Bo McCarver’s weekly housing news compilation – 2/17/2009

Foreclosures continue at record rates as the Obama Administration prepares an injection of money into the failing American economy. Meanwhile, scammers find clever ways to bilk tenants by renting vacant homes until the courts process foreclosures. See “Scammers finding open door at foreclosed homes.”

A new class of homelessness surges as whole families find themselves on the streets. See the last article below — “Homelessness: The Family Portrait.”

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

Summers Says Obama Mortgage Plan to Focus on Lowering Payments
By Rich Miller and Matthew Benjamin        Bloomberg Press        February 13, 2009
The White House is willing to spend more than the $50 billion already pledged to stem home foreclosures and intends to focus its efforts on reducing monthly mortgage payments, rather than principal, said Lawrence Summers, the president’s top economic adviser.

“We’re prepared to do what is necessary,” Summers said in an interview on Bloomberg Television’s “Political Capital with Al Hunt” yesterday. “Going directly at the problem means addressing affordability by addressing payments.”

U.S. mortgage rescue plan cheers some, angers others
By Andrea Hopkins       Reuters        February 13, 2009
CINCINNATI – News that U.S. President Barack Obama is working on a plan to rescue homeowners from problem mortgages before they even miss a payment has pleased some Americans and angered others.

“This is fantastic,” said Rick Williams, who has watched thousands of heartbroken homeowners struggle and fail to pay ballooning mortgages over the last few years as president of the nonprofit Home Ownership Center of Greater Cincinnati.

Three major banks suspending foreclosures for several week
By Stella Hopkins       Charlotte Observer        February 13, 2009
Bank of America and two other major banks said today they will suspend foreclosures for several weeks as the federal government works on a plan to help people save their homes.

Bank of America will delay foreclosure sales starting today on primary residences. That means investment property, second homes and such are not part of the package. The moratorium ends March 6, but the Charlotte bank will consider an extension if the federal loan-modification plan isn’t ready, said spokeswoman Jumana Bauwens.

The bank last year bought Countrywide Financial, the largest mortgage lender and a key player in the subprime mortgage market that has been plagued with foreclosures following years of lax lending.

J.P. Morgan Chase and Citigroup also announced foreclosure moratoriums today.

Wells Fargo, which recently bought Wachovia, had previously delayed foreclosures for certain mortgages. This week, the bank said it would extend that delay and expand it to more customers while awaiting the federal plan.

Foreclosed homeowners could get restitution in Countrywide pact
By Dave Michaels        Dallas Morning News       February 11, 2009
Texans who had mortgages with Countrywide Financial and lost their homes to foreclosure may be eligible for restitution payments worth $2,300 under a program announced Wednesday.

The $7.5 million program is part of the largest predatory-lending lawsuit in history. The agreement called for Countrywide to use $8.4 billion to modify the terms of mortgages for 400,000 borrowers in Texas and 10 other states who got unaffordable loans from Countrywide.

The settlement reserved about $150 million to help borrowers who already lost their homes or were near foreclosure – 120 days or more delinquent on payments. Texas’ share of the restitution amounts to about $7.5 million, according to Texas Attorney General Greg Abbott, who sued the mortgage company.

Forecast: Homebuilding to fall by nearly 50% – but not in Dallas-Fort Worth
By Steve Brown       Dallas Morning News      February 16, 2009
U.S. homebuilding will fall by almost 50 percent this year, a new forecast predicts.

But don’t expect such a large decline in home starts in North Texas, analysts with Metrostudy say.

The Houston-based housing research firm anticipates that new home production in the U.S. will decrease by an additional 47 percent in 2009.
“This decline would be in addition to the 33 percent drop from 2007 to 2008, and is steeper than many other housing economists have predicted,” Brad Hunter, Metrostudy’s chief economist said in the new report. “Some forecasts have been unrealistically high.”

North Texas home sales off 27 percent in January
By Andres Jares       Fort Worth Star-Telegram      February 11, 2009
North Texas existing home sales in January are down 27 percent from a year ago, according to figures from the North Texas Real Estate Information System.

All but one month of the past 24 months had fewer sales than the same time the year before. It’s the second steepest drop, after the 33 percent drop in November.

There were 3,399 homes sold in January in a 29-county area that spans from the Oklahoma border to north of Waco.

The median price for a single-family home is $129,000, down 6 percent from a year ago.

There are 4,367 homes pending for future sale, according to the figures. That’s a 17 percent drop from this time last year.

Dallas-Fort Worth home prices down about 5% in new report
By Steve Brown       Dallas Morning News        February 12, 2009
Dallas-Fort Worth home prices fell by almost 5 percent in the fourth quarter, according to the latest in a string of recent housing market assessments.

North Texas’ year-end decline in median home sales prices was modest compared to the record 12.4 percent nationwide drop reported Thursday by the National Association of Realtors. The Realtors’ quarterly home price report tracks houses sold through their multiple listing service.

D-FW’s fourth quarter annual decline was about twice the rate of the home price decrease the Realtors association reported for the area in third quarter 2008.

But it is in line with recent local studies that show median home sales prices in the area dropped by between 3 and 5 percent in 2008.

Scammers finding open door at foreclosed homes
By Jon Nielsen       Dallas Morning News       February 13, 2009
Ellis County Constable Mike Jones drove his white cruiser through the neighborhood of palatial two-story homes and lush lawns. He stopped in front of a house with an overgrown weedy lot and a Ford Probe jacked up in the driveway. Sheets hanging in the windows clashed with the home’s $400,000 price tag.

Jones knew that homeowners in this subdivision could afford the upkeep of their property. So why weren’t they? What he discovered was that squatters were living in a foreclosed home they never owned.

Dallas council votes to let developers form taxing districts
By Rudolph Bush      Dallas Morning News      February 11, 2009
The Dallas City Council took a significant step Wednesday toward allowing developers to create quasi-governmental districts that can issue public debt and levy taxes within defined areas.

With one dissenting vote, the council consented to the creation of three municipal management districts, or MMDs, that could give developers a powerful tool to build primary infrastructure in areas where the city won’t.

Dallas group pursues vote on limiting development subsidies
By Rudolph Bush        Dallas Morning News      February 12, 2009
A union-backed organization seeking to sharply limit city subsidies for development in Dallas filed more than 32,000 signatures with the Dallas City Secretary’s office today.

If valid, the signatures collected by Dallas Right to Vote are more than enough to require the City Council to call an election that could radically change the way Dallas redevelops downtown and other neighborhoods.

Farmers Insurance Rate Hike likely to hit many homeowners
By Terrence Stutz       Dallas Morning News     February 13, 2009
AUSTIN – Hundreds of thousands of homeowners in North Texas and across the state will see their insurance rates increase by double digits beginning Monday after state regulators decided not to object to the rate hikes by Farmers Insurance.

The higher rates affect policyholders for two of the company’s largest subsidiaries – Farmers Insurance Exchange and Fire Insurance Exchange – which will boost their premiums nearly 10 percent and 12.6 percent respectively, starting with policies renewed on Monday.

Farmers is the third-largest home insurer in Texas.

Galveston Housing authority clean up begins
By Rhiannon Meyers       Galveston County Daily News       February 17, 2009
GALVESTON – Five months after Hurricane Ike, crews have started mucking out condemned public housing developments to ready them to house displaced residents by the fall.

Galveston Housing Authority is renovating two developments to house residents while crews demolish two other hurricane-damaged developments, Oleander Homes and Palm Terrace.

Residents will be allowed to live in the renovated units until new public housing developments are built, said Harish Krishnarao, executive director.

San Antonio Housing Authority’s coal-ash residue
By Greg Schwartz        San Antonio Current      February 12, 2009
Is a toxic contaminant still toxic if tests say its presence is below state regulatory protection levels? The San Antonio Housing Authority and the Texas Commission on Environmental Quality say no. But Pendleton Street residents on the city’s near West Side still worry as they continue to spar with SAHA about whether dust from the low-income housing construction project on San Marcos Street is making them sick.

Homelessness: The Family Portrait
Across Region, Economy Pulls Rug From Under More and More 2-Parent Households

By Chris Jenkins       Washington Post       February 16, 2009
Robert Polight leaned over an electric pot in a corner of Room 27 at the Breezeway Motel, stirring the sauce for his family’s favorite dinner: spaghetti.

He strained the noodles in the room’s cramped bathroom sink.

His wife, Joshalyn James, had just finished slicing sausage on the coffee table and was busy cleaning up after him. Son Jake, 6, quietly played a video game, and daughter Haira,12, giggled on the phone.

Dinnertime, even under these circumstances, has given the family a sense of stability since it became homeless.

Fairfax County pays $65 a night for the family to stay at the 1950s-era motel in Fairfax City while it waits for space to open in a county shelter. The family was evicted from a rented townhouse in Spotsylvania after Polight lost his warehouse job and he and James couldn’t make ends meet on her salary as a medical assistant.