Tuesday, June 29, 2010

Housing Industry Poised to Recover in 2010

Written by: David Lereah Thu, December 17, 2009
Market Activity, Market Commentary

As we approach the New Year, we are more hopeful about prospects for 2010 compared to the dismal performance of 2009. This past year was a year of crises. The economy was on the brink of Depression, shedding 8 million jobs during the past two years, while the unemployment rate climbed sharply to 10 percent (as of this writing) from 4.9 percent. The U.S. credit markets and banking system virtually collapsed, foreclosures became rampant and the housing sector crashed with home values plummeting 10 to 15 percent in most metropolitan areas across the nation.
Government bailouts were commonplace, with taxpayer dollars replenishing the coffers of Wall Street companies, large financial institutions, insurance companies and even the automobile industry. As 2009 draws to a close, we collectively breath a sigh of relief; acknowledging that the economy and housing markets somehow survived. The convoluted maze of government programs and subsidies, a multi-billion stimulus package and an overly accommodative monetary policy conducted by the Federal Reserve heroically kept the economy from falling into the abyss. For all the criticism directed at government decision making throughout the year, something worked. We are in a much better place today than we were yesterday.
As we enter 2010, the economy is rebounding, the credit markets thawing and the housing sector recovering. Read more...

Thursday, June 24, 2010

Fairfax County supervisors authorize transformation of Tysons Corner

By Kafia A. Hosh and Derek Kravitz
Washington Post Staff Writers

Wednesday, June 23, 2010
Fairfax County officials on Tuesday approved a landmark proposal to allow the transformation of Tysons Corner from a sprawling, auto-dependent office park into vibrant, walkable city. Read more...

Housing sales decrease in May, dashing hopes of quick recovery

By Dina ElBoghdady
Washington Post Staff Writer
Wednesday, June 23, 2010
Sales of previously built homes dropped in May after huge gains the previous two months, a sign that the federal tax credit that helped energize sales at the start of the selling season has sputtered out sooner than expected.
The National Association of Realtors reported Tuesday that sales of existing single-family homes, townhouses, condominiums and cooperatives fell 2.2 percent, to a seasonally adjusted rate of 5.66 million units, in May from April, snapping hopes of a robust housing recovery anytime soon. Analysts surveyed by Bloomberg had expected an increase of 6 percent. Read more...

Monday, June 14, 2010

TOP News: Week of June 14th, 2010

Lenders go after money lost in foreclosures
By Dina ElBoghdady
Washington Post Staff Writer
Wednesday, June 16, 2010

After the bank foreclosed on Fernando Palacios's Gainesville home in March, he thought he was done with what he described as the most stressful financial situation of his life.

The bank sold the home for far less than Palacios owed on it, as often happens with foreclosures. What Palacios did not see coming was the letter from his lender demanding that he pay the shortfall: $148,064.02. "I really thought I was through with this house," said Palacios, who fell behind on payments when the economy soured and his cleaning business stumbled.

MD homeowners gain protection in foreclosure process
By Ovetta Wiggins
Washington Post Staff Writer
Thursday, May 20, 2010; 4:10 PM

Maryland Gov. Martin O'Malley signed legislation Thursday that creates a foreclosure mediation program designed to help beleaguered homeowners stay in their homes.

The bill gives homeowners the legal right to mediation with their lender during foreclosure proceedings.

House Passes FHA Reform Bill Authorizing Higher Premiums
In a near unanimous vote of 406 to 4 Thursday, the U.S. House of Representatives passed a bill intended to replenish the coffers of the federal agency that insures mortgages against default, the Federal Housing Administration (FHA).

The FHA Reform Act (H.R. 5072) enables the agency to reform its current mortgage insurance premium structure by shifting some of the upfront cost to the annual premium – a move that HUD Secretary Shaun Donovan says will increase FHA’s capital reserves and reduce risks to the FHA insurance fund.

Thursday, June 10, 2010

Thursday, June 3, 2010

Up in the Air - Home Values Up, But How Much Owners Can Recoup in Recovery?

Luxury Living Special Section
by Rima Assaker

Saab’s company has been providing real estate and mortgage services since 1987, so he has seen the dips and peaks this industry can weather. “With banks and financial institutes sinking, the condition of the housing market has become volatile,” said Saab. “However, the principle stays the same, and people will continue to invest in real estate.”

Saab, who has personally invested in multiple foreclosure and other properties, pointed out that “real estate investment has always been one of the key profit areas for banks and other financial institutions.”

“Investing in a house has always been considered one of the safest ways to safeguard our money. Owing to this investment fundamental, people continued investing in real estate during the period between the late 1990s and 2005, even though the prices were reaching their all-time highs,” he explained.

“Housing prices will increase with time, and will surpass the heights we saw during the late 1990s through 2005,” Saab predicts. “I don’t foresee that to happen in a blink of an eye, but we will see those prices again in between seven to 10 years.”
Saab points out that investment opportunities abound due to foreclosure properties that have flooded the market. “Foreclosures and short-sales will make up as much as 40 percent of total sales for the next 30 to 36 months,” he said. “The percentage could possibly be greater, depending upon how eager banks will be to put their inventory on the market. Their preferences will be to pace their releases to keep prices from plummeting, but the sheer numbers may make that impossible for some banks.”Saab advises that “even after the supply begins to dwindle, the effect upon home prices will continue for at least another year.”
Capital CushionAs negatively as homebuyers and real estate investors may view the market, the Washington region is still considerably better off than most markets across the country.“We live in the metropolitan area of the nation’s capital,” said Saab. “This is a government, defense, high-tech and business center. Everyone wants to be here because this is where the jobs are.”Evers, who has more than 35 years of real estate experience, agrees. “Companies [and their employees] want to be here, but in addition, it’s a beautiful location and a beautiful city. It’s a plum place to live for so many reasons … it’s like the courtiers wanting to be closer to court — anything to do with the government, the people want to be close.”And government often equals job stability, Saab notes. “There is a ton of money running around Washington, D.C.,” he said. “It’s clearly shown by the fact that people can handle a $3,500 to $4,500 per month mortgage or rent payment. Income is not going to change anytime soon in D.C. or its suburbs.”“The D.C. metro area is also very transient, meaning people come in and out of it frequently, which also raises the demand for buying and selling homes,” adds Long & Foster’s Bacchus. “People come to Washington to get things done, and they will always need to come to and be in Washington to do business and make things happen in the country.”He concludes: “The D.C. area has no idea what it is like to be in a Midwestern or Southern state, or some places in Florida, where there is no semblance of industry and no economic engine to support the economy. We are very lucky.”
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