Real Estate News Archive

What's happening on the Real Estate front. News from around the nation, we could have focused on the Green Valley and Sahuarita Arizona news. But, we felt a more rounded picture was far more accurate.

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Can Economy Handle Interest-Rate Resets?Interest rate resets on trillions dollars of adjustable-rate mortgages “won’t significantly impact the national economy or the mortgage lending industry” is the conclusion of a recent study conducted by First American CoreLogic, a provider of mortgage risk assessment.

Noting that the reset phenomenon has already begun, study author Christopher Cagen, Ph.D., director of research and analytics, anticipates a total of $112 billion in default losses spread over several years. These losses, he predicts, “won’t break the national economy. But the impact estimated in the study will be costly on the subset of people and organizations that experience it.”

The study analyzed 26 million mortgages originated between 2004 and 2006, including 8.37 million adjustable-rate mortgages valued at $2.2 trillion. In the next seven years, the study predicts that 1.1 million or 13 percent of these ARMs will go into foreclosure as owners face the double pressures of large rate resets and insufficient equity to refinance or sell.

Hardest hit, and affected the soonest, will be those holding subprime mortgages and teaser rate loans with low initial interest rates, interest-only, or negative amortization features originated within the last three years. Approximately, 1.1 million active first mortgages originated in 2004 to 2006 had an initial interest rate below 2 percent. Payments on loans such as these could increase by 97 percent after the interest rate resets.

Potential default rates due to interest rate loan resets, according to the study, will include: 32 percent of teaser loans 7 percent of market rate adjustable loans 12 percent of sub prime loans

Variables Affect Outcome

Changes in variables, most especially price, could easily change these projections. For example:

Each 1 percent rise in prices would cause 70,000 fewer loans to be lost to reset driven foreclosure, because price appreciation provide more equity enabling owners to refinance or sell.Each 1 percent fall in prices would cause an additional 70,000 loans to enter foreclosure

Another factor is remediation, either from outside sources such as the government or from the marketplace. “Many loans are being refinanced from adjustable-rate to fixed-rate terms, avoiding payment reset,” says study author. “Many lenders are working with their clients to modify or refinance existing loans to avoid default.”

— By Camilla McLaughlin for REALTOR® Magazine Online

March 26, 2007 Real Estate News "Subprime Fallout: Home Owners vs. Banks"

Financially-strapped and bankrupt home owners are pointing the finger at banks and mortgage brokers for selling them on the idea of subprime mortgages.

Doug Duncan, chief economist for the Mortgage Bankers Association in Washington, D.C., acknowledges that in some cases aggressive lenders obscured facts and made loans that borrowers couldn't afford. But he, like other lenders, says it was the responsibility of borrowers to read and understand what they signed.

About 50 percent of the subprime mortgages were "stated income loans," with no verification of borrowers' incomes, says Paul Leonard, director of the California office of the Center for Responsible Lending.

Last year, the Mortgage Asset Research Institute sampled 100 such loan applications and reported that 90 percent listed significantly higher incomes for borrowers than they had reported on their tax returns.

"Borrowers need to protect themselves and need to read what they're signing,” says Nick Larson, an assistant vice president at the Mortgage Asset Research Institute. “At the end of the day, bottom line, you can't stress this enough: The person who is signing the papers is committing themselves financially.”

Source: Associated Press, Alex Veiga (03/25/07)

March 23, 2007 Real Estate News "Existing-Home Sales Post 'Surprising' Gains"

Existing-home sales rose strongly in February reaching the highest level since last April, and follows a healthy gain from January, according to the NATIONAL ASSOCIATION OF REALTORS®.

Total existing-home sales — including single-family, townhomes, condominiums, and co-ops — rose 3.9 percent to a seasonally adjusted annual rate of 6.69 million units in February from a downwardly revised level of 6.44 million in January. Still, the numbers are 3.6 percent below the 6.94 million-unit pace in February 2006.

March 22, 2007 Real Estate News "Senator Blames Federal Regulators for Subprime Woes"

U.S. Sen. Christopher Dodd, chairman of the Senate Banking Committee, is blaming federal regulators for the crisis in the subprime mortgage market.

