HUD and Treasury Vow to Help Stabilize Real Estate Market
HUD & Treasury to help foreclosure market?
In 2009, foreclosure rates shattered records a the number of homes that received foreclosure notices hit 2.8 million, up 21% from 2008 and up 120% from 2007 according to RealtyTrac‘s recent foreclosure data. Foreclosures are clearly on the rise and various signs point to this trend continuing.
In response to what some call a foreclosure crisis, HUD (the Housing and Urban Development Department) vows to take action to speed up the resale of foreclosures by waiving a major FHA rule (that prohibits insuring a mortgage on a home owned by the seller for less than 90 days) from February 1, 2010 to February 1, 2011. HUD noted that they will keep a strict supervisory role in this process to avoid predatory practices.
“FHA borrowers, because of the restrictions we are now lifting, have often been shut out from buying affordable properties,” said FHA Commissioner David Stevens said in a Reuters report.
The Treasury Department pledged to step up efforts on their end as well to improve HAMP (the Home Affordable Modification Program) which analysts note is not working. Only 25% of those eligible for a modification have been helped, up 1% from November which some read as a move in the right direction while the Treasury realized it’s a tiny step that could be much greater.
“It’s marginal progress,” Washington, D.C.-based mortgage industry consultant Howard Glaser told Reuters. “It’s helping the borrowers who have received the modifications, but systemically, the program is insignificant,” added Glaser. “With the wave of foreclosures ahead, it’s kind of like fighting a forest fire with a squirt gun.”
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This article published on Tuesday, January 19th, 2010 at 12:01 am | Contact the editor
Topics: News
About this Columnist (Full Profile)
AGBeat Editor-in-Chief: Lani, named one of Real Estate’s 100 Most Influential, as well as 12 Most Influential Women in Real Estate, is a business writer hailing from the great state of Texas in the city of Austin. As a digital native, Lani is immersed not only in advanced technologies and new media, but is also a stats nerd often burried in piles of reports. Lani is a proven leader, thoughtful speaker, and vested partner at AGBeat.
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- AgentGenius:
#agnow This is great news regarding the moratorium on the anti-flipping rule.
Hopefully this will incentivise ev… http://bit.ly/7x8ROg
- AgentGenius:
#agnow The biggest problem is the fact that we think the banks are too big to fail, yet it was their poor screening… http://bit.ly/7x8ROg
- FHA Low on Funds, Raising Mortgage Insurance Premiums:
[...] the HUD and the Treasury vowed to do their part in stabilizing the real estate market, and today, the FHA makes their announcement, with all three experiencing 20/20 hindsight which [...]
- AgentGenius:
#agnow [...] the HUD and the Treasury vowed to do their part in stabilizing the real estate market, and today, the … http://bit.ly/7x8ROg
- AgentGenius:
#agnow Surprising news. Fantastic data. In my region, property sales even has stuck for two years. http://bit.ly/7x8ROg
- FