing principal balance of less than $400,000.

The Florida Hardest Hit Fund currently operates only in Lee County under a pilot program in preparation for a statewide rollout expected in March.

More information can be found by going to Florida's Official hardest hit website

Fannie n Freddie going away?

2011-02-16T12:02:00.000-05:00

The Obama administration laid out three broad options Friday for reducing the government's role in the mortgage market. (The government currently owns or guarantees more than 90 percent of new mortgages). All three of the options would almost certainly lead to higher interest rates and costs for borrowers.

The administration said the government should withdraw its support for the mortgage market slowly, over five years or more, winding down the troubled mortgage giants Fannie Mae and Freddie Mac.

But rather than making a single recommendation, the administration offered Congress three scenarios and will let lawmakers shape the final policy.

The options are:

-- No government role, except for existing agencies like the Federal Housing Administration.

-- A government guarantee of private mortgages triggered only when the market is in trouble.

-- Government insurance for a targeted range of mortgage investments that already are guaranteed by private insurers. The government guarantee would kick in only if those private companies couldn't pay.

The private sector will assume a greater role in housing finance under all of the options.

The bailouts of Fannie and Freddie have so far cost taxpayers nearly $150 billion.

A near-complete withdrawal by the government probably would end the popular 30-year fixed rate mortgage or, at least, make it more expensive. Banks would prefer adjustable-rate mortgages that would fluctuate with the markets.

Administration officials said the proposals will end the hybrid model of public-private companies that left the public on the hook for billions when Fannie and Freddie failed.

Issued jointly by the Treasury Department and the Department of Housing and Urban Development, the plan suggests several short-term measures that would effectively increase the cost of taking out a government-backed mortgage. Other financing options would become more competitive, drawing private dollars back into the market.

These include reducing the maximum size of mortgages purchased by Fannie and Freddie by more than $100,000, to $625,000, by October. The companies would require 10-percent downpayments for all loans. And the fee for the government guarantee would increase.

Another schizophrenic and disappointing jobs report - Important!

2011-02-10T08:30:00.000-05:00

Despite improving profits, rising demand and generally positive flow of economic data, companies did not meaningfully increase their hiring in January. Only 36,000 payroll jobs were added in the month, much lower than expected.

On the other hand, the unemployment rate dropped, from 9.4 percent in December 2010 to 9.0 percent in January 2011, marking a decline of 0.8 percent in just two months.

How could the unemployment rate drop so much when the number of payroll jobs barely budged? The Bureau of Labor Statistics compiles the two numbers – jobs added and the unemployment rate – from two different surveys. The payroll figure comes from the establishment survey – the government asks companies how many people are on their payrolls. The unemployment rate is taken from the household survey – the government asks people about their work status.

The unemployment rate is calculated by dividing the number of people who say they are unemployed into the number of people who say they are in the labor force. The rate can fall when people leave the workforce or quit looking for jobs. And it can fall when fewer people report they are unemployed. When both happen in the same month, that can cause the unemployment rate to drop rapidly. In the past two months, that’s precisely what happened. Since November, the size of the labor force has fallen by 764,000 while the number of unemployed has fallen by 1.178 million. Meanwhile, the number of people who report they are working has risen by 414,000.

36,000 jobs. Is that your final answer? Fortunately, no. Each month, the payroll jobs numbers originally reported in the prior two months are revised. And in January, as has been the trend, data reported in previous months was revised upwards.

In other words, BLS discovered a bunch of new jobs. November’s figure, first reported in December as a 39,000 job gain, was revised in January to a 71,000 job gain, and was revised upward once again – to a gain of 93,000 jobs. The results for December, first reported as a gain of 103,000 jobs, have been revised upwards to 121,000.

Isn’t the government creating lots of jobs? No. The jobs recovery, such as it is, has been largely a private sector affair. Deficits may be on the rise, but government employment – especially at the city and state level – is falling. In January, once again, the private sector added jobs while the government slashed them. Manufacturing added 49,000 jobs in the month. But government jobs declined by 14,000, and have fallen by 335,000 since last May.

Does the headline rate paint the best picture of the labor market situation? Not really. The reality is that there is an enormous amount of slack in the U.S. labor market. That’s why inflation remains contained, despite the rise in commodity prices. As BLS reports, “in the past 12 months, average hourly earnings have increased by 1.9 percent.”

Workers have been unable to demand higher wages in part because so many other workers are sitting on the sidelines. Aside from the headline number, people should look at the BLS’s “alternative measures of labor force underutilization,” which can be seen here.

Aside from those who say they are out of work, BLS aims to estimate:

-- The number of people who are working part-time but would prefer to be working full-time.

-- The number of people who are “marginally attached to the labor force” (i.e. people who are sitting on the sidelines and not really working).

-- “Discouraged workers” (people who have essentially given up because they view their prospects as too dim.

The BLS calls this tally the U-6 measure, better known as the "real unemployment rate". You can also think of it as a truer picture of the sum total of worker frustration.

In January, the U-6 stood at 16.0 percent. That’s down from 17 percent last fall, and marks the lowest such figure since April 2009. But it still highlights the fact that one in six workers isn’t employed to the degree he or she wants to be.

In short, the January employment report shows a snapshot of a labor market that is improving, but at a painfully slow rate.

The American dream drops to a 12-year low

2011-02-07T08:19:00.000-05:00

Click image to enlarge

More seeking mortgage modifications

2011-02-03T00:40:00.000-05:00

Americans made loan modifications to 1.76 million mortgages last year, with about two-thirds of the modifications performed through private mortgage servicers, and one-third of them through the federal government’s Home Affordable Modification Program (HAMP).

The data, released on Wednesday by the private coalition of mortgage lenders HOPE NOW, also showed that mortgage modifications jumped more than 40 percent from 2009 to 2010. There were 1.24 million loan modifications in 2009.

Global survey: U.S. homes are most affordable

2011-01-28T19:02:00.000-05:00

United States real estate offers a lot of bang for your buck, according to a new survey that shows U.S. homes are the cheapest relative to incomes among English-speaking nations.

Australian homes – which have a median price of $454,000 – were found to be the most unaffordable among English-speaking nations, according to the report by consulting firm Demographia, which examined affordability in the third quarter of 2010. The median home in Australia costs 6.1 times the gross annual median household income. What’s more, 85 percent of the homes in Australia’s major cities were more than 5.1 times average income, according to the survey.

On the other hand, U.S. homes have a median home price of $168,000 and homes cost only three times yearly income or less.

The priciest city for real estate, in general: Hong Kong, with homes costing 11.4 times income. (The report considers any markets where home prices are 5.1 times household income or more very unaffordable.) Prices in Hong Kong have increased by more than 50 percent in the past two years due to low interest rates, an expanding economy and buyers flooding in from China.

The United States boasted the most affordable major markets. Atlanta was the most affordable big city, in which the median home price is $129,000.

Meanwhile, the most unaffordable markets in the U.S. were mostly found in California: San Francisco (homes cost 7.2 times income), San Jose (6.7 times), San Diego (6.2 times), New York (6.1 times), and Los Angeles (5.9 times).

Nation's cold snap may heat up Florida's real estate market

2011-01-23T01:03:00.000-05:00

Finding an escape from the snow last week was tough. Nearly 70 percent of the contiguous United States was covered in the white stuff. The National Weather Service said that every state except Florida reported snow on the ground — even Hawaii.

The Lower Keys of Florida, was the farthest away from snow that you could get without leaving the US. The warm climate, the ocean and the lack of an income tax, appeal to home buyers.

Key West, the southernmost point, is also rich in culture. It's an old historic city with a live and let live, non-judgemental attitude. It is more cosmopolitan than the rest of the Keys, with lots of theaters and galleries. At the center of its famous Old Town is lively and colorful Duval Street, lined with bars, evening strollers and nightlife. Key West has areas — including New Town, Midtown and Casa Marina — where homeowners can walk to shops and restaurants, but Old Town is the most desirable. It is charming. In Old Town, you can get something tiny: a one bedroom, one bath from $300,000. But it is $500,000 minimum for something decent. And the high-end starts at $3 million. In Old Town, you cannot tear down, just renovate, and there are old Victorians and what they call conch houses. It's a small - 2 by 4 mile - competitive island market, where a bargain can be very hard to find even with the help of an agent who is tapped into the local coconut telegraph.

2011 Bleakest year in foreclosures? Time to Buy?

2011-01-13T15:42:00.000-05:00

Banks took back 1 million homes in 2010 and are poised to take back more homes this year than any other since the U.S. housing meltdown began in 2006. About 5 million borrowers are at least two months behind on their mortgages and more will miss payments as they struggle with job losses and loans worth more than their home's value, industry analysts forecast.

"2011 is going to be the peak," says foreclosure tracker RealtyTrac Inc.

One in 45 U.S. households received a foreclosure filing last year, or a record high of 2.9 million homes. That's up 1.67 percent from 2009.

The pace slowed in the final two months of 2010 as banks reviewed their foreclosure processes after allegations surfaced in September that evictions were handled improperly. Under increased scrutiny by the government, lenders temporarily halted taking actions against borrowers severely behind on their payments. However, most banks have since resumed their eviction processes, and the first quarter will likely show a rebound in foreclosure activity.