Dodd, a presidential hopeful, said in a statement that "a pattern of neglect by federal bank regulators ... precipitated the subprime mortgage crisis that could cause 2.2 million home owners to lose their homes."

Dodd described rising interest rates combined with the Federal Reserves’ tolerance for lax lending standards as "a perfect storm that has contributed to the hardship and heartache that millions of home owners now face."

The banking committee is expected Thursday to closely question officials from the Federal Reserve and several other federal agencies during a committee hearing.

Source: Reuters News, Kevin Drawbaugh (03/21/07)

March 22, 2007 Real Estate News "Fed Leaves Interest Rates Alone"

The Federal Reserve yesterday left the key federal funds rate at 5.25 percent — unchanged since last June.

But in a discussion of future changes, the Fed took a more neutral stance than in previous statements, saying "future policy adjustments will depend on the evolution of the outlook for both inflation and economic growth.” Observers view this as opening the door to cutting interest rates in the coming months if economic growth decelerates further.

Ian Shepherdson, chief U.S. economist at High Frequency Economics, says it is normal for inflation to ease when an economic expansion is decelerating — and for the Fed to show "equivocation." When the Fed's expectation of "moderate" growth fails to materialize, he says, "expect rapid easing" with the first cut by August.

Source: The Wall Street Journal, Greg Ip (03/22/07)

March 21, 2007 Real Estate News "Short Sales Might Help Curb U.S. Housing Slump"

A growing number of lenders are approving short sales as an alternative to foreclosure, says Mortgage Bankers Association Chief Economist Doug Duncan.

The move is a way for lenders to avoid having to take over and manage property.

"The way banks see it, it's better than if the house goes into foreclosure, stands empty, and sees its value spiral downward before it's auctioned on the courthouse steps," says Duncan, who expects rising delinquencies to spark an increase in pre-foreclosure sales.

Though short sales put additional downward pressure on the national median home price, Fannie Mae chief economist David Berson says they also lower the number of foreclosures and can help ease the housing downturn. Short sales are hard to track, though, because they're not counted, making it impossible to know exactly how many occur.

—Bloomberg, Kathleen Howley (03/21/07)

March 20, 2007 Real Estate News "How to Make Homes More Energy-Efficient"

Building green may cost more than building a conventional house, but over time the environmentally friendly home will actually save owners money on energy, architects say.

Building green isn’t all that different from the techniques used years ago before air conditioning and central heat. A skillful green architect considers climate, landscape, and access to raw materials.

Right now the only standards for building green homes are self-imposed by experienced builders. But the U.S. Green Building Council, which has been offering certification for commercial building projects, recently started a residential pilot program.

Here are some of the standards that are part of the proposed certification:

Daylighting: Lots of windows cut down on the need for artificial light.Gardens: Thick vegetation close to the house keeps the air inside cooler. Larger overhangs: A 4-foot overhang over a window or extension from the roof takes the edge off of the sun's heat.Metal: Metal-sided buildings reflect the sun's heat, resist rust, and cost relatively little.Shallower rooms: One-room deep homes with ventilation on at least two sides get great cross breezes.Smaller homes: It costs less to build, heat, and cool a smaller home.

Source: Houston Chronicle, Maggie Galehouse (03/18/07)

March 18, 2007 Real Estate News "Subprime Lenders Got What They Deserve?"

Even with a number of subprime lenders facing the prospect of bankruptcy, Robert Steel, the Treasury Department undersecretary for domestic finance, told reporters the current situation in the subprime market is manageable.

"We monitor the markets all the time, and are hopefully pretty aware of market conditions," Steel says. "It seems to us that the situation is a manageable one that we're watching."

His comments were echoed by those testifying before a House Financial Services panel.

"There's absolutely no question that there were lenders with this product that got aggressive," John Robbins, chairman of the Mortgage Bankers Association, told the committee. Those lenders are now being punished by the market as investors abandon them, he said.

Another witness, Karen Shaw Petrou, managing partner of Federal Financial Analytics, noted that subprime mortgages account for only an estimated $1 trillion of the $8 trillion U.S. home-mortgage market.

