Cash for Caulkers: Appealing to Home Shoppers?

Congress is about to approve a program to put contractors back to work doing energy retrofits.

If “Cash for Caulkers” passes, home owners will be eligible for a tax credit worth up to $12,000 or half the cost of the retrofits, whichever is lower.

A home owner who spends $24,000 to cut his energy use in half will save an average of $100 per month, estimates Lane Burt, manager of building energy policy at the Natural Resources Defense Council. With a $12,000 tax rebate from the government, the payback will take 10 years.

Some real estate practitioners pointed out that energy retrofits might be a hard sell because they don’t raise a home’s sale value. "It sounds good on paper, but it's just not how the American consumer makes choices," says Jeff Geoghan, a Coldwell Banker REALTOR® in Lancaster, Pa. "If you're buying a house, and you see a furnace has a 95 percent efficiency rating, are you really going to make your decision based on that?"

Source: CNNMoney.com, Steve Hargreaves (02/04/2010)

Fannie, Freddie Go After Bad Loans

Accountants at Fannie Mae and Freddie Mac are auditing mortgage files to uncover loans with improper documentation about a borrower’s income, and then forcing banks and savings and loans to buy the loans back.

Freddie required lenders to buy back $2.7 billion of loans in the first nine months of 2009. Fannie Mae won’t disclose its figures, but the mortgage trade publication Inside Mortgage Finance said Fannie made $4.3 billion in loan-repurchase requests in the first nine months of 2009.

One result is that banks are underwriting mortgage loans even more carefully than they were last year, which can further slow the lending process.

"If you're being hit with a lot of repurchases very suddenly, the easiest thing to do is to tighten your standards rapidly," said Glenn Boyd, a Barclays analyst.

Source: The Wall Street Journal, Nick Timiraos (01/30/2010)

Investors, Cash Buyers Become Larger Part of Housing Market

By Buck Wargo (contact)

Wednesday, Feb. 3, 2010 | 1:50 a.m.

Sales of new and existing homes priced below $200,000 comprised 77 percent of transactions in Las Vegas in December as investors remain an integral part of the market, a real estate information firm reported.

That price point also continues to be a favorite of first-time buyers. In December 2008, 58 percent of the sales fell under $200,000, San Diego-based MDA DataQuick reported.

Federal Housing Authority loans, a popular form of financing with first-time buyers, accounted for 50 percent of all home purchases, the firm reported.

Investors and those buying a second home accounted for 40 percent of all Las Vegas homes sold in December, up from 36 percent in November and 31 percent in December 2008, the firm reported.

Cash purchases accounted for nearly 46 percent of sales, up from 43 percent in December and 33 percent in December 2008.

The median price paid in these all-cash deals was $100,000, said DataQuick spokesman Andrew LePage.

Foreclosure sales continued to wane in December but still accounted for more than half of all December transactions. The firm reported 63 percent of sales of existing homes and condos were foreclosures, down from a peak of 74 percent in April 2009.

DataQuick reported the combined 5,315 sales of new and resale homes and condos was the highest in December since 2006, when 5,780 homes sold.

December marked the 16th consecutive month that sales have risen year-over-year, LePage said. December’s sales were 33 percent higher than December 2008.

DataQuick confirms what other research firms have reported that prices have changed little in recent months.

The median paid per square foot for single-family homes remained at $76, the same as it’s been since October. That’s down 60 percent from the peak of the market of $190 per square foot in June 2006, the firm reported.

Union Helping Open Doors to Homeownership in Las Vegas

By Michael Mishak (contact)

Monday, Feb. 1, 2010 | 2 a.m.

http://www.lasvegassun.com/news/2010/feb/01/union-helping-open-doors-homeownership/

FHA Lifts Flip Rule, Making Homes Easier to Buy

http://www.lasvegasnow.com/Global/story.asp?S=11915817

Analyst: Las Vegas Home Prices Will

Increase 3 Percent This Year

By Buck Wargo (contact)

Thursday, Feb. 4, 2010 | 12:47 p.m.

A Las Vegas housing analyst said today he expects sales of existing homes in 2010 to mirror those in 2009 and predicts prices will increase by more than 3 percent by the end of the year.

