Tuesday Report, April 20, 2010
Special to the Texas Low Income Housing Information Service
Charges have finally been filed against Goldman Sachs for creating bogus investment institutions that profited from the housing debacle. The Securities and Exchange Commission will face a tough legal defense in a complicated case as Goldman also mounts a campaign to garner public support.
In Texas, legislators listen to testimonies about stringent HOA rules and once more contemplate laws curbing their power to impose fines on homeowners.
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S.E.C. Accuses Goldman of Fraud in Housing Deal
By Louise Story and Gretchen Morgensen New York Times April 16, 2010
Goldman Sachs, the Wall Street powerhouse, was accused of securities fraud in a civil lawsuit filed Friday by the Securities and Exchange Commission, which claims the bank created and sold a mortgage investment that was secretly intended to fail.
The move was the first time that regulators had taken action against a Wall Street deal that helped investors capitalize on the collapse of the housing market.
The suit also named Fabrice Tourre, a vice president at Goldman who helped create and sell the investment.
In a statement, Goldman called the commission’s accusations “completely unfounded in law and fact” and said it would “vigorously contest them and defend the firm and its reputation.”
The focus of the S.E.C. case, an investment vehicle called Abacus 2007-AC1, was one of 25 such vehicles that Goldman created so the bank and some of its clients could bet against the housing market. Those deals, which were the subject of an article in The New York Times in December, initially protected Goldman from losses when the mortgage market disintegrated and later yielded profits for the bank.
Full story at: http://www.nytimes.com/
The Americans who flocked to buy oceanfront condos south of the border have vanished. Prices have plummeted, and some cash-strapped developers have halted projects midway.
By Alana Samuels Los Angeles Times April 15, 2010
Reporting from Rosarito Beach, Mexico
The condo in the Palacio del Mar development just south of Mexico’s Rosarito Beach spares no luxuries. Travertine tile. Stainless steel appliances. A customized wine rack.
Then there’s the view. On one side is the glittering Pacific. On another, just 30 feet away, is the half-completed shell of an adjacent condominium project. The building looks like an abandoned parking garage, with floors of concrete piled atop one another and steel spikes poking out from the floor.
Foreclosure filings drop 12%
By Steve Brown Dallas Morning News April 15, 2010
Home foreclosures have turned lower for next month’s forced sales.
The 4,861 Dallas-Fort Worth homes scheduled for foreclosure in May represent a 12 percent decline from year-earlier totals.
And foreclosure filings are down 21 percent from the recent peak in March, Addison-based Foreclosure Listing Service said Thursday.
Foreclosure filings declined by 15 percent in Dallas County this month from a year ago.
“This decline is welcomed news, but I must warn that one month’s activity does not change a long established trend,” George Roddy, Foreclosure Listing Service president, said in the report. “Home postings have been on the high-end for some time now.
“In fact, for the past 16 consecutive months, monthly posting activity has topped 4,000 each month.”
Commercial foreclosure listings remain high in Dallas-Fort Worth
By Steve Brown Dallas Morning News April 19, 2010
While residential foreclosures have slowed for next month, there’s no letup in the volume of commercial properties set for foreclosure in May.
More than 300 Dallas-Fort Worth area commercial properties, including offices, shopping centers, apartments and warehouses, are set for forced sale by lenders next month. That’s similar to levels seen for the last several months.
The original debt on this real estate adds up to almost $879 million, according to Foreclosure Listing Service.
Full story at: http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-comforeclosures_19bus.ART0.State.Edition1.3dabb5f.html
Appraisals to drop for most Williamson homeowners
By Laylan Copelin Austin American Statesman April 20, 2010
Two-thirds of Williamson County taxpayers should see lower values when notices for 2010 property appraisals are mailed next week, Chief Appraiser Alvin Lankford said Monday.
New construction, however, should help the county’s overall property value to remain steady or increase slightly, he added.
“It was better news than we expected,” said Lankford, who had expected a slight drop. “We have been fortunate to have growth to offset the loss in market values.”
Outraged homeowners detail HOA fines, foreclosure threats for Austin lawmakers
By Robert Garrett Dallas Morning News April 19, 2010
AUSTIN – Lawmakers say they have tried to write laws in recent years to prevent homeowners associations from gouging and abusing property owners, but more might need to be done.
On Monday, outraged homeowners told a Texas House panel they’ve been threatened with huge fines and possible foreclosure for what they described as minor infractions of association rules.
A Houston couple may wind up having to pay more than $20,000 after a feud over a $50 ticket for having gray – instead of black – tape on exterior water lines, leaders of a property owners’ rights group told the House Business and Industry Committee.
“That was clearly, if it’s true, the most egregious thing we heard today,” said Rep. Gary Elkins, R-Houston, the panel’s vice chairman.
The issue of how much power homeowners associations should have so they can collect past-due assessments and enforce architectural uniformity has simmered in the Legislature since the 1990s, said Rep. Helen Giddings, D-Dallas.
Fewer houses abandoned than thought, city says
By Rhiannon Meyers Galveston Daily News April 20, 2010
GALVESTON — More than 1,000 seemingly abandoned houses pepper Galveston’s neighborhoods, according to the latest estimates from the city’s planning department.
The city’s planning and community development department canvassed the island between November and February and documented street by street the condition of houses.
From these so-called “windshield surveys,” the city determined there are as many as 1,078 abandoned houses in Galveston by counting homes that are boarded up, appear to be vacant and have yards that are not maintained.
Full story at: http://www.galvnews.com/story/155309
Hurricane-damaged Pointe apartments coming down
By Rhiannon Meyers Galveston County Daily News April 19, 2010
GALVESTON — A hurricane-damaged West End apartment complex that officials said had been a hub for vagrants and drug users for the past year and a half is coming down.
Crews last week began demolishing The Pointe apartments, 7301 Stewart Road.
The 168-unit complex never was repaired after Hurricane Ike struck Galveston on Sept. 13, 2008, flooding the ground floor apartments and tearing apart the roof.
Galveston police officers and city code enforcement officers have spent months pushing for the demolition or repair of the complex, which has been one of the biggest problems for crime and vagrancy west of 61st Street, Lt. Henry Porretto said.
Full story at: http://www.galvnews.com/story/155265
By Melissa Fletcher Stoeltje and Brian Chasnoff San Antonio Express-News April 15, 2010
Among the many in business attire who gathered Wednesday for a jubilant dedication of the new Haven for Hope campus, Richard Hartzog worked quietly in an old T-shirt, ferrying chairs back and forth across a crisp, serene courtyard.
Hartzog, 50, is homeless, exactly the sort of person for whom the $100 million transformation center was built. An addict of gambling and morphine, he’s been volunteering at the burgeoning campus — sweeping, scrubbing bathrooms, washing windows — for the past month.
A resident of the SAMMinistries emergency shelter, he received an unexpected reward from NuStar Energy Chairman Bill Greehey, who put his arm around Hartzog during a break.
“You know what,” Greehey said, “I’ll tell (SAMMinistries) the ones that have been working over here ought to be the first ones” to move in.