K+B Delta Vee will publish again in the new year. Until then, all the best to you and yours this holiday season.
Wednesday, December 19, 2007
Somewhere Mr. Whipple Is Weeping with Joy
In New York City, Jennifer Cannon and Doy Nichols of Lexington, KY, are getting married today in a bathroom. (Insert your own unprintable joke here, as I did, and then shame on us all.)
The bride will wear a lovely gown made entirely out of Charmin toilet paper. No word on what the groom is wearinmg when he takes the plunge.
Proctor & Gamble, makers of Charmin, note that the couple is "flush with excitement" and that they will be honeymooning at Destination Kohler in Kohler, WI.
The bride will wear a lovely gown made entirely out of Charmin toilet paper. No word on what the groom is wearinmg when he takes the plunge.
Proctor & Gamble, makers of Charmin, note that the couple is "flush with excitement" and that they will be honeymooning at Destination Kohler in Kohler, WI.
Tuesday, December 18, 2007
November Building Permits Fell to 14-Year Low
Permits for new homes in November fell to a 14-year low, while single family housing start numbers dropped to the lowest point in 16 years, according to the Census Bureau.
The latest lump of coal finds a seasonally adjusted annualized start rate of 1.187 million homes in November, down 24.2% from the same month last year. Single family starts slumped to a rate of 829,000 units a year, down 34.9% from November, 2006.
Starts have slumped 47.6% from the pace in January, 2006, and the single family start rate has dipped 54.3% over that span.
Permits dipped to a seasonally adjusted annualized rate of 1.152 million during the month, down 24.6% from November, 2006. Single family permits fell 33.7% to 754,000 units per year.
The latest lump of coal finds a seasonally adjusted annualized start rate of 1.187 million homes in November, down 24.2% from the same month last year. Single family starts slumped to a rate of 829,000 units a year, down 34.9% from November, 2006.
Starts have slumped 47.6% from the pace in January, 2006, and the single family start rate has dipped 54.3% over that span.
Permits dipped to a seasonally adjusted annualized rate of 1.152 million during the month, down 24.6% from November, 2006. Single family permits fell 33.7% to 754,000 units per year.
Tuesday, December 11, 2007
Gloomy Paragraph of the Day
From the AP: "While the mortgage crisis has brought a rising wave of foreclosure notices into public view, less evident have been "pictures of people standing with furniture on the lawn" after being forcibly evicted from their homes, (Freddie Mac chairman and CEO Richard) Syron said. "As that begins to happen, and it will happen, I am afraid of the impact that this has."
NAR Sees Modest Turnaround in 2008
The National Association of Realtors says existing home sales are likely to total 5.67 million units this year, the fifth highest on record, rising 0.5% to 5.70 million in 2008. The 2008 figure will still be down 12.0% from 6.48 million in 2006. Existing-home prices should be down 1.9% to a median of $217,600 for all of 2007, and then rise 0.3% to $218,300 in 2008.
NAR says the 30-year fixed-rate mortgage will rise slowly to the 6.4% range by the end of 2008. Gross domestic product (GDP) growth should be 2.1% in 2007, down from a 2.9% growth rate last year; GDP growth is forecast to improve to 2.4% in 2008.
The unemployment rate is likely to average 4.6% for 2007, unchanged from last year, but rise to 5.0% in 2008. Inflation-adjusted disposable personal income is estimated to grow 3.1% this year, the same as in 2006, and then grow 2.2% next year.
NAR says the 30-year fixed-rate mortgage will rise slowly to the 6.4% range by the end of 2008. Gross domestic product (GDP) growth should be 2.1% in 2007, down from a 2.9% growth rate last year; GDP growth is forecast to improve to 2.4% in 2008.
The unemployment rate is likely to average 4.6% for 2007, unchanged from last year, but rise to 5.0% in 2008. Inflation-adjusted disposable personal income is estimated to grow 3.1% this year, the same as in 2006, and then grow 2.2% next year.
Monday, December 10, 2007
How the Mortgage Crisis Shapes Up
A sobering assessment from the Wall Street Journal: "As house prices fall and homeowners default on mortgages at troubling rates, the pain has spread far and wide. An examination of the resulting crisis shows that it is comparable to some of the biggest financial disasters of the past half-century.
So far, the potential losses look manageable compared with the savings-and-loan crisis of the 1980s and the tech-stock crash of 2000-02. But the housing debacle could yet take years to work out, thanks to the sheer complexity of it. Until the mess is cleaned up, investors will remain jittery and banks will likely hold back on all kinds of lending -- a credit crunch that is already damping global growth and could tip the U.S. economy into recession."