Foreclosures are expected to remain elevated through the year as homeowners contend with stubbornly high unemployment, tougher credit standards for refinancing and falling home values. Sharga said he expects prices to dip another 5 percent nationally before finally bottoming out. The decline will push more borrowers underwater on their mortgages. Already, about one in five homeowners with a mortgage owe more than their home is worth.

2010 worst for home sales in more than a decade

2010-12-29T09:50:00.000-05:00

Home prices are dropping in the nation's largest cities and are expected to keep falling next year, as fewer people purchase homes and millions of foreclosures come on to the market.

The Case-Shiller 20-city home price index released Tuesday fell 1.3 percent in October from September. All cities recorded monthly price declines. The last time that happened was in Feb. 2009.

Atlanta recorded the largest decline. Prices there fell 2.9 percent from a month earlier. Home prices in Washington dropped 0.2 percent in October, the second monthly decline after five straight increases. Home prices in Dallas, Portland, Ore., Charlotte, N.C., Tampa, Fla. and Denver have fallen for four straight months.

The 20-city index has risen 4.4 percent from their April 2009 bottom. But it remains 29.6 percent below its July 2006 peak.

Foreclosures likely will remain high for the next two years.

IMPORTANT!!! Today's vote will define the Internet

2010-12-21T09:13:00.001-05:00

Imagine if Comcast customers couldn't watch Netflix, but were limited only to Comcast's video-on-demand service. Imagine if a cable news network could get its website to load faster on your computer than your favourite local political blog. Imagine if big corporations with their own agenda could decide who wins or loses online. "The internet as we know it would cease to exist.

The US Federal Communications Commission (FCC) is today expected to formally approve controversial new rules on how internet users access content such as YouTube and Skype.

Dubbed by one US senator as "the most important free speech issue of our time", the rules drawn up by the country's media and telecoms regulator would effectively create two levels of internet access.

FCC members Michael Copps and Mignon Clyburn last night said they would support the proposal laid out by chairman Julius Genachowski. The five-member FCC panel is expected to approve the proposal in Washington later today.

However, the new framework would allow mobile internet service providers to charge content companies for more efficient delivery to US homes. Wireless providers will also be allowed to block applications or services, providing that they are not competitors. Fixed-line and wireless provider Verizon, for example, would not be allowed to block access to Skype because it provides a rival voice service.

The new rules allow providers to charge customers more for using high-bandwidth services such as downloading or streaming videos on YouTube or online movie rental site Netflix.

Today's vote represents the first time the principle of net neutrality – where all internet content is treated equally – has been formally ratified in the US. It is the culmination of five years of heated discussion over the future of the internet.

Public interest groups and technology companies called the framework "fake net neutrality" and said the rules "create a vague and shifting landscape, open to interpretation", rather than enshrining principles of the open internet. Netflix, Skype and Amazon have also previously expressed reservations about the plans.

Who rules the web? Important

2010-12-16T01:31:00.000-05:00

High Credit Card Rates & Fees * Thanks to the Supreme Court

2010-12-01T14:49:00.000-05:00

Have you ever wondered why all your credit card bills seem to get mailed to South Dakota, Nevada or Delaware? Or how credit card companies can ignore your state's usury law, which limits the amount of interest that can be charged on a loan?

The answer lies in a couple of Supreme Court Rulings. A 1978 Supreme Court ruling, Marquette National Bank of Minneapolis vs. First of Omaha Service Corp. and the other Smiley vs. Citibank.

The first ruling let credit card issuers "export" nationally whatever interest rate was allowed in the state in which they were headquartered. To induce the companies to relocate, some states simply dropped their usury laws. Several large issuers bit on the deal, relocated and it became anything goes for credit card rates.

A couple of states deciding their economic development plan was going to be to attract the credit card export industry,deregulated their consumer credit marketplace and said, 'If you come plop your little headquarters in Delaware or South Dakota, you can export our interest rate cap -- look at us, we don't have any!' Other states said, 'They're getting banks to headquarter there; we should take our interest rate caps off as well to compete for credit card issuance.' It became a tool to deregulate credit card rates."

South Dakota was the first to offer what amounted to unlimited interest rates to lure card issuers into relocating their headquarters. A quick look at the membership of the state's Chamber of Commerce shows how big of an impact the offer made -- and continues to make -- on the state's employment base.

It's no coincidence that South Dakota is the home state for subprime card issuer First Premier Bank, which gained notoriety for offering a card with an interest rate of 79.9 percent.

