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Today's Interesting Articles
2007-07-31 18:47:00
1. WASHINGTON, DC - A proposal by the Office of Federal Housing Enterprise Oversight (OFHEO) that could lower the conforming loan limit ("CLL" - calculations establish the maximum size limit for loans that Fannie Mae and Freddie Mac are allowed to purchase and they are also used to set limits for FHA and VA loans - important to home buyers looking to put 3%-5% down with government subsidized loans especially when the subprime market is deteriorating) as early as 2009 and would establish new guidance for calculating the annual limit so that it could be reduced in the future would have adverse consequences for the nation?s home buyers, according to National Association of Home Builders... In NAHB?s response, David Crowe, the association?s senior staff vice president for regulatory and housing policy, noted that the conforming loan limit remained unchanged in 1993 and 1994, years in which the home price index registered declines, because ?the current law does not require a decline in t...
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Writing a Compelling Executive Summary
2007-07-30 22:16:00
By now (7/30/07), the word is out on the housing slump, but the verdict is still out as to its affect on the commercial markets (one side note - I received an email from a fellow CCIM in St. Louis that is advising for sale a local 184k SF shopping center for $3.9M or $21.14/SF with two large vacancies totally 72% of the property - I haven't seen these types of properties since the RTC days).So, as the credit crunch grows from Wall Street to Main Street, the need for developers and brokers to artfully pitch their ventures will become tantamount as more projects chase tighter purse strings from private sources. It might be time to recall an article and website that I found effective in developing a "compelling executive summary". As the San Jose VC firm, Garage Technology Ventures, points out on their website, the job of the executive summary is to sell, not to describe (although designed for the submitting technology ventures to the fund, I still think this applies to real estate de...
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How Does an Internet Babe Make the Leap to Biotech? [Digg]
2007-07-30 18:13:00
Guy Kawasaki's 10 Questions with Moira Gunn - the host of 'Tech Nation', its popular segment 'BioTech Nation' and self-proclaimed ?Internet babe.?
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National: Upcoming Wall Street expectations
2007-07-28 06:53:00
NEW YORK (MarketWatch) -- U.S. stocks will continue to fall next week, in continuation of a sell-off that saw the Dow Jones Industrial Average experience its worst week in over four years, due to nervousness that the easy-money binge of the last few years has come to an end.Another heavy week of earnings, including 99 reports from S&P 500 companies, capped by the all-important July employment report on Friday, also awaits investors.But stocks will remain vulnerable to any new signs of distress from hedge funds hit by their exposure to bad U.S. home loans, as well as from credit markets, where Wall Street firms and corporations are finding it harder and harder to obtain financing."We're finishing up earnings season and the general tone has been positive," said Owen Fitzpatrick, head of the U.S. equities group at Deutsche Bank. "But it's been overwhelmed by the whole subprime and credit-market issues."View article..
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National: The Credit Window is Now Closed
2007-07-27 01:15:00
"The credit window is now closed," writes strategist Barry Ritholtz in his blog, and the "multi-engine plane" that is the market has lost one of its sources of power ("liquidity - what is occurring today is a full blown repricing of the liquidity spigot slowly turning off").As for the U.S. housing market, economist Mark Zandi expects a lot more pain, but not a recession. Here are some highlights of his forecast, based on a study using anonymous data collected by consumer credit agency Equifax: Home prices will fall 10% from the peak nationally, more in the bubble regions in California, Florida, Nevada, Arizona and Washington, D.C. Home sales could bottom later this year, home construction could bottom early next year, and house prices could bottom late next year. It'll be 2010 before the housing market could be termed "normal."About 17% of total mortgage debt is at risk, totaling about $2.5 trillion in subprime, Alt-A and jumbo debt. About $1.4 trillion is at serious risk of defaul...
