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Real Estate News - March 2008
The following news stories are those which are most important for understanding the house price crash and the impact on house prices going forward...
Marketwatch: Fewer people bought residential properties as investments last year, according to a National Association of Realtors report released Friday.
Marketwatch: U.K. commercial property investment group Mapeley Ltd said Friday that talks about a bid for the company have ceased. The group previously announced on Feb. 26 that it had received an approach about an offer.
New York Times: Commodity boom continues as high rice cost creates fears of Asia unrest.
New York Times: In Boston, Residents Seek Face-to-Face Advice to Avoid Foreclosure.
New York Times: Foreclosure Machine Thrives on Woes.
Marketwatch: Arming against foreclosure - Should bankruptcy laws be tweaked to help homeowners avoid foreclosure?
FT: UK house prices continue to slide.
FT: Northern Rock to announce loss for last year.
Mortgage Strategy: Paragon has axed one third of its workforce.
New York Times: Not Everyone Is Cheering Lower Rates - THE large reduction in interest rates this year is a boon to debt-heavy homeowners and businesses, and it may yet save the economy from recession. But it does no favors for people who receive more interest income than they pay out, like those in, or close to, retirement.
New York Times: First, Self-Control. Then, Debt Control. While the financial experts are urging people to pay down debt — particularly expensive credit card debt — that is easier said than done.
Mortgage Strategy: Lehman Brothers is considering suspending lending at its two UK mortgage lending divisions Southern Pacific Mortgage Limited and Preferred Mortgages.
Marketwatch: Finding Your Refuge From Inflation. Just as you can't avoid inflation at the gas pump or the grocery store, you can't avoid it in your investment portfolio, either - though there are ways to limit the damage.
Reuters: Lehman to raise $3 billion to quash stability fears.
FT: Jimmy Cayne, a one-time travelling salesman who became a paper billionaire last year as chief executive of Bear Stearns, has sold his entire stake in the investment bank for a little more than $61m.
FT: The credit crunch yesterday forced three of the UK's biggest lenders to tighten up the supply of home loans and charge more for them in moves that are likely to put further pressure on the property market.
Marketwatch: U.K. house prices see fifth monthly drop.
Real Estate Journal: Foreclosures are occurring at the highest rate in decades -- and as a result, lenders are acquiring homes faster than they can sell them off. Last year, sales of foreclosed homes rose just 4.4%, while the supply more than doubled, according to First American CoreLogic.
FT: King hints at cut in interest rates.
FT: Regulators will have to consider imposing tougher capital requirements on the banking sector to avoid a repetition of the current crisis and address fundamental flaws in the global financial system, according to the Bank of England’s governor.
Marketwatch: Sales of new homes in the United States fell to a 13-year low in February, dropping 1.3% to a seasonally adjusted annual rate of 590,000. Sales have fallen four months in a row and are off about 30% in the past year. Inventories represented a 9.8-month supply at the February sales rate, unchanged from January and the highest since 1981. The median sales price fell 2.7% in the past year to $244,100.
Reuters: Goldman Sachs forecasts global credit losses stemming from the current market turmoil will reach $1.2 trillion, with Wall Street accounting for nearly 40 percent of the losses.
Marketwatch: U.S home prices in 20 major U.S. metro areas have plunged a record 10.7% in the past year as prices continued to decelerate, Standard & Poor's said Tuesday. The 20-city Case-Shiller home price index fell a record 2.4% from December to January, the 18th consecutive decline in prices. For 10 major cities, prices fell 2.3% in January and 11.4% for the past 12 months.
FT: Forecasts for City construction cut by half.
New York Times: JPMorgan Raises Bid for Bear Stearns to $10 a Share.
Real Estate Journal: Home Vacancy Rates Post Sharp Increases.
Real Estate Journal: Mortgage Mess Hits Home For Nation's Small Builders.
FT: Borrowers with modest loan-to-values and clean credit records are being dragged into the centre of the credit crisis as it becomes increasingly difficult for existing homeowners to secure new mortgage deals.
Marketwatch: U.S. home resales up first time in seven months. Median sales prices plunge record 8.2% in past year.