So far, the potential losses look manageable compared with the savings-and-loan crisis of the 1980s and the tech-stock crash of 2000-02. But the housing debacle could yet take years to work out, thanks to the sheer complexity of it. Until the mess is cleaned up, investors will remain jittery and banks will likely hold back on all kinds of lending -- a credit crunch that is already damping global growth and could tip the U.S. economy into recession."
Friday, December 7, 2007
November Residential Construction Employment Down 2%
Employment in the residential construction field overall slipped 2.1% from October to November, with some 3.2 million workers employed during the month, according to the Bureau of Labor Statistics. The figure marked a 5.1% drop from levels in November, 2006.
Some 963,900 workers building residential units were employed in November, down 2.0% from October, while 2.2 million residential specialty trade contractors were employed, a 2.2% month-to-month drop.
For the economy as a whole, the unemployment rate held at 4.7%. Average hourly earnings increased just half a percent from October to November to $17.63; the mark was 1.8% higher than the same month last year.
Some 963,900 workers building residential units were employed in November, down 2.0% from October, while 2.2 million residential specialty trade contractors were employed, a 2.2% month-to-month drop.
For the economy as a whole, the unemployment rate held at 4.7%. Average hourly earnings increased just half a percent from October to November to $17.63; the mark was 1.8% higher than the same month last year.
Monday, December 3, 2007
More Than Half of Sub-Prime Borrowers Could Have Gotten Conventional Loans
The Wall Street Journal finds a study that says 55% of the borrowers in 2005 who got sub-prime mortgages could have qualified for more conventional mortages with better terms. In 2006, 61% did. "The analysis also raises pointed questions about the practices of major mortgage lenders. Many borrowers whose credit scores might have qualified them for more conventional loans say they were pushed into risky subprime loans. They say lenders or brokers aggressively marketed the loans, offering easier and faster approvals -- and playing down or hiding the onerous price paid over the long haul in higher interest rates or stricter repayment terms," says the Journal.
In other news, Lennar Homes has sold $1.3 billion in land to Morgan Stanley for 40 cents on the dollar.
In other news, Lennar Homes has sold $1.3 billion in land to Morgan Stanley for 40 cents on the dollar.
Friday, November 30, 2007
How We Got Here
From the court documents in the fallout of the Duke Cunningham bribery case. Former Congressman Cunningham is currently serving eight years for taking bribes from a number of individuals, including the Thomas Kontogiannis mentioned here:
"The government’s investigation indicates that Kontogiannis’s typical mortgage fraud involved the following scenario. (With regard to the following narrative, see Exhibit 5 and Exhibits 12-19.)
Kontogiannis would have a loan application prepared in the name of a putative home purchaser, sometimes with the knowledge of the person (who might be paid a fee) and sometimes without the person’s knowledge, for a property that Kontogiannis either had developed or had planned to develop. Fraudulent paperwork would be prepared related to, for example, income, assets, or appraisal. (Kontogiannis presumably would pay a kickback to the individual preparing these documents.) Applications would then otherwise be submitted for approval to various financial institutions in accordance with normal industry practices. At closing, all title documentation (such as the mortgage and note, the uniform settlement statement (HUD-1 form), title-insurance paperwork, and affidavits pertaining to the purchaser’s identity and intent of occupancy) would be fraudulently executed by a loan officer controlled by Kontogiannis. ... The mortgage and note, however, would never be recorded, the taxes never paid, and title insurance never purchased. Instead, the funds that had been disbursed for these purposes would eventually be steered to another company ostensibly owned by one of Kontogiannis’s daughters but controlled by Kontogiannis.
These fraudulent loans would ultimately be sold into the secondary-mortgage market to a lender who would be led to believe, based on the loan documentation provided by Kontogiannis’s agent, that the loan had been sent for recording and that all taxes and recording fees had been paid....
One company alone had purchased over 100 of the loans in the secondary market, with an average loan amount of approximately $500,000. That publicly traded and federally chartered bank thus had approximately $50,000,000 in loans that were potentially worthless because, as a result of Kontogiannis’s scams, none of the mortgages were recorded in primary position as the bank had assumed. That, in turn, meant that if any of the loans defaulted, the bank would not be able to foreclose on any real property and thereby recoup any of the losses. ”
Published speculation says the "one company" may be Washington Mutual, which you may remember surfaced in another matter.
