Bo McCarver’s weekly housing news compilation – 6/16/2009

While market analysts search vainly for glimmers of hope in the housing industry, foreclosure rates continue to soar. Efforts to help sinking mortgage holders require time and much paperwork, ideally done by a specialist.

Meanwhile, scammers claiming those special skills emerge everywhere and take several thousand dollars from desperate homeowners while not improving their situations.

For a pdf version of the full articles, plus contextual articles in economics, health and legal issues, contact Bo McCarver at bmccarver@austin.rr.com

Housing, CPI may feed early recovery hopes

By Caroline Valetkevitch Reuters June 12, 2009

NEW YORK – Stock investors will watch housing starts, CPI (Consumer Price Index) and other data next week for signs that hopes for economic recovery will not turn out to be false.

If recent weeks’ activity is any indication, stocks may stay in a narrow trading range, as recovery hopes have been met with concern about an uncertain job market, rising gasoline prices and higher borrowing costs.

The three major U.S. stock indexes ended just slightly higher for the week, even though the Dow Jones industrial average .DJI broke into positive territory for the year for the first time since early January.

“We’ve been in a slow, upward drifting trading range,” said Fred Dickson, market strategist at D.A. Davidson & Co.

in Lake Oswego, Oregon. “Investors are going to be looking to see … if the green shoots in the economy have sprouted a little bit further or are languishing, waiting for some more water.”

The benchmark S&P 500 .SPX is up 39.86 percent since the 12-year closing low of March 9, and investors have been eager for more definitive signs that the recovery is going to be strong enough to sustain a rebound in corporate profits, which probably would underpin stronger gains in the market.

Besides data on construction of new housing, which has been among the weakest parts of the economy, investors will scrutinize readings on inflation at the wholesale and consumer level, when the Producer Price Index and the Consumer Price Index for May are released next week. Wall Street also will note the numbers on industrial production and capacity utilization as well as weekly initial jobless claims.

State to receive $1.7 billion in hurricane relief

By Mike Snyder        Houston Post June 10, 2009

Texas will receive an additional $1.7 billion to help local communities recover from three hurricanes that struck the state last year, the Department of Housing and Urban Development announced Wednesday.

Combined with the $1.3 billion provided to Texas last November, the new allocation brings the state’s total disaster relief to more than $3 billion — about half the funds appropriated by Congress in response to the 2008 national disasters.

Homebuilder sentiment index slips 1 point

By Alex Veiga        Associated Press June 15, 2009

LOS ANGELES — The National Association of Home Builders says its housing market index slipped by one point in June, reflecting many builders’ uncertainty about when their business prospects might improve.

The Washington-based trade association said Monday the index fell to 15 – the first decline since January, when the index dropped to an all-time low of 8.

Index readings lower than 50 indicate negative sentiment about the market.

The report reflects a survey of 548 residential developers nationwide, tracking builders’ perceptions of market conditions.

The index readings for current sales conditions and traffic by prospective buyers remained unchanged from May. The reading on expectations for sales over the next six months dropped by a point. [End of story]

Rising Mortgage Rates Leave Refinancers Behind

NPR June 14, 2009

In recent weeks, mortgage rates have shot to the highest levels since Thanksgiving. That rise has left procrastinators wishing they had refinanced their home loans last month, when interest rates on 30-year fixed mortgages were below 5 percent.

Today, with rates at roughly 6 percent, the mortgage refinancing boom is cooling.

Economists and financial planners are trying to predict where rates go from here. Many believe the Federal Reserve will allow long-term rates to keep rising. Earlier in the housing crisis, the Fed purchased huge amounts of mortgage-backed securities, a strategy intended to help hold down interest rates. But Fed watchers say the central bank is likely to stand aside now, allowing market forces to nudge up rates.

Penetrating the Maze of Mortgage Relief

By Vivian Toy      New York Times June 12, 2009

SINCE President Obama unveiled a mortgage modification program in March to help people who are at risk of losing their homes, housing counselors in the New York area have fielded hundreds of calls along the lines of: “How do I get one of those 2 percent mortgages?”

The answer has often been, “Well, it’s not that simple.”

Housing advocates who work with homeowners in foreclosure or on the verge of it say that while the loan modification program could help thousands of New Yorkers, it has been slow to get off the ground and a majority of people who have applied for help have yet to hear whether they will receive it.

One thing is clear: Homeowners who have a HUD-approved housing counselor championing their cause are more likely to get a modification than those who try it on their own. Housing counselors say they often understand the program’s guidelines better than the people answering phones for lenders, so they know how to pursue a case aggressively.

Mortgage fraud cases cover state

Texas AG confronts rising crime in Austin

By Enrique Rangel       Amarillo Globe-News June 14, 2009

AUSTIN – Last week, a San Antonio man was sent to prison for six years and three months after pleading guilty to running a mortgage scam that bilked lenders out of nearly $1.7 million. In February, his wife and partner in crime received a similar sentence.

