(grim’s note: While the Altos numbers are a welcome addition, realize that they are month over month numbers, which tend to exhibit strong seasonality with regards to price and inventory. These numbers are hard to use (and potentially confusing/misleading) without seasonal context.)
From Altos Research:
August 2010: REAL-TIME HOUSING MARKET UPDATE
This month’s housing data confirms what we’ve been saying for some time: the mini-“boom” of this spring was created by seasonal demand, with some extra help from pressure to meet deadlines for capitalizing on tax credits. Now that those are gone, buyer activity has all but come to a standstill.
Rapidly rising inventory, pricing weakness in the Altos 10-City Composite signal continued home price pressures in August and into the fall of 2010. This month, the Altos 10- City Composite price decreased 0.63%.
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Foist my Commodore 64 came through
Mortgage market knocked by ‘mega-refi’ talk
The market for mortgage-backed securities has had a good run this year, but it’s taken a hit in recent days on growing talk of a “mega-refi” program that could let homeowners refinance home loans more easily at lower rates.
Speculation about a mega-refi program has been growing. Treasury bond yields have slumped in recent months and mortgage rates have fallen to record lows. But refinance activity hadn’t picked up much until recently. That’s muted the impact of lower rates and sparked discussions of ways to tackle the problem.
A major wave of mortgage refinancing could reduce borrowers’ monthly interest payments, leaving more money in their pockets for spending. That, in turn, could boost economic growth.
However, lots of refis would be bad for mortgage-backed securities investors. That’s because older securities with higher interest rates would be paid off at face value then replaced with newer bonds with lower coupons.
“Bill Gross’s statement in favor of a mega-refi program is probably the major story for mortgage traders,” said Steve Kuhn, who oversees mortgage investments at hedge fund firm Pine River Capital Management LP.
Zillow: 30-Year Mortgage Rate Drops Back to Record Low
The national, 30-year fixed-mortgage rate (FRM) slightly decreased from a week earlier, reverting back to the record low average of 4.28% set two weeks ago, according to the Zillow Mortgage Marketplace weekly update. This is down 0.02% from last week.
Regionally, 30-year rates vary, but the majority of states witnessed a deflation. Most large states saw a decline in rates: California’s current rate of 4.33% is down from 4.34% last week; New Jersey’s at 4.26% is down from 4.28%; Pennsylvania’s at 4.32% is down from 4.33%; Illinois’ at 4.3% is down from 4.34%, and Florida’s at 4.21% is down from 4.24%.
Just got some news on a tall grass down the block media room , bowling, just grand have been there. Neighbors got a lawn guy to cut , mind you these are Mcmansions in the most prestigious part of town and someone ( owner suspected although I don’t think so ) gutting the house. Moved out bought down south. Great times in the USA!
Bill Gross,suggesting a federal mandate of lowering interest rates of all outstanding home mortgages without having to go through refi.Homeowners gets to keep more of their money and maybe help a bit on FK.
Yo the end is near, this just keeps getting more surreal. Doom may be right.
Gross sittin’ on a pretty big pile of mortgages.
What is he thinking suggesting this? He is holding a big pile of MBS. Got to find out his game.JJ might be able to throw some bones on this.
Grim Yo, something smells rotten in Denmark. Hm-mm…..
Gross would rather get paid a little rather than nothing at all. Guaranteed he’s run the scenarios before making such a suggestion, as nothing he says is ever random or meant for the benefit of anyone other than himself.
He’d be taking an enormous haircut, so our takeaway should be the knowledge that he (along with a lot of other phony bulls) knows it’s about to go from gray to black.
I can tell you from my own recent anecdotal experience that the profile of the borrower who’s getting lis pendens served recently is pretty much “let the mf’ers have the money pit…but not before I milk a couple years out of it”. Even the dumbasses know the strategic default game now.
You can also bet Gross has a play ready to take advantage of any blanket insta-refi actions Phony/Fraudy might take.
scratch that, bad reporting
Clot 11 my take also, something is better than nothing . The sh*t is about to hit the fan.
