Monday, October 31, 2011
Views-Reviews and Real Estate News: A summer of modest economic growth is helping disp...
Views-Reviews and Real Estate News: A summer of modest economic growth is helping disp...: A summer of modest economic growth is helping dispel lingering fears that another recession might be near. Whether the strength can be susta...
A summer of modest economic growth is helping dispel lingering fears that another recession might be near. Whether the strength can be sustained is less certain. The economy grew at an annual rate of 2.5% in the July-September quarter, the Commerce Department said Thursday. But the growth was fueled by Americans who spent more while earning less and by businesses that invested in machines and computers, not workers. The expansion, the best quarterly growth in a year, came as a relief after anemic growth in the first half of the year, weeks of wild stock market shifts and the weakest consumer confidence since the height of the Great Recession. The economy would have to grow at nearly double the third-quarter pace to make a dent in the unemployment rate, which has stayed near 9% since the recession officially ended more than two years ago. For the more than 14 million Americans who are out of work and want a job, that's discouraging news. And for President Barack Obama and incumbent members of Congress, it means they'll be facing voters with unemployment near 9%. "It is still a very weak economy out there," said David Wyss, former chief economist at Standard & Poor's. For now, the report on US gross domestic product, or GDP, sketched a more optimistic picture for an economy that only two months ago seemed at risk of another recession.
Some economists doubt the economy can maintain its modest third-quarter pace. US lawmakers are debating deep cuts in federal spending next year that would drag on growth. And state and local governments have been slashing budgets for more than a year. Obama's $447 billion jobs plan was blocked by Republicans, meaning that a Social Security tax cut that put an extra $1,000 to $2,000 this year in most American's pockets could expire in January. So could extended unemployment benefits. They have been a key source of income for many people out of work for more than six months. Nor is the economy likely to get a lift from the depressed housing market. Typically, home construction drives growth during an economic recovery. But builders have been contributing much less to the economy this time. Wyss said that the collapse of housing had probably depressed annual growth by as much as 1.5 percentage points in the past two years. Paul Ashworth, chief US economist for Capital Economics, predicts that growth will cool in the fourth quarter and next year. "While our baseline forecast does not include an outright contraction, we expect GDP growth to average a very lackluster 1.5% next year," Ashworth said in a note to clients.
Some economists doubt the economy can maintain its modest third-quarter pace. US lawmakers are debating deep cuts in federal spending next year that would drag on growth. And state and local governments have been slashing budgets for more than a year. Obama's $447 billion jobs plan was blocked by Republicans, meaning that a Social Security tax cut that put an extra $1,000 to $2,000 this year in most American's pockets could expire in January. So could extended unemployment benefits. They have been a key source of income for many people out of work for more than six months. Nor is the economy likely to get a lift from the depressed housing market. Typically, home construction drives growth during an economic recovery. But builders have been contributing much less to the economy this time. Wyss said that the collapse of housing had probably depressed annual growth by as much as 1.5 percentage points in the past two years. Paul Ashworth, chief US economist for Capital Economics, predicts that growth will cool in the fourth quarter and next year. "While our baseline forecast does not include an outright contraction, we expect GDP growth to average a very lackluster 1.5% next year," Ashworth said in a note to clients.
Friday, October 7, 2011
Surprise! Dodd Frank cost passed on to consumers
Bank of America CEO Brian Moynihan defended the bank's decision to impose a $5 debit card fee on customers next year, saying it was needed, in part, to recoup billions of dollars in costs from complying with Dodd-Frank law. "I have an inherent duty as a CEO of a publicly held company to get a return for my shareholders," he said at the Aspen Institute in Washington. "At the same time, I have an inherent duty to do a great job for my customers." He wouldn't say if other Bank of America fees would be raised. He said the bank — the nation's largest mortgage lender through its purchase of Countrywide Financial — is trying to work through the backlog of its mortgage foreclosures and "find a resolution" with the state attorneys general suing Bank of America and other banks over their mortgage practices.
Thursday, October 6, 2011
housing should be the priority
National Association of Realtors (NAR) President Ron Phipps spoke at the New Solutions for America’s Housing Crisis forum, where he joined a panel of experts to discuss solutions for addressing the country’s housing and economic challenges. The event was hosted by Economic Policies for the 21st Century and the Progressive Policy Institute. “As the leading advocate for homeownership, Realtors® know that issues like affordable financing, natural disaster insurance, the mortgage interest
deduction, and foreclosures and short sales don’t just affect people who own a home – homeownership shapes communities and strengthens the nation’s economy,” said Phipps, broker-president of Phipps Realty in Warwick, R.I. “America needs strong public policies that promote responsible, sustainable homeownership and that will help stabilize the nation’s housing market to support an economic recovery.” Phipps said that housing is not recovering at the rate it should be and called on legislators and regulators to do no harm. He said that proposed legislation and regulatory rules or changes to homeownership tax benefits need to help America out of today’s economic struggles and not further harm consumer confidence or exacerbate problems within the fragile real estate industry.
