Sales of New Homes Dropped 7.6 Percent

February 1, 2010
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New home sales surprisingly dropped 7.6 percent last month, topping the industry’s weakest year on record.

The Commerce Department said that December sales fell to a seasonally adjusted annual rate of 342,000 from an upwardly revised November pace of 370,000. Economists surveyed by Thomson Reuters had forecast a pace of 370,000 for December.

The results were the weakest since March and indicated demand remains slow-moving despite newly expanded tax incentives to drive sales.

Home sales have had an unsteady recovery from their four-year slide. December’s sales pace was up 4 percent from the bottom in January 2009, but down 75 percent from the peak in July 2005.

The median sales price of $221,300 in…

Builder Sentiment Index Weakens in January

January 20, 2010
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The National Association of Home Builders stated that its housing market index cut down this month to the lowest level since last summer.

The plunge reflects fears that demand for new homes will be weak despite the extension of a federal tax credit for buyers.

The reading of 15 is the second-straight monthly decline and the lowest since June. It reveals that builders are depressing about their prospects albeit Congress extended the deadline for the tax credit of up to $8,000 for first-time homebuyers and expanded it to include $6,500 for existing homeowners who have moved.

The index reflects a survey of 504 residential developers nationwide. Index readings below 50 indicate negative sentiment…

The “New” Root Cause Of The Great Housing Crisis

December 5, 2009
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In the midst of the administration’s announcement that there will be a mandate to additional changes through its Making Home Affordable program, which aimed the improvement in its pace and overall effectiveness, it puts up with asking the question whether the program’s ineffectiveness to date is a result of factors now hugely beyond the control of the leader and servicers charged with the implementation of the program itself.

The only thing that is certain is the increasing number in unemployment and is expected to continue rising until the mid-2010. It is cautious to expect that the impacts of any loan modification program will be at best unpretentious. The administration must now…

Women From Manteca, CA Charged For Mortgage Fraud Scheme Involving 25 Borrowers

October 7, 2009
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Two women from Manteca, California, who were named as Irene Sotiriadis and Helen Sotiriadis, were indicted by court for the mortgage fraud scheme that they have carried out from March 2006 to November 2007. Both of them were also issued an arrest warrant after FBI found out about their intention to take flight to Greece.

The mortgage fraud scheme that Irene and Helen Sotiriadis conducted allegedly includes the recruitment of 25 borrowers from the Cambodian immigrant community and caused them to purchase homes that they are not capable of paying for. Irene and Helen promised them a low monthly fee of $1,500 after giving high initial monthly mortgage payments of $4,000…

Asians Surprisingly The Most Affected By The Decline In Housing Market

September 30, 2009
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Decline in the housing market almost affected every homeowners in U.S. especially in California where foreclosure rates are high and property price declines. But among the racial groups including Blacks, Whites, and Hispanics, the Asians surprisingly turned out to be the most affected.

Asians being the most affected among the groups is definitely a surprising result since they are known to earn more and have less debt. But according to the survey, one out of three Asian homeowners who live in California has experienced foreclosures and drops in home values. These are also supported by data showing that Asian homeownership dropped 1.24 percentage points last year to 59.4 percent while the…

FHA Plans To Apply Policy Changes To Get Back Their Financial Cushion

September 29, 2009
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Here comes another bad news especially for the home buyers. The FHA, or also known as the Federal Housing Administration, is planning to make some amendments regarding their loan insurance policy because of the losses that they have acquired from the past year.

The FHA has already announced that they will be eliminating the $8,000 rebate for the new home buyers and this time they are also planning to tighten up their lending for another level of home buyers. The commissioner of FHA has claimed that they will not reduce the numbers of loans that they have already insured and they will not also increase the borrowers’ fees, but how would…

Man From Ohio Awaits Sentencing After Entering A Guilty Plea For Mortgage Fraud Scheme

September 24, 2009
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A man from Ohio, named as Charles E. Townsend, has entered his guilty plea last September 11, 2009 for one count of money laundering charged on him in connection with a mortgage fraud scheme that inflated the actual value of several properties in Columbus, Ohio.

According to his plea, Townsend helped his co-defendants, who are identified as Aryeh Schottenstein and Jeffery Lieberman, to fraudulently acquire funding for the properties at Columbus through Stillwater Investments Group of New York. Townsend was responsible for exaggerating the value of the properties which Stillwater has funded. He also promised Stillwater to use some of the funds for renovating some of the properties included in the…

Real Estate Sector Could Experience Another Slump If FHA Loans Continue To Inflate

September 14, 2009
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The real estate economy is slowly but surely getting back on track and as you can notice, it’s starting to get better compared to the last few years when it experienced slumps due to recession. But there’s a great chance that another slowdown will occur if the Federal Housing Administration loans inflate.

Every time mortgage companies approve loans like hot potatoes, you can barely see a Federal Housing Administration loan on the list. This is because mortgage companies tend to allow almost anybody to acquire few hundred thousands of dollars no matter what their credit history say, while FHA is much stricter with their requirements to qualify for the loan. But…

China Investment Corporation About To Purchase Mortgage Backed Securities In U.S. For $2 Billion

August 30, 2009
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Almost every part of the world today is experiencing a recession and we all know that U.S., especially their real estate market, is one of the most affected. However, there are still investments coming in for them including the one from China Investment Corporation.

As an investor, you would surely want to put your money in a venture that will be profitable and that’s what China Investment Corporation expects as they are planning to purchase 2 billion dollars worth of mortgage backed securities. U.S. is currently experiencing a recession but this investment just proves that U.S. real estate is still one of the better investments worldwide.

This also proves that the world…