Countrywide Delinquencies Rise

Daily Real Estate News  |   February 19, 2008

 

Countrywide Financial Corp., the nation's largest mortgage lender, says loan delinquencies as a percentage of unpaid principal balance increased to 7.47 percent in January from 4.32 percent in January 2007.

Foreclosures pending as a percentage of unpaid principal balance increased to 1.48 percent in January from 0.77 percent in January 2007.

The rise in foreclosures and late payments reached record levels in January, according to Countrywide.

Countrywide says it funded $21.89 billion of home loans in January, down 41 percent from $37.11 billion a year earlier. Average daily loan applications totaled $2.64 billion, down 6 percent from $2.82 billion a year earlier.

Source: The Associated Press, Alex Veiga, and Reuters News, Jonathan Stempel (02/15/08)

Report: Dallas-Fort Worth home prices least likely to drop

07:30 AM CST on Wednesday, January 16, 2008 By STEVE BROWN / The Dallas Morning News stevebrown@dallasnews.com Dallas-Fort Worth's housing market is the least likely of any in the country to see a decrease in home values, a new report confirms. At the same time, the chances of a house price decline rose in almost four out of five U.S. markets, according to a report released Tuesday by mortgage insurance firm PMI Group. Dallas and Fort Worth ranked dead last in PMI Group's latest forecast of cities with the biggest chance for a home price shakeout. Analysts with the California-based company estimate that Dallas-Fort Worth has less than a 1 percent chance of marked home price drops in the next two years. By comparison, cities in California , Nevada and Arizona have more than an 80 percent likelihood of falling residential values. "We're seeing an increasingly polarized market," PMI economist David Berson said in a news release. "The risk that home prices will be lower in two years has increased for many of the largest cities in the nation, although areas that saw only moderate home price gains during the 2002-to-2005 period still generally have low risks of price declines," he said. That's certainly the case in Dallas-Fort Worth, where home price appreciation during the last five years has been a fraction of the national average. "Because Texas did not participate in the double-digit home price gains in the first half of the decade, it doesn't have to take the great pain of the areas that are compensating for that now," Mr. Berson said in an interview. Now that the housing sector is in a slump, home values in North Texas have been relatively flat while they are falling in many other major U.S. cities. In 2007, the median price of homes sold through the North Texas Realtors' multiple listing service was up 1 percent from 2006. Texas markets – including the D-FW area – were also less affected by investors who ran up prices in some cities, Mr. Berson said. And most Texas cities are outpacing the rest of the country in overall economics, he said. "The state economy is doing pretty well, and job growth is above the national average," Mr. Berson said. "It's quite likely Texas will be doing better than the national average for the foreseeable future," he said. The D-FW area has gotten high marks in the PMI risk report before. And other national surveys show that North Texas ' housing market is outperforming those in the rest of the country. Even so, pre-owned home sales were down about 8 percent last year, and sales of new homes fell about 17 percent in 2007. Foreclosure rates also continue to rise. Analysts are therefore keeping a close eye on D-FW home prices for signs of deterioration. "I can't argue with the PMI risk assessment, but it doesn't mean that it still couldn't happen – just not as likely as elsewhere," said Dr. James Gaines, an economist with Texas A&M University 's Real Estate Center. "So far, most Texas markets are doing well. "The metroplex probably will do well to have positive overall appreciation, but pockets within the metroplex will have a rough time for a while." Indeed, Mr. Berson said, the Texas housing market isn't bulletproof. "There are no sure things," he said. "It's possible that some parts of Texas will see some declines in the near term." But overall, the outlook for the local housing market is good, he said. HOW RISKY IS THE HOUSING MARKET? Markets with the most and least risk of a home price decline, based on price appreciation, economic growth and affordability according to PMI Group, one of the country's largest mortgage insurance firms. An index of 100 means there is a 100 percent chance of home prices falling in the next two years. MOST RISKY Riverside , Calif. 94 Las Vegas 89 Phoenix 83 Santa Ana , Calif. 81 Los Angeles 79 LEAST RISKY Fort Worth Less than 1 Dallas Less than 1 Pittsburgh Less than 1 Houston Less than 1 San Antonio Less than 1 SOURCE: PMI Group

Cities Where Values Have Fallen the Most

While resetting rates are causing some foreclosures, falling home prices are also playing a big part in the real estate malaise.

Home owners who owe thousands more on their homes than they are currently worth find themselves unable to refinance and unable to sell at a price that will come close to covering what they owe on the mortgage.

However, according to ZipRealty, a real estate tracking firm that aggregates multiple listing service data, the decline may be reaching bottom with inventories starting to decline nationwide. Even in Sacramento and Las Vegas, inventory numbers have started to fall, if only marginally, ZipRealty says.

The following are the top 10 cities where prices have fallen the most in the last year, according to ZipRealty.

1. Sacramento, Calif.: - 18.5 percent
2. Las Vegas: - 17.2 percent
3. San Diego: - 17.1 percent
4. Tampa, Fla.: - 11.7 percent
5. Los Angeles: - 10.7 percent
6. Miami: - 10.6 percent
7. Phoenix: - 9.5 percent
8. Jacksonville, Fla.: - 8.7 percent
9. Detroit: - 7.7 percent
10. Atlanta: - 7.1 percent

10 Best Places for House Bargains

The best place to get a bargain on a home is an area where there is healthy job growth and more houses available than people to buy them.

These are markets "where you have high inventories but pliable borrowers, with lenders willing to deal," says Anthony Sanders, a professor of finance at Arizona State University.

Forbes magazine went looking for markets where the damage from risky lending hasn't been as dramatic as in some parts of the country and where employment growth will burn off an over-abundance of inventory quickly.

Here are what the magazine considers the 10 best cities for bargain house hunters.

1. Salt Lake City, Utah. Developers have gotten ahead of the demand, but the city is adding jobs more quickly than practically any place else in the country.

2. Raleigh, N.C. Another place where building got ahead of the curve, but the economy is expanding quickly.

3. Orlando, Fla. This part of the state had fewer speculators than Miami and Tampa, and it's adding jobs faster than those cities as well.

4. Charlotte, N.C. The financial industry is moving here, adding jobs, but the inventory of unsold homes is still significant.

5. Phoenix. This city had a high foreclosure rate, but the economy is growing and people are still moving here in large numbers.

6. Seattle. The city's port has profited from the weak dollar, but the housing price growth has slowed.

7. Las Vegas. This market was hit hard by foreclosures, but the growing economy makes the huge inventory less toxic than it is many places.

8. Jacksonville, Fla. The foreclosure rate is slower than the rest of the Florida cities, making the large inventory likely to improve.

9. Richmond, Va. There is only one foreclosure per 1,103 households here (compared to 1 in 33 in Detroit). Still, there are plenty of homes on the market.

10. Houston. Homes in Houston have long been a bargain. While there have been plenty of foreclosures, the population and the economy are expanding.

Source: Forbes, Matt Woolsey (02/07/08)

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