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Implode Explode
Tracking the many faces of the global credit implosion.
Updated: 2 min 56 sec ago
Foreclosure suit tarnishes Silver Tower condo project
"Bank of America has filed a $40-million foreclosure lawsuit on a 225-unit River North condominium project in what could be a preview for other slow-selling downtown high-rises."
Apartment Vacancy Rates in U.S. to Decline in 2010, CBRE Says
"Apartment vacancies in the U.S., which reached a record high of 7.4 percent in 2009, will fall this year as job losses stabilize and fewer new rental homes enter the market, CB Richard Ellis Group Inc. said."
Orascom Development to Build Low-Cost Homes in Iraq, Romania
"-The need for low-cost and middle-income housing is rising in Egypt, which has a population of 80 million. The number of new housing units required per year in the country may reach 600,000 overall, with about 65 percent of the demand coming from people who make less than 24,000 pounds a year, said Patrick Gaffney, a real-estate analyst at HSBC Securities Egypt in Cairo."
mortgage demand still soft
Another week, more weak mortgage demand, according to the Mortgage Bankers Association.
The group’s market composite index climbed just 0.5 percent on a seasonally adjusted basis, or 1.2 percent unadjusted, compared with one week earlier.
Government Intervention In Housing Often A Mistake For Communities And Taxpayers
" So what happens when government steps in to revitalize neighborhoods and make more people homeowners? Sometimes neighborhoods are hurt and homeowners go into foreclosure."
The Rubber Hits the Road (Hussman commentary)
``. Although the 2010 peak in the Alt-A / Option-ARM reset schedule doesn't occur until July, with a much larger peak in mid-2011, a small initial round of resets is already in progress, having started about November of last year. I would expect that if we are indeed at risk of a second wave of mortgage defaults and credit strains, it will show up first as a surprising jump in 30-day mortgage delinquencies in the data we see over the next 2-4 months. I do not expect quarters upon quarters of uncertainty. It may take longer to observe the full effect of continued mortgage delinquencies and foreclosures, but we are at about the point where the data would depart from the market's "all clear" expectations if credit pressures are likely to resume with force.''
Entropy – Why the World as We Know It Is Dying
The concept of entropy is one of the most useful terms for understanding just about everything. While it has its origins in natural law – thermodynamics, specifically – the concept holds true pretty much across all closed systems.
In the simplest of terms, every closed system will ultimately degrade toward a state of maximum entropy.
Memo to Barney Frank from a Retired Chief Fannie Mae Lobbyist
"Like it or not, Fannie and Freddie alone are carrying out the secondary mortgage market policies that the Treasury wants performed and which the nation demands. The fact is, without Fannie and Freddie, the US would have no “conventional” secondary mortgage market where non-government guaranteed mortgage loans are securitized and sold throughout the world."
China Property Prices Jump, Highlighting Bubble Risk
"China’s property prices rose at the fastest pace in almost two years in February, adding urgency to the government’s efforts to rein in speculation and increase the amount of affordable housing."
Apollo Said to Triple Property Assets With Citi Unit Purchase
"The purchase of Citi Property Investors will give New York- based Apollo 65 real estate investments in 26 countries with a net asset value of $3.5 billion, said the person, who asked not to be named because the negotiations are private. Apollo’s global head of real estate, Joseph Azrack, helped assemble the portfolio when he led the Citigroup unit from 2004 to 2008."
U.S. MBA Mortgage Applications Index Rose 0.5% Last Week
" Mortgage applications in the U.S. rose for a second week, led by an increase in purchases that may indicate the renewal of a homebuyer tax credit is starting to invigorate demand."
General Growth Investors Add $3.93 Billion to Plan
"- General Growth Properties Inc. said its biggest debt and equity holders offered to jointly invest $3.93 billion in the company, bolstering a plan with Brookfield Asset Management Inc. to bring the mall owner out of bankruptcy."
Too Late To Refinance?
"..., it must also be noted that the Federal Reserve will complete its commitment to purchase $1.25 billion in mortgage-backed securities by the end of March. It is no secret that this program has kept mortgage rates artificially low for more than a year. Mortgage analysts believe mortgage rates will begin to rise when the Federal Reserve completes its purchase by the end of the month. If refinances seem to be drying up now, it is unlikely the mortgage industry will witness a refinance revival if mortgage rates climb back to the 6% range."
HBFC imposes embargo on loans to housing projects
" “If HBFC fails to provide the required housing finance, it is feared that the real estate and construction sector will face the same fate as that of Dubai, resulting in increased unemployment and other social problems”, added Farooq. The difficult policies initiated by HBFC are impossible to comply with and have made it impossible to acquire housing finance. In the last financial year HBFC financed to the tune of Rs 3.8 billion, whereas in the current year, a negligible amount of Rs 700 million is disbursed, he said. "
U.K. RICS February Home Price Gauge Shows Fewer Gains
" A U.K. house price gauge showed fewer increases in values last month than economists forecast as more people tried to sell their homes, a sign the property market may be running out of steam."
City of London Developers Start Skyscrapers as Rents End Slide
Brookfield Asset Management Inc., owner of a stake in the U.K.’s tallest building, is about to start constructing an even higher tower in the City of London.
The 64-story Pinnacle is currently the only major office project scheduled for completion after 2012 in the City, the capital’s main financial district.
That may be about to change.
State Tax Revenues Plummet By $87 Billion, Biggest Year Over Year Decline In History; Record State Tax Hikes In Progress
"A lot of conflicting data came in last week. There is a lot of positive news, but does it all add up to a recovery or is the cyclical recovery headed for a stall? Nothing has changed the underlying conditions that would relieve the credit freeze. And without credit, the economy will stall."
‘On the Edge’ Banks Facing Writedowns After FDIC Loan Auctions
A Federal Deposit Insurance Corp. plan to auction more than $1 billion in assets seized from failed banks next month, including a loan to build a W Hotel in Atlanta, may trigger writedowns that weaken lenders nationwide.
...
“These banks can’t believe that the regulator they pay to protect them is going to sell these loans to someone who can flip them and cause them serious losses,” said Robert Reynolds, a lawyer at Reynolds Reynolds & Duncan LLC in Tuscaloosa, Alabama, who represents 25 lenders that took part in financing the W Hotel. “Our banks just cannot believe they’re being treated in a way that ultimately hurts the FDIC’s insurance fund, because some of them are right on the edge.”
That's funny, Robert Reynolds of Reynolds Reynolds & Duncan LLC; most of the rest of the country (and there are many more of us than of bankers) just cannot believe the banks made such idiotic loans at inflated values, with virtually no fundamental due diligence, even as many of us warned about the bubble.
In fact, forget about the "tin foil hatters" (like us here at Implode); how about ground-shaking financial crashes as some sort of "signal":
The loan for construction of the W Hotel in downtown Atlanta was made in April 2008, a month after the collapse of Bear Stearns Cos., according to Reynolds. The developer of the property is Atlanta-based Barry Real Estate Cos., which owns commercial projects in Atlanta, Dallas, Orlando, Florida and Birmingham, Alabama.Who-coulda-known?
We would add also that it is not the FDIC's mandate to go into the commercial property business. It has already held onto these properties too long.
It is, however, unfair that the mega-banks have all gotten an unscripted and unjustified mega-bailout from the Fed and federal monetary authorities, while everyone else gets tough love.
We say: tough love for all
Consumer 10.0: Why consumers need an independent CFPA
"...,an independent Consumer Financial Protection Agency - an agency charged with protecting individuals and families from risky financial products - should be a keystone in this year's urgent drive for financial reform."
Miami and Orlando Top List for Greatest Housing Price Reductions
" Miami and Orlando top the ZipRealty price reductions list for February. "Contrary to the national trend, sellers in Florida seem to be cutting their asking prices aggressively to attract buyer interest," stated ZipRealty CEO Pat Lashinsky. "First-time buyers looking to take advantage of the $8,000 tax credit, those looking for a second home and real estate investors are finding there are deals to be had in South Florida, Orlando and Jacksonville.""