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Sacramento: Regional 2Q Industrial Report
2007-07-26 17:21:00
Every quarter we receive market statistics for regions around the country from CBC and other competing national brokers. Colliers International has office in both Sacramento and Roseville, as well as covering the greater Sacramento Region. Click on the link to view their Sacramento Industrial Trends Report for the second quarter of 2007.
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Northwest: Smaller Cities Buck Housing Slump
2007-07-26 07:05:00
In an attempt to find some promising news about the housing market and the indicators that I've found over the last month to give us exactly what we all knew would happen (especially here in California - having seen the developers over the past four years fall all over themselves to option up anything that could be entitled quickly at astronomical prices per acre), I wanted to find areas that still had a retail market for Bay area developer clients. It will be these smaller markets that provide retail buyers for those modest developments (so long to the 1,000 acre master planned communities wanting entitlements in this market when the inventory of foreclosures show-up through these delinquencies. Below is the AP article from 7/19.."SALEM, Ore. (AP) -- Aside from being Oregon's capital city, Salem doesn't have much to boast about. Most downtown restaurants close by 7:00 p.m. and Lefty's -- the only cool bar in town, according to local college students -- is known for its karaoke ...
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CNNMoney: Subprime woes hit junk bonds
2007-07-25 20:49:00
This article yesterday from CNN confirms an earlier post (July 16, 2007) I found regarding the two prong approach of identifying the losses from the subprime market (and recasting those losses to junk status) and its affects on the market..NEW YORK (CNNMoney.com) -- Woes plaguing the subprime mortgage market are spreading to junk bonds, according Bill Gross, manager of the world's largest bond fund.Credit markets are facing a "sudden liquidity crisis" in the high-yield bond sector as a growing lack of confidence has frozen future lending, the PIMCO bond manager wrote in an August investment newsletter posted on the PIMCO Web site.VideoMore video CNNMoney.com's Allen Wastler looks at adjustable rate mortgages resetting from their low teaser rates. Play video cnnad_createAd("623475","http://ads.cnn.c om/html.ng/site=cnn_money&cnn_money_posit ion=220x200_ctr&cnn_money_rollup=markets_ and_stocks&cnn_money_section=quigo¶ms .styles=fs","200","220"); "Both...
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National: Mortgage Delinquency Map
2007-07-24 17:15:00
Mortgage delinquencies continued to climb in the second quarter, new data show. The map below shows how delinquency rates have increased in those metro areas as the housing market has slowed. The pickup in delinquencies has been particularly notable in parts of Florida and California. Nationwide, delinquency rates climbed to 3.15% in the second quarter, compared with 2.87% in the first quarter.The map below shows the two counties in Northern California, San Joaquin and Merced, that lead the way in delinquencies over the period.View article..
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National: Top Business Journal Real Estate Headlines
2007-07-23 18:29:00
Every week I receive the top real estate headlines from business journals around the country. Below is a shortened list of top news stories that can provide some great insight into the regional markets and direction of the commercial market. One interesting note in this week's trend is the fact that office rents appear to be rising enough to support new construction in several markets (from Boston and Tampa stories)AlbuquerqueOutside developers aid Westside commercial expansionAtlantaNew Midtown tower among city's largestAustinSt. Croix bolsters presence in S.E. Austin with purchaseBaltimoreLancaster Foods doubles warehouse space in JessupBaltimoreCOPT plans Harford Co. office park: At 800,000 square feet, it would be the county's largest complexBostonIn reversal, new now cheaperBostonGoogle eyes E. Cambridge sitesDallasGrowth study set for Lancaster airport area: 306-acre field could have future as cargo airportDaytonDefense contractor training center to open near Wright-PattEas...
