The eminent administration change refocuses policies to relief of low and middle income households rather than the financial industry. This week we see Congress balk on bankrolling bad mortgage ventures while Fannie Mae refuses to evict renters in foreclosed properties. The coping tactics, however, do not address the long-term economic issues that continue to worsen.
In Texas, public schools see a surge in student transfers as parents move to cheaper housing and better jobs.
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Home values seen losing over $2 trillion during 2008
Reuters Dec 15, 2008
NEW YORK – Homes in the United States have lost trillions of dollars in value during 2008, with nearly 11.7 million American households now owing more on their mortgage than their homes are worth, real estate website Zillow.com said on Monday.
U.S. homes are set to lose well over $2 trillion in value during 2008, according to an analysis of recent Zillow Real Estate Market Reports.
Housing Starts Plunged 19% in November
Associated Press December 16, 2008
WASHINGTON – The construction of new homes plummeted in November by the largest amount in almost a quarter-century as builders slashed production in the face of a recessionary economy.
The Commerce Department said Tuesday that new home starts fell to a seasonally adjusted annual rate of 625,000 from a downwardly revised level of 771,000 in October.
That is a drop of 18.9 percent, the steepest since March 1984. The total is far below the 740,000 pace that Wall Street economists expected.
Lawmakers rap Treasury on bailout plan
By Emily Kaiser and Karey Wutkowski Reuters December 10, 2008
WASHINGTON – U.S. lawmakers on Wednesday threatened to withhold the remaining half of the $700 billion of financial bailout cash unless Treasury Department officials do more to help homeowners avoid foreclosure and push banks to extend more credit to consumers.
In early October, Congress authorized the Treasury to use $700 billion of taxpayer money to buy soured assets from banks to ease a financial panic. But a week later, the Treasury backed away from that plan, saying it would instead try to strengthen the financial system by buying shares in the banks.
Fighting Foreclosures, F.D.I.C. Chief Draws Fire
By Charles Duhigg New York Times December 10, 2008
On the weekend before Thanksgiving, Washington’s top financial regulators were gathered on a conference call to discuss the rescue of the banking giant Citigroup when Sheila C. Bair, the chairwoman of the Federal Deposit Insurance Corporation, interrupted with a concern.
Speaking from her home, Mrs. Bair declared that the F.D.I.C. would contribute to a bailout only if Citigroup were forced to participate in a foreclosure prevention program she was championing on Capitol Hill. After a brief discussion, she got her way.
Housing: the key to economic revival?
The next bailout could focus on homeowners headed for default.
By Mark Trumbull Christian Science Monitor December 12, 2008
Momentum is building for the next bailout – not one targeted at big corporations but at the lowly borrower at risk of foreclosure.
The reason is that mortgage-relief measures undertaken in the past year have failed to stem a wave of loan defaults, and those defaults continue to play a central role in the current economic downturn.
New census numbers explain why the housing bubble burst
By Stephen Ohlemacher Associated Press December 15, 2008
WASHINGTON – Things really are bad all over – and they had gone bad even before the housing and finance industries crashed and sent the economy into a tailspin.
New census data show that throughout the first half of the decade, the slumping economy touched nearly every U.S. community. Incomes dropped while poverty and unemployment rose in the vast majority of the nation’s cities and towns.
Small and medium-size cities in the Midwest, already suffering from an ailing auto industry, were hit the hardest, with unemployment rates doubling or tripling throughout Michigan, Ohio, Indiana and Illinois.
Fannie Mae Lets Renters Stay Despite Foreclosures
By Charles Duhigg New York Times December 14, 2008
In a move that provides relief to thousands of renters who face eviction but draws the federal government even deeper into the housing market, the loan giant Fannie Mae said Sunday that it would sign new leases with renters living in foreclosed properties owned by the company.
