Tuesday Report, May 24, 2011
Special to the Texas Low Income Housing Information Service
In Texas, Galveston disaster recovery continues and a homeless census found the homeless population in Harris and Fort Bend counties grew by 25 percent.
Nationwide, a huge backlog of unsold houses wait for better mortgage terms for borrowers as sales continue to sink nationwide. Buyers with cash, however, continue to snap up good deals on homes with reduced prices and make the recession work for them.
Meanwhile the new, federal Consumer Financial Credit Bureau unveils new mortgage rules that call for plain and clear terms for lending rates. The revisions are almost moot points in an industry that has retreated from making mortgages to new, struggling homeowners.
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State awaits GHA plans
By Amanda Casanova Galveston County Daily News May 22, 2011
GALVESTON — State officials, concerned about delayed progress in rebuilding 569 units of public housing, are eager to see plans that meet fair housing requirements and would allow the city to maintain eligibility for the second round of Community Development Block Grants. Under state requirements for the federal funding, the public housing cannot “all be replaced north of Broadway” and still “further fair housing,” said Kevin Hamby, legal counsel for the Texas Department of Housing and Community Affairs. While community leaders continue to debate where the 569 units should be built and the implications of constructing public housing on the island, the department is looking forward to seeing plans that are not within the current footprint, Hamby said. “We do recognize progress is being made to develop the plan,” he said this week in a letter to Mayor Joe Jaworski, adding that the department’s board wanted “more clarity.” Construction plans After Hurricane Ike knocked out all four of the public housing developments on the island, the Galveston Housing Authority Board of Commissioners voted to rebuild the 569 public housing units. Later, the city council agreed to commit to the rebuild, offering $25 million to the project. While the Galveston Housing Authority doesn’t intend to rebuild in the current footprint, the housing authority will meet all the necessary requirements, a spokesman with the housing authority said. “GHA is committed to replacing all of the 569 homes lost to Hurricane Ike and doing so in a way that will create stronger neighborhoods and better outcomes for families,” said Justin Herter, public information officer for GHA.
Full story at: http://galvestondailynews.com/story/232798
Homeless population keeps increasing, coalition finds
Fort Bend, Harris counties up 25% over ’10
By Renee C. Lee Houston Chronicle May 24, 2011
The homeless population in Harris and Fort Bend counties grew by 25 percent this year, according to an annual count by the Coalition for the Homeless of Houston/Harris County.
The Jan. 31 census found 8,538 men, women and children were homeless this year, compared with 6,819 in 2010. If jail inmates without homes are included, this year’s count is more than 13,000, the coalition said in a report released Monday.
More than 400 volunteers canvassed the two counties on foot and in vehicles to produce the count.
The increased numbers are partly due to the recession, said coalition President and CEO Connie Boyd. Texas’ economy fared relatively well, so “people moved here because of the hope of getting a job,” she said. “It didn’t always work out.”
Camp Called Home
Tents in the woods are home to a few hundred folks but a headache to others.
By Sarah Angel and Peter Gorman Fort Worth Weekly May 20, 2011
Awell-worn footpath leading through a patch of weeds into a large stand of trees is the only sign that you’re approaching a homeless camp on Fort Worth’s East Side. Low-hanging branches and bushes have been left untouched to help conceal the spot from outsiders.
About 100 feet in, the trail ends at a tiny warren of seven or eight tents around an open area defined by two long benches flanking a small fire pit with a grill. A kitchen counter rigged between two trees is covered in bottles and jars of condiments and instant coffee; shelves underneath hold pots, pans, and soap. The bathroom is a squat hole dug into the ground 20 feet away. A piece of paper taped to a tree nearby reads: “Paper in the basket please. Thank you.” Shower and laundry facilities consist of the nearby Trinity River. The camp is in a beautiful spot, surrounded by trees and bluffs, and residents keep it neat and garbage-free. If you were just camping for a couple of weeks, it would be a prime site.
The man who put the camp together is called Little Wolf, a 22-year-old who says he never knew his mother, has a dad in prison, and was raised by his older brother. He’s slight and shy, a bit wary. But he lights up when asked about the camp.
US home sales fell in April, as tight credit hindered buyers
The home sales report also found that the median price for sales of previously owned homes was $163,700 – some 5 percent below the median price a year ago.
By Mark Trumbull Christian Science Monitor May 19, 2011
The pace of home sales fell by nearly a percentage point in April, even as the inventory of properties for sale remains large.
One major obstacle to sales activity is tight credit conditions for potential buyers, said the National Association of Realtors (NAR), which released the sales numbers Thursday.
Other problems include high unemployment and weakness in home prices, which has made some home shoppers wary of buying when prices may be poised to drop further.
At the same time, the crosscurrents in the housing market include some positive forces. Foreclosure activity is declining in many regions, and an improving job market should boost demand for houses over time. Mortgage rates remain low.
Austin-area home resale market remains slower than a year ago
Austin American-Statesman May 19, 2011
Sales of existing homes last month were down 16 percent from April 2010, the Austin Board of Realtors reported Thursday.
April 2010 was the month that federal homebuyer tax credits expired.
Dallas-area sales were down 20 percent; Houston sales were down 14 percent.
In Austin, the median price rose 3 percent, to $196,400. The price per square foot rose 9 percent, to $121. That reflects a higher concentration of sales at upper price ranges.
But it took much longer to sell a house — an average of 88 days — up 28 percent from a year earlier, the board said.
A total of 1,690 existing homes sold last month in Central Texas. Sales in the pipeline to close this month were down 27 percent.
For the first four months of the year, sales were down 8 percent from a year ago, to 5,309.
Consumer finance agency proposes simpler mortgage forms
By Kevin G. Hall McClatchy Newspapers May 18, 2011
WASHINGTON — Moving to address one of the principal factors that led to the nation’s deep financial crisis, the new Consumer Financial Protection Bureau on Wednesday unveiled the first prototypes of what could become plain English mortgage-disclosure documents for consumers.
“It is always good for consumers to know the real cost of a mortgage,” Elizabeth Warren, the adviser creating the new bureau, said in a conference call.
The two prototype documents made public Wednesday will be subjected to focus-group testing with consumers, lenders and real estate professionals. After that, there’ll be at least five rounds of evaluation and revision, with an eye toward having a standard proposed by July 2012.
Although these two alternative versions of a new mortgage-disclosure document are preliminary, the “Know Before You Owe” effort marks an important change. It merges two federal-disclosure documents that currently are required when a consumer takes out a loan to purchase a home, and translates them from finance-speak into clear language that any buyer can understand.
Consumers trending to shorter-term mortgages
By Kenneth R. Harney Washington Post May 20, 2011
Could I refinance you into a seven-year fixed-rate mortgage at 2.99 percent? Or how about 10 or 15 years fixed in the mid-3s?
These might sound suspiciously like teaser quotes with tricks in the fine print, but they are in fact signs of an important shift underway among American homeowners: Not only have they been refinancing at a robust pace in recent weeks, but they’re also ratcheting down on the remaining number of years they plan to pay on their mortgages.
Freddie Mac chief economist Frank Nothaft calls the shift to shorter terms “a very strong trend.” In his company’s latest quarterly survey of refinancers, more than one out of three borrowers who ditched their 30-year fixed-rate loans opted to replace them with 15-year or 20-year mortgages at near-record low rates.