Jacksonville Home Sales in Q3 Up Slightly While Median Price Slipped

21 11 2010

Jacksonville area Realtor-brokered home sales went flat in the third quarter as compared to the same period last year as median sales prices slipped.

There were 3,386 single-family home sales in the Jacksonville metropolitan area in July, August and September, according to data from the Florida Association of Realtors. That represented just a razor-thin increase — nine sales more than the same quarter in 2009.

At the same time, the median price of Jacksonville area houses sold during the quarter fell by 6 percent — from $150,600 in 2009 to $141,200.

That was better news than the sales data for the whole state during the quarter, however. Statewide, sales fell 7 percent, from 44,451 to 41,122. The news wasn’t good in median prices, either, as that figure fell from $145,300 to $135,200 — also a 7 percent drop.

The condominium market picked up sharply in volumes but fell in median sales prices, also sharply, both in Jacksonville and statewide during the third quarter, FAR data shows.

Sales volumes rose from 417 to 638 in Jacksonville, a hefty 53 percent increase. Statewide, sales rose from 14,793 in the third quarter of 2009 to 16,938 in the third quarter of this year.

But third quarter median condominium sales price drops also were in double digits, both locally and statewide. The Jacksonville median sales price dropped 31 percent, from $112,300 to $77,200; the statewide drop was 21 percent, from $106,000 to $84,000.

Source: The Florida-Times Union

Moody’s Hopeful on Recovery, Notes Pent-Up Florida Demand

17 11 2010

The pace of the recovery in the nation is moderating and the lift spurred by nearly $800 billion in federal stimulus spending is fading, but there are several promising signs that growth will continue, including in Florida, a leading national fiscal analyst told reporters Friday morning.

Moody’s Analytics economist Chris Lafakis said the Federal Reserve will remain aggressive, with a quantitative easing plan that he equated to “basically flooding the global monetary system.” Lafakis predicted the strategy would lift asset prices, reduce corporate borrowing costs, and increase the willingness of consumers to spend.

Lafakis predicted substantial growth in Florida’s economy, mentioning that the Miami, Orlando and Tampa areas are expected to recover “quite significantly” due to a rebound in population growth and a willingness of more people to travel to Florida for vacations. “The story of pent-up demand is true in no place more so than Florida,” he said.

Nationally, corporate balance sheets are strong and business profits have “fully recovered from the recession,” he said, adding that businesses are in the position to hire more employees, but their level of willingness varies.

“It’s truly the case that profit growth leads job growth,” Lafakis told state government reporters gathered for the annual conference of the Association of Capitol Reporters and Editors.

Household liabilities in the United States have fallen by $900 billion since peaking two years ago and a shift to spending and addressing pent-up demand for purchasing “creates a lot of economic juice,” Lafakis said.

Arturo Perez, a fiscal affairs expert with the National Conference of State Legislatures, said states are collectively facing budget gaps that total half a trillion dollars in the coming years. He said state tax revenues bottomed out in fiscal 2010 and that tax collections were growing in 42 states in fiscal 2011, which began July 1. Perez described the prevailing sentiment across the states as “cautiou-mistic” with revenues rebounding from a depressed base.

The national economy, which had shed 700,000 to 800,000 jobs per month during the recession, has been adding jobs in recent months but not at the 150,000 per month rate that Lafakis said is needed to keep up with growth in the labor force and make a dent in the unemployment rate.

Over the past three months, he said, the national recovery has “downshifted to a more moderate pace.”

In the conference’s opening session Thursday, Lori Grange, deputy director of the Pew Center on the States, described research showing elected officials face a “huge deficit” in public trust in state government.

Grange said taxpayers favor reduced government spending over new taxes as a budget-balancing strategy and are breaking strongly against new state government debt and borrowing. The center plans to release a report on state debt trends in February, she said.

Grange said Illinois had gone on a “borrowing binge” that had led to the lowering of its bond rating and noted that voters in Washington rejected a $500 million request for capital spending to improve public schools.

The economic crisis is forcing state government officials to fundamentally rethink their operations, Grange said. She said high unemployment, expiring federal stimulus funds and increased demand for social programs had created “the perfect storm of lousy conditions and all of it’s in the face of significant budget gaps.”

Source: Moody.com

Survey: Neat Neighborhoods Sell Homes

17 11 2010

When they’re considering moving to a particular neighborhood, most consumers feel they can trust their eyes to determine how safe the area might be.

According to a sampling of 1,492 visitors to Relocation.com, the safety of their new neighborhood is their most important consideration when they’re moving. The survey showed that 93 percent of consumers considered safety to be an “important” or “very important” concern.

