Tuesday Report, January 18, 2011
Special to the Texas Low Income Housing Information Service
While spin artists quibble over whether the recession continues or not, the sad fact emerges that the value of homes has fallen more than in the Great Depression. Meanwhile, more than a million US homeowners were foreclosed during 2010. Canada, however, faces no such circumstances and cites sound and honest bank lending practices as the reasons.
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Home value declines surpass those of Great Depression
By Katie Curnutte MercuryNews.com January 11, 2011
Along with the snow and cold, November brought continued declines in home values. In fact, the Zillow Home Value Index has now fallen 26 percent since its peak in June 2006. That’s more than the 25.9 percent decline in the Depression-era years between 1928 and 1933.
November marked the 53rd consecutive month of home value declines, with the Zillow Home Value Index (ZHVI) falling 0.8% from October to November, and falling 5.1% year-over-year.
Foreclosures, however, took a tumble in November, with fewer than one out of every 1,000 homes being foreclosed. Unfortunately, that is an effect of the bank moratoriums that took place after the robo-signing issues came to light. Foreclosures are expected to rise again once that effect wears off.
Despite the bad news in the housing market, things are looking up for the greater economy, with signs that it is doing better than it was just three months ago. Chief Economist Stan Humphries said this will help the housing market by increasing household formation and consumer confidence. These changes will be longer-term and gradual. In the near term, home values will continue to fall thanks to excess inventory of homes, high negative equity and foreclosure rates, and weakened demand due to elevated unemployment.
US banks ‘foreclosured on record 1m homes in 2010’
BBC January 13, 2011
Banks repossessed a record one million US homes in 2010, and could surpass that number this year, figures show.
Foreclosure tracker RealtyTrac said about five million homeowners were at least two months behind on their mortgage payments.
Foreclosures are likely to remain numerous while unemployment remains stubbornly high, the group said.
Among the worst hit states were Nevada, Arizona, Florida and California, once at the heart of the housing boom.
Nevada had the highest foreclosure rate for the fourth year in a row, with one in 11 housing units receiving a foreclosure notice, and RealtyTrac said more than half the nation’s foreclosures occurred in Arizona, California, Florida, Illinois and Michigan.
RealtyTrac said 2.9 million US households were subject to a foreclosure filing last year, up 1.67% from 2009.
“2011 is going to be the peak,” senior vice-president Rick Sharga told the Associated Press news agency.
Foreclosures slowed toward the end of 2010 amid revelations that banks had based the proceedings on improper documentation, but the pace is likely to rebound in the first quarter of 2011, Mr Sharga said.
[End of story: http://www.bbc.co.uk/news/business-12184365]
Few foreclosures, no bank failures: Canada offers lessons
By Kevin G. Hall McClatchy Newspapers January 13, 2011
TORONTO — Maybe Canada has something to teach the U.S. about housing finance.
One in 4 U.S. homes is thought to be worth less that the mortgage being paid on it. One in every 492 U.S. homes received a foreclosure notice in November. For the fourth year running, analysts are speculating on where the bottom is for U.S. real estate.
No such worries up here in Canada — yet its system of mortgage finance gets little attention in the U.S.
Not a single Canadian bank failed during the Great Depression, and not a single one failed during the recent U.S. crisis now dubbed the Great Recession. Fewer than 1 percent of all Canadian mortgages are in arrears.
That’s notable given that the recent U.S. economic turmoil was triggered by a meltdown in mortgage finance, forcing an unprecedented government rescue of Wall Street investment banks and the collapse of more than 300 smaller banks as the housing sector went bust.
How’d Canada avoid all that?
“This sounds very simple, but one of our CEOs has said we are in the business of making loans to people who will pay them back,” said Terry Campbell, vice president of policy for the Canadian Bankers Association in Ottawa.
144 unsold Montgomery Plaza condos posted for foreclosure
By Sandra Baker Fort Worth Star-Telegram January 14, 2011
The 144 unsold condos in Montgomery Plaza on Fort Worth’s near west side — about 60 percent of the units — have been posted for a Feb. 1 foreclosure auction by the Granbury business that holds the note.
Wealth Diversified Fund in Dallas filed the posting Tuesday in Tarrant County on behalf of Granbury-based Lowry Donkey Farm. The posting also covers 80 percent of the common areas of the building on West Seventh Street near Trinity Park, according to the notice of substitute trustee sale.
Plano-based OMP Development borrowed $75 million from Citibank in 2007 to buy the upper seven floors of the historic Montgomery Ward store and catalog building from Kimco Real Estate. OMP has been redeveloping the building into 240 luxury condos. Several residents live in the converted building.
Austin American-Statesman January 14, 2011
Austin area property foreclosure postings are up 14 percent for the Feb. 1 auction, compared to a year earlier, according to Foreclosure Listing Service Inc.
