Banks May Decide to Hold On to Troubled Loans
June 29, 2009
According to an article in Reuters, some banks may be taking a play out of the 90’s handbook. Instead of selling or taking a loss on troubled loans, some banks may hold on to the loans and try to ride it out. Experts at the Reuters Global Real Estate Summit are projecting that commercial real estate downturn is nowhere near the bottom. They are also predicting that home sales may stay somewhat subdued until the economy improves.
Of course, this may impact the ability of developers and others to get new financing for commercial projects, further depressing the market. The latest numbers from S&P Case-Shiller Home Price Indices show a price decrease of 19.1 for single family homes in the first quarter.
However, there is some light at the end of the tunnel. Many economists believe that home prices are near the bottom. You can read the rest of the article here.
Canadians Find U.S. Property More Attractive
June 29, 2009
A recent report in the The Sierra Vista Herald reflects that U.S. property has become an increasingly more attractive opportunity for Canadian home buyers and investors.
Reports are that Canadian investment in U.S. real estate has more than doubled in one year, from 11 percent to 23.5 percent, making Canada the largest foreign real estate investor in the U.S.
U.S. property values are in many areas at an all time low thus causing much upside potential. And, the Canadian dollar has move to par with the U.S. dollar. This hasn’t happened since November of 1976. As such, the Canadians are enjoying a rate they haven’t seen in nearly three decades.
64.4 percent of Canadian buyers plan to use their U.S. homes for vacation purposes according to NAR, the National Association of Realtors. The average use of their property is nearly 3 months with a third of the foreign purchasers intending to use their U.S. home 3-6 months.
Clearly now is the time to buy real estate in the U.S. for many types of buyers, both local and abroad.
Green Certification Moving Toward Common International Metrics
June 19, 2009
Currently, a number of green building rating systems exist throughout the world but there is no international standard. The leading rating systems per ClimateChangeCorp.com include the United Kingdom’s Building Research Establishment’s Environmental Assessment Method (BREEAM), Australia’s Green Star program, and the United States’ Leadership in Energy and Environmental Design (LEED).
LEED certification, which is offered by the U.S. Green Building Council, rates how a building was built. The United States also has Energy Star, a technical assistance program that provides tools and resources to help evaluate energy performance and reduce energy use and greenhouse gas emissions.
The lack of an international standard may soon change. BREEAM, LEED and Green Star have agreed to develop common metrics for measuring CO2 emissions. This initial step will help international property developers and building owners monitor the energy performance of their global asset portfolio.
Overseas Investment in the US may be on the Rise
June 18, 2009
The beleaguered US commercial real estate market may be getting some much needed capital from foreign investors. A survey conducted by the Association of Foreign Investors in Real Estate (AFIRE) is showing some promising numbers.
According to the survey, in the past six months the confidence level of overseas investors has gone up. Over two-thirds of survey respondents among the 200 members stated they planed to invest some debt or equity in the US real estate market before the end of the year. Foreign real estate lenders say they also plan to increase lending by 58 percent and equity investors plan to increase investment activity by 73 percent in the US.
Current market activity may be partially responsible for the survey results. The highly publicized purchase of AIG headquarters earlier this month by Korea based Kumho Investment Bank may have helped.
As part of the survey, investors also ranked which US cities they felt would recover first. Washington, DC took the top spot, followed by New York City (which ranked first last year), San Francisco, Boston and Los Angeles. You can read the full survey on AFIRE’s website here.
ARMLS Rules on Search Engine Indexing
June 11, 2009
In a breakthrough ruling, the Arizona Regional Multiple Listing Service (ARMLS) has come out with its interpretation for search engine indexing. The decision can be found here.
In a nutshell, the ARMLS states that true search engines (such as Google and Yahoo) are allowed as they are not misappropriating the data - and that to prevent such indexing would place REALTORs at a disadvantage in competing in the marketplace.
United Kingdom Market Hints At Turnaround
May 26, 2009
Several recent positive signs indicate that the UK housing market may be moving into a recovery mode.
Mortgage Approvals
In February, mortgage approvals rose by the biggest margin in three years, according to the Bank of England. Mortgage approvals rose again in March by 16 percent over February.
House Prices
UK house prices showed a surprise bounce in March as the nationwide house price index registered its first rise since October 2007.
