Real Estate & Mortgage

Short Sale Relief

The House Ways and Means Committee voted to change a rule that forces upside down homeowners to tax on forgiven (usually in the form of short sales)  or foreclosed upon.

The current tax code requires a lender who forgives debt to provide a Form 1099 to the IRS stating the amount the borrower has been forgiven. This disclosure applies whether a short sale, foreclosure, deed in lieu of foreclosure or any similar arrangement relieves the borrower of the obligation to pay some portion of his or her debt. If the property is sold at foreclosure or is sold for less than the amount borrowed, that difference is considered income and is subject to the tax.

Foreclosures:Stocks Tank Bonds Up

Like no one saw this coming?......Stocks took a dive today as foreclosures are causing Sub Prime Lenders to lose their credit financing, and forcing sme to close shop.

Investors, already wrought with fear of a faltering economy, dumped subprime mortgage stocks. ector while problems increased for lenders such as New Century Financial Corp, Accredited Home Lenders Holding Co and General Motors Acceptance Corp.'s residential unit.

Bolstering the belief that the problems are widespread, the Mortgage Bankers Association reported that new repo s surged to an all-time high in the last quarter of 2006.

The new survey data also underscore the shaky state of the housing market as it undergoes a correction after years of rising prices. As home values increased, lenders provided more bad credit to hi-risk borrowers. Many of the loans were structured to require small monthly payments in the early years that rise sharply over time.

Nearly 4.95 percent of all home mortgages in the survey were delinquent - 30 or more days past due - in the fourth quarter of 2006. That's up from 4.67 percent in the previous quarter, and is the highest rate since 4.97 percent in the second quarter of 2003. Delinquency on subprime mortgages increased to 13.33 percent in the fourth quarter from 12.56 percent the previous quarter, the survey found.

The seasonally adjusted percentage of foreclosures that were begun in late 2006 set a new survey record, accounting for 0.54 percent of all loans in the survey. New foreclosures filings accounted for 2 percent of all subprime loans in the survey.

The 13.5 percent delinquency rate for all Federal Housing Administration loans was also an all-time high for the Mortgage Bankers of America's National Delinquency Survey.

The survey evaluates more than 43.5 million loans, of which 33.3 million are prime loans, about 6 million are subprime loans and about 4 million are government loans.

"Record Foreclosures in Massachusetts"

Foreclosures hit an all time high in January in the Bay State of Massachusetts. 2,207 foreclosure filings in January 2007, doubles  the amount filed for the same period a year prior.   20,618 foreclosure filings in the past 12-months makes for a 77 % jump in filings compared to the same period a year prior.

Housevalues and Foreclosures

Housevalues.com has added some executive staff while dropping about 12 percent of the overall workforce. It also has given up on its mortgage lead-generation business.

Meanwhile, California is feeling the wrath of the Housing Bubble as California foreclosures rise to n eight year high in the last quarter. This according to all that is Real Estaet Data-Data Quick.

Mortgage default notices filed against California homeowners are up 145% since the 4th quarter of '05. In fact defaults in Cali hit the highest level in about eight years in the final quarter of 2006.

Conflicting Real Estate News

From Fox News within a day of each other:

Good News:

New Home Sales Rise Unexpectedly in April 

Sales of new homes rose unexpectedly in April to the fastest pace this year as the housing sector showed resilience in the face of rising mortgage rates. But the price of homes sold last month fell and the level of unsold homes rose to a record high.

The Commerce Department reported that sales of new single-family homes increased by 4.9 percent last month to a seasonally adjusted annual rate of 1.198 million units, the highest rate since last December.

Bad News:

NOD Mortgages

Delinquency rates are rising on mortgages issued last year, according to Wall Street firms. People who bought homes in 2005 faced a double whammy -- rising mortgage rates and sky-high prices. Many were overstretched and took out risky adjustable-rate or interest-only mortgages. 

Affordable Homes

This from BankRate.com. Housing is still affordable in the right spots

The article says that Coastal metropolises like Los Angeles, New York, Boston and San Francisco all might be ranked among the most desirable places to live, but they are expensive! Thus home prices make it tuff to find affordable housing.