When assessing the safety of a potential neighborhood, buyers increasingly relied on their eyes – 75 percent said they could determine how safe an area was by looking at the upkeep and front lawns of local homes. In addition, 74 percent said the area’s word-of-mouth reputation was an important factor.

“It’s interesting to see how home buyers determine neighborhood safety based on the neighborhood’s appearance and not as much based on police statistics or crime reports,” said Relocation.com chairman and founder Sharon Asher. “Our findings suggest that some home sellers who are struggling to generate interest may want to go the extra mile and help their neighbors with landscaping needs in order to create buyer interest.”

Some cities have earned a reputation for safety. The city of Boston ranked as the safest in the country for families with young children, according to a recent report by Underwriters Laboratories.

Source: Relocation.com

Fannie Mae Freddie Mac cut ties to David J. Stern Florida law firm

16 11 2010

Mortgage giants Fannie Mae and Freddie Mac have terminated relationships with a Florida law firm under investigation for fabricating documents to speed up foreclosures.

Fannie Mae and Freddie Mac announced they have removed files from the law offices of David J. Stern and making arrangements to transfer them to other Florida law firms, company representatives said.

“We’re taking the documents to protect our interests, preserve the integrity of the documents, and protect the rights of borrowers,” said Doug Duvall, a spokesman for Freddie Mac.

This unusual step follows both Fannie and Freddie’s decision last month to stop referring new foreclosures to Stern’s office. Florida Attorney General Bill McCollum last month released sworn statements from former employees who alleged illegal handling of files.

This move terminates Stern’s position in dealing with all on-going foreclosures. Documents pertaining to homes already taken back by Freddie were also are being removed from Stern’s office, Duvall said.

Kelly Scott, a former legal assistant at Stern’s office, testified to the attorney general that current employees were concerned about what was happening to documents. Former colleagues, she said, saw an 18-wheeler truck drive away with documents and allegedly take them to a Stern office in Orlando.

Freddie planned to take its files from all Stern offices, Duvall said.

Stern called Fannie Mae and Freddie Mac his “babies,” Scott told the attorney general. Both agencies also pressured the firm to move cases along faster and gave the firm a quota, Scott said.

Scott also testified that employees were given jewelry, cars and houses from the firm in exchange for altering and forging key documents used to process foreclosures.

The two government-sponsored lending giants said they would audit Stern’s files after the release of Tammy Lou Kupusta’s testimony in early October.

Scott and Kupusta painted a picture of a secret system designed to speed up the foreclosure process. Attorneys and staff members forged signatures, changed dates and passed around notary stamps, the women say in interviews with attorney general’s staff.

The women described long tables where employees would sign 1,000 documents a day without reading them.

Last week the law offices of David J. Stern and an associated company starts laying off 70 percent of its combined staff. The terminations come two days after mortgage giants Fannie Mae and Freddie Mac severed ties with the firm.

In the e-mail to employees, Stern said the referral of new business has decreased by over 90 percent in the last six months. “While we are doing everything possible to guide the company successfully through these difficult times, these developments mandate that we take immediate action to align the business with current realities,” Stern said in the e-mail.

The firm originally employed about 1,000 people.

The law firm, which handles Florida foreclosures for major lenders, is under investigation by the Florida Attorney General for sloppy work and fabricating key documents used to complete foreclosures.

One employee testified that Stern had relationships with people inside Fannie and Freddie who would tip him off before routine audits. Problem documents were then hidden in conference rooms until the auditors left, the employee told the attorney general.

After the testimony was released, Fannie and Freddie sent auditors in to examine files. Both companies announced they terminated their relationships with the firm and were removing all of their files from Stern offices.

Two weeks ago, Stern’s mortgage document processor DJSP Enterprises Inc. said it would terminate an additional 198 employees as the volume of work shrinks. That company has laid off a total of 300 people, the company said.

DJSP was spun off into a publicly traded company by Stern. The company handles work for his law firm.

Source: The Tampa Tribune

U.S. Foreclosure Homes Drops 9% in Oct.

12 11 2010

The number of U.S. homes foreclosed by lenders last month fell by the sharpest margin this year, as several major lenders temporarily halted most or all of their foreclosures amid allegations thousands of foreclosures were handled improperly.

Home repossessions dropped 9 percent from September to October, according to RealtyTrac Inc.

The decline represents the first significant hitch in a foreclosure steamroller that’s had lenders on pace to seize more than 1 million homes this year.

In recent weeks, some lenders that had suspended taking action against borrowers severely behind in payments have announced plans to resume doing so, though at a more measured pace, in an attempt to ensure there aren’t any flaws in the process.

That means the number of homes lost to foreclosure should begin picking up again, but at a much slower pace.

