Bo McCarver’s weekly housing news compilation – 2/3/2009

All eyes were on the political struggle surrounding the Democratic stimulus program this week as more dismal news of foreclosures continued to wash up. Meanwhile, Citigroup has finally heard Congress and is the first of the large lenders to use TARP funds to free-up mortgage loans.

While major housing developments in most of the nation are on hold, Dallas, plans are moving smoothly to construct dense housing along the DART route to Carrolton.

In Galveston, the housing authority ponders how to rebuild or rehab four complexes demolished by Hurricane Ike. It will be at least two years before the work is complete. Meanwhile, many residents live in motels where the authority has been slow to pay rents and evictions are threatened.

For a pdf version of the full articles, plus contextual stories in economic, environmental and legal areas, contact Bo McCarver at bmccarver@austin.rr.com

Foreclosure’s Final Act
Area Homeowners’ Fears Unfold In High-Stakes Courtroom Drama

By Ovetta Wigins       Washington Post        January 31, 2009
The court clerk calls his name, and Harry Rexrode, not entirely sure what to do, steps to the defendant’s table. He is dressed in jeans, a flannel shirt with dried paint spattered on the sleeves and work boots. He has no attorney.

In a stern tone, Prince George’s County Circuit Judge Herman Dawson asks Rexrode whether he knows what is happening to him.

Rexrode, 50, nods his head. “I want to see if I can get a continuance,” he says.
Dawson grins, as if amused by Rexrode’s use of the legal term. “A continuance? For what?”
“To stay,” Rexrode says.

Rexrode is seeking a miracle really, in a place where there are precious few. He is in the county’s foreclosure court, asking Dawson to let him remain in the Hyattsville home he has owned since 1997 a little longer before the bank takes it and he is put out in the cold.

Report: 16% of Dallas-Fort Worth homeowners owe more on property than it’s worth
By Steve Brown       Dallas Morning News      February 3, 2009
Almost 16 percent of homeowners in the Dallas-Fort Worth area owe more than their property is worth, a new report suggests.

And in all of 2008, D-FW homeowners lost almost $4 billion in home value, according to Internet real estate company Zillow Inc.

The North Texas statistics were part of a nationwide housing market report Zillow released early Tuesday.

Overall home values in the D-FW area fell by less than 2 percent last year, Zillow said. That compares with an almost 12 percent drop nationwide.

Since the peak of the market, Zillow analysts estimate that home values in North Texas have decreased by almost 5 percent.

A Month Free? Rents Are Falling Fast
By Elizabeth Harris      New York Times      January 30, 2009
IN this painful economic climate of layoffs and shrinking investments, there is a sliver of positive news: it’s a good time to be a renter in New York City. Prices are falling, primarily in Manhattan, and concessions like a month of free rent are widespread.

Although it is notoriously difficult to quantify the state of the rental market, rents fell in almost every sector of the Manhattan market last year, according to the Real Estate Group, a New York brokerage. The steepest drop was in one-bedrooms, down 5.7 percent in buildings with doormen and 6.53 percent in buildings without. The only category that rose: rents for two-bedroom apartments in doorman buildings, up just a bit, by 0.61 percent. But these numbers, like most available data, represent asking rents rather than the final price. Anecdotal evidence suggests that some people are negotiating rents as much as 20 percent lower than the original prices asked by landlords. These figures also leave out incentives, like a month of free rent or a landlord’s paying the broker fee, which can add up to real savings.

Citigroup to deploy $36 billion to boost lending
By Madlen Read       Associated Press      February 2, 2009
NEW YORK  – Citigroup, under pressure to increase its lending, says it will spend $36.5 billion to issue mortgages, make credit card loans and buy mortgage-backed securities in the tight credit markets in the coming months.

The decision arrives after the bank received $45 billion in capital from the federal government in two installments late last year, and taxpayers’ questions mounted about the use of that money.
In a report reviewed by The Associated Press that Citigroup plans to release Tuesday morning, the bank detailed how it is boosting lending efforts by using funds from the Troubled Assets Relief Program, or TARP.

Rental assistance slow to arrive
By Rhiannon Meyers      Galveston County Daily News      February 1, 2009
LEAGUE CITY – In between sobs, Darla Ford tells a story about falling between the cracks.

She lost her island rental house and all of her possessions in a fire during Hurricane Ike. She lived in her car when the Federal Emergency Management Agency initially denied her application for assistance because someone else had applied using her address.

She finally settled into a rental house in League City, only to find out she might soon be on the streets again because of a glitch in her paperwork.

“It’s so hard to go to bed at night wondering what’s going to happen to you in the morning,” she said. “It just feels like nobody cares about us.”

Ford, who has been living in a rental house on the federal Disaster Housing Assistance Program, is worried she soon will be evicted because the Galveston Housing Authority, which is administering the program, has not paid her rent in three months.

Two public housing complexes to be demolished
By Rhiannon Meyers      Galveston County Daily News      January 29, 2009
GALVESTON – The Galveston Housing Authority will demolish two public housing developments and renovate two others, board members decided Wednesday.

Board members agreed to tear down Oleander Homes, 5228 Broadway, and Palm Terrace, 4400 Sealy St., but it’s not yet clear what kind of housing will replace those developments. It will take at least two years to replace that public housing, said Harish Krishnarao, executive director.

