Housing

The President likes to say that we are in a nationwide housing crisis.   While there is no question we are facing an American economic slowdown, is the real estate bust truly a nationwide phenomenon and one that merits his recently announced foreclosure prevention plan?   The numbers suggest it is not. As one of our smart viewers pointed out, the "crisis" seems to be mostly limited to ... read more

On the show today, HUD Secretary Shaun Donovan indicated my numbers were wrong when I asked why only one - ONE - mortgage has been modified under the Hope for Homeowners mortgage modification plan.   Either the Secretary needs to revisit his numbers, or his office need to revisit theirs.    Below is my email chain yesterday with a HUD official.  I have removed the name and email ... read more

The score is like something from of a cricket match gone horribly wrong: 3,675,971 to 1. Sadly, it's not sports.  That is the tally as of April 8th for the number of mortgage modifications performed under competing public and private plans. Private sector (Hope Now):3,675,971 Government (Hope for Homeowners): 1 The government figure is not a ... read more

Not that familiar with the author but the article makes some interesting points. His first point has to do with the history of bubbles and post-bubble asset revaluations: 1. Bubbles do not re-inflate in the asset class which just popped.  It is simply a truism that bubbles never reflate, ever. Tulip bulb valuations did not rise to stratospheric heights after the Tulip Craze popped, and the ... read more

Is the American government promoting another housing bubble?   It appears so. I have no idea how I missed this one ... but last week the Department of Housing and Urban Development said it is pushing a plan to allow lenders to accept the $8,000 first time home buyers tax credit as the down payment for the home. Let's repeat that. The already tiny 3.5% down payment required by the FHA ... read more

Chart on the May existing home sales figure. ... read more

More mildly good news for housing... Pending home sales rose 3.6% in June. That was much higher than the expected 0.7% increase and marks the fifth straight monthly gain. This comes with the recent Case-Shiller home price index that indicated some stabilization of prices in specific areas. The data is not wildly bullish, but does indicate there may be some building demand. Not to throw ... read more

This breaking now ... Lot of questions on first glance. 1) Is this a Fannie Mae bailout in disguise?   Fannie selling as help for homeowners, but given Fannie's precarious (and taxpayer owned) financial position, renting homes back may allow Fannie to delay the write downs that are inevitably coming and drag out the hit to what's left of its balance sheet. 2) Does Fannie still have to ... read more