Friday, January 30, 2015

Subprime Bonds Are Back With Different Name

(Bloomberg) -- The business of bundling riskier U.S. mortgages into bonds without government backing is gearing up for a comeback. Just don’t call it subprime.

Hedge fund Seer Capital Management, money manager Angel Oak Capital and Sydney-based bank Macquarie Group Ltd. are among firms buying up loans to borrowers who can’t qualify for conventional mortgages because of issues such as low credit scores, foreclosures or hard-to-document income. They each plan to pool the mortgages into securities of varying risk and sell some to investors this year. JPMorgan Chase & Co. analysts predict as much as $5 billion of deals could get done, while Nomura Holdings Inc. forecasts $1 billion to $2 billion.

Sunday, January 25, 2015

Builders’ New Power Play: Net-Zero Homes

LAS VEGAS—Net-zero homes are going mainstream, if the home-building industry has anything to do with it.
The homes, which generate more electricity in a year than they use, have long been viewed as a niche product for the affluent who can afford custom homes. The chief problem is that it is expensive to get a home to net-zero status, and many customers aren’t willing to wait several years for their electricity-bill savings to cover the thousands of dollars they would have to spend on net-zero features such as solar panels and energy-efficient windows, doors and appliances.
But some builders, motivated by what they deem as rising demand from home buyers and state and local regulators, are aiming to change those perceptions by designing such homes for the mass market. Such a model home—the latest in the National Association of Home Builders’ annual New American Home series showcasing new-home designs —is on display this week in a hillside neighborhood 7 miles from the Las Vegas Strip as part of the trade group’s International Builders Show.

Sunday, December 21, 2014

Luxury home sales rise

Luxury home sales in the Denver area rose slightly more than 19 percent in November, compared with November 2013, according to a report released today.

A total of 81 luxury homes sold  in November, up from 68 in November 2013, a 19.1 percent increase, shows the report by Coldwell Banker Residential. The report is based on Metrolist data.

Meanwhile, the median sale price of a luxury property last month was $1.322 million, down fractionally from a year ago when it stood at $1.325 million.. November’s median sale price was up 5.2 percent from October.

Homes also sold at a faster pace on average in November than they did a year ago, and sellers received a higher percentage of their asking price on average.


Sunday, May 4, 2014

Rising tide lifts all homes in Vegas

Rising tide lifts all homes in Vegas

Everybody has joined this party.

From Centennial Hills to Southern Highlands, and from Summerlin to Sunrise Mountain, home values in every local ZIP code soared in 2013.

That’s according to a new housing appreciation map from real estate research company SalesTraq, which shows double-digit percentage gains in all but one area ZIP code.

It’s important to note that the numbers are averages, and your specific house value may have risen more or less depending on everything from the number of foreclosures on your block to how tricked out your home interior is.

But in general, widespread appreciation offers broad economic benefits to the Las Vegas Valley.

To understand how broad, look first at how much home values in each corner of the valley improved.


Every ZIP code enjoyed a 2013 boost, ranging from a low of 6.9 percent in Boulder City’s 89005 to a high of 53.2 percent in 89107, around Decatur Boulevard and U.S. Highway 95.

Improvement was “quite broad,” said Heidi Kasama, president of the Greater Las Vegas Association of Realtors.

“It’s a very healthy appreciation map,” she said.

The ZIP code map also tracks what association numbers show the market has been doing, with average annual gains of 20 percent to 30 percent in the past year.

“Appreciation helps stabilize homeowners’ personal balance sheets,” said Brian Gordon, a SalesTraq principal. “It moves a significant number of borrowers from the red into the black in terms of home equity. The financial profile of local homeowners has improved dramatically as a number of folks finally have their head above water. From a psychological standpoint, it has consumers feeling better about the economy and their personal financial situation.”

You can see the economic effects in other indicators, Gordon said. Take taxable sales, which have seen healthy growth for more than two years, driven largely by increased consumer spending on furniture, cars and meals out.

Before you get too excited, remember that values are up a lot only because they fell so much during the recession.

The median price of a local existing home peaked at $290,000 in June 2006, and plunged to a low of $100,000 in January 2012, SalesTraq data show. In 2008 and 2009, every ZIP code saw double-digit percentage pricing declines.

The median recovered to $158,000 by February, up 21.5 percent from $130,000 in February 2013. That, in turn, was up 28.7 percent from $101,000 in February 2012.

So even though the percentages look strong, market values are nowhere near their apex.

The market’s appreciation is also a function of collapsing bank-owned inventory, said local real estate agent Tim Kelly Kiernan, broker-owner of Kelly Realty Group at Re/Max Extreme. Nevada’s Homeowners Bill of Rights took effect Oct. 1, making it harder to foreclose on delinquent loans. Combine that slumping supply with relatively strong investor demand, and an appreciation spike was inevitable, he said.