The board also agreed to renovate hurricane-damaged apartments at Cedar Terrace, 2914 Ball St., and Magnolia Homes, 1601 The Strand, in an effort to bring displaced public housing residents home as quickly as possible, Krishnarao said.

FEMA puts mobile home sites on hold
By T.J. Aulds       Galveston County Daily News      January 31, 2009
With thousands of Galveston County residents living in motels after being displaced by Hurricane Ike, federal authorities confirmed two of the county’s planned community mobile home sites likely won’t be built because the demand just isn’t there.

Federal Emergency Management Agency officials had planned to place as many as 400 mobile homes on four sites in the county. However, the number of eligible heads of household who have said they are willing to move into a FEMA mobile home community is 116, according to figures released Thursday.

Because of the apparent lack of demand, FEMA is holding off on construction of the Edgewater site in Bacliff, on property that once was a red fish farm, as well as the site near the Galveston County Justice Center on Broadway in Galveston, said Stephen M. De Blasio Sr., the agency’s federal coordinating officer for Hurricane Ike.

Foreclosure threat in the face of Ike
By David Ellison        Houston Chronicle       Jan. 30, 2009
Alison Putman’s Kemah home has been uninhabitable since it was flooded during Hurricane Ike, but she’s still getting letters from a new mortgage company that says she could face foreclosure.
That’s especially frustrating for Putman and her husband because their initial mortgage company, GMAC, had granted them forbearance from October to February to give them time to settle some complicated flood insurance matters. GMAC, however, notified them in December that the loan had been sold to Nationstar Mortgage in Dallas, effective in January.

“I am absolutely fearful,” she said. “Based on the complaints that I have read online and the reputation the company has in more than one state, I’m worried they have legal grounds to foreclose on the home because we haven’t paid since October.”

Home Loan Program Benefits Rural Families
By Rene Gutel      NPR       January 29, 2009
Even though the country is in the midst of a financial crisis, it’s still possible to buy a house with no money down. A relatively small but growing number of Americans are turning to an obscure home loan program backed by the U.S. Department of Agriculture.

East Riverside project revives waterfront height limits debate
By Shonda Novak       Austin American-Statesman      January 30, 2009
A Houston developer’s request to build taller buildings near Lady Bird Lake than zoning allows has touched off another debate over waterfront development.

Grayco Partners is seeking a zoning change for its proposed project at East Riverside Drive and South Lakeshore Boulevard. It would be the largest redevelopment project planned along East Riverside, where various developers are tearing down older apartment complexes and are building or planning new residential and mixed-use projects.

Plans on track for development near DART in Carrollton, Farmers Branch
By Stephanie Sandoval      Dallas Morning News        January 31, 2009
The financial crunch may have put the brakes on construction projects around the country. But plans are moving right along for residential development in the future DART station areas in Carrollton and Farmers Branch, city officials there said this week.

High Street Residential, a division of Trammell Crow, plans to break ground by late summer or early fall on a $40 million upscale apartment project near the downtown Carrollton station. Plans call for a mixed-use project featuring about 295 units in four buildings, with retail uses on the lower levels.

Not just for mother-in-law
Accessory apartments benefit society and the economy, and it’s time for tax credits to promote them

By Patrick H. Hare and George W. Liebmann        Baltimore Sun        January 29, 2009
Twenty years ago, we separately produced publications urging that governments should provide incentives for the creation of accessory apartments (sometimes called “mother-in-law apartments”) in owner-occupied housing. Our writings pointed out that there was a shortage of small-unit housing; that household sizes had dropped, rendering many large homes ripe for partial use by renters; that it was irrational to maintain regulations that discouraged extended families from living next to each other; and that Germany, Japan and Finland had provided such incentives as housing policy.

The idea fell on stony soil. Only a handful of wealthy American suburbs then permitted accessory apartments. The political climate was hostile to new federal programs and “tax expenditures.” No need was felt to further stimulate housing-related industries.

Homelessness surges as funding falters
Providers to the poor try to stretch meager resources to meet growing need

By Kari Huus        MSNBC       January 31, 2009
SEATTLE – As snowstorms blew into this Northwest city and the economy iced over in December, the occupants of a shelter nestled among industrial buildings on the north side prayed for divine intervention.

“We were hoping for the Christmas miracle,” says Glen Dennis, 41, who was working his way through a residential drug-treatment program at the CityTeam Ministries shelter. Dennis and the other 11 guys in the long-term program -dubbed the “disciples” – also worked each day to prepare for some 50 to 60 overnight shelter guests, and dish up free hot meals to about 100 people. “We kept doing what we were doing, and hoped someone would come by and drop off a big check.”

But the check did not come – even after a coalition of other shelters, nonprofits and local churches tried to pull together a rescue package to keep the shelter open. On Dec. 27, CityTeam Ministries, based in San Jose, Calif., closed the Seattle facility – leaving scores of people to seek food, shelter and sobriety elsewhere. For Dennis, who had been free of crack cocaine for nearly 11 months, the upheaval led to another painful relapse out on the streets.

Dallas likely to pay for 500 permanent housing units for homeless
By Rudolph Bush and Dave Levinthal       Dallas Morning News       January 28, 2009
The Dallas City Council has agreed that taxpayers should help fund the construction of 700 permanent housing units for homeless people who need consistent support to get off the streets.
Though council members haven’t yet committed any money to the plan, their vote Wednesday signaled that they intend to use city money to pay for about 500 of the 700 units within the next five years. Federal funds will pay for about 200.