In the other case mentioned, Smiley vs. Citibank, a California woman, Barbara Smiley, had filed a class action lawsuit against Citibank's South Dakota-based credit card division, claiming that the $15 late fee she was charged on her credit card bill violated California state law. Citibank responded that the late fee was, in effect, interest and was covered under the National Bank Act. The Supreme Court agreed; the result was an increase of late fees and other fees from $10 or $15 to the $39 fee that credit card customers may see today.

The pair of decisions caused terrific abuses in the credit card market, and probably stunted the growth of an honest credit card market for over 20 years. They also killed off State Usury Laws for Credit Card Rates, increased late fees and other fees and encouraged predatory lending. The result, were the kinds of tricks and traps based on legal gimmickry that led to the need for some protection for Consumers. That's why we now have the Credit CARD Act of 2009 and the Wall Street reform law that included a Consumer Financial Protection Bureau.

Don't expect those Acts to protect us from being charged rediculously high rates though, to take it that far would come across as anti-capitalism, socialistic or even downright unamerican.

Republicans may trade Unemployment Benefits for extension on Tax Cuts

2010-11-30T01:12:00.000-05:00

Unemployment benefits extensions are set to expire on Tuesday, Nov. 30. At the moment, there doesn't seem to be many on Capitol Hill overly concerned that another two million people, many of whom seem the extensions as their only financial lifeline in a flat economy, will soon see their unemployment benefits disappear. According to OpenCongress.org, there is nothing about unemployment benefits scheduled for introduction or debate in Congress on the last two days of November.

The lame duck House of Representatives is in session. For Republicans, that means that anything they oppose can be delayed, voted against, tabled, shelved, or sent on to the Senate to be filibustered. The lame-duck Congress is not only in session, it is in season -- and Republicans are loaded and prepared to kill off as much of the Democratic legislation as they can push through in the next few weeks before the Republican-heavy 112th Congress convenes.

Part of that lame-uck legislation is emergency unemployment benefits and the Tier unemployment extensions. Republicans already knocked down a proposal to extend unemployment benefits through February 2011. They argued that the Democratic proposal did not pay for the extensions and would therefore increase the deficit and the national debt. Instead of compromise or finding the means to pay for the unemployment benefits extensions, Democrats simply fell back on the argument that the unemployment extensions were necessary for a sluggish economy and that there had never been an instance where the unemployment rate was above 7 percent and the U. S. Congress had denied unemployed Americans emergency benefits.

In short: the Republicans are crying fiscal and future expenditure responsibility (something their record indicates they know little about) to deny benefits while the Democrats cry economic and humanitarian necessity (while ignoring fiscal responsibility and therefore playing into Republicans' hand).

But as the last unemployment benefits extension package reaches expiration, there are rumblings of a deal in which Republicans, who are exceptionally interested in continuing the Bush tax cuts to all Americans (including the 2-3 percent of the income earners that are among the wealthiest in the nation), might be open to a compromise with Democrats, who only want to extend the Bush tax cuts for those making less than $250,000 per year. Some believe that Republicans might find leeway in their opposition to the unpaid-for unemployment benefits extensions if the Democrats allow the passage of continuation legislation for the Bush tax cuts, which will expire at the end of the year. This deal would include President Obama's signature of approval.

In order for millions that might see homelessness, financial ruin, and/or another financial lifeline extinguished in the next few weeks (or months, if benefits remain unextended through January and so on), Congress will be working on a December deal where the richest and those able to afford the cessation of the Bush tax cuts, not to mention adding nearly a trillion dollars to the national deficit over the next decade.

Sounds like a deal being negotiated by people who have the time and money to do so. While millions are watching their unemployment benefits (which average -- with an emphasis on average -- around $300 per week) expire in an economy that is producing only one job (and usually one that underpays the unemployed prospective job seeker) for every individual looking for work, a group of legislators that count amongst themselves 261 millionaires (according to OpenSecrets.org) will try to reach a compromise on legislation that will extend benefits to the jobless and extend tax cuts to the nation's wealthiest.

Having plenty of money and receiving a paycheck that exceeds $3,346 per week (which is the current regular salary of each member of Congress -- $174,000 per year) apparently dulls one's senses to the urgency of those struggling to simply maintain their household and find meaningful employment. As the Bush tax cuts expiration date nears, it will be interesting to note how quickly Republicans and Democrats come together to get something passed in the lame duck Congress. Because there is little doubt that the Bush tax cuts -- all of them -- will now be extended in order for both parties to get what they want. It is now just a matter of negotiating the terms of compromise.