Check your email.
Hi all: quick question regarding renting a SFH. We have decided to take out renters’ insurance to cover our belongings etc. as we rent a SFH. Does the landlord continue to hold his homeowners’ policy to cover his structure? Also are there different rates for owner occupied vs. tenant occupied? Thanks in advance!
Afe have had a policy since selling in 06, do not worry about landlord (& he does ) & yes renters ins is cheaper.
Mike- took a look at that. Intriguing. Check your e-mail.
TPTB should drop mortgage rates to 0% for a week and let everyone listen to the silence.
When every other word on CNBC between 6-9 AM is “deflation”, you know the pushing-on-a-string game is over.
I’m waiting for Santelli to go all-in Howard Beale.
Gross was nearly all in back in 08 with 60% agency MBS. Man knows how to work it, check his paper now notice the Euro Bet?
Juice Euro bet?
connecting long term unemployment and suicide
“Bill Gross,suggesting a federal mandate of lowering interest rates of all outstanding home mortgages without having to go through refi.Homeowners gets to keep more of their money and maybe help a bit on FK.”
The hell with that crap. The damn rates are down to damn 4% right now and the damn bank aren’t lending shlt because you damn terrorists have them scared shltless. Here’s what will solve this problem damn quick:
1) Bulldoze some damn houses and cut the damn supply by 75%
2) Put everybody into a damn 100 year mortgage
3) Confiscate all damn gold worldwide and if someone refuses to give it up, shoot them. Actually, this one’s a damn twofer–you save the damn greenback and get rid of all the damn real estate terrorists at the same damn time.
You’d have a damn bull market in housing and stocks overnight.
Sweet dreams. Strap on your adult diapers and ready yourself to vomit with fear.
What a waste of good brew…….
Scottish scientists raise their glasses to whiskey-powered car
Last Updated: 9:44 AM, August 17, 2010
Posted: 8:23 AM, August 17, 2010
A new whiskey-based biofuel that can power cars was developed by scientists in Scotland, Sky News reported Tuesday.
Researchers found a formula to make the fuel from whiskey by-products. They combined pot ale — the liquid from copper stills distillery equipment — and the spent grains used to make whiskey, also known as draff, to produce butanol.
The resulting form of alcohol can then be used as fuel to power a vehicle, much like ethanol.
However, the scientists said butanol was superior to ethanol — with 25 percent more energy per unit volume. The biofuel can also be introduced to unmodified engines with any gasoline blend, whereas ethanol can only be blended up to 85 percent and requires engine modification.
With 352 million gallons of pot ale and 206,000 tons of draff produced annually by the malt whiskey industry, there is even potential for the new biofuel to be available at gas stations.
Professor Martin Tangney, director of the Biofuel Research Centre at Edinburgh Napier University, said: “The EU has declared that biofuels should account for 10 percent of total fuel sales by 2020. While some energy companies are growing crops specifically to generate biofuel, we are investigating excess materials such as whiskey by-products to develop them. This is a more environmentally sustainable option and potentially offers new revenue on the back of one of Scotland’s biggest industries.”
The drink-it-then-drive-it research was based on technology once used to manufacture explosives during WWI and WWII.
However, there is no confirmation yet that it will make your car go like a rocket.
I’m sick of studying already…
I’m watching board lecture series. Toxicology lecture – discussing ipecac…
Guy lecturing plays THIS scene.
I’m near pissing my pants and in tears laughing….
grim says: From MarketWatch:
Mortgage market knocked by ‘mega-refi’ talk
Article says one can pick up a few % points trading these bonds. My question is how big are these bond pools and what % of the mtgs get defaulted on –
US Says Bankruptcies Reach Nearly 5-Year High
U.S. bankruptcy filings have reached the highest level since 2005, government data released on Tuesday show, as the economy slows and the unemployment rate hovers just below double digits.