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National: When the housing rebound comes
2007-07-20 19:30:00
(Money Magazine) -- If you're the sensitive type of homeowner, you may want to skip the rest of this paragraph, which recounts the unrelentingly grim news about home prices.At least 42 percent of major housing markets are in decline, with some projected to fall by double digits over the next five years.One alarming sign: The National Association of Realtors has reversed its usually sunny outlook and is now predicting a 1 percent drop nationwide in existing home prices in 2007, the first such prediction in the four decades since NAR started tracking prices.Still, no bear market lasts forever, and indeed, predictor NAR, quickly recovering from its unusual flash of pessimism, is forecasting that prices will bottom out this quarter.How will you know?Because housing markets are intensely local, it won't do much good to check national figures. Instead, stay alert to leading indicators of recovery in your local market, such as:Inventory is decliningA local broker should be able to tell y...
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Home Buyer Tip: A 6-step plan for boosting credit score to buy home
2007-07-20 07:36:00
WASHINGTON (MarketWatch) -- Question: I need some assistance in cleaning up my very poor credit score of 638 from Trans Union and 559 from Equifax. It's not the result of any credit cards but poor choices (which I admit) and a divorce with little to no child support of three girls. I'm in my mid-forties and all three girls are over the age of 18.My question is how do I increase my FICO score within the next 6-10 months and is there a reputable agency that can work on my behalf? I would like to purchase a home early next year. I know there's a lot of work that needs to be done and would greatly appreciate any assistance you or an agency can provide. List below.. View article for details..1. Settle collections2. Get rid of the 'black marks'3. Clean up late pays4. Get even5. Remain open6. Remain active
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Bernanke: Subprime hit could top $100B
2007-07-19 22:33:00
NEW YORK (CNNMoney.com) -- Losses in the fast-unraveling subprime lending market could top $100 billion, but the Federal Reserve is taking measures to protect borrowers, according to Fed Chairman Ben Bernanke . "The credit losses associated with subprime have come to light and they are fairly significant," Bernanke told the Senate Banking Committee in a second day of testimony on the Fed's twice-yearly economic report. Federal Reserve Chairman Ben Bernanke cnnad_createAd("353931","http://ads.cnn.c om/html.ng/site=cnn_money&cnn_money_posit ion=220x200_ctr&cnn_money_rollup=business _news&cnn_money_section=jobs_and_economy& cnn_money_subsection=quigo¶ms.styles= fs","200","220"); "Some estimates are in the order of between $50 billion and $100 billion of losses associated with subprime credit problems," he said, referring to a segment of the mortgage market that caters to borrowers with shaky credit.Defaults on mortgages in the subprime sector have risen sharp...
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National: The end of the old MLS?
2007-07-18 20:15:00
So you think that Silicon Valley won't have an effect on the real estate business? From today's San Francisco Chronicle, there is a new player in the home buyer's arsenal of online tools that works as an "aggregator" of information from the traditional MLS, craigslist, trulia, zillow, etc. in a netvibes type interface.Terabitz.com, the brainchild of a near-child, will go live with its real estate "dashboard," where users can create a personal page from for-sale listings, valuation tools, maps, photos, crime statistics, weather and neighborhood cafes, banks and airports. Whereas other sites usually provide a few of those resources, Terabitz says its hub aggregates all the information a home shopper needs -- from a place to peruse four-bedroom colonials to where to find a baby crib.The home buyer (and for that matter, any lender, investor or potential seller) can view current inventory for sale and for rent from multiple sources, giving the home buyer more resources than most agent...
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National: Market Cycles & Income-producing Real Estate
2007-07-18 05:30:00
Number Of Months From Peak-To-Peak of Each Business Cycle Since 1900Information Source: Nat?l Bureau of Economic Research, Inc. An investor needs three pieces of information for developing a reasonable investment strategy and the chart provides this information: (1) The average length of time from peak-to-peak for the prior twenty-one cycles is 58 months. (2) The current business peak was reached in March 2001. (3) We are presently 68 months into the current cycle. What have we concluded so far? Given the country?s current economic model, the economy is cyclical.Bull markets don?t last forever.Recessions don?t last forever.The average cycle for the past 100 years from peak-to-peak is 58 months.The peak for the current cycle was March 2001.We are 68 months into the current cycle. This information gives an investor the next possible peak and the length of time needed for the subsequent peak. The average is 58 months. The shortest peak-to-peak business cycle is 17 months and the longes...