But not everyone equally felt 2013’s upward bump.


Some ZIP codes are considerably closer than others to pre-recession pricing, despite smaller 2013 percentage gains.

In Summerlin’s 89138, appreciation clocked in at 21.1 percent — about half of the rate of some city center ZIPs. Yet, 89138 posted Southern Nevada’s highest median price, at nearly $285,000.

The story was similar in 89135, also in Summerlin. There, appreciation was 15.8 percent, even as the median reached $282,000. In Anthem’s 89052, prices jumped 15.9 percent, to a median of $269,000.

Meanwhile, the opposite happened in the urban core, where percentage gains were white-hot even as median prices languished well below pre-recession levels.

In downtown’s 89101 ZIP, prices spiked 49.7 percent, to a median of $69,000. Around Sahara Avenue and Valley View Boulevard, homes in 89102 appreciated 41.2 percent, to $120,000. In 89107, where prices soared 53.2 percent, the median was still just $95,000.

The city’s center may have had better percentage gains than the suburbs in 2013, but that’s because the core is still trying to catch up to the outskirts, where values have been improving for three years.

“It’s a shift from what we saw in 2012, when more mature ZIP codes in the central and eastern parts of the valley struggled to maintain values,” Gordon said. “It’s a function of timing. Those areas are lagging some of the earlier gains we saw in areas that stabilized much more quickly. So in 2013, areas that were harder-hit started to see greater gains in percentage terms. Suburban areas have less catching up to do.”

Homeowners in the urban center and suburban areas shouldn’t expect the party to last through 2014.

And that’s not a bad thing.


Remember 2004 and 2005? Gordon does, and he said it wasn’t pretty — or sustainable.

“We were witnessing double-digit appreciation on top of double-digit appreciation, and prices during that time frame escalated well beyond the buying power of consumers. Incomes were not aligned with values at that time, and that, combined with the economic downturn, made conditions throughout the valley shift the other way. We went from the country’s fastest-appreciating market to its fastest-depreciating market.”

Yet, even if the latest numbers mirror appreciation rates in 2004, that doesn’t mean the market is vulnerable to another bubble, Gordon said.

“Absolute price points have adjusted, and have aligned much more with where incomes are today, and the buyer profile is starting to adjust. The amount of speculation and investor acquisitions in the market are starting to subside, and investors are divesting themselves of some assets. Distress is leaving the market.”

The mix of properties on the market is also changing. Two-thirds of local properties sold today are equity or nondistressed sales — a reversal of trends three years ago. Also, three out of 10 local homeowners are underwater, down from more than six in 10 in 2012.

“All of that suggests a much more stable environment,” Gordon said. “The supply-and-demand dynamics in the Las Vegas housing market are much more stable than they’ve been probably at any time in the last decade.”

Given that stability, don’t expect 2014’s appreciation map to keep up with 2013’s version.

Because the market has worked through a big chunk of its inexpensive, distressed homes, investor interest is starting to wane, Gordon said. Sales will be driven more by people who are buying a place to live in.

“As availability creeps north, and the demand side of the equation becomes more sustainable, overall price appreciation is likely to slow,” he said.

Kasama noted that appreciation has already slowed noticeably in the past seven months, with the median single-family home price hovering at $185,000 to $195,000 since September, according to the Realtors’ association.

“We might see small, steady increases, but I don’t think you can have the type of appreciation we had in 2013 again in 2014,” she said.

Still, while no ZIP code will see a surge of 20 percent to 40 percent this year, some codes should fare better than average.

Expect stable prices in the suburbs, and perhaps a little more ground gained in the city’s center, as the urban core’s “absolute price position” attracts investors and owner-occupiers alike, Gordon said.

But Kiernan forecasts flat to “minimal” appreciation rates across the board.

For-sale inventory has more than doubled, from 4,200 units in April 2013 to 9,000 today. Another 48,000 homes remain in some stage of foreclosure, he said.

“I think we’re still going to have to take another hit of some kind, hopefully not one as bad as we took in the last recession,” Kiernan said. “If those 48,000 homes go through foreclosure or short sale, common sense says we’ll have to take a value hit. We could see the roller-coaster, peak-and-valley thing get going again.

“We’ll be back to normal when those homes flush through the system, but how long that takes is anyone’s guess.”

Contact reporter Jennifer Robison at or 702-380-4512. Follow @J_Robison1 on Twitter.