Lenders such as Bank of America, Ally Financial’s GMAC Mortgage and JPMorgan Chase & Co. suspended some or all of their foreclosure activity after the foreclosure documents mess erupted in late September. In recent weeks, they announced plans to resume some foreclosure actions.

Bank of America announced Oct. 8 it would withdraw for review some 102,000 pending affidavits related to foreclosure proceedings in 23 states where courts play a role in the process.

About two weeks ago, the lender said it would begin resubmitting those affidavits, a process that was expected to take several weeks to complete.

It continues to have a hold on trustee sales or sheriff’s auctions of foreclosed homes, and is still delaying foreclosures in the 27 states that don’t require a judge’s approval as it reviews its cases in those states.

JPMorgan Chase said last week it would be restarting the foreclosure process later this month after halting foreclosure proceedings on 127,000 loans in 40 states.

“We expect it will take about three or four months to basically get back up to speed,” said spokesman Thomas Kelly.

GMAC, meanwhile, has been reviewing its thousands of foreclosure cases and moved ahead with them on a case-by-case basis.

“The moratorium may have been lifted by just about all the banks, but it’s gone from a foreclosure moratorium to a foreclosure slowdown,” said banking analyst Nancy Bush of NAB Research.

Banks have seized more than 909,000 homes through the first 10 months of the year and, even with the delays caused by the temporary foreclosure freeze, are on pace to take back more than 1 million homes this year.

Economic woes, such as unemployment or reduced income, continue to be the main catalysts for foreclosures.

In all, 93,236 homes were taken back by lenders in October, down from a peak 102,134 in September, said RealtyTrac, which tracks notices for defaults, scheduled home auctions and home repossessions – warnings that can lead up to a home eventually being lost to foreclosure.

Despite the sharp drop, October’s tally was still 21 percent higher than a year ago. Lenders have foreclosed on an average of more than 91,000 properties each month this year.

The number of homes taken back by banks fell sharply from September in many of the foreclosure hotbed states, including Arizona, California, Illinois and Nevada.

Florida bucked that trend, with repossessions rising 1 percent from September. They nearly doubled versus October last year.

“There were probably a whole batch of foreclosures that were already in process when the freeze was announced that led to Florida’s numbers being not affected as much in October as some of the other states,” Sharga said.

Initial defaults have fallen on an annual basis the past nine months as lenders have taken steps to manage the levels of distressed properties they have on their books.

All told, 332,172 properties received a foreclosure-related warning last month, down 4 percent from September and essentially flat versus the same month last year, RealtyTrac said. That translates to one in 389 U.S. homes.

Among states, Nevada posted the highest foreclosure rate last month, with one in every 79 households receiving a foreclosure notice. That’s nearly 5 times the national average.

Rounding out the top 10 states with the highest foreclosure rate in October were: Florida, Arizona, California, Michigan, Utah, Georgia, Idaho, Illinois and Colorado.

Source: The Associated Press

Florida’s Existing Condo Sales Up in 3Q 2010

12 11 2010

Sales of existing condominiums in Florida rose 15 percent in third quarter 2010 compared to the same period a year earlier, according to the latest housing statistics from Florida Realtors. A total of 16,938 existing condos sold statewide in 3Q 2010; during the same period the year before, a total of 14,793 units changed hands.

Fourteen of Florida’s metropolitan statistical areas (MSAs) reported higher existing condo sales in the third quarter, according to Florida Realtors. The statewide existing-condo median sales price was $84,000 for the three-month period; in 3Q 2009, it was $106,000 for a decrease of 21 percent.

“A healthy housing market is built on the foundation of a robust economy,” said Dr. Sean Snaith, director of the University of Central Florida’s Institute for Economic Competitiveness. “As the economic recovery continues in Florida – and in particular as the labor market improves – the housing market will follow suit. The price decline in the condo market continues to attract domestic and foreign buyers to Florida to take advantage of this buying opportunity.

“The third-quarter single-family and condo Florida resales data reflect a slowdown relative to second-quarter data as the expiration of the first-time homebuyer’s tax credit in April pulled future demand into the second quarter,” Snaith said, adding that the drop-off was expected.

Meanwhile, in the year-to-year quarterly comparison for existing single-family home sales, 41,122 homes sold statewide for the quarter compared to 44,451 homes in 3Q 2009 for a 7 percent decrease. The statewide existing-home median sales price was $135,200 in 3Q 2010; a year earlier, it was $145,300 for a decrease of 7 percent. Sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes, according to the National Association of Realtors® (NAR). The median is a typical market price where half the homes sold for more, half for less.

The University of Florida’s Bergstrom Center for Real Estate Studies’ latest quarterly survey of real estate trends reports that the jobless rate remains a top concern for the future outlook of the state’s real estate industry. The survey polls market research economists, industry executives, real estate scholars and other experts.