A total of 1,376 properties were posted in Travis, Williamson, Hays and Bastrop counties. The vast majority were single-family homes.
George Roddy Sr., president of Foreclosure Listing Service, said this is the 25th month in a row that postings have been at or above 1,000. “The foreclosure crisis is far from over,” he said.
“Until a significant amount of workers begin to be re-employed, there is simply no reason for foreclosure postings to decline,” he said.
Additionally, he said a growing percentage of postings are for homes where the owner owes more on the mortgage than the house is worth. Twenty-two percent of the residential postings for the Feb. 1 auction fell into that category.
In the past year, the number of such postings has increased 87 percent, Roddy said.
Foreclosure filings in El Paso down 42%
By Vic Kolenc El Paso Times January 15, 2011
El Paso home foreclosure filings declined 42 percent last year, new data show.
In 2010, El Paso had 1,104 homes with foreclosure filings, down from 1,905 in 2009, reported RealtyTrac, a California company that tracks foreclosure filings nationwide.
The foreclosure filings include default notices, scheduled auctions and bank repossessions.
In Texas, foreclosure filings increased almost 19 percent last year to 118,923.
In the U.S., foreclosure filings increased 1.6 percent last year to 2.87 million.
Full story at: http://www.elpasotimes.com/business/ci_17099641
New Study Reveals the Hidden Environmental Cost of Parking
By Eric Jaffe Infrastructure January 12, 2011
The price of free parking keeps going up. One cost is painful urban congestion, which is made worse by drastically under-priced street parking. Another is a relative cost to the environment, which occurs when the near-certain prospect of free (or cheap) parking entices people into their cars and away from alternative forms of transportation. Recently a team of researchers from the University of California at Berkeley, writing in a recent issue of Environmental Research Letters, described a previously unknown cost — energy and emissions that come from building America’s vast parking infrastructure:
The environmental effects of parking are not just from encouraging the use of the automobile over public transit or walking and biking (thus favoring the often more energy-intensive and polluting mode), but also from the material and process requirements in direct, indirect, and supply chain activities related to building and maintaining the infrastructure.
Control the Masses
By Diana Lind Architect January 3, 2011
Andrés Duany is souring on what he sees as excessive, obstructionist community engagement in urban planning. At an event last year, the co-founder of New Urbanism complained of “an absolute orgy of public process” In the U.S.: “Basically, we can’t get anything done.” Is there a place anymore for bottom-up planning?
Public engagement in the community planning process is a relatively new phenomenon. Is it good evidence of American democracy in action or of public skepticism about the planning profession? Urban planning with public participation has not always existed, nor has it been deemed necessary. Even 50 years ago, planners were still considered demigods. They had reformed cities to be beautiful, healthier, cleaner, and more stable. Planners had done more for public health than doctors.
Developers reluctant to use ‘SmartCode’ style, city officials say
Bu Chris Roberts El Paso Times January 12, 2011
A new development style adopted by the city two years ago but yet to be put into practice would create safer and healthier neighborhoods, a city official said today.
To counter conventional sprawl, so evident on El Paso’s East Side, the city should begin using something called “SmartCode,” said Mathew McElroy, deputy director for the city’s Planning and Economic Development Division.
That code would result in neighborhoods similar to Kern Place and Sunset Heights, McElroy said, which encourage walking instead of driving with short, interconnected blocks and centrally located parks.
However, developers, operating in a poor economic climate, have been reluctant to use the new style, said El Paso Mayor John Cook. He proposed using city owned-land for a project that would prove there is a market for SmartCode development.
[End of story: http://www.elpasotimes.com/newupdated/ci_17077240]
More families became homeless in recession
By Henri E. Cauvin Washington Post January 13, 2011
During the throes of the recession, the number of homeless people in the United States increased, and the number of homeless families increased at an even greater rate, according to a report released Wednesday.
The findings by the National Alliance to End Homelessness, although not surprising, confirm the harsh toll that the recession – which began in December 2007 and ended in June 2009 – took on families.
Historically, people struggling with mental illness, substance abuse or other chronic problems have been the focus of government homelessness efforts, and until recently the number of such homeless people had been declining.
Homeless camp shut down near downtown Fort Worth
By Ale Branch Fort Worth Star-Telegram January 15, 2011
FORT WORTH — A large homeless camp near downtown Fort Worth was dismantled Saturday with help from church volunteers.
Most of the 50 tents that were pitched on the hill at Riverside Drive and East Lancaster Avenue were gone by early afternoon. Two people crammed bedding and other possessions into a shopping cart.
Volunteers who provide outreach at the camp would help the homeless clean up remaining trash, said Rick Paredes, a volunteer. Church members moved a large trash receptacle to the hill.
“If there is still trash here, it will only be because someone else came and made a mess after we left,” he said.