Archive for October, 2009
Government Action Boosted Home Prices by Five Percent: Goldman Report
Despite the objections from conservatives and industry advocates, the Obama administration’s steps to intervene in the housing market have had a positive effect on home prices, buttressing values by five percent, according to a new report by Goldman Sachs
U.S. home prices for August off 11.3% from year ago
Case-Shiller home price index released Tuesday by Standard & Poor’s:
In August prices rose in 17 of 20 cities. In the past year, prices are down 11.3% in the 20 cities. Prices are down 29.3% from the peak.
Prices in all 20 cities were lower in August 2009 than in August 2008. The figures are not seasonally adjusted.
Oct. consumer confidence falls for second month
U.S. consumers became more cautious in October, the Conference Board said Tuesday.
The consumer confidence index fell to 47.7 in October from an upwardly revised 53.4 in September
Consumers were more pessimistic about the labor market, with those claiming jobs are “hard to get” rising to 49.6% from 47.0% in the prior month
If you missed out on housing credit, don’t fear
If you missed out on the $8,000 federal tax credit for first-time home buyers, which is set to expire after Nov. 30, don’t despair.
One of two things will probably happen: Congress will extend the credit into next year or, if not, home prices will fall as demand falls off, perhaps by as much as $8,000.
Read more:
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2009/10/27/BUGQ1AAV4H.DTL#ixzz0V9wjyL8k
Central Valley homeowner sues Pulte Homes over ‘predatory’ practices
read more here:
http://www.centralvalleybusinesstimes.com/stories/001/?ID=13431
California new-home starts fall again – September sees 36 percent year-over-year drop
New-home construction dipped again in September, the builders’ lobby says Monday.
When compared to September of last year, production in 2009 was off by 36 percent. Permits for single-family homes totaled 2,150, down 2 percent from August and down 12 percent from September 2008, while multifamily permits totaled 770, up 0.5 percent from August but down 63 percent from September of last year.
CIRB also announced that it is revising its forecast downward from 39,500 total units to just 37,700 total units in 2009, which would be by far the lowest total on record.
U.S. existing-home sales rise 9.4% to 5.57 million
Resales of U.S. houses jumped 9.4% in September to a seasonally adjusted annual rate of 5.57 million, the highest in more than two years, the National Association of Realtors estimated Friday. Sales as tracked by the NAR are up 24% from January’s bottom, and are up 9.2% compared with a year ago.
Revised formula puts 1 in 6 Americans in poverty
The level of poverty in America is even worse than first believed.
A revised formula for calculating medical costs and geographic variations show that approximately 47.4 million Americans last year lived in poverty, 7 million more than the government’s official figure. According to the revised National Academy of Science (NAS) formula:
_About 18.7 percent of Americans 65 and older, or nearly 7.1 million, are in poverty compared to 9.7 percent, or 3.7 million, under the traditional measure. That’s due to out-of-pocket expenses from rising Medicare premiums, deductibles and a coverage gap in the prescription drug benefit.
_About 14.3 percent of people 18 to 64, or 27 million, are in poverty, compared to 11.7 percent under the traditional measure. Many of the additional poor are low-income, working people with transportation and child-care costs.
_Child poverty is lower, at about 17.9 percent, or roughly 13.3 million, compared to 19 percent under the traditional measure. That’s because single mothers and their children disproportionately receive non-cash aid such as food stamps.
_Poverty rates were higher for non-Hispanic whites (11 percent), Asians (17 percent) and Hispanics (29 percent) when compared to the traditional measure. For blacks, poverty remained flat at 24.7 percent, due to the cushioning effect of non-cash aid.
_The Northeast and West saw bigger jumps in poverty, due largely to cities with higher costs of living such as New York, Boston, Los Angeles and San Francisco.
FHA tightens condo lending rules
Tougher rules that will determine which condominium developments will qualify for low-interest Federal Housing Administration mortgage loans are scheduled to go into effect Nov. 2.
Under the new FHA rules, a condo development must be 50 percent sold out with no more than 10 percent of the units owned by a single individual. In addition, no more than 15 percent of the homes in the complex can have payments that are past due.
The highest use of FHA financing in the United States is reported by Northern California builders, according to a report Monday by Irvine-based John Burns Real Estate Consulting on government loan program impacts on new home sales.
Goldman Sachs Posts $3 Billion Gain
Just months after paying back billions in bailout funds, Goldman Sachs reported a profit of $3.19 billionfor the third quarter, or $5.25 diluted earnings per common share, exceeding analyst expectations by about $1 a share. Goldman’s earnings were up 270 percent for the quarter compared to the same period last year.
It was only about 12 months ago that the 140-year-old firm averted collapse by accepting an estimated $70 billion, including $10 billion in TARP; $11 billion from the Federal Reserve; $30 billion from the FDIC; and $13 billion from AIG, as reported by The Huffington Post.
According to Huffington, Goldman Sachs was able to use this money to buy billions in distressed assets around the world at record low prices.
On the company’s Q3 conference call Thursday, David Viniar, CFO, said the firm is looking aggressively at distressed investing, but that holders of distressed assets have yet to loosen their grip.
“We are starting to see a little more than a trickle, but not much more of distressed opportunities,” Viniar said.