Overly stringent standards and lower mortgage loan limits are preventing qualified borrowers from getting loans, and Phipps called on lenders and regulators to reduce the overcorrection in underwriting standards for mortgages. He urged support for
policies that ensure qualified borrowers can obtain safe and sound mortgages in all markets at all times and encourage sound lending without high downpayment requirements. “Realtors® support strong underwriting, but too-stringent standards are curtailing the ability of creditworthy consumers from obtaining mortgages to purchase a home, and that’s impacting the recovery,” said Phipps. “Making mortgages available to creditworthy home buyers and streamlining loan modifications and short sales will help stabilize and revitalize the housing industry and reduce the rising inventory of foreclosed homes.” Phipps recommended that political and industry leaders work together to help reshape real estate and put the country BOAk on the right track. “Our goal is to help ensure that anyone in this country who aspires to own their own home and can afford to do so is not denied the opportunity to build their future through homeownership,” Phipps said.
deduction, and foreclosures and short sales don’t just affect people who own a home – homeownership shapes communities and strengthens the nation’s economy,” said Phipps, broker-president of Phipps Realty in Warwick, R.I. “America needs strong public policies that promote responsible, sustainable homeownership and that will help stabilize the nation’s housing market to support an economic recovery.” Phipps said that housing is not recovering at the rate it should be and called on legislators and regulators to do no harm. He said that proposed legislation and regulatory rules or changes to homeownership tax benefits need to help America out of today’s economic struggles and not further harm consumer confidence or exacerbate problems within the fragile real estate industry.
Overly stringent standards and lower mortgage loan limits are preventing qualified borrowers from getting loans, and Phipps called on lenders and regulators to reduce the overcorrection in underwriting standards for mortgages. He urged support for
policies that ensure qualified borrowers can obtain safe and sound mortgages in all markets at all times and encourage sound lending without high downpayment requirements. “Realtors® support strong underwriting, but too-stringent standards are curtailing the ability of creditworthy consumers from obtaining mortgages to purchase a home, and that’s impacting the recovery,” said Phipps. “Making mortgages available to creditworthy home buyers and streamlining loan modifications and short sales will help stabilize and revitalize the housing industry and reduce the rising inventory of foreclosed homes.” Phipps recommended that political and industry leaders work together to help reshape real estate and put the country BOAk on the right track. “Our goal is to help ensure that anyone in this country who aspires to own their own home and can afford to do so is not denied the opportunity to build their future through homeownership,” Phipps said.
Tuesday, October 4, 2011
Views-Reviews and Real Estate News: California pulls out of foreclosure talksThe sta...
Views-Reviews and Real Estate News: California pulls out of foreclosure talks
The sta...: California pulls out of foreclosure talks The state of California pulled out of multi-state mortgage negotiations with large US banks, deal...
The sta...: California pulls out of foreclosure talks The state of California pulled out of multi-state mortgage negotiations with large US banks, deal...
California pulls out of foreclosure talks
The state of California pulled out of multi-state mortgage negotiations with large US banks, dealing a sharp blow to long-running efforts to secure a broad settlement over allegations of lending abuses. California Attorney General Kamala Harris wrote in a letter on Friday that she will pursue her own investigation. "California was being asked for a broader release of claims than we can accept and ... the relief contemplated would allow too few California homeowners to stay in their homes," Harris said in the letter to government officials leading the talks. New York had exited the talks in August over a disagreement about how much legal immunity the banks should receive in any settlement. Representatives of the banks met with Harris last week in an attempt to keep California on board. The state has faced some of the worst default rates in the country, with an unemployment rate of 12.1% and two million residents who owe more on their mortgage than their home is worth. Eight of the 10 hardest hit US cities in terms of foreclosure rates are in California, Harris said. State and federal officials have discussed penalties totaling roughly $20 billion from institutions that include Bank of America,
JP Morgan Chase, Wells Fargo and Citigroup.
The state of California pulled out of multi-state mortgage negotiations with large US banks, dealing a sharp blow to long-running efforts to secure a broad settlement over allegations of lending abuses. California Attorney General Kamala Harris wrote in a letter on Friday that she will pursue her own investigation. "California was being asked for a broader release of claims than we can accept and ... the relief contemplated would allow too few California homeowners to stay in their homes," Harris said in the letter to government officials leading the talks. New York had exited the talks in August over a disagreement about how much legal immunity the banks should receive in any settlement. Representatives of the banks met with Harris last week in an attempt to keep California on board. The state has faced some of the worst default rates in the country, with an unemployment rate of 12.1% and two million residents who owe more on their mortgage than their home is worth. Eight of the 10 hardest hit US cities in terms of foreclosure rates are in California, Harris said. State and federal officials have discussed penalties totaling roughly $20 billion from institutions that include Bank of America,
JP Morgan Chase, Wells Fargo and Citigroup.
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