Northern Virginia Bits Bucket 7/31/2008

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Northern Virginia Bits Bucket 7/30/2008

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Northern Virginia Bits Bucket 7/29/2008

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Notable from yesterday's Bits Bucket:

"Duh said...

Here's an update from the front lines of Eastern PWC - the market is back up and running, thanks to all of the bank-owned properties. Multiple bids on houses that sell in days or weeks. The last June numbers showed that there was a little over six months worth of inventory on the market, but that number WILL go down when the July numbers come out".

Cute

(Hat tip Instapundit). From Knoxnews.com:

Northern Virginia Bits Bucket 7/28/2008

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Northern Virginia Weekend Bits Bucket 7/26-7/27, 2008

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The Years Have Not Been Kind . . .

1921 WILLOW LN
WOODBRIDGE, VA 22191
List Price: $108,900
Prior Sale: $82,000 3/1/1994
Listing Date: 07/10/08

Note: Route 95 is practically in the backyard.

Halting "Buy and Bails"

Jim Klinge at Bubbleinfo.com has the scoop on a new underwriting rule that attempts to put a stop to buying a new house and then bailing on the old mortgage:

"Fannie and Freddie underwriting guidelines will require that borrowers applying for a mortgage to purchase a property, and who already own another, must verify that they have at least 30% equity in the old property - or they can't get a loan".

This will go into effect August 1st.

Renters Beware (Here We Go Again)

Hat tip Contrarian. From the Fairfax County Times:

"County police arrested a 31-year-old Catlett man Thursday night for fraudulently renting foreclosed homes that did not belong to him.

Richard Hiner allegedly posted rental listings on Craigslist.com and then collected security deposits and rent for bank-owned homes that had gone into foreclosure.

Police were contacted multiple times in the period between Sunday, July 13, and Friday, July 18, by victims claiming they had been defrauded after signing contracts on homes they found on the Web site.

According to police, after the victims called Hiner, the contact person on the advertisement, Hiner then allegedly gave tours of the properties and collected money from the victims".

Northern Virginia Bits Bucket 7/25/2008

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Foreclosure news, from CNNMoney:

"220,000 homes were lost to bank repossessions in the second quarter, according to a housing market report Friday issued by RealtyTrac. That's nearly triple the number from the same period in 2007.

A total of 739,714 foreclosure filings were recorded during that three-month period, up 14% from the first quarter, and 121% from the same period in 2007. That means that one of every 171 U.S. households received a filing, which include notices of default, auction sale notices and bank repossessions.

'Most areas of the country are seeing at least some increase in foreclosure activity,' said James Saccadic, CEO of RealtyTrac, an online marketer of foreclosed homes. 'Forty-eight of 50 states and 95 out of the nation's 100 largest metro areas experienced year-over-year increases in foreclosure activity.'"

Housing Bill

"As a result of the bill, Congress will raise the national debt ceiling to $10.6 trillion from $9.8 trillion".

The WSJ has a lengthy column on the bill today:

"Key points of the housing bill, and their cost over 10 years (to be fully offset by tax code changes and fees):

• Fund to provide more low-income housing: $5.3 billion
• Tax credits for first-time home buyers: $4.6 billion
• Grants for state and local governments to buy foreclosed homes: $3.9 billion
• FHA insurance for up to $300 billion of home loans: $729 million
• Counseling for homeowners facing foreclosure: $210 million
• Loosens restrictions on how states issue tax-exempt housing bonds
• Keeps lenders from foreclosing or increasing mortgage interest on returning troops for a year. Creates financial-counseling program, increases home-loan limit for military veterans: $112 million
• Raises loan limit for lenders to 115% of the local area median home price, up to $625,000
• Raises limit on seniors' reverse-mortgage program to $625,000
• Raises limit on federal debt to $10.6 trillion, from $9.8 trillion
• New regulator for Fannie and Freddie, financed by the two lenders

The bill also authorizes the Treasury secretary to expand credit and buy equity shares in Fannie or Freddie if necessary. The Congressional Budget Office estimates this would cost an extra $25 billion if it happened".

Northern Virginia Bits Bucket 7/24/2008

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Northern Virginia Bits Bucket 7/23/2008

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Mortgage Rates Approaching 5-Year Highs

From NYT:

"The average interest rate for 30-year fixed-rate mortgages rose to 6.71 percent on Tuesday, from 6.44 percent on Friday, according to HSH Associates, a publisher of consumer rates. The average rate for so-called jumbo loans, which cannot be sold to Fannie Mae and Freddie Mac, was 7.8 percent, the highest since December 2000.

Loan rates are rising because of concern in the financial markets about the future of Fannie Mae and Freddie Mac, which own or guarantee nearly half of the nation’s $12 trillion mortgage market.
. . .
The rise in rates is of greatest concern for homeowners whose mortgages required them to pay only the interest on their loans for the first few years. If such borrowers are unable to refinance into lower-cost loans, many of them will face the prospect of having to pay both interest and principal at higher, adjustable rates.