There were 422,061 bankruptcy filings between April and June, according to the Administrative Office of the U.S. Courts, up 9 percent from 388,148 in the prior three-month period, and up 11 percent from 381,073 a year earlier.
For the year ended June 30, there were 1.57 million bankruptcies, up 20 percent from 1.31 million a year earlier.
Consumer bankruptcies rose 21 percent to 1.51 million, and business bankruptcies rose 9 percent to 59,608.
Quarterly filings surpassed 400,000 for the first time since a record 667,431 bankruptcies were begun in the fourth quarter of 2005, when Congress overhauled federal bankruptcy laws and made it harder for people and businesses to file.
“We know the causes of bankruptcy are principally job losses and health care, with the overlay of the foreclosure crisis,” said Deborah Thorne, an associate professor of sociology at Ohio University. “It feels very unsettled, and I’m not surprised the numbers are going up. Until we get our feet on the ground, provide decent-paying jobs, and do something with the housing crisis, bankruptcies will continue to go up.”
Newark Arena Sale ‘Not Feasible’ to Plug Gap, Mayor Booker Says
Newark Mayor Cory Booker said a plan to sell the city’s three-year-old Prudential Center arena is “not feasible,” after two city councilors said the sale could help close a budget gap that was as wide as $150 million.
The $375 million venue, home of the New Jersey Devils National Hockey League team, is owned by the city’s housing authority. It sits adjacent to City Hall, two blocks from Newark Penn Station, a major New Jersey Transit rail hub.
Booker, 41, a Democrat in his second term as head of the state’s largest city, said Newark is in litigation over $3.5 million in annual lease payments from the Devils. Until that case is settled, the city can’t consider a sale “in any real way,” though officials smay revisit the idea when the legal issues are resolved, Booker said in a telephone interview.
From the WSJ:
‘Vultures’ Save Troubled Homeowners
Anna and Charlie Reynolds of St. George, Utah, were worried about losing their home to foreclosure last year. Then they got a lucky break—from an unlikely savior.
Selene Residential Mortgage Opportunity Fund, an investment fund managed by veteran mortgage-bond trader Lewis Ranieri, acquired the loan at a deep discount and renegotiated the terms with the Reynolds. The balance due was cut to $243,182 from $421,731, and the interest rate was lowered. That reduced the monthly payment to $1,573 from $3,464, allowing the family to stay in their home despite a drop in Mr. Reynolds’ income as a real-estate agent. “It was a miracle,” says Ms. Reynolds.
But Mr. Ranieri isn’t your typical miracle worker. As a fund manager who was once vice chairman of the bond-trading firm Salomon Brothers, he’s a member of the Wall Street crowd that is often pilloried for helping inflate the housing bubble, though he sat out the excesses of recent years. The 1989 book “Liar’s Poker” made him famous for billion-dollar trades in mortgage bonds and junk-food “feeding frenzies” with his trading-desk buddies.
“10 Signs The U.S. Is Becoming a Third World Country,”
The United States by every measure is hanging on by a thread to its First World status. Saddled by debt, engaged in wars on multiple fronts with a rising police state at home, declining economic productivity, and wild currency fluctuations all threaten America’s future.
Grim 32 – The key to executing that strategy is being able to buy the distressed mortgages from the mbs trust pools. I would like to see how well marketed the pool was when Raineri bought it. The biggest issue at hand when a servicer liquidates the pool is determine “fair market value”. It sounds easy enough but there is quite a bit of gray area.
Once Lewie has the pools for 10 cents on the dollar, he can re-work the principal to 50 cents on the dollar and still make a killing. He also looks like a real sweet-heart in the process.
Refi apps jump, purchase apps drop.
Overall level still abysmal.
Love the way the media is spinning it as “13% jump in mortgage apps”, while failing to distinguish between purchase and refi.
It would be funny if an unintended consequence of all the recent “insta-refi” talk is that refi apps dry up as eligible borrowers anticipate being essentially given a free, one-page re-work on their rates.