Dennis Smith, the president of Home Builders Research, said in a seminar held over the Web that existing home prices will rise by $4,000, or 3.3 percent, from $123,000 at the end of 2009 to $127,000 by the end of 2010. It will jump another 5.6 percent to $134,000 by 2011, Smith said.

Prices have fallen nearly 60 percent from the peak of the market.

“I am not expecting prices to take a big jump for a long time,” Smith said. “Anybody who thinks home prices are going to appreciate markedly in the next couple of years is not listening to what’s happening out there,” Smith said.

Smith predicts the existing home market will have 45,000 sales, keeping pace with the 44,885 in 2009 in one of the market’s best years. By 2011, however, Smith said he expects sales to fall to 44,000 because of higher interest rates.

Investors continue to buy up foreclosures properties and shut first-time buyers out of the marketplace. Smith said those buyers will turn more to the new-home market.

Las Vegas had 4,968 sales of single-family homes in 2009, and that should increase slightly to 5,400 in 2010 and increase to 6,000 in 2011.

The first half of 2010 should have stronger new home sales because of the $8,000 tax credit for first-time buyers and $6,500 credit for other buyers is set to expire by June 30, he said.

“The second half is up in the air because we can’t assume they will extend the tax credit again,” Smith said. “We won’t have a big increase but it is an increase. That suggests we have reached the bottom of the new-home segment.”

As for new-home permits, Smith projects 4,400 will be issued in 2010, up from 3,850 in 2009. By 2011, builders will take out 5,100 permits, he said.

Smith said he can’t predict when the market will return to 10,000 permits. Builders took out 32,879 permits in 2004.

“I don’t know when we will get back to normal,” Smith said. “We have to change the definition of that.”

Smith said the median new-home price should increase to $220,000 by the end of 2010, a 2.8 percent gain over the $216,000 price in 2009. The new home price was $244,090 in 2008.

Smith said he’s not expecting a flood of foreclosures in 2010 and suggested the market can absorb those it is getting because of strong demand from investors.

According to newly released data from First American CoreLogic on foreclosures for the Las Vegas, the rate of foreclosures among outstanding mortgage loans was 8.53 percent in December, an increase of 4.34 percentage points compared to December of 2008 when the rate was 4.20 percent. Foreclosure activity in Las Vegas is higher than the national foreclosure rate, which was 3.16 percent for December 2009, representing a 5.37 percentage point difference, the firm reported.

The mortgage delinquency rate has increased. First American CoreLogic data for December 2009, shows that 21.08 percent of mortgage loans were 90 days or more delinquent compared to 11.91 percent for the same period last year, representing an increase of 9.17 percentage points.

Analyst: Las Vegas Economy Sick with 'Jobophilia'

http://www.lvrj.com/news/breaking_news/Analyst-Las-Vegas-economy-sick-with-jobophilia-82995687.html

Thursday, Feb. 4, 2010 | 1:50 a.m.

High-rise condominiums depreciated at the fastest rate in 2009, at 44 percent, while the average price decline for residential real estate fell 23 percent, according to a report from SalesTraq.

The 23 percent decline in homes, condos and townhomes is less steep than 2008, when residential values fell 33 percent on average based on closing prices, SalesTraq reported.

The average sales price fell 10 percent in 2007 after remaining flat in 2006. Prices rose as much as 44 percent in 2004 before slowing to a 14 percent gain in 2005, according to SalesTraq.

In 2009, high-rise condo prices fell 44 percent from $351,750 at the start of the year to $196,000 by the end of the year, said SalesTraq President Larry Murphy.

Mid-rise condominiums had their prices decline 28 percent from $152,450 to $110,000.

Single-family homes ranked third with prices declining 19 percent from $158,950 to $128,871, Murphy said.

Townhome prices fell 18 percent from $85,500 to $69,990.

Condo conversions fell the least, from $62,000 to $57,111, Murphy said. That equates to 8 percent.

The smaller drop doesn’t mean condo conversions have been a good investment, Murphy said. Those units dropped by a large amount in 2008, he said.