For borrowers with a $400,000 loan, such a jump could send their monthly payments to $2,338 from $1,417, estimates Louis S. Barnes, a mortgage broker at Boulder West Financial in Boulder, Colo.
. . .
'When we get to rate levels like this, the market just shuts down,' Mr. Barnes said".

Northern Virginia Bits Bucket 7/22/2008

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Arlington Approves Accessory Dwelling Units

Hat tip to blog reader The Nothing for this link yesterday:

From NBC 4:

"Arlington County leaders on Saturday approved a plan that would allow homeowners to rent out rooms in their homes.

But many homeowners don't like the idea, saying it could cause neighborhood overcrowding. The planning commission also opposed the plan.

But supporters said the plan could create more affordable housing in the county".

Some more information here.

Northern Virginia Bits Bucket 7/21/2008

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From the weekend Bits Bucket discussion, hat tip KeithK for mentioning a way to beat the $100,000 FDIC limit at your bank: CDARS®.

Northern Virginia Weekend Bits Bucket 7/19-7/20, 2008

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Virginia's Dwindling Barrel of Cash

From the Washington Post:

"RICHMOND, July 17 -- Gov. Timothy M. Kaine's administration ordered state agencies to stop hiring, traveling and buying equipment and prepare for even more severe cuts as the state's budget surplus is almost gone amid an economic slowdown.
. . .
'While the exact magnitude of the revenue gap for the next [two years] is uncertain at this time, it may be significant based on our preliminary analyses,' wrote Turnage [Kaine's chief of staff], who ordered agencies to stop all but essential hiring, review all contracts, cancel discretionary travel and halt purchases of new equipment and software.
. . .
[Secretary of Finance Jody W.] Wagner said the state's surplus has dwindled to $5.4 million, down from more than $1 billion in 2006. She also said it will be difficult to reach revenue projections for fiscal 2009 and 2010. As part of Kaine's two-year, $77 billion budget, revenue was projected to grow by 2.2 percent this year and 6.8 percent in fiscal 2010".

Northern Virginia Bits Bucket 7/18/2008

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Here's some new information about June sales in Culpeper County, where there was an 84% increase in sales over the prior year:

On her blog, Real Estate Agent Julie Emery pointed out that 38 out of the 57 sales were foreclosures (over 2/3), and with 10 of those foreclosure sales, the price was 48.8% lower than the prior sales price. She provides a few pictures of the houses that sold in June under those conditions.

Northern Virginia Bits Bucket 7/17/2008

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Northern Virginia Bits Bucket 7/16/2008

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Yesterday's comment thread has some good discussion on finding local rentals.

So Much for the OFHEO

The OFHEO was created in 1992, when the House Banking Committee's chairman was Rep. Henry Gonzalez, a Texas Democrat. It has seemed to me (laywoman that I am) to have had very limited power and usefulness, except for making those cool housing price indexes that we compare to Case-Shiller's.

And now Paulson today says it's been all for naught:

"WASHINGTON (Reuters) - U.S. housing finance giants Fannie Mae and Freddie Mac have the potential to pose systemic risks to the financial system and need a stronger regulator, U.S. Treasury Secretary Henry Paulson said on Tuesday".

"Paulson, in prepared testimony before the Senate Banking Committee, urged Congress to pass legislation to reform oversight of the two government-sponsored enterprises, with modifications that provide them temporary government backstops for liquidity and equity capital".

Stronger regulation has been tried before, and failed to pass the Senate.

Northern Virginia Bits Bucket 7/15/2008

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Free Rent

FDIC halts IndyMac Foreclosures.

(Only the $15 billion of bank-owned mortgage loans found in IndyMac's portfolio).

Diversify

From the Washington Post: "Workers Shaken by Fannie, Freddie Woes".

"'This is my family's financial future,' said Lorrie Rudin, former director of executive compensation for Fannie Mae, who retired last year. 'I worked there for 20 years, and I'm just absolutely devastated and terrified.'"

Is anyone else incredulous? Putting all your savings into your employer's basket? After such recent examples as Enron? Worldcom?

Northern Virginia Bits Bucket 7/14/2008

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Northern Virginia Weekend Bits Bucket 7/12-7/13, 2008

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Arlington Co. and Alexandria City -- Price Reductions

Price Reductions July 6 - July 12, 2008 (click for entire list):

Ridin' to the Rescue

Yesterday the Senate voted 63 to 5 to approve "housing market stabilization" legislation -- now it goes to the House.
. . .
From the Washington Post:

"The centerpiece of the legislation would authorize the Federal Housing Administration to help 400,000 distressed borrowers trade exotic loans that have rapidly rising monthly payments for more affordable loans backed by the federal government. The FHA would insure the new loans if the current lenders agree to forgive a portion of each homeowner's debt."