Two weeks ago, in a separate case, a federal grand jury indicted eight people in a $14 million mortgage fraud ring in the Dallas area. They were accused of setting up straw buyers for homes in upscale neighborhoods at high prices, obtaining inflated loans based on misrepresentations about planned repairs, then paying the original owners and splitting the remaining proceeds among themselves. Then, after making a few payments, they defaulted on the loans.

And in March, an East Texas woman was sentenced to 99 years in prison for her involvement in a similar scheme.

Anti-foreclosure help called a scam

By Guillermo Contreras       San Antonio Express-News June 16, 2009

Jacquelyn Guerrero and her husband handed over their $3,000 tax refund to try to stop the impending foreclosure. Guadalupe Dominguez handed over her monthly $1,400 Social Security income and more money she borrowed.

They testified Monday that they still lost their homes because of the misrepresentations of Rosario Castro Divins, who sent dozens of direct-mailed advertisements claiming she could stop foreclosures.

Tenants evicted as apartment owner faces foreclosure

By Allen Essex        Valley Morning Star June 14, 2009

HARLINGEN — Apartment dwellers on Sonesta Drive were shocked Thursday to find eviction notices on their doors telling them to move out by July 5.

Such occurrences have been common lately, said their landlord, John Sanchez of “For RENT Inc.; The Property Management Company.”

Only four tenants out of eight apartments in two buildings were affected this time, Sanchez said.

But it’s a national trend that is affecting Harlingen and the rest of the Rio Grande Valley, as well as many other parts of the United States, he said.

ForeclosuresThey’re up in the county, state

By Jullieta Chiquillo        Laredo Morning Times June 14, 2009

Hugo Lozano’s youngest son used to play with his Hot Wheels on a windowsill in his parents’ one-bedroom apartment on Clark Avenue.

But Lozano had bigger dreams for his family. In 2003, Lozano and his wife bought a $125,000 house in Village Heights, where their two boys would each have their own room to play in. They invested a lot in the house. The Lozanos retiled the floor and did some other maintenance work themselves The house also welcomed a daughter, now 9 months old.

“It wasn’t only a house or a dream to own a house,” said Lozano, a customer service manager at a local bank. “It was our home.” But by the end of 2007, the bills were piling up as the couple struggled with their mortgage payments. Facing the risk of foreclosure, they sought help from local nonprofit Laredo-Webb Neighborhood Housing Services and managed to work out a deal with their mortgage company.

They’re among the lucky ones.

Homeowner associations filing more foreclosures

By Paul Weber      Associated Press June 14, 2009

IRVING — Thousands of Americans who have generally kept up with their mortgages in a rough economy may still be in danger of losing their homes because they made a fateful trade-off: They let their homeowner association dues slide.

Many homeowners are learning to their surprise that condo and neighborhood associations — which oversee security patrols, mow lawns, plant flowers and clean the community swimming pool, among other activities — might have the right to foreclose when dues aren’t paid. That right is often written into the purchase agreement signed by the homeowner.

Among those who have been threatened with foreclosure is Lacey Pilat, who lost her job catering corporate parties and nearly lost her two-story house in Irving, a suburb of Dallas.

“Basically, our landscaper was foreclosing on the house,” said Steve Pilat, her husband. “That’s the way we looked at it.”

Major developer files for bankruptcy in Austin

Crescent Resources lists $1 billion in both assets, liabilities.

By Claudia Grisales Austin American-Statesman June 10, 2009

Crescent Resources LLC, the North Carolina-based developer of high-end residential and mixed-use projects in 10 states, including the Austin area, filed a massive bankruptcy case in Austin on Wednesday.

The developer listed both assets and liabilities of more than $1 billion and dozens of properties in the Southeast and Southwest.

The company said it had received $110 million from existing lenders to keep going during the Chapter 11 bankruptcy and expected to continue operating without any “significant disruption.”

American Housing files bankruptcy

Foundation’s actions voluntary

By Kevin Welch       Amarillo Globe-News June 12, 2009

LUBBOCK – American Housing Foundation changed course Thursday by willingly filing for bankruptcy and asking a judge to investigate at least $21 million in life insurance proceeds allegedly reassigned by founder Steve Sterquell in an effort to defraud creditors of the foundation.

American Housing filed for voluntary bankruptcy, ending an attempt by investors and lenders since April 21 to force it into involuntary bankruptcy. The move takes some legal pressure off the foundation.

Slump leads to fewer teardown fights between Dallas preservationists, builders

By David Flick       Dallas Morning News June 16, 2009

For preservationists, sometimes the best that can happen is nothing at all.

Katherine Seale, director of Preservation Dallas, said the most striking change she has noticed recently in her North Dallas neighborhood has been the lack of change – the teardowns of nearby ranch-style houses has all but ceased.

The reason is the recession.

“There’s an old joke that goes: ‘A bad economy is a preservationist’s best friend.’ People get hurt in times like these, so it’s not particularly funny,” Seale said. “But it is true.”

Fewer houses and buildings are under construction, so fewer older ones are torn down. The decrease in threats to historically significant structures is hard to quantify but impossible to miss.

