Banks Foreclose on Builders With Perfect Records

Even with perfect loan records banks are withdrawing funds due to increasing pressure from regulators and the continually imploding real estate market.

NY Times

RealtyTrac: Foreclosure Filings Increase 81% in 2008

Foreclosure filings were reported on 2.3 million U.S. properties in 2008, an increase of 81 percent from 2007 and up 225 percent from 2006, according to the RealtyTrac U.S. Foreclosure Market Report released today. 

The steep annual increase came despite a quarterly decrease in the fourth quarter after nine consecutive quarterly increases. And the fourth quarter decrease came despite a surge in foreclosure activity in December. The conflicting trends come largely as a result of artificial pressures on the foreclosure market, according to RealtyTrac CEO James J. Saccacio.

California Home Prices Plunge 50 Percent in Two Years

 

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Home Ownership Back at 2000 Levels

The homeownership rate decreased slightly to 67.5% and is now back to the levels of late 2000.

Dow 5000 May Still be a Possibility

"My transgenerational stock market outlook is this: stocks are cheap when valued within the context of a financed-based economy once dominated by leverage, cheap financing, and even lower corporate tax rates. That world, however, is in our past not our future. More regulation, lower leverage, higher taxes, and a lack of entrepreneurial testosterone are what we must get used to – that and a government checkbook that allows for healing, but crowds the private sector into an awkward and less productive corner. Dow 5,000? We don’t have to go there if current domestic and global policies are focused on asset price support and eventual recapitalization of lending institutions. But 14,000 is a stretch as well. One only has to recognize that roughly 20% of bank capital is now owned by the U.S. government and that a near proportionate share of profits will flow in that direction as well. Better to own corporate bonds than corporate stocks, but that’s a story for another Investment Outlook." William Gross for his Deccember Investment Outlook



Pimco 

Double Digit Home Price Drops Across the U.S. for October

Home prices dropped at a record pace for the month of October.

"Prices in Las Vegas and Phoenix, where developers built subdivisions stretching into the desert, fell by nearly a third in October from 2008. Home prices fell 31 percent in San Francisco and 29 percent in Miami. Prices in New York declined 7.5 percent in October over the same month a year ago.
Fourteen of the 20 cities in the Case-Shiller survey posted double-digit declines for the year. The relative winner was Dallas, which had the smallest yearly decline, of 3 percent. The value of a single-family house in Detroit, which has been pummeled by closing plants and the implosion of the auto industry, was less in October than it was in October 1998."

 NYTimes