"The package includes a plan to modernize the FHA and create a strong new regulator for struggling mortgage giants Fannie Mae and Freddie Mac, a move supporters say would shore up confidence in the companies. There are also $14.5 billion in tax breaks, including a credit of up to $8,000 for first-time home buyers. Additionally, the bill would provide $3.9 billion in emergency funds for local governments to purchase vacant, foreclosed properties.

The White House opposes the emergency funding and has threatened a veto. But Frank and Dodd said they expect lawmakers will take the funding out of the bill and that the president will sign it".

"Pointing False Fingers of Blame"

=  ?AP:

"The banking regulator said it closed IndyMac after customers began a run on the lender following the June 26 release of a letter by Sen. Charles Schumer, D-N.Y., urging several bank regulatory agencies that they take steps to prevent IndyMac's collapse".

"In the 11 days that followed the letter's release, depositors took out more than $1.3 billion, regulators said".

"In a statement Friday, Schumer said IndyMac's failure was due to long-standing practices by the bank, not recent events".

"If OTS had done its job as regulator and not let IndyMac's poor and loose lending practices continue, we wouldn't be where we are today," Schumer said. "Instead of pointing false fingers of blame, OTS should start doing its job to prevent future IndyMacs."

"The bank is the largest regulated thrift to fail and the second largest financial institution to close in U.S. history".

Morning Washout

FREDDIE MAC (NYSE: FRE)
4.76 -3.24 (40.56%) 9:49AM ET

FANNIE MAE (NYSE: FNM)
8.69 -4.51 (-34.17%) 9:49am ET

In other news:

From Mortgage Lender Implode-O-Meter:

"Update - 2008-07-11: "The FDIC is in charge" was the verbal announcement ringing through the halls of IndyMac's Pasadena offices. "Everyone show up for work on Monday."

"The above information came from an inside source just minutes ago. A formal announcement will be made later today".

Northern Virginia Bits Bucket 7/11/2008

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Freddie

Last Trade: 8.06
Trade Time: 12:38PM ET
Change: -2.20 (21.44%)
Prev Close: 10.26
Open: 8.45

Day's Range: 6.75 - 8.99
52wk Range: 9.88 - 67.20
Volume: 111,053,894
Avg Vol (3m): 13,667,400
Market Cap: 5.21B
P/E (ttm): N/A
EPS (ttm): -5.70
Div & Yield: 1.00 (7.40%)

CNBC Anchor Stunned

A Decade of June Sales

Standouts from June:

Prince William County sales up 82%, (Median Price down 34%);
Manassas Park City sales up 116%, (Median Price down 45%); and
Manassas City sales up 178%! (Median Price down 50%)



Source: MRIS

Northern Virginia Bits Bucket 7/10/2008

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Northern Virginia Bits Bucket 7/9/2008

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The Rules

From AP:

"The Federal Reserve will issue new rules next week aimed at protecting future homebuyers from dubious lending practices, its most sweeping response to a housing crisis that has propelled foreclosures to record highs".
. .
"The plan, which will be voted on at a Fed board meeting on Monday, would apply to new loans made by thousands of lenders of all types, including banks and brokers".

"Under the proposal unveiled last December, the rules would restrict lenders from penalizing risky borrowers who pay loans off early, require lenders to make sure these borrowers set aside money to pay for taxes and insurance and bar lenders from making loans without proof of a borrower's income. It also would prohibit lenders from engaging in a pattern or practice of lending without considering a borrower's ability to repay a home loan from sources other than the home's value".

Northern Virginia Bits Bucket 7/8/2008

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Arlington County -- On the Market

3701 5TH ST S #507
ARLINGTON, VA 22204
List Price: $91,000
Prior Sale: $185,000 9/28/2006
Listing Date: 06/27/08
-50.8%

1503 GEORGE MASON DR S #2
ARLINGTON, VA 22204
List Price: $159,900
Prior Sale: $295,000 12/13/2005
Listing Date: 06/23/08
-45.8%

1503 GEORGE MASON DR S #22
ARLINGTON, VA 22204
List Price: $159,000
Prior Sale: $272,000 6/3/2005
Listing Date: 06/26/08
-41.5%

1934 LOWELL ST
ARLINGTON, VA 22204
List Price: $339,900
Prior Sale: $575,000 8/29/2006
Listing Date: 07/01/08
-40.9%

4505 9TH ST S
ARLINGTON, VA 22204
List Price: $299,900
Prior Sale: $484,000 2/10/2006
Listing Date: 06/23/08
-38.0%

5226 10TH PL S
ARLINGTON, VA 22204
List Price: $215,000
Prior Sale: $326,000 6/20/2005
Listing Date: 06/24/08
-34.0%

2022 MONROE ST S
ARLINGTON, VA 22204
List Price: $305,000
Prior Sale: $410,000 7/24/2006
Listing Date: 06/30/08
-25.6%

See Arlington County 7/7/2008 for more comparisons from this week's listings.