It is the first nationwide effort to provide widespread relief to renters ensnared by the unfolding mortgage crisis, and it will effectively transform Fannie Mae – a government-controlled mortgage finance company – into a national landlord. It may also increase pressure on private lenders to establish similar programs and on lawmakers to pass renter relief.
Building new public housing may cost less
By Rhiannon Meyers Galveston County Daily News December 10, 2008
GALVESTON – Among six options for the future of Galveston’s public housing, renovating four hurricane-damaged federal projects would cost the most per square foot, take the longest and present the most obstacles, housing authority documents show.
Four public housing projects – Cedar Terrace, Palm Terrace, Oleander Homes and Magnolia Homes – remain closed after they were flooded by Hurricane Ike on Sept. 13. Renovating them would cost more per square foot than new construction and would take five to 10 years to finish, said Harish Krishnarao, executive director of the Galveston Housing Authority.
Schools confront a moving problem
Districts expect more students to switch campuses in weak economy
By Jennifer Radcliffe Houston Chronicle December 15, 2008
Out sick for just two days last year, first-grade teacher Hazel Boatner returned to class to find that four of her students had moved from Bonham Elementary School.
“I wanted to cry,” Boatner said. “Those are my babies. I had to clean out their desks.”
Keeping track of students is a difficult challenge for teachers and principals at urban schools such as Bonham, where roughly one-third of children change campuses before the end of the year. Educators expect the little-discussed “mobility rate” to increase because of the sour economy.
The mobility rate – which reflects the number of children who spend less than 83 percent of the school year at the same campus – exceeds 20 percent statewide and 25 percent in the Houston Independent School District. Some of the hardest-hit campuses have rates near 40 percent.
The high turnover rates speak to the obstacles that low-income students – and, in turn, their schools – face. Poverty forces families to move for jobs or cheaper rent, sometimes as often as every few months. In other cases, children bounce between relatives and are asked to adjust to new schools along the way.
Dallas zoning proposal aims for urban living
By Rudolph Bush Dallas Morning News December 4, 2008
An effort to make it easier to build dense urban neighborhoods in Dallas took a step forward at City Hall on Wednesday, even as a debate over particulars of the plan continued between city officials and a group representing developers and neighborhood interests.
Planners are eager for the city to implement what is known as “form-based zoning” because they think it will help move the city away from its history of developing around the automobile, with stores, homes and offices at far remove.
Local officials will keep eye on bills to cap home appraisal hikes
By Regina Dennis Waco Tribune-Herald December 14, 2008
Local officials are concerned that proposed state legislation to limit increases in home appraisal values could be a drain on county and city operations.
Sen. Robert Nichols, R-Jacksonville, filed one of several bills to keep a lid on how much appraisers can raise home values. Under his bill, home appraisals couldn’t rise more than 5 percent a year, half the hike currently allowed.
Homelessness, hunger on rise in US cities: report
Agency France-Presse December 12, 2008
WASHINGTON (AFP) – Homelessness and hunger increased in an overwhelming majority of 25 US cities in the past year, driven by the foreclosure crisis and rising unemployment, a survey showed Friday.
Out of 25 cities across the United States surveyed by the US Conference of Mayors, 83 percent said homelessness in general had increased over the past year while 16 cities, or nearly two-thirds of those polled, cited a rise in the number of families who had been forced out of their homes.
Upgrading from a cardboard box for the homeless
By Martha Groves Los Angeles Times December 10, 2008
Christopher Raynor’s father kicked him out when he was 13, after his stepmother interrupted an orgy in his bedroom and the teen jammed a broom handle against her throat.
Now 40, Raynor has lived much of his life in the rough. His current domicile is a patch of dirt behind some pampas grass and coastal sage scrub where Pacific Coast Highway meets Temescal Canyon Road, in the backyard of Pacific Palisades.
Until a few weeks ago, he dozed on a thin mattress in the open air. Now he beds down in a snug mobile shelter called an EDAR (short for Everyone Deserves a Roof), a covered contraption that looks like the offspring of a shopping cart and a pop-up camper.