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Online: New Online Maps for Real Estate Users
2007-07-17 19:29:00
Since Google made its maps available for customization last year, savvy programmers have created thriving businesses by adding layers of information.So in May, Washington-based startup FortiusOne launched GeoCommons, a cartographic portal where users can easily create their own mashups. The site has 2 billion pieces of localized data -- from census figures and school district budgets to water-contamination and traffic-congestion hot spots -- and it is rapidly adding more. Two examples are below offered by users that collected data through business and government sites:1. Foreclosure Filing and the Subprime Collapse: Foreclosure filings are starting to hit hard. People all over the country are having trouble paying off their ARMs (Adjustable rate Mortgages) and houses are being foreclosed. This is having a ripple effect in the economy, Home Depot and Lowe's have already cut their earnings estimates and it looks likely that more trouble is on the way. Our map will show you the locati...
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Retail Developers Increasingly Target 'Active Adults' in Lifestyle Communit
2007-07-17 19:09:00
In the retail industry today, there's a lot of talk about the "aging baby boomer" population; what effect will their retirement have on the economy? When will they retire? How will they live when they retire? What will they buy?Of particular interest is the growth of so-called "active adult communities," designed to serve the 55+ age group and that include retail as an integral part of such development. CoStar spoke with three executives with firms that are active in this segment, including Pulte's Del Webb communities, The Villages of Florida, and Inland real estate to learn more about the retail requirements of this population - changes to community and shopping center design or retail tenant mix in response to generational changes.View article..
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Local News: Housing project limited in scope
2007-07-17 19:08:00
Feed: Recordnet News HeadlinesPosted on: Thursday, July 12, 2007 4:00 AMAuthor: Recordnet News HeadlinesSubject: Housing project limited in scope LODI - The committee that is overseeing an affordable-housing project on Lodi's East Side voted Wednesday to limit development to senior rental homes. View article... COPPEROPOLIS - It will be at least another two weeks before the developers of Tuscany Hills win approval for their plan to bring 335 luxury homes, a golf course and an aggressive lake protection plan to 1,113 acres on the shore of Lake Tulloch. View article...
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Local News: Elk Grove council approves mall plan
2007-07-17 19:07:00
The open-air facility will be the first regional shopping center in the city.By Sandy Louey - Bee Staff Writer Published 6:29 am PDT Thursday, July 12, 2007Story appeared in METRO section, Page B2Late Wednesday night the Elk Grove City Council approved plans for a 1.1 million-square-foot open-air shopping mall.Elk Grove Promenade, the city's first regional shopping center, will have as much retail space as the 1.1 million-square-foot Arden Fair mall and nearly as much as the 1.3 million-square-foot Roseville Galleria.The council approved the development plan 3-1. Councilmen Gary Davis, Patrick Hume and Michael Leary voted in favor, while Councilwoman Sophia Scherman was opposed. Mayor Jim Cooper was out of town. The 107-acre project at Grant Line Road and Highway 99 is expected to generate nearly $4 million in sales tax revenue its first full year of operation and provide 2,500 jobs, according to Louis Bucksbaum, who is overseeing the project for Chicago-based General Growth P...