New York Times: Slump Moves From Wall St. to Main St.
FT: Hong Kong IPO market is ‘almost dead’.
FT: Madrid – Shares in Inmobiliaria Colonial fell almost 30 per cent on Thursday after Investment Corporation of Dubai and banks failed to agree a partial takeover bid for the Spanish property company.
FT: CIT Group, the largest independent commercial finance company in the US, on Thursday said it drew on $7.3bn in emergency credit lines and will sell assets to meet funding requirements.
Reuters: Citigroup cuts 2,000 jobs.
Real Esatte Journal: Atlanta Office Brokers Brace for a Bloodbath.
Real Estate Journal: A key barometer of construction-industry activity is signaling that the abrupt downturn in commercial construction could run deeper, and last longer, than previously expected.
FT: Financial companies are cutting back on their New York office space in response to the credit crisis, threatening the market with a flood of supply that could push up vacancies and push down rents, real estate brokers say.
Reuters: Mortgage lenders to pump $200 billion into markets.
Real Estate Journal: Condo Prices Head Lower Across U.S.
Mortgage Solutions: Specialist Mortgages Plc has announced it is withdrawing from the prime buy to let market with immediate effect.
Mortgage Strategy: Commercial First is suspending all new commercial lending with immediate effect.
Property Week: Shares in DTZ plunged 17% this morning after it issued a second profit warning.
FT: Property investors are struggling to find attractive rates of debt-financing to fund acquisitions, although the more established are finding money still available, albeit for smaller deals and at punitive rates.
FT: UK banking jobs ‘to be cut by 15%’.
FT: “Fair” values for bank assets could be different for accounting and regulatory purposes, the UK regulator has warned, in a move that could see banks forced to top up their capital reserves.
Marketwatch: Battling Wall Street's biggest crisis since the Depression, the Federal Reserve slashed its key lending rate by 75 basis points Tuesday to jump-start the sagging economy and boost confidence in the U.S. financial system.
Marketwatch: Single-family housing starts sink to 17-year low. Building permits drop 7.8%, biggest decline in 13 years.
Marketwatch: Frank Holmes, chief executive officer at U.S. Global Investors, says that gold will hit $2,000 an ounce and that while the move won't be straight there from current levels investors should not be surprised by it.
Real Esatte Journal: Two massive housing developments in Las Vegas, involving several of the nation's largest home builders, have received default notices on about $765 million in debt, according to one of the partners in the projects.
FT: Wolseley hit hard by US building woes.
FT: Northern Rock to axe one-third of staff.
FT: Equities blow to pension deficits.
FT: Carlyle Capital Corporation is to be wound up after the $22bn Amsterdam-listed mortgage fund said its shareholders had approved an application for a court appointed liquidator to sell its remaining assets.
Real Estate Journal: Older Homeowners Cautioned On Use of Reverse Mortgages.
Marketwatch: The Federal Reserve on Sunday cut the rate on direct loans to commercial banks by a quarter-point and said it will allow primary dealers to borrow at the rate in exchange for a broad range of investment-grade collateral.
Marketwatch: J.P. Morgan Chase to buy Bear Stearns for $2 a share
Reuters: House seeks debt limit increase to $10.2 trillion.
New York Times: JPMorgan and Fed Move to Bail Out Bear Stearns.
Marketwatch: J.P. Morgan, Fed to provide financing to Bear Stearns.
Real Estate Journal: Countrywide Financial Corp. saw its foreclosure rate continue to climb as its loan delinquency rate rose 66% in February from a year earlier, though it dipped slightly from January.
FT: Shares in Bear Stearns continued their sharp decline on Thursday as investors grew increasingly worried about the investment bank’s exposure to Carlyle Capital and other troubled investment funds.
FT: AIG urges ‘fair value’ rethink.
FT: Dollar plunges to record low.
Gold Money: A new record low for the dollar.
Real Estate Journal: Home builder Toll Brothers Inc. warned that it could suffer "significant" losses if its joint-venture partners don't honor their obligations to certain development projects amid the housing downturn.