(Links by FranklyMLS.com)

Northern Virginia Bits Bucket 7/7/2008

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The Tax Man Cometh (and Goeth)

.

Here is a house in the Brookside subdivision in Warrenton. It's currently listed for $499,900 $479,900; its original list price was $560,000 in May, so the price is being steadily cut to (hopefully) sell soon.

It captured my attention because the price is one of the lowest I've seen for that subdivision. So, as I'm naturally snoop-- er, curious, I looked up the tax record.

The house was purchased in February 2003 as a new house from the builder -- NV Homes. So the contract price would have been settled approximately four months prior, or sometime in the last quarter of 2002. The purchase price was $561,257.

Two years later, in 2005, the Fauquier County tax assessor wandered through the neighborhood and decided its total taxable value was:

$1,025,300. ($800,300 for the house and $225,000 for the 0.9-acre lot).
I hope the new owner can get that little problem taken care of.

Northern Virginia Weekend Bits Bucket 7/4-7/6, 2008

Please post your local house search updates, MLS finds, on-topic ideas, and links here. And happy Independence Day to all!

FHA to Buyers: Pony Up

From NPR:

"Brian Demer, who used the FHA down-payment assistance program to buy a new condominium in Aldie, Va., says he wouldn't have been able to buy it without the program.

"Bottom line, I didn't have to put 3 percent down, which was a big deal," he says.

Demer got his down payment from the nonprofit organization Genesis on a recommendation from Holly Davis, a loan officer at SunTrust Bank in Reston, Va. Davis calls the FHA down-payment assistance program the "hot program," especially because private lenders are pulling their no down payment, 100 percent financing deals.
. . .
Data show that buyers who receive down payments through nonprofits are two to three times more likely to default than FHA homebuyers who provide their own down payment.

The FHA projects the high defaults will require it to ask for a $1.4 billion subsidy from Congress next year — the first one in its 74-year history.

Because of high default rates and conflict of interest issues, the FHA is trying to shut down the nonprofit down-payment program, even though it now accounts for more than a third of all FHA loans. That's up from 5 percent in 2001".

"Flood of Foreclosures in the Fall"?

H/T Ben Jones from the Housing Bubble Blog:

From the McLean Connection:

"By all accounts, Ali and Shanaz Alavi bought their new home in Great Falls for a bargain basement price. The couple purchased the five-bedroom home sitting on five acres of gated woodland for $1.1 million. The property owner, Jennifer Lynne Ridley, had been trying to sell the house for just under $2 million for the past 18 months.
. . .
“Almost all Realtors would admit the housing market, even in areas like Great Falls and McLean, has slowed. ‘There are more homes in the market than there are buyers for,’ said Realtor Sepideh Farivar, who added, a person has to be motivated to sell in this market.”

“Joe O’Hara, a Realtor with Washington Fine Properties, said he expects to see prices drop on many of the homes in and around Georgetown Pike. ‘Most of the homes along Georgetown Pike are very expensive. There are a limited number of buyers and lots of sellers.’”

From the Star Exponent:

“In 2007, banks foreclosed on 182 properties in all in the town and county of Culpeper.”
. . .
"Nancy Heflin, president of the Greater Piedmont Area Association of Realtors, said she has never seen anything like it in her 19 years in the business. And she doesn’t expect the picture to improve anytime soon.”

“‘We are anticipating another flood of foreclosures in the fall,’ said Heflin of Front Royal.”

Northern Virginia Bits Bucket 7/3/2008

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Retraining

From the Fauquier Times-Democrat:

Tim McMenamin is accepting applications for one 9-1-1 dispatcher.

'We are getting applications from a lot of Realtors and loan officers,' the director of the Communications Division of the Fauquier County Sheriff's Office said.

Earlier this year, McMenamin hired three people after advertising openings on the county Web site for three months. He received a substantial number of applications, mostly from people who had no experience or training in emergency communications. Most, McMenamin said, came from people who had worked in construction.

'Easily one-third of [of the applicants] didn't read the job description,' he said. 'When we contacted them, they were surprised that [the job] involved rotating shift work and working weekends and holidays.'

Approximately a third of the applicants failed the entrance exam, which tests a number of skills, including a prospective candidate's ability to do several things at once.

'The multi-tasking aspect is where most people were failing in the exam," McMenamin said. "It's not a skill that can be taught.'"

Northern Virginia Bits Bucket 7/2/2008

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Northern Virginia Bits Bucket 7/1/2008

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