"It is a very distressing picture at this point," she said. "People forgot that subprime means higher risk, higher risk means more losses."

Source: The Associated Press, Marcy Gordon (03/12/07)

March 18, 2007 Real Estate News "Most Owners Don't Expect Home Values to Rise"

Most U.S. home owners don’t expect any change in the value of their homes in the next year, according to a survey by Reuters and University of Michigan.

The survey, conducted in January and February, says 55 percent of American home owners expect their home value to stay the same, while 38 percent expect an increase in value. Just 7 percent expect value to decrease.

Overall, home owners’ estimates of rising values are modest – a median price increase of just 0.1 percent. That would represent a slowing in expected price appreciation from double-digit increases in the recent past, likely discouraging the typical home owner from borrowing against their home equity, the survey concluded.

Source: Reuters News (03/14/2007)

March 17, 2007 Real Estate News "Economists Split on Effect of Subprime Fallout"

Just over half of 60 economists who were surveyed by The Wall Street Journal said they expect the unraveling subprime mortgage market to eventually spill over into broader mortgage market.

"Mortgage credit-quality problems go well beyond the subprime sector," Jan Hatzius, chief U.S. economist at Goldman Sachs in New York, wrote in a research note. "The underlying problem is not the subprime market per se, but the reset of large quantities of adjustable-rate debt.”

So-called teaser rates, or low initial rate on ARMs, expires sooner for subprime mortgages, which means home owners with ARMs may come to experience payment problems, Hatzius said.

But not everyone agrees there will be a big fallout. "You can tell a lot of scary stories," says Richard DeKaser of National City Corp., "but they're not broadly accurate. We're still talking about a small segment of the nation's homes that are affected."

According to the American Housing Survey for 2005, the most recent date for which data are available, 33 percent of all homes are owned outright and 57 percent have traditional mortgages, leaving just 10 percent potentially affected by ARM woes.

Source: The Wall Street Journal, Phil Izzo (03/16/2007)

March 17, 2007 Real Estate News "FHA Reforms Could Bring Alternatives to Risky Loans"

The NATIONAL ASSOCIATION OF REALTORS® has called on Congress to enact legislation that will allow the Federal Housing Administration to conform to today’s mortgage environment by offering safe alternatives to risky loans.

“Because FHA has not changed with the times, a growing number of home buyers are deciding to or are being forced to use one of several types of nontraditional mortgages,” said Joanne Poole, a REALTOR® and broker-owner from Maryland. She spoke on NAR’s behalf at a hearing before the U.S. Senate Appropriations Subcommittee on Transportation, Housing, and Urban Development.

If the FHA had an effective alternative to offer home buyers, “it’s not hard to imagine a lessening of those risky products, and therefore a lowering in the rising number of mortgage delinquencies,” Poole said.

NAR: Eliminate 3% Down Payment Rule

NAR spoke out in favor of many proposed changes to FHA, including eliminating the statutory 3 percent minimum cash down payment, offering down payment flexibility; allowing the FHA to offer risk-based pricing; and increasing the loan limits for FHA loans.

The FHA was established in 1934 to provide consumers with an alternative during a lending crisis. Since then, the agency has insured more than 34 million properties. However, because FHA has not evolved, its market share has been dropping, Poole said: FHA loans accounted for about 12 percent of the market in the 1990s, compared with less than 3 percent today.

Poole also noted that FHA loans have a foreclosure rate lower than many of the riskier, nontraditional mortgage products, and the program has never needed a federal bailout.

“When formed, FHA was a pioneer of mortgage products, but today it has become like a lender of last resort,” Poole said.

History of Helping the Housing Market

The universal and consistent availability of FHA loan products is the principal hallmark of the program that has made mortgage insurance available during periods of prosperity or depression, Poole said.

For example, when the housing market was in turmoil during the 1980s, FHA continued to insure loans when others left the market. FHA also devised a special loan forbearance program after the Sept. 11, 2001 attacks for those who temporarily lost their jobs, and enacted a foreclosure moratorium after Hurricanes Katrina and Rita for borrowers who were unable to pay their mortgages on time.

