Thursday, April 14, 2011

Housing News Digest, April 14

Renting vs. Buying at the High End
A couple of years ago, when prices fell sharply in many high foreclosure low end areas, we discussed a probable "hard floor" for low end house prices. The price floor would come from investors paying cash and buying low end properties to rent.

Of course this investment strategy doesn't work well in negative absorption areas like Detroit (areas with a declining number of households), but in many areas this is exactly what has happened.

Colorado No. 9 for foreclosures
Colorado’s foreclosure activity in the first quarter fell by 13.6 percent from a year earlier, but that is about 50 percent year-over-year drop of 28.95 percent, according to Irvine, Calif.-based RealtyTrac. Foreclosure activity in Colorado is down 11.9 percent from the fourth quarter, also trailing an almost 14.8 percent drop for the nation.

$535 billion in mortgages may need foreclosure review
Mortgage servicers may have to review as much as $535 billion in loans for possible remediation to borrowers who suffered financially from improper foreclosures, according to an estimate from the investment bank Keefe, Bruyette & Woods.

Real Estate Bust Hasn’t Dimmed Americans’ Faith in Real Estate
Despite an extended slump in real-estate prices, most Americans still believe homes are the best investment, according to a survey released today by the Pew Research Center.

According to the results of a telephone survey conducted in March, Pew found eight-in-ten adults believed a home was the best long-term investment a person could make.

UPDATE:US Housing Programs Face Cuts In FY11 Federal Budget
The Department of Housing and Urban Development's Community Development Fund program, money used to redevelop poverty-stricken neighborhoods and economic development, is being reduced by $942 million, for a 2011 funding level of $3.5 billion, according to details released.