Monday, December 20, 2004

In 2005, interest rates have nowhere to go but up.

Economists, lenders, mortgage brokers and others involved in the housing industry can at least agree on that. But they expect the rise to be gradual and don't believe it will drastically impact the nation's housing market.

By the end of 2005, most expect mortgage rates to be in the range of 6.5 percent to 7 percent.

"They're not going to be as good as they had been in the past, but not disastrous," said James Barth, senior fellow at the Milken Institute and finance professor at Auburn University.

Looming over mortgage rate movement is the Federal Reserve's stance on monetary policy and the state of the bond market.

Since June, the Federal Reserve's Open Market Committee has raised its target for the federal funds rate by 25 basis points five times, bringing it to 2.25 percent. The federal funds target rate is what banks charge each other overnight. It has no direct impact on mortgage rates or the bond market, but it can alter them indirectly. A change in the federal funds rate, for example, is likely to change the prime rate, the rate banks charge their best corporate customers. That's generally about three percentage points above the federal funds rate.

From there, any lines of credit tied to the prime rate rise as well. The yields on short-term Treasury bills generally move with changes in the federal funds rate.

Since rates on 30-year fixed-rate mortgages tend to move closely with the 10-year Treasury bonds, any potential increase in the rate of that benchmark bond is likely to drive up mortgage rates as well. And with the overall continuing decline of the dollar against other currencies, it's likely the 10-year Treasury bond will increase regardless of what the Fed does, said Christopher Cagan, director of research and analytics for First American Real Estate Solutions.


Friday, December 17, 2004

Suite Vollard building Curitiba, Brazil
 Posted by Hello

Want to go for a spin? Just stay home

Each floor of the brand new 11 story Suite Vollard building can revolve independently 360 degrees to the left or to the right.

“This is the only building in the world in which each apartment can spin individually,” said Joao Carlos Peters, marketing director at the Moro construction company. “This is really a work of art because this was based on an entirely new concept of living,” Peters said.

Spinning in the high-tech building is activated by voice commands. It takes an hour for each 3,000-square-foot apartment to complete one rotation. “You can’t have it spin any faster because you need the turning to be subtle,” Peters said.

The project took 10 years to complete and the suites, which each occupy an entire floor of the circular building, went on sale Thursday for $300,000.

Tuesday, December 14, 2004

Does Your Home Have "Curb Appeal"?

First impressions do make a difference when selling your home. Oftentimes, before making the phone call to schedule an appointment, a homebuyer will drive by your home to determine if they may be further interested. If the house presents a good impression, then you receive the phone call for an appointment.

Many homes are eliminated from a potential homebuyer’s list because they do not give a good first impression. The work you put into sprucing up the inside will be in vain if the exterior of your home does not draw people in. In the real estate world this is known as "curb appeal", that is, your home should be appealing to potential buyers from their initial curbside or drive-by viewing.

Achieving curb appeal is not very difficult, nor does it have to be very costly. Assuming your roof, gutters, etc… are not in obvious need of repair, most of your efforts will be focused on cosmetics. Step back from your home or better yet, go to the curb and take a long objective look at your home. You may want to take a look from different angles. Compare your home to others on your block. You will be focusing on two main areas; the house itself and the landscaping surrounding your house.

When observing your home, start at the top of the roof and work your way down. Write down areas that need attention. You are striving for a look that makes observers feel that your home is neat, clean and well cared for. The following areas of your exterior deserve special attention:

Roof and chimney - Shingles should be intact with none missing and mortar between the bricks should be secure. Although expensive to replace, a roof or chimney in disrepair often discourages potential homebuyers.

Exterior siding - If your siding needs to be painted, it is well worth the expense and time. Choose a color that is fairly neutral and that coordinates with homes in your immediate vicinity. Power washing dirty siding can make a house look almost new again.

Gutters – You should repair and clean gutters. Weeds growing from your gutters are a good example of a negative first impression. Nothing says "poor maintenance" like weeds in a gutter.

Windows and Trim - If the paint on the trim or windows is peeling, scrape and paint. Replace any broken glass and finally clean the windows inside and out.

Front Entry Door - If your front door has not been painted in 3-4 years, consider a fresh coat of paint. Depending on the style of your home, a contrasting color from your siding may add visual interest. The front door should welcome buyers into your home. A nice looking wreath in tune with the season gives a warm homey touch.


Friday, December 10, 2004

Real estate scam hits Texas

150 homeowners allegedly defrauded of mortgage payments

The Texas Attorney General's Office is seeking a restraining order and asset freeze against a company that has allegedly defrauded more than 150 homeowners by keeping their mortgage payments.

Consumers in the Dallas-Fort Worth and Houston areas reported to the Office of the Attorney General that City Mortgage Services Inc. (which has no affiliation to CitiBank or CitiMortgage) and its principals, Gustavo Duarte and Alfredo Mendez, pocketed thousands of dollars that should have been forwarded to the mortgage companies financing the consumers' homes.

The company, which had offices in Dallas, Houston and Austin, shut down abruptly earlier this year, leaving consumers owing their mortgage companies substantial amounts of money in missed payments and late fees, the office announced.