Timothy Becker, the center’s director, noted that investment in real estate continues to flow into Florida, though investors are wary about the economy. “The apartment sector is the stellar performer,” he said, adding that conditions continue to improve in the commercial sector. “We’re starting to see stabilization across property types in occupancy, with respondents saying they feel better about what rents are going to look like in the near future.”

Low mortgage rates continued to be available during the third quarter of the year. According to Freddie Mac, the national commitment rate for a 30-year conventional fixed-rate mortgage averaged 4.45 percent in 3Q 2010; one year earlier, it averaged 5.16 percent.

Source: Florida Realtors

Global Investor Sentiment Survey

10 11 2010

The United States’ investment sales market has the potential for increased fluidity in the year ahead, based on findings from Colliers International’s Q3 2010 Global Investor Sentiment Survey.

More than six out of 10 U.S. real estate investors responding to the survey indicated that they are considering selling property over the next year, up considerably from the 23 percent reported in the Q1 response. Meanwhile, 85 percent of U.S. investors expressed a desire to buy assets domestically during that time, with a focus on primary markets nationwide. The combined forces may position a significantly increased number of U.S. assets to trade over the next 12 months.

In particular, U.S. investors noted markets in California, Texas, New York/New Jersey and Florida, as well as Washington, D.C., Boston, Atlanta, Chicago, Denver and Seattle as key targets.

Further, 60 percent of U.S. real estate investor respondents expect to expand their portfolios in the coming year. An additional three out of 10 expect to maintain the size of their portfolios, with some of those expressing an interest in rebalancing their portfolios among different asset classes.

The survey, which includes investors from around the globe, also determined that the majority of U.S. respondents still believe that the “Property Clock” is at six o’clock, or at the bottom of the cycle. That is in sharp contrast to the average globally, which puts the time at eight o’clock, or at the beginning of an up cycle, but is similar to the U.S. sentiment in the first quarter of 2010.

The Property Clock equates market cycles to specific times of the day, with 12 o’clock representing the top of the market and six o’clock representing the bottom. Each six-hour period in between designates rising (after six o’clock to 12 o’clock) or declining (after 12 o’clock to six o’clock) cycles.

“With the Property Clock at six, it is no wonder why so many investors are seeking to expand their portfolios in the coming year,” said Dylan Taylor, Chief Executive Officer of Colliers International in the U.S. “Investors recognize that prices are at the bottom and see tremendous value in commercial real estate. This kind of positive sentiment expressed by U.S. investors is often a precursor to a more active investment sales market. There is plenty of pent-up demand and the survey suggests investors are ready to get off the sidelines and back into the game.”

The survey also reflected overall positive momentum globally. Survey participants believe that most commercial real estate markets have passed the bottom and are on the rise. Improving markets are characterized by rising demand, falling availability and vacancy and rising headline rents.

Some additional key global findings of Colliers International’s Q3 2010 Global Investor Sentiment Survey include:

• The largest group of respondents put the Global Property Clock for their regions at eight o’clock; the second and third largest groups were at six and seven o’clock, respectively.

• Most Q1 respondents placed their markets at between five and six o’clock.

• Ninety percent of respondents said they planned to expand their current level of real estate holdings within a year or maintain them at current levels.

• New York, Chicago, San Francisco, Washington, London, Sydney, Singapore and Hong Kong were listed as key cross-border investment destinations. Emerging markets mentioned include Poland, Ukraine and Brazil.

• Nearly 80 percent think debt will be easier to access in the next 12 months. Respondents who said they believe the cost of debt would rise in the next 12 months fell slightly from the first quarter of 2010, with 44 percent predicting an increase vs. 52 percent six months ago.

Some additional key regional findings include:

• In Western Europe, 60 percent of respondents intend to make cross-border investments, a notable increase from the figure of 30 percent for Q1 2010.

• 73 percent of Asian investors expect to expand their property portfolio in the next 12 months, up from 65 percent in Q1 2010.

• Looking ahead to the next 12 months, fewer Pacific investors (46 percent) expect to expand their property portfolio compared to the 68 percent who expected to expand in Q1 2010.

• Across Central and Eastern Europe, the range of locations being targeted by investors was quite diverse, although Warsaw remains the most popular destination, notably for office product. Other popular targets quoted were Kiev, Prague, Moscow and Bucharest.

The Colliers International Q3 Global Investor Sentiment Survey was conducted from August 15 to September 7, 2010. More than 200 major institutional and private investors with holdings of US $710 billion and representing a cross-section of property investors around the globe participated. The survey’s primary purpose is to better understand global investor attitudes in the current marketplace at a global and regional level, including investors’ outlook for the coming 12 months.

See complete Q3 2010 report here.

Source: Colliers International

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