"The government’s investigation indicates that Kontogiannis’s typical mortgage fraud involved the following scenario. (With regard to the following narrative, see Exhibit 5 and Exhibits 12-19.)
Kontogiannis would have a loan application prepared in the name of a putative home purchaser, sometimes with the knowledge of the person (who might be paid a fee) and sometimes without the person’s knowledge, for a property that Kontogiannis either had developed or had planned to develop. Fraudulent paperwork would be prepared related to, for example, income, assets, or appraisal. (Kontogiannis presumably would pay a kickback to the individual preparing these documents.) Applications would then otherwise be submitted for approval to various financial institutions in accordance with normal industry practices. At closing, all title documentation (such as the mortgage and note, the uniform settlement statement (HUD-1 form), title-insurance paperwork, and affidavits pertaining to the purchaser’s identity and intent of occupancy) would be fraudulently executed by a loan officer controlled by Kontogiannis. ... The mortgage and note, however, would never be recorded, the taxes never paid, and title insurance never purchased. Instead, the funds that had been disbursed for these purposes would eventually be steered to another company ostensibly owned by one of Kontogiannis’s daughters but controlled by Kontogiannis.
These fraudulent loans would ultimately be sold into the secondary-mortgage market to a lender who would be led to believe, based on the loan documentation provided by Kontogiannis’s agent, that the loan had been sent for recording and that all taxes and recording fees had been paid....
One company alone had purchased over 100 of the loans in the secondary market, with an average loan amount of approximately $500,000. That publicly traded and federally chartered bank thus had approximately $50,000,000 in loans that were potentially worthless because, as a result of Kontogiannis’s scams, none of the mortgages were recorded in primary position as the bank had assumed. That, in turn, meant that if any of the loans defaulted, the bank would not be able to foreclose on any real property and thereby recoup any of the losses. ”
Published speculation says the "one company" may be Washington Mutual, which you may remember surfaced in another matter.
Thursday, November 29, 2007
People Feel At Home in Their Kitchens
A friendly reminder from eBay, and you've only yourself to blame if you click through.
New Home Sales Drop 23.5% in October
New home sales dipped 23.5% in October to a seasonally adjusted annualized rate of 728,000 units, according to the most recent figures from the Census Bureau. That figure was reported widely as an month-to-month increase, but while it was a 1.7% increase over the revised September rate, it was well below the initially reported rate of 770,000 units in September.
Through the first ten months of 2007, some 689,000 new homes have been sold, down 24.2% from the same period last year.
The median new home price for October was $217,800, down 8.6% from September's median and down 13.0% from October, 2006's median price. Builders were reckoned to have 8.5 months worth of unsold inventory. The average house sold had been on the market nearly six months, up from 3.7 months in October, 2006.
Through the first ten months of 2007, some 689,000 new homes have been sold, down 24.2% from the same period last year.
The median new home price for October was $217,800, down 8.6% from September's median and down 13.0% from October, 2006's median price. Builders were reckoned to have 8.5 months worth of unsold inventory. The average house sold had been on the market nearly six months, up from 3.7 months in October, 2006.
October Foreclosures Level Off, But Are Still Nearly Double 2006's Pace
Some 224,451 foreclosure notices were filed in October, up 94% from the same month last year, according to online marketplace RealtyTrac®. However, the mark was up just 2% from September. The national foreclosure rate for the month was one foreclosure filing for every 555 households.
“Overall foreclosure activity continues to register at a high level compared to last year, but it appears to have leveled off over the past two months after hitting a high for the year in August,” said James J. Saccacio, chief executive officer of RealtyTrac. “Default notices were down nearly 9% in October, indicating that some of the efforts on the part of homeowners, lenders and advocacy groups to find alternatives to foreclosure may be starting to have an impact. On the other hand, bank repossessions were up nearly 35% , evidence that more homeowners who enter foreclosure are losing their homes.”
“Overall foreclosure activity continues to register at a high level compared to last year, but it appears to have leveled off over the past two months after hitting a high for the year in August,” said James J. Saccacio, chief executive officer of RealtyTrac. “Default notices were down nearly 9% in October, indicating that some of the efforts on the part of homeowners, lenders and advocacy groups to find alternatives to foreclosure may be starting to have an impact. On the other hand, bank repossessions were up nearly 35% , evidence that more homeowners who enter foreclosure are losing their homes.”
Subscribe to:
Posts (Atom)