“FHA has helped to stabilize housing markets when private mortgage insurance has been nonexistent or regional economies have faltered,” Poole said. “Now, more than ever, FHA needs to be strengthened to continue to be useful and available to borrowers. FHA is a leader in preventing foreclosures.”

— REALTOR® Magazine Online

March 14, 2007 Real Estate News "What to Expect in the 2007 Housing Market"

Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions, but a recovery is likely this year, according to the latest forecast by the NATIONAL ASSOCIATION OF REALTORS®.

David Lereah, NAR’s chief economist, says there’s some ambiguity about the current housing market.

“Our goal each month is to fine-tune the forecast based on the latest housing data and a variety of economic indicators, but extraordinary weather variations are skewing home sales and clouding the picture,” he says. “Underlying trends point to a housing recovery in 2007, but it will take a couple months for us to get a better handle on it.

Existing-home sales are expected to slowly improve from what appears to be the cyclical low last fall, but we think there will be some additional pain in the new home market, which hopefully will start to rise later in the year.”

2007 Housing Projections

Here are some of NAR’s predictions for the coming months in housing:

Existing-home sales are projected at 6.42 million this year and 6.66 million in 2008, compared to 6.48 million last year. The national median existing-home price is projected to rise 1.2 percent to $224,500 this year, following a 1 percent gain in 2006. “Although existing-home sales will be marginally reduced due to subprime lending restrictions, they should be gradually rising this year and next,” Lereah says. “However, total sales this year will be fairly close to 2006 because last year started high and ended low.”

Lending problems in the subprime marketplace, which continue to grow, will also play a role in housings' recovery. “[This] could inhibit future housing activity and further dampen our forecast,” Lereah says. “Even so, these problems are likely to be contained and not spill over into the prime mortgage market.”The 30-year fixed-rate mortgage is expected to rise to 6.7 percent by the end of the year.

Last week, Freddie Mac reported the 30-year fixed rate dropped to 6.14 percent. “Over the last few years, mortgage interest rates have moved in surprising directions — the unexpected dip we’re seeing now and a rise in mortgage applications are positive signs,” Lereah says. “With soft home prices and lower interest rates, affordability has improved for home buyers and that is encouraging them to get into the market.”

New-home sales are forecast at 950,000 in 2007 and 981,000 next year, down from 1.06 million in 2006. The median new-home price should grow 1.7 percent to $249,600 in 2007, following a 1.9 percent increase last year. Housing starts will probably total 1.50 million this year and 1.56 million in 2008, in contrast with 1.80 million units last year.

Overall, stronger gains are probable in 2008, with new-home prices growing 3 percent and existing-home prices rising 3.1 percent.

Weather Cools the Market

For critics who don’t understand the weather impact on seasonally-adjusted sales, Lereah says they'll likely be reminded about the consequences throughout this spring.

Here’s what’s happened and how it’s likely to play out: In December, unusually mild weather brought out shoppers and January existing-home sales rose, Lereah explains. “However, a sudden chill in January slowed shopping activity relative to December and pending sales, based on contracts, fell," he says.

The biggest weather impact from February has yet to be seen. “February’s winter storms brought markets to a halt in much of the country, and it was the coldest February since 1979 — that should drag sales down in March,” Lereah says. “This means we may not see an upturn in closed transactions before May 25 when we report sales for April.”

Meanwhile, the following are some other factors to watch that can affect the market: The unemployment rate will probably average 4.7 percent this year; it was 4.6 percent in 2006.

Inflation, as measured by the Consumer Price Index, is forecast at 2.1 percent in 2007, down from 3.2 percent last year, while growth in the U.S. gross domestic product is seen at 2.5 percent this year, compared with 3.3 percent in 2006.

Inflation-adjusted disposable personal income is expected to rise 3.1 percent in 2007, up from a gain of 2.6 percent last year.