For several years, Seale’s organization regularly sent out frantic – and, ultimately, futile – alerts:

In December 2006, the art deco house of architect George Dahl in Highland Park was leveled. In 2007, the Georgian-style YWCA building in Old East Dallas was knocked down for a rehabilitation center. In April 2008, bulldozers appeared on a Sunday morning to demolish a vintage insurance building on Turtle Creek Boulevard.

This year – silence.

The Battle Over This Old House

By Amy smith        Austin Chronicle June 11, 2009

Even after reaching an impasse during a grueling mediation process late last year, both parties in a historic Hyde Park zoning dispute have agreed to take six more months to try to reach a settlement agreement ­– or else square off in a December trial. At this writing, a trial may be the only way to settle the emotionally charged debate pitting historic preservation against property rights. Until then, the six-month cooling-off period provides a reprieve of sorts for the Hyde Park Neigh­borhood Association, which last month secured a temporary restraining order to block the demolition of a 100-year-old home at 4213 Avenue G. Property owner Helen Nohra and her now-grown children have owned the Bradford-Nohra property for more than 60 years. They want to bulldoze the time-worn neoclassical home and build townhomes on the spacious corner lot at 43rd and Avenue G.

The South(side) Rises Again

By Dan McGraw     Fort Worth Weekly June 11, 2009

Sitting in the foyer of Fort Worth architect Bob Kelly’s office, Eddie Vanston doesn’t look like a big-time real estate developer. He’s slumped in a chair, dressed in bulky gray sweat shorts, a well-worn “Kinky Friedman for governor” t-shirt, and old work boots that look like they’ve slogged+ through years of construction sites.

The only sign that he might be involved in anything having to do with the top side of real estate development is a tape measure clipped to his waistline of his shorts. But that just makes him look like one of the guys who hangs drywall. At 53, his dishwater-blond hair is fading in the front, gathered in a long ponytail in back.

It’s not the look of a Columbia University grad who once taught English at a ritzy New York private high school. He’s meeting at the South Main Street office of Kelly, his partner in some projects on the Near Southside, because he doesn’t have his own office down there. His office is actually his car, the front passenger seat piled high with paperwork, the back seat awash with his kids’ toys.

The unconventional look is likely a product of his unconventional approach to his business. The Dallas native (he still lives there) has been redeveloping run-down historic structures on Fort Worth’s Near Southside for more than 10 years now. Plenty of Dallas developers were lured to Cowtown’s high-end condo market in the years before the housing bust, but Vanston was here long before most of them, always working in the world of market-rate rentals.

East Austin subdivision sets new bar for green design

Homes, some set aside for lower-income buyers, designed to produce as much energy as they use.

By Shonda Novak Austin American-Statesman June 14, 2009

Three miles from downtown in East Austin, the first homes are rising at a project that aims to set a precedent by combining green building, affordability and aesthetics.

Architect Chris Krager is undertaking his biggest project to date with Sol (for Solutions Oriented Living), a subdivision with 40 homes on Perry Road, near Airport Boulevard and Bolm Road.

Several more homes are expected to break ground in the next few weeks. The first home-

owners could move in by August, and about half of the homes should be finished by the end of the year, Krager said.

Through solar power and other energy-saving features, the two- and three-bedroom homes are designed to produce at least as much energy as they consume over a year.

They will have efficient heating and cooling systems, spray-foam insulation, natural lighting, metal roofs and other energy-saving features. Those measures are expected to reduce the total energy demand to about half of that of a standard-built home.

Public housing: location matters [Beaumont]

By Dan Wallach      Beaumont Enterprise June 14, 2009

The urge to draw is as old as cave paintings, so it’s no shock to see bright pink chalk scrawls on an urban basketball court.

But the neon curlicues on the city-owned concrete court at Cottonwood Park across from the Beaumont Housing Authority’s Concord Homes spell out the harshness of the street in juvenile script.

Obscenities, in a column like a hopscotch grid, land like fists as the eye reads them.

“It hurts me to hear babies say that,” said Rasheka Haley-Simpson as her children, Anthony, 5, Gabriella, 4, and Brianna, 2, clambered on the playground, burning off afternoon energy at top speed.

“I tell them, ‘I don’t care what other people say. I don’t want to hear that come out of your mouth,'” Haley-Simpson said.

After four years at Concord Homes, one of Beaumont’s public housing communities, Haley-Simpson is aching to leave.

“A lot of people get caught up in not trying to push themselves,” she said. “They’re not trying to improve. Some people are shocked I live here. But you do what you’ve got to do. I’m not trying to remain in the system.”

But a lack of affordable housing hems in families like Haley-Simpson’s.

Houston’s homeless get nighttime help

By Cindy George      Houston Chronicle June 14, 2009

It was still daylight and oppressively hot for almost 7 in the evening as down-on-their-luck folks gathered at Gray and Jackson in downtown Houston.

With dusk approaching, they followed the smell of baked chicken to the building with the sunshine logo on its sign.

While other homeless agencies had wrapped up their services for the day, Bread of Life at St. John’s Downtown was just opening its doors.

Not so long ago, evenings meant that some of the same people in the dinner line would have been settling into their sleeping spots on the church lawn.

Now, the nonprofit’s effort to usher the homeless to self-sufficiency has switched from day hours to a nighttime program called After Dark.