"Brazen schemes like these will not be tolerated in Texas," said Attorney General Abbott. "City Mortgage systematically victimized these Hispanic families by exploiting their dreams of home ownership. I am committed to ensuring this scam doesn't hurt any more Texas consumers."

According to the lawsuit, City Mortgage dispatched teams of door-to-door salespersons throughout Hispanic neighborhoods, touting the company's "debt-reduction service." Sales pitches and promotional materials promised consumers City Mortgage would save them thousands of dollars by withdrawing and forwarding to their mortgage company a larger monthly amount than their regular mortgage payment, thus reducing the number of years it took to pay off the loan, the office announced. City Mortgage charged families between $700 and $1,000 for the service.

The lawsuit alleges, "The home solicitation presentation of defendants included a promise to lower the consumers' mortgage payments and shorten the term of their mortgage loan by making bi-weekly payments instead of monthly and making increased payment amounts. In many cases, the defendants represented to consumers that the mortgage repayment plan defendants were proposing was a city of Dallas plan and/or approved/sanctioned by the city of Dallas."


Tuesday, December 07, 2004

Housing Wealth Has Greater Effect Than Stocks, New Study Shows

Housing wealth has a more immediate impact on consumer spending than stock wealth and has sustained the U.S. economy since the beginning of this decade, shows a new study produced by the Joint Center for Housing Studies of Harvard University and Macroeconomic Advisers, LCC, and commissioned by the National Association of Realtors®.


Monday, December 06, 2004

New futures market to protect against housing bubble

CME plans derivatives that would guard home's value

The nation's largest futures exchange today announced that it plans to build a sophisticated derivates market to protect homeowners from a bursting housing bubble.

Chicago Mercantile Exchange has completed a Letter of Intent with MACRO Securities Research LLC to explore developing derivatives based on the Fiserv, CSW family of Housing Price Indexes. These derivatives would create a market that ultimately will provide homeowners with tools to help them protect the value of their largest asset.

MACRO Securities Research, or MSR for short, is a financial innovations firm dedicated to the creation of instruments designed to unlock liquidity in new asset classes

The CSW Home Price indexes track home price trends and are used by some of the country's largest lenders for loan originations as well as various types of mortgage analysis. MSR owns the exclusive rights to develop financial products based on the CSW Indexes.

As the largest domestic asset class, U.S. single-family homes represent a $22.3 trillion market, according to the U.S. Census Bureau and the Mortgage Bankers Association's Mortgage Finance Forecast. Given all of the participants in the U.S. housing sector, including insurance companies, pension funds, hedge funds, home buyers, mortgage banks and insurers as well as developers, construction suppliers and homeowners, this type of product could appeal to a large number of potential market users.


Friday, December 03, 2004

Real estate: The week ahead

Workforce housing summit in D.C.; New York Realtors meet in Atlantic City

The National Association of Home Builders is sponsoring, "Close to Home: A Symposium on Workforce Housing," Dec. 8, in Washington, D.C. Department of Housing and Urban Development Secretary Alphonso Jackson, Freddie Mac CEO Richard Syron, NAHB President Bobby Rayburn, and Nicolas Retsinas, director of the Harvard Joint Center for Housing Studies, are among the event speakers.

The latest installment of Inman News' audio conference series will take place Dec. 9, at 11 a.m. PST. The topic is "The progressive Realtor association," featuring Bill Malkasian, president of the Wisconsin Realtor Association; Joel Singer, EVP of the California Association of Realtors; and Bob Hale, president and CEO of the Houston Association of Realtors. See the conference Web site for dial-in information. To become a member of Inman News, logon to the membership Web page.

The sixth annual Mortgage EC Conference is slated for Dec. 6-7, in Las Vegas. The event will focus on eCommerce and Internet issues facing the mortgage industry.

The New York Association of Realtors will host its 2004 Realtor Convention and Trade Expo, "Triple Play," Dec. 7-9 in Atlantic City.


Thursday, December 02, 2004

Third-quarter real estate prices jump 13%

Nevada records highest statewide increase

Average U.S. home prices increased nearly 13 percent from the third quarter of 2003 to the third quarter of this year, according to the Office of Federal Housing Enterprise Oversight's house price index.

Appreciation for the most recent quarter was 4.62 percent, or an annualized rate of 18.5 percent.

"The appreciation reflected in this quarter's report shows further acceleration from already rapid increases," said Armando Falcon Jr., director of OFHEO. "The growth in house prices over the past year surpasses any increase in 25 years."


Wednesday, December 01, 2004

Consumers gain access to free credit reports

Up to 3 requests may be staggered throughout 12-month period

he Federal Trade Commission today announced the three nationwide consumer reporting companies – Equifax, Experian, and TransUnion – will begin processing consumers' requests today for free annual credit reports at

A credit report contains consumers' identification information; payment history with different creditors; a list of inquiries made by various financial institutions; and information on the public record, such as foreclosures or bankruptcies. Consumer reporting companies collect and sell this information to lenders and other businesses that have a permissible purpose to obtain it.

The Fair and Accurate Credit Transactions Act of 2003 amends the Fair Credit Reporting Act and requires the nationwide credit bureaus to provide consumers, upon request, a free copy of their credit report once every 12 months. Consumers in 13 Western states may request a free annual credit report beginning today.