Real Estate Journal: Fannie, Freddie Shares Suffer Hit As Mortgage-Default Fears Mount.
Marketwatch: Dollar falls below 100 yen for first time since 1995.
FT: Credit squeeze hits three more hedge funds.
FT: Shinsei, the Japanese bank, has been forced to sell its Tokyo headquarters to help cover a $300m loss on investments in the US mortgage market.
Reuters: Dollar sinks to record low vs euro, currency basket.
Property Week: Housing gloom nears 90s' recession depths.
FT: Citigroup in $1bn bail-out of six funds.
FT: Fed leads $236bn liquidity boost.
Marketwatch: Warren Buffett's latest annual shareholder letter just arrived. And in these uncertain times, it's more prescient than ever.
Marketwatch: Derivatives the new 'ticking bomb'. Buffett and Gross warn: $516 trillion bubble is a disaster waiting to happen
Reuters: Bear Stearns debt protection costs jump, puts active.
Marketwatch: Crude ends near $108 on weak dollar, speculation. Speculators triple their net long positions last week; heating oil hits new high
Real Estate Journal: Housing, Bank Troubles Continue to Deepen.
Marketwatch: 100% more difficult. First-time home buyers struggle to find down-payment money.
FT: Credit derivatives turmoil strikes.
Reuters: Fed boosts auction size in surprise action.
Real Estate Journal: In the latest sign of how the credit crunch is hurting even borrowers with good credit, some home-equity lenders are starting to slam the door on homeowners who want to refinance their primary mortgages.
FT: Taylor Wimpey hit by US housing meltdown.
FT: Thornburg Mortgage shares lost more than half their value on Thursday after the lender said it had defaulted on a debt.
FT: Shares in Ambac, the troubled bond insurer, fell a further 15 per cent on Thursday as the company continued its efforts into the evening to raise $1.5bn in essential capital that it needs to shore up its triple-A credit ratings.
Marketwatch: Household net worth falls 3.6% in 4th quarter.
Marketwatch: U.S. foreclosures hit another record high, MBA says.
Property Week: The credit crunch has started to hit buy-to-let landlords with mortgages for investors looking to rent out properties beginning to 'dry up', research showed.
Property Week: The Bank of England has voted to hold interest rates at 5.25% today.
FT: Mortgage lenders take tough stance on deposits.
FT: Buffett now richest person in the world.
Reuters: Ambac raising at least $1.5 bln of new capital.
Marketwatch: Crude surpasses $104; heating oil at new high.
Real Estate Journal: Fannie Mae and Freddie Mac announced an agreement with New York Attorney General Andrew Cuomo to discourage inflated appraisals by enforcing new standards in the home-mortgage market.
Real Estate Journal: Bernanke Says Homeowners Need Extra Help on Mortgages.
Wall Street Journal: Credit Agricole Swings to Loss On Write-Downs.
FT: California, the largest borrower in the US municipal bond market, on Tuesday forged ahead with plans to issue debt without paying for bond insurance, completing a $1.75bn bond issue sold largely to retail investors.
Mortgage Strategy: A survey from the Financial Services Authority has revealed one in five borrowers fear they will not be able to make their mortgage payments over the next year.
Real Estate Journal: Commercial Real Estate To Yield Write-Downs.
Real Estate Journal: How the Credit Mess Can Squeeze You.
New York Times: Bundled Mortgages and Dubious Fees Complicate Foreclosure Cases.
FT: Sweden’s banks have risen above the crowd of European banks that have struggled to justify or account for their exposure to an assortment of toxic loans.
Marketwatch: The level of the Fed's benchmark interest rates is lower than standard monetary policy rules call for and therefore must be transitory and reversed in due course or inflation expectations may become unmoored, said Philadelphia Fed Bank President Charles Plosser on Monday.
Reuters: Billionaire investor Warren Buffett said on Monday the U.S. economy is in recession and that stocks are "not cheap" despite recent declines.
Marketwatch: Gold, crude oil hit new highs, as dollar tumbles.
Berkshire Hathaway letter to shareholders.