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NorCal: Foreclosures' furious pace
2007-07-17 19:06:00
SJ is 1st, Merced 2nd, Stanislaus 4th in nation's mortgage defaultsBy J.N. SBRANTIjnsbranti@modbee.comLast Updated: July 12, 2007, 09:44:58 AM PDT About $925 million worth of mortgages have been foreclosed on since January in the Northern San Joaquin Valley, and 2,575 homes have been auctioned off on courthouse steps in Stanislaus, San Joaquin and Merced counties. During June alone, there were 203 home foreclosure auctions in Modesto at which lenders tried to recover what they could from $66 million in delinquent loans, according to the Fore closureRadar research firm. By comparison, only 15 such home auctions took place in June 2006, and those loans were worth just $4 million, said Sean O'Toole, who owns ForeclosureRadar, a research firm based in Discovery Bay. O'Toole has been tracking the rapid rise in foreclosures throughout California. Statewide last month, he said, there were foreclosure auctions for 6,960 homes with loan values of $2.83 billion. "Foreclosure sales n...
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Interesting items I found on the web today
2007-07-17 19:05:00
Home buyers and home sellers alike can find more innovative and useful features than ever on real estate web sites, which are nimbly adapting to the U.S. housing slump. Residential agents are beginning to be wary of www.buysiderealty.com and www.iggyshouse.com ? while investors, lenders and homeowners are using valuation tools like www.zillow.com, www.housefront.com and www.trulia.com At market close today, Research in Motion (RIM)'s market cap of $42.3 billion edged out Motorola's $41.4 billion. This despite the fact that RIM's annual revenue of $3 billion is puny next to Motorola's nearly $43 billion. (Yes, you read that right; Motorola's market cap is less than its annual revenue.)A new service called Ether (www.ether.com) provides an innovative and easy way to sell what you say to others that need or want your expertise.
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Silicon Valley: Another huge commercial property sale said to be in works
2007-07-17 19:05:00
One of the region's most-respected commercial property owners is contemplating the sale of his entire 7.7-million square-foot Silicon Valley portfolio, sources say. But neither party to the potential transaction would confirm details on Friday.Well-placed sources in valley real estate say Carl Berg is selling his entire Silicon Valley portfolio to Starwood Capital Group, a privately owned, Connecticut-based real estate investment firm. The deal, if done, would be the largest commercial property sale in Silicon Valley history, as measured by square footage.The previous record-setter was the Peery-Arrillaga portfolio of 5.3 million square feet, which sold last year for more than $1 billion. A purchase price for the Berg deal could not be learned, but one source said it will likely total less than the Peery-Arrillaga sale.View article..
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Upcoming Week: What to expect the Fed to say about housing
2007-07-17 19:04:00
While the Fed is expected to remain optimistic about inflation fears and semi-soft manufacturing growth, here's what Marketwatch anticipates for the Housing sector: "Bernanke could also bring some depressing news on housing with him into the hearing room. The Commerce Department will report on housing starts and building permits for June earlier in the morning on Wednesday, at exactly the same time the CPI is released. The median forecast calls for a 1.6% decline in starts to a seasonally adjusted annual rate of 1.45 million. Building permits are expected to fall 2.3% to 1.485 million. Housing starts are down about 24% in the past year, while permits are down about 21%. On Tuesday, the home builders will release their sentiment index for July. After falling to a 16-year low of 28 in June, another decrease is possible in July, our survey says. "The housing market overall continues to be on the ropes, with another rash of credit quality problems in the subprime l...
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National: The Great Mortgage Party Hangover
2007-07-17 19:03:00
This is a recent article I pulled from Inman and the assessment of the troubles that has yet to affect our industry. Lou Barnes discusses the premature "housing crash" that the bond market buyers anticipated a year ago, only to get clobbered with resilient market data ("People are buying cars, going to restaurants, taking vacations in Tahoe.. just not buying houses" from a recent Sacbee article). Now, the market pundits and bond agencies are acknowledging their timing errors and are re-rating their methodologies with stricter guidelines, leading to a two-part "end game": (i) where are the loses? and (ii) what is the effect? Part one, the mortgage losses. Very little money has been "lost." The market value of the securitized mortgages in question has fallen 30-70 percent, but if you don't sell, you don't have to recognize loss. The re-rating of this stuff to junk will force institutional investors to sell, to recognize, and probably depress value farther. We will also learn who h...
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