New Buyer Inquiries
According to the RICS (Royal Institution of Chartered Surveyors) 2009 Housing Market Survey, new buyer inquiries rose for the fifth consecutive month and to their best level since September 2003. Moreover, there is now clear evidence that the higher level of buyer interest is resulting in actual sales.
House Sales and Inventory
Sales of housing inventory also inched up for the third consecutive month to its best level since August 2008. Meanwhile, the number of new listings of residential property continues to decline. As a result, the number of real estate listings has dropped to its lowest level since September 2007.
The combination of rising sales and fewer homes on the market pushed the sales to inventory ratio – a key indicator to the future price trend — higher for the third consecutive month.
These positive signs have led to improved confidence in both the sales and price outlook for the UK real estate market.
Signs of Economic Stablilization Emerge
May 26, 2009
At their meeting in late April, G-7 finance chiefs predicted “weak economic recovery will start to take hold in coming months” and that “recent data suggest that the pace of decline in our economies has slowed, and some signs of stabilization are emerging.”
Some of the news that has boosted their expectations is the rebound in German business confidence, signs of recovery in China, and new home sales and stabilization of existing home sales in the United States.
In Germany, Bloomberg reports, interest rate cuts and government stimulus packages boosted expectations that the recession in Europe’s largest economy will ease later in 2009. Chancellor Angela Merkel’s coalition plans to spend about 82 billion Euros ($107 billion) to stimulate growth through such measures as tax breaks and investment in infrastructure. The plan also includes a 2,500-euro payment to people who scrap their old cars and buy new ones.
The International Monetary Fund forecasts China’s growth rate to be 6.5 percent, which is considered strong given the global context. China is expected to maintain relatively strong growth because its export sector makes up a smaller percentage of its economy compared with other countries, channelnewsasia.com reports. In comparison, the global economy is projected to decrease by 1.3 percent in 2009 due to the financial crisis.
In the U.S. market, new home sales were higher than expected, providing further evidence that the market may be stabilizing, Bloomberg reports. The combination of lower mortgage rates and tax credits for first-time homebuyers is likely to support sales in coming months.
In addition, even though existing home sales in the United States declined from February to March, the market appears to be stabilizing with modest monthly ups and downs, says Lawrence Yun, chief economist of the National Association of Realtors. First-time buyers are driving the market, which is critical to recovery.
NAR delays IDX decision
May 16, 2009
I’m certain that many of you are aware of the ongoing discussion regarding the MIBOR choice to determine that search engines be classifed as scrapers.
The vote by NAR to clarify that search engines are not to be classified as scrapers was to take place today.
However, at the request of the MIBOR representative, the board sent the decision back to the MLS committee.
This essentially means a delay of 6 months because the MLS committee will not be meeting again until November.
More details forthcoming.
FHA to Allow 8,000 dollar tax credit to be used for down payment, closing costs
May 13, 2009
The Seattle Post Intelligencer posted yesterday evening that the FHA will allow the $8,000 tax credit (or advances against the tax credit) to be used for down payment and closing costs.
Although the details have not been totally released an are expected out of Washington by the end of the week, the desired effect of this move would be to provide buyers more incentive to buy and more of the means to purchase homes with less out of pocket expense.
More detail as they become available….
Keller Williams presents This Month in Real Estate - May 11, 2009
May 13, 2009
Keller Williams Realty has released the May 2009 installment of This Month in Real Estate.
This monthly series is hosted by Byron Ellington and Jay Papasan. Jay coauthored the Millionaire Real Estate Agent book with Gary Keller and Dave Jenks of Keller Williams Realty International. Viewers of this video will find timely information about what is going on in the current real estate market.
Click here for the This Month in Real Estate video.
Highlights:
- A pause in home price declines
- Home prices lower by 12% from last year
- Last Month home prices increased 4% from previous month
- Recent data indicates over 52% of homes purchased were by first time home buyers
- Home buyers are looking for a place to live, not a place to buy and sell
To find the Keller Williams office closest to you, visit www.kw.com
Agents interested in what Keller Williams has to offer may visit KWConnect Guest Pass for videos that explain our value proposition. If you are an agent and would like a Team Leader to contact you, please send an e-mail inquiry to calcarter at gulfshoreslife.com .
This summary was posted by Cal Carter of Keller Williams Alabama Gulf Coast. His team, The Gulfshoreslife.com Team specialize in working with buyers of Gulf Shores Condos on the Alabama Gulf Coast.
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