And how lame the Democrats really are will be seen in the number of months of unemployment benefits extension they command in order to give the Republicans (and the wealthy) their precious tax cuts. Given the economic expectations of the coming year (unemployment to remain relatively level with its current rate) and the damage to the national debt the Bush tax cuts will incur in the next decade, anything less than a year of unemployment benefits extensions would be lame indeed.

New Unemployment Claims Drop

2010-11-24T11:33:00.000-05:00

New U.S. claims for unemployment benefits last week dropped to their lowest level in more than two years while consumer spending rose in October, pointing to a moderate strengthening in economic activity.

Initial claims for state unemployment benefits fell 34,000 to a seasonally adjusted 407,000, the Labor Department said on Wednesday, the lowest since mid-July 2008. That was well below economists' expectations for a fall to 435,000.

The news was tempered by a surprise drop in new home sales last month, a reminder that growth would remain sluggish.

Small investors permanently soured on stocks?

2010-11-23T10:42:00.001-05:00

In 2008, $234 billion flowed out of equity mutual funds; the selling really intensified in the fourth quarter. In 2009, some thought the worst was over, but $9 billion still flowed out of equity funds. In 2010, the outflows picked up again.

As of the end of August, about $19 billion had left stock mutual funds.

So, what to make of this? Reuters suggests that the break between retail investors and the stock market is deep and lasting. The worry now is that a Lost Decade will create a Lost Generation of investors who avoid the market in a way not seen since the Great Depression.

Martha's News

Million-Dollar + Foreclosures

We're feeling a little better

Florida gets the most attention

Developer / City still haggling over senior housing project

Interest Rate Snapshot

Obama "No more red tape. No more runaround from the banks"

Florida Housing Market Indicators

Proposed settlement with Banks little help for homeowners

Woo-Hoo! Low Interest Rates to 2014

Florida housing sales stats positive

The stats are in and we Have a Winner!

Foreclosure Heat Map for December by Realty Trac

Highest December Foreclosure Numbers by State

BofA offers up to $20,000 to shortsellers

Foreclosure review program

Banks bait-n-switch

Banks push to expedite Florida foreclosures

Housing Market Indicators

Occupy Movement Meetups Everywhere

Another mortgage hurdle? Sheesh!

An (Intense) Analysis of the Obama Jobs Plan

Bipolar housing market

Pickup in Foreclosure Activity

Zillow: Key West Home Prices

Key West Zillow Home Value Index

New Foreclosure Wave

Better Strategy For the Economy

FHFA filed lawsuits today against Bank of America & 16 more

What's the down payment on $30 Billion?

Just the Facts

"Buy when there's blood in the streets"

Interest rate lowest in 40 years

Investors Buying Now

Home sales on pace to be the worst in 14 years

The Housing Slump Gonna End?

S&P downgrades US credit rating

Stocks drop but hiring better than expected

Agreement reached to raise the debt ceiling

Jobless Claims Dropped Last Week

Lets go all in, if we can get in

Obama helps a few more out-of-work homeowners

The Great Recession lingers on Main Street

Emergency Homeowners Loan Program

Banks finally getting the picture?

and now something completely different

Home Prices Over The Past Year

What was that?

Freddie & Fannie Summer Clearance Sale

Notorious Hacker's Den discovered in Wickford, Essex UK

Good Strategic Default Video from CBS

Gov gives Banks 30 more days to submit plans to fix foreclosure practises

Foreclosure Limbo

Florida couple threatens bank with foreclosure

Record Low Equity

Standard & Poors signals double dip in housing

U.S. home purchases by foreigners surge $16 billion

Opportunity calling! Buy Foreclosures Now!

RENTS UP!

Mortgage Rate Trend Index

Weak Housing Market Still

Finding buyers for high-end homes is about to become a tad harder

Zillow says Key West Home Prices / Values UP?

Banks propose billions to close foreclosure probe

Housing Market Indicators

New Uniform Foreclosure Guidelines

Investors buying as home prices are falling

New Florida Short Sale Bill

Miami-Dade Jobs Picture Worse than Detroit?

Mortgage Lenders Told to Reimburse Homeowners

Good News (No, Really)

****** "Buy when there's blood in the Streets" ****** Baron Rothschild

New Trend Towards Smaller Homes

Key West Fan Christian Slater has a New Series

Real Estate Crash catching up to U.S. Municipalities

First-time homebuyers getting shut out

18% of Florida Homes Are Vacant

Florida court system facing $72.3 million deficit

Florida foreclosure mediation programs (a sampling)

Housing Market Indicators

"Buy when there's blood in the Streets" Baron Rothschild