— REALTOR® Magazine Online

March 13, 2007 Real Estate News "NAR: Fannie, Freddie Need Stronger Oversight"

News of a strong regulatory regime that preserves the housing mission of government-sponsored enterprises will strengthen the housing finance system and emphasize the important role housing plays in the nation’s economy, the NATIONAL ASSOCIATION OF REALTORS® testified on Monday.

“We believe that having a single, independent, safety and soundness regulator for Fannie Mae, Freddie Mac and the Federal Home Loan Banks, with oversight and appropriate authority, is imperative to ensuring the support of their vital housing finance mission,” says Thomas M. Stevens, immediate past president of NAR.

“REALTORS® believe that the GSEs’ housing mission and the benefits that come with it play a vital role in the continued success of our nation’s housing system," Stevens says. "We have opposed, and will continue to oppose, legislative proposals that could reach beyond safety and soundness regulation and diminish the housing mission of the GSEs."

In addition to creating a strong regulator and GSE governance, NAR encouraged Congress to maintain the focus on the GSEs’ important housing mission, provide a streamlined new program approval process, oppose statutory limits on GSEs’ portfolio size and authorize regional adjustments to conforming loan limits for high-cost areas.

“NAR believes that Fannie Mae, Freddie Mac and the Federal Home Loan Banks are integral components of this nation’s highly acclaimed housing finance system," Stevens says. "Their support of the secondary mortgage market is crucial to REALTORS®, and for supplying funding for single-family and multifamily housing.

"Any legislation should protect the GSEs’ ability to accomplish their housing mission and support housing finance. In addition, we hope there will be a focus on efforts to increase affordable homeownership opportunities, especially among minorities and other underserved populations.”

NAR pledged to work with the 110th Congress to move forward on GSE legislation that protects the vibrancy, liquidity, and evolution of the housing finance system.

— REALTOR® Magazine Online

March 12, 2007 Real Estate News "Some Subprime Lenders Face Bankruptcy"

Big banks and investors that purchased subprime mortgages originated by small lenders over the last couple years are responding to an increase in defaults on the products by ordering the lenders to buy them back.

Many subprime originators are now facing bankruptcy because they lack the money necessary to comply, and some experts argue that the subprime mortgage market is weakening at a faster pace due to these repurchase demands.

New Century Financial Corp., for instance, is among the lenders on the brink of bankruptcy, fielding repurchase orders from Morgan Stanley, Citigroup Inc., Goldman Sachs Group Inc., Credit Suisse Group Inc., IXIS Real Estate Capital Inc., and Bank of America Corp.

The company reportedly owes a total of $8.4 billion to these creditors, and Piper Jaffray analyst Robert Napoli says that repurchasing the loans at a 20-percent loss would eliminate New Century shareholders' equity.

Source: The Wall Street Journal, Carrick Mollenkamp, James R. Hagerty, and Randall Smith (03/13/07)

March 8, 2007 Real Estate News "Borrowers Hit by Rising Standards, Falling Prices"

More and more borrowers in markets where home prices are declining are finding themselves facing foreclosure — unable to pay their mortgage, unable to sell the property, and unable to refinance the loan because their income and credit scores no longer qualify them.

The trend accelerated last week after federal regulators proposed stricter guidelines for banks that make sub-prime adjustable-rate mortgages. The move followed Freddie Mac’s decision to drastically raise the criteria for the sub-prime ARMs it would buy and to require better proof of a borrower’s finances.

Nearly two dozen sub-prime lenders have already shutdown or been purchased and another dozen are in trouble, according a report by Credit Suisse.

In 23 metropolitan areas where home prices fell 4 percent or more at the end of last year, at least half the sub-prime ARMs will reset to higher rates this year or next, according to an analysis by First American Loan Performance.

The eight metro areas where prices have fallen the most and the amount they’ve declined are:

Sarasota/Bradenton, Fla., down 18 percent

Palm Bay/Melbourne/Titusville, Fla., down 17 percent

Cape Coral/Fort Myers, Fla., down 12 percent

Springfield, Ill., down 10 percent

New Orleans, down 9 percent

Reno, Nev., down 9 percent

Barnstable/Yarmouth, Mass., down 8 percent

Youngstown/Warren, Ohio, down 8 percent

Source: USA Today, Noelle Knox (03/05/07)

Part6

March 1, 2007 Real Estate News "Regional Data: West Has Biggest Sales Drop"

Northeast: The Northeast saw an existing-home sales pace of 1.04 million units in the fourth quarter, which was 6.6 percent below a year ago. The median Northeastern resale single-family home price was $274,600 in the fourth quarter, which is 2.5 percent below the same period in 2005.

