Today’s News Synopsis:
CBIA reports that 36,209 building permits were issued in California last year. The 30-year mortgage rate decreased by 0.4 percent in December. DBRS expects loan servicers to allow more principal reductions as more attempted modifications fail. According to RealFacts, the average Orange County apartment rent fell 6.7% during the 4th quarter of 2009.
In The News:
CBIA – “It’s Official: California Housing Production Reached New Low in 2009” (1-26-10)
“California homebuilders put up the lowest number of homes for a single year in 2009, beating the previous low that was set in 2008, the California Building Industry Association announced today. CBIA said just 36,209 permits were issued statewide last year for new homes, apartments, condominiums and townhomes, down 44 percent from 2008 and down a whopping 83 percent – 176,751 units – compared to 2004, the peak of the latest cycle.”
Housing Wire – “Mortgage Insurer MGIC Loses $1.3bn in 2009” (1-26-10)
“The Wisconsin-based mortgage insurer posted a total $1.3bn net loss in all of 2009, more than double the $525.4m net loss in all of 2008.”
Housing Wire – “Mortgage Rates Dip in December, Stay Above 5 Percent” (1-26-10)
“The average interest rate for a 30-year fixed-rate mortgage (FRM) of $417,000 or less was 5.05% in December, down from 5.09% in November. The average interest rate on 15-year, FRM of $417,000 or less was 4.54%, down from 4.63% in November.”
Housing Wire – “Going Forward, BarCap Expects Mixed Results from REITs” (1-26-10)
“Analysts at Barclays Capital (BarCap) project mixed results from the real estate investment trust (REIT) sector, as the companies begin releasing their Q409 and year-end earnings reports. On average, the analysts expect fourth quarter funds from operations per share (FFOPS) for the REIT sector to increase 6.1% year-over-year, but decline 28.1% on an operating basis, which they define as excluding non-recurring items.”
Housing Wire – “Home Prices Continue to Improve in November” (1-26-10)
“Annual home price declines were in the single digits in November 2009, as the Standard & Poor’s (S&P)/Case-Shiller home price indices continue a 10-month run of improved results. The monthly indices track existing home prices every month on a year-over-year basis in 20 markets, broken down in 10-city and 20-city composites. The 10-city composite declined 4.5% and the 20-city composite declined 5.3% in November 2009 compared to November 2008.”
Housing Wire – “DBRS Expects Re-Defaults to Drive Principal Forgiveness” (1-26-10)
“With more than half of all modified loans expected to re-default in 2010, servicers are likely to increase the use of principal forgiveness, as an option to bring these continually distressed mortgages current, rating agency DBRS said in commentary yesterday.”
Bloomberg – “Fed Weighs Interest on Reserves as New Policy Rate“ (1-26-10)
“Federal Reserve policy makers are considering adopting a new benchmark interest rate to replace the one they’ve used for the last two decades. The central bank has been unable to control the federal funds rate since the September 2008 bankruptcy of Lehman Brothers Holdings Inc., when it began flooding financial markets with $1 trillion to prevent the economy from collapsing. Officials, who began a two-day meeting at 2 p.m. today in Washington, have said they may replace or supplement the fed funds rate with interest paid on excess bank reserves.”
Orange County Register – “Lake Forest has biggest O.C. rent cuts” (1-26-10)
“The average rent in that city was $1,347 a month during the fourth quarter vs. $1,520 in the fourth quarter of 2008. That compares to an average decrease of $105 countywide, according to RealFacts. The average Orange County apartment rent fell 6.7% to $1,473 during the final three months of last year.”
Orange County Register – “4 O.C. cities top CA. home price gains” (1-26-10)
“The overall median price in December was $496,070, down 0.6% from November, but up 12.1% from the prior year. Sales were up 4.5% from November and up 17.9% from December 2008.”
Looking Back:
One year ago, the NAR reported that existing home sales had increased by 6.5 percent within one month. Statistics from First American Corelogic showed that home prices fell in 38 U.S. states. Banks disposed of over $1 billion in loan and construction debt within one quarter. Distressed home sales represented 50 percent of the Southern California housing market.
California Real Estate Investing News is a post from: The Norris Group