The article refeences Lawrence Yun an Econmist from NAR. He says high home prices in popular coastal cities appear to be driving a wave of migration to less costly locales, according to , economist at the National Association of Realtors, or NAR. "Californians are buying up properties in cheaper neighboring states. On the East Coast,  prospective homeowners are seeking out property in Virginia and the Carolinas."

It appears  United Van Lines reported that California had a higher number of outbound moves relative to inbound ones for the first time since 1995. For every 44 moves into the state last year, the company handled 56 outbound moves.States with a much higher number of people moving in rather than out included Oregon, Idaho, Arizona and North Carolina.

Overall, housing affordability nationwide is at its lowest point in 15 years, according to the NAR. In December, the percentage of households in California able to afford a median-priced home stood at 14 percent, according to the California Association of Realtors. New York City, Boston, Washington, D.C., and increasingly, South Florida homes, , according to Yun, are also progressively unaffordable. The most affordable markets, by contrast, tend to be in the Midwest.

Fastest Growing US Counties

Florida's population of Flagler County increased 10.7 percent to 76,410 residents in the year that ended July 1, 2005. Up 53 percent increase in population since the 2000 census making it the fastest-growing U.S. county for the second year in a row, the U.S. Census Bureau reported Thursday.

Most of the top 10 fastest growing counties were on the suburban fringes of major metropolitan areas, and all but one were located in the South or West regions of the U.S.

The other fast growing counties between 2004 and 2005 include:

2. Lyon County, Nev., near Carson City
3. Kendall County, Ill., outside of Chicago
4. Rockwell County, Texas, near Dallas
5. Washington County, Utah, 120 miles north of Las Vegas
6. Nye County, Nev. 100 miles north of Las Vegas
7. Pinal County, Ariz., near Phoenix
8. Loudon County, Va., suburban Washington, D.C.
9. King George County, Va., suburban Washington, D.C.
10. Caroline County, Va., near Richmond

Home Forclosures

The number of foreclosures spread throughout Southern California, with San Diego leading the way (up 8 percent). This according to Default Research, a research company that tracks real estate forclosure homes.

Serdar Bankaci, president, says, "The real estate bubble has not burst in Southern California, but it sure is deflating," said . "The decline was bound to happen and so is the continued rise in forclosures -- the market is just adjusting itself right now."

While San Diego foreclsures have the highest default rates, Riverside County home foreclsures was a close second up 7%, followed by San Bernardino repossessed homes up 6%.

Bankaci says, "If you are the first to approach the homeowners, these properties can provide an excellent opportunity for real estate deals with a possibility for great returns. Proving that even he believes California and other markets to be great investments long term.

Foreclosures Up

RealtyTrac™ an online marketplace for foreclosure properties, released its January 2006 Monthly U.S. Foreclosure Market Report, which shows 103,540 properties nationwide entered some stage of foreclosure in January, a 27% increase from the previous month and a 45 percent increase from January 2005.

The report shows a January national foreclosure rate of 1 foreclosure - repo property for every 1,117 U.S. households, continuing an upward trend in which the national foreclosure rate rose in every quarter of 2005.

"This is the first time since we introduced the report in January of 2005 that we've seen back-to-back months with increases of more than 20 percent," noted James J. Saccacio, chief executive officer of RealtyTrac. "While some of this might have to do with the seasonality of normal real estate cycles, it appears that rising interest rates and softening home prices are beginning to push foreclosure inventories closer to the historic average of one percent of all U.S. households."

Who has the biggest rate of foreclosure? Georgia wins.

Georgia foreclosures spiked in January. The state reported 7,342 properties entering some stage of foreclosure, more than twice the number reported in December. Georgia documented the highest foreclosure rate among the 50 states -- one new foreclosure for every 422 households.

Who was 2nd? The land that has been one of the hottest . With one new foreclosure for every 483 households, Nevada documented the second highest foreclosure rate among the 50 states. The state reported 1,795 properties entering some stage of foreclosure, a 60 percent increase from December and more than 2.5 times the number reported in January 2005.

With a total of 3,747 properties entering some stage of foreclosure, new foreclosures in Colorado tripled from December to January and increased 36 percent year over year. The state recorded one new foreclosure for every 488 households -- the third highest foreclosure rate among the 50 states.