After the Atlantic City and Trenton-Ewing areas, the strongest price increase in the Northeast was in Pittsfield, Mass., with a median price of $220,600, up 4.7 percent from the fourth quarter of last year. Also, recording strong price gains was the Albany-Schenectady-Troy area of New York with a median price of $198,700, up 4.1 percent.

South: Total existing-home sales in the South were at an annual rate of 2.49 million units in the fourth quarter, down 8.5 percent from the fourth quarter of 2005. After the gains in Arkansas and Texas, the next strongest increase in the South was in Kentucky, up 5.6 percent from a year ago, while Mississippi rose 2.0 percent.

The median existing single-family home price in the South was $181,700 in the fourth quarter, which is 3.7 percent below a year earlier. The strongest increase in the South was in the Beaumont-Port Arthur area of Texas, where the median price of $120,000 was 15.1 percent above the fourth quarter of 2005. Next was Raleigh-Cary, N.C., at $226,300, up 14.5 percent from a year ago, followed by the Cumberland area of Maryland and West Virginia, with a 14.4 percent gain to $98,000.

Midwest: In the Midwest, total existing-home sales declined 8.6 percent to a 1.43 million-unit annual level in the fourth quarter compared with a year earlier. The median existing single-family home price in the Midwest was $161,800, down 4.2 percent from the fourth quarter of 2005.

The strongest metro price increase in the Midwest was in the Davenport-Moline-Rock Island area of Iowa and Illinois, where the median price of $116,400 was 6.6 percent higher than a year ago. Next was Dayton, Ohio, at $119,500, up 5.9 percent from the fourth quarter of 2005, and Rockford, Ill., at $121,500, up 5.7 percent in the last year.

West: In the West, the existing-home sales pace of 1.28 million units was 17.8 percent lower than the fourth quarter of 2005. The best performance in the region was in Alaska, where existing-home sales rose 0.4 percent from a year earlier.

The median existing single-family home price in the West slipped 0.4 percent to $355,100 during the fourth quarter. After Salt Lake City, the strongest increase in the West was in the Salem, Ore., area, at $223,100, up 14.9 percent from fourth quarter of 2005, followed by Farmington, N.M., at $183,000, up 14.0 percent, and Spokane, Wash., at $189,200, up 12.2 percent from a year ago.

— REALTOR® Magazine Online

February 26, 2007 Real Estate News "Condo Prices Dip Slightly"

Metro area condominium and cooperative prices — covering changes in 58 markets — show the national median existing condo price was $220,900 in the fourth quarter, down 2.1 percent from the same period in 2005. Thirty-one metros showed annual increases in the median condo price, including seven areas with double-digit gains; 27 metros had price declines.

The strongest condo price gains were in the Austin-Round Rock area of Texas, where the fourth quarter price of $160,000 rose 16.5 percent from a year ago. Also, posting strong condo price gains were the Newark-Union area of New Jersey and Pennsylvania, where the median condo price of $352,600 rose 16.4 percent from the fourth quarter of 2005, and Springfield, Mass., at $160,400, an increase of 14.6 percent.

Metro area median existing condo prices in the fourth quarter ranged from $102,600 in Wichita, Kan., to $580,300 in the San Francisco-Oakland-Fremont area. The second most expensive reported condo market was Los Angeles-Long Beach-Santa Ana at $402,000, followed by the San Diego-Carlsbad-San Marcos area of California at $358,200.

Affordable condo markets include Bismarck, N.D., at $103,500, and Greensboro-High Point, N.C., at $119,100.

up next in the news "Regional Data: West Has Biggest Sales Drop "...

