by Calculated Risk on 7/23/2008 08:50:00 PM

I participated on a panel today on housing at the Inman Real Estate conference in San Francisco. I wasn't the most bearish participant - that goes to John Williams of Shadow Stats - but it was definitely fun. We only barely touched on most housing subjects ... Oh well. I think it's safe to say that even the bulls were a little bearish.

Other bloggers included Yves Smith of Naked Capitalism and Noah Rosenblatt of UrbanDigs - plus a couple of real estate executives (the most bullish).

On blogging, from The San Francisco Business Times: FDIC learns it ignores bloggers at its peril

The federal agency insuring bank deposits learned that it can't afford to ignore the blogs following its seizure this month of IndyMac Bank, the largest bank failure since the 1980s.

"The blogs were a bit out of control," Sheila Bair, chairman of the Federal Deposit Insurance Corp., told the San Francisco Business Times after a speech in San Francisco this week.

That's putting it mildly. Following the FDIC's takeover of IndyMac on July 11, widely followed blogs were speculating on bank runs on some of California's largest banks based on nothing more than people waiting for their branch to open or large deposits moving between financial institutions.

The FDIC plans to pay closer attention to the blogosphere in the future.

Looking back, I guess we were one of the voices of reason. I couldn't find lines at any other banks ... and as far as can tell, reports of lines at other banks (other than IndayMac) were inaccurate.

by Calculated Risk on 7/23/2008 06:39:00 PM

From MarketWatch: House approves housing aid, Fannie-Freddie plan

Senate is next. Bush will not veto.

by Calculated Risk on 7/23/2008 05:39:00 PM

From Reuters: San Diego sues Bank of America over foreclosures

San Diego City Attorney Michael Aguirre said on Wednesday he had filed a lawsuit against Bank of America ... and its Countrywide unit to prevent the mortgage lenders from foreclosing on homes in his city, which he aims to make a "foreclosure sanctuary."

Oh my ...

Note: I'm at the Inman Real Estate conference in San Francisco. I'll have more later ...

by Calculated Risk on 7/23/2008 01:44:00 PM

From the WSJ: States Face Threefold Increase In Budget Shortfall for 2009

A new report is projecting that the cumulative fiscal-year 2009 budget shortfall for U.S. states will more than triple to $40.3 billion as the economic slump makes it more difficult for states to collect sufficient revenues.

More ripples from the weak economy.

by Calculated Risk on 7/23/2008 11:30:00 AM

A few stats from the WSJ: Equal-Opportunity Crisis (hat tip Michael)

Foresight Analytics ... estimates that construction-loan delinquencies among all property types reached 9% in the quarter, up from 7.2% in the first quarter and 2.4% in the year-earlier period. ...

Among loans to single-family-housing developers, an estimated 12% of the loans were at least 30 days past due, compared with 10.8% in the previous quarter and 3.1% a year earlier.

Matthew Anderson, partner at Foresight Analytics, says that an early read on the data shows the pain is spreading to nonresidential projects. He says the weakening economy has put pressure on developers of shopping malls ...

Developers of malls, hotels, and offices are all going to get hurt.

by Calculated Risk on 7/23/2008 09:47:00 AM

Note: Down Payment Assistance Programs (DAPs). Tanta and I have written extensively (and negatively) about DAPs for years.

From the WaPo: Congress Is Set to Limit Down-Payment Assistance (hat tip Bob_in_MA)

[T]he FHA said seller-funded down payments present the single biggest challenge to its solvency. Borrowers who take part in these arrangements go to foreclosure at nearly three times the rate of borrowers who put their own money down, according to the agency.

The fate of these seller-funded down-payment-assistance programs has been in limbo for weeks. The Senate version of the housing bill would have banned them. The House version would not. Negotiators crafting a compromise bill have agreed to the Senate's position, which also is supported by the Bush administration.

"We're going to yield to the Senate on that," said Rep. Barney Frank (D-Mass.)

Good riddance.

A few of our previous posts:

FHA Going After DAP Again? Tanta, June 10, 2008

DAP for UberNerds, Tanta, Oct 19, 2007 **** READ this one for nerdy details! ****

FHA to Ban DAPs, CR, Sept 29, 2007

Housing: IRS Raps DAPs, June 2, 2006

More on Housing, CR, Feb 24, 2005

by Calculated Risk on 7/23/2008 09:07:00 AM

From Bloomberg: Fannie Mae Unsold $5 Billion Homes Bring Peril to Shareholders

Fannie Mae acquired twice as many homes through foreclosure in the first quarter as it sold, regulatory filings show. ... Late payments on the company's home loans, a harbinger of foreclosures, almost doubled in the past year.

Together, Fannie Mae and Freddie Mac, the two biggest U.S. mortgage finance companies, owned a record $6.9 billion of foreclosed homes on March 31, compared with $8.56 billion held by all 8,500 U.S. commercial banks and savings and loans.

A large percentage of existing home sales are previously foreclosed properties (41.9% of sales in California in June were previously foreclosed), and yet, REOs are still piling up at Fannie Mae and elsewhere. The problem is clearly getting worse ...

by Calculated Risk on 7/23/2008 08:40:00 AM

The MBA released their weekly survey of mortgage applications and interest rates this morning: Mortgage Applications Decrease In Latest MBA Weekly Survey

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.59 percent from 6.22 percent ...

The average contract interest rate for one-year ARMs remained unchanged at 7.16 percent ...

Note: this data is for the week ending July 18. Based on the WSJ and NYTimes reports last night, rates for 30 year fixed mortgages have increased more over the last few days.

Also note that purchase loan applications were off sharply.

by Calculated Risk on 7/23/2008 02:01:00 AM

Jon Stewart interviews Richard Bitner:

by Calculated Risk on 7/22/2008 11:44:00 PM

Bloomberg: U.S. Lawmakers Reach Deal on Fannie, Freddie Bill

WSJ: Lawmakers Reach Deal On Big Housing Package

Here is an interesting detail:

The Treasury would be barred from providing aid that would cause a breach in the federal debt ceiling under the agreement, a constraint aimed at limiting any taxpayer losses. The debt limit would be raised to $10.6 trillion from the current $9.815 trillion.

My guess of $10 trillion in U.S. debt by the end of Bush's 2nd term is looking better. That is one forecast I wish I had been wrong about.