Good one on the hot sheet this morn, 488 days on market new construction reduced from 499 to 385, the second phase of construction. Should have stopped at the first.
Is it in Hoboken? Does Frank know about it?
Time to buy that house, Mike. Toxic mold and water problems should’ve had plenty of time to take hold in that place.
Frank is turning tricks in the SRO motels next to the Holland Tunnel.
HEHE , no Vernon. Clot, yes should be just about ripe. Also townhouse that we talked about last year at 392 now 219. Grim remember those reddish brown 3 bds.
As we have postulated it starts out here & works its way in. Hopefully you train/Bc town buyers will get the same massive reductions.
Speaking of reductions.
Total amount of 2 bedroom condo’s in Hoboken for under $400,000
is 37 units.
Right now Frank must be ready to jump off or jump in. (Building or River)
Which one is it Frank?
Did they nuke NY . Crickets chirping.
Can anyone here recommend a NJ real estate lawyer who has dealt with REDC (auction.com) before?
Any other real estate professionals?
Jon Corzine will be moving to Rumson ….he’s buying Dawkins 29 million estate for 19million 35% off sale ! ….http://3.bp.blogspot.com/_N2EyyrA_LPs/TGqhAgigGII/AAAAAAAAJ90/ug4XAeG0yBo/s1600/bernie.jpg
Just catching up on the blog…thanks again Grim!!
just got back from vacation – 2 weeks in Belmar where the weather was magnificent and the beach fun. One week in Brittany, France, not so nice weather but good food and fun times.
We really like the North End of Belmar- there’s action not too far away, but the beach never feels packed since you’ve got the space down by the fishing pier that is virtually empty…Ate at Moonstruck – a little disappointed no really fresh fish on the menu. Otherwise hit Mr Shrimp with my 11 year old niece who liked it. Had pizza several times from the place on Main St. – Frederico’s I think – it was delicious – very high quality. Also Ragin Cajun as I mentioned – the best meal of the vacation (other than the ones I whipped up for my family – of course!)
Big night out was dinner at the Belford Bistrot in Middletown. I’d have to give it a 7/10 – food inventive, but no atmosphere and the service not all that nice. Really had that Belford “Edge”. Last year we went to Doris and Ed’s in Highlands and that was a dream. Maybe next year Nicolas in Middletown.
Catching up on the blog – and on the houses that are on the market in Belmar. I’ve decided to be really picky and only go for something North of 6th.
Fiddy – did you see the house on 10th just brought the price down a bit?
Corzine: perfect example of the American concept of “fcuk up, move up”.
I want to be reincarnated as an idiot who can’t do anything right, yet accumulates millions of dollars and remains impervious to the fact that the rest of the world sees me as a complete dolt.
I also want to run for political offices in which the only way I can win is to buy the votes of huge, indolent constituencies.
Is this a problem?
yes, there is a ‘stop the mosque’ video
If blood transfusions, wires and tubes don’t do the trick, is there a problem?
Can’t make this stuff up.
SEC Charges State of New Jersey for Fraudlent Municipal Bond Offerings
Washington, D.C., Aug. 18, 2010 – The Securities and Exchange Commission today charged the State of New Jersey with securities fraud for misrepresenting and failing to disclose to investors in billions of dollars worth of municipal bond offerings that it was under funding the state’s two largest pension plans.
According to the SEC’s order, New Jersey offered and sold more than $26 billion worth of municipal bonds in 79 offerings between August 2001 and April 2007. The offering documents for these securities created the false impression that the Teachers’ Pension and Annuity Fund (TPAF) and the Public Employees’ Retirement System (PERS) were being adequately funded, masking the fact that New Jersey was unable to make contributions to TPAF and PERS without raising taxes, cutting other services or otherwise affecting its budget. As a result, investors were not provided adequate information to evaluate the state’s ability to fund the pensions or assess their impact on the state’s financial condition.
New Jersey is the first state ever charged by the SEC for violations of the federal securities laws. New Jersey agreed to settle the case without admitting or denying the SEC’s findings.