February 22, 2007 Real Estate News "Buyers Responding to Incentives"

While the fourth-quarter statistics provide a snapshot of the housing market a few months ago, the current market already is changing for the better, Combs says. Favorable interest rates and better pricing are fueling buyer demand.

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage was 6.25 percent in the fourth quarter, down from 6.56 percent in the third quarter. The rate was 6.22 percent in the fourth quarter of 2005.

February 20, 2007 Real Estate News "A Look at Long-Term Price Gains"

NAR President Pat Vredevoogd Combs says it’s smart to examine home price trends over a five-year period for a more accurate picture of appreciation that home owners realize when they sell.

“Since the typical owner stays in a home for six years, it’s more useful to look at the five-year comparison for metro area home prices — most of them are seeing strong gains,” she said. The median five-year price gain is 41.8 percent.

NAR’s research shows that typical sellers experienced healthy gains on the value of their home over the last five years in almost all 131 available areas, even in areas with recent price declines.

Metro areas with the largest single-family price gains over the past five years include the California areas of Riverside-San Bernardino-Ontario, up 155.3 percent, and Los Angeles-Long Beach-Santa Ana, up 142.3 percent, followed by the Miami-Fort Lauderdale-Miami Beach area of Florida, up 135.4 percent.

Feb 16, 2007 Real Estate News, "Most, Least Expensive Markets"

The most affordable median price for single-family homes was in Elmira, N.Y., at $78,400. Other affordable markets include the Youngstown-Warren-Boardman area of Ohio and Pennsylvania, with a fourth-quarter median price of $80,000; and Decatur, Ill., at $89,200.

The most expensive was in the San Jose-Sunnyvale-Santa Clara area of California where the median price was $760,000. The second most expensive area was San Francisco-Oakland-Fremont, at $733,400, followed by the Anaheim-Santa Ana-Irvine area (Orange Co., Calif.), at $690,700. More news to come.

Feb 15, 2007 Real Estate News, 4th Quarter Marks 'Bottom of Housing Cycle'

4th Quarter Marks 'Bottom of Housing Cycle' Existing-home sales in most states declined from year-ago levels in the fourth quarter, marking the likely bottom for the current housing cycle, according to the latest quarterly survey by the NATIONAL ASSOCIATION OF REALTORS®. Prices dipped slightly overall, as sellers were more willing to negotiate.

“This information confirms 2006 was the year of contraction,” says NAR Chief Economist David Lereah. “Hopefully the fourth quarter was the bottom of this current business cycle.”

He says home sales are leveling at historically high levels, and examination of data within the fourth quarter shows home prices began to stabilize near the end of the year. “When we get the figures for this spring, I expect to see a discernible improvement in both sales and prices,” he says.

Sales Pace Slows 10%

Total state existing-home sales, including single-family homes and condos, were at a seasonally adjusted annual rate of 6.24 million units in the fourth quarter, down 10.1 percent from a 6.94 million-unit level in the fourth quarter of 2005. Even with the general decline, six states showed increases in the sales pace from a year ago and one was unchanged.

The biggest total sales increase was in Indiana, where existing-home sales rose 13.7 percent from the fourth quarter of 2005. In Arkansas the fourth-quarter resale pace rose 11.1 percent from a year earlier, while Texas experienced the third strongest gain, up 6.2 percent.

Prices Rise in 71 Metro Areas

The national median price for existing single-family homes was $219,300 in the fourth quarter, down 2.7 percent from a year earlier when the median price was $225,300. The median is a typical market price where half of the homes sold for more and half sold for less. For all of 2006, the median price rose 1.4 percent to $222,000.

Among the 149 metropolitan statistical areas examined for the fourth-quarter survey, 71 showed price gains from a year earlier, including 14 metros with double-digit annual increases; 73 areas had price declines and five were unchanged.

The largest single-family home price gain was in the Atlantic City, N.J., area, where the median price of $339,800 was 25.9 percent higher than a year ago. Next was the Salt Lake City area, where prices rose 22.7 percent to $223,600; and The Trenton-Ewing area of New Jersey, with an 18.9 percent increase to $289,000. More news to come.