Rising tide lifts all homes | Las Vegas Review-Journal

Thursday, January 2, 2014

'Boomerang' Buyers Expected to Boost Recovery in the New Year

The Federal Housing Administration recently implemented the “Back to Work” program. This program allows the purchase of a new property as soon as twelve months following a foreclosure or short sale provided that the borrower can prove that their prior default was the result of a financial hardship. “Financial hardship” is strictly defined as an employer-driven loss of at least 20 percent in income for six months or more. Although the program is definitely a step in the right direction, it leaves those who were self-employed out in the cold.

Read more here...

Thursday, September 12, 2013

JPMorgan Removes Lending Barriers in Booming U.S. Markets

JPMorgan Chase & Co. (JPM), the nation’s largest bank by assets, is easing mortgage lending standards in housing markets hard hit by the crash where prices are surging.
The bank lowered some down payment requirements in Florida, Nevada, Arizona and Michigan because they will “no longer be considered distressed states,” it informed smaller lenders it buys loans from in July. The second-largest U.S. mortgage lender also loosened underwriting requirements for a refinancing program for Federal Housing Administration borrowers.

As the economy rebounds and home values climb at about the fastest pace since 2006, lenders including the largest, Wells Fargo & Co. (WFC), JPMorgan, Bank of America Corp. (BAC), and mortgage insurers are easing the tightest credit conditions in two decades, lifting restrictions put in place after the worst real estate bust since the Great Depression. Banks are being forced to compete harder for customers after a spike in borrowing costs from near-record lows slowed refinancing by more than 70 percent and curbed what had been record profits.
“Historically, you make underwriting as tough as possible when people are lined up at the door and when the lines go away, you start loosening underwriting to get people back,” said Guy Cecala, publisher of Inside Mortgage Finance.

Continue here

Saturday, May 4, 2013

Fannie Mae appears to be more 'reasonable'

Fannie Mae appears to be more 'reasonable'

I like to be the bearer of good news. This week, I have two examples.

The first one is a follow-up to columns I wrote in this space in January and February after hearing from would-be homebuyers, Realtors and others who said that Fannie Mae was blocking short sales by asking for tens of thousands of dollars above appraised value for the homes they control.

Basically, this government-sponsored enterprise that backs millions of mortgages across the country seemed to be holding back home sales.

Most of the complaints I heard were from potential buyers who needed financing, rather than paying cash, to purchase a property previously financed by a Fannie Mae loan.

The issue usually involved short sales, which occur when a lender agrees to sell a property for less than what the borrower owes on the mortgage.

Of course, short sales have become a big part of our housing market here in Southern Nevada, where the housing supply is very tight and short sales now account for about one in every three existing home sales.

Short sales can be complicated enough without having someone reject a buyer’s offer late in the game.

Just ask reader Dylan Budd, who wrote: “The Q&A article in (the Jan. 12) paper describes our situation closely. We are first-time homebuyers who tried to purchase a Fannie Mae short sale, but are in limbo because they came back and asked for $55,000 above the appraised value of $195,000. Our situation is different because we made a cash offer, which your article suggests may be their preference (but did not prevent them from coming back with a ridiculous price). We can only infer that they simply do not want to sell at fair market value. Hopefully, the GLVAR advocacy on the issue will pressure Fannie Mae to be more reasonable ...”

Leaders of the Greater Las Vegas Association of Realtors have been contacting Fannie Mae officials and government leaders, urging Fannie Mae to get back to accepting reasonable offers.

These efforts seem to be paying off.

In recent weeks, I’ve heard reports that Fannie Mae has been more reasonable in accepting offers.

In addition, Fannie Mae recently launched a website designed to help real estate agents and others through this process, to better review appraised values and to hopefully save agents and buyers time and trouble when trying buy a short-sale property.

For more information, visit www.

My second bit of good news is about the return of the “traditional” home sale, where the seller is an actual homeowner, not a lender.

Just when we were beginning to think this type of transaction was an endangered species here in Southern Nevada, we’ve seen a gradual rebound this year. In fact, so far in 2013, more than half of all sales reported by GLVAR have been the traditional variety.

In March, 33.3 percent of all local existing-home sales were short sales. Another 11.2 percent of all local home sales were bank-owned properties. The remaining 55.5 percent of March sales were the traditional type.

This wasn’t the case in past years, when our market was dominated by foreclosures and short sales and the lives of Realtors were dominated by dealing with banks that controlled most of the properties we were trying to buy and sell.

This return of traditional sellers is encouraging news. I hope it’s a sign that more homeowners who’ve been considering a move are seeing today’s rising home prices and listing their homes for sale.

As any prospective buyer can tell you, we could use more homes on the market.

Dave Tina is the 2013 president of the Greater Las Vegas Association of Realtors and has worked in the real estate industry for more than 35 years. GLVAR has more than 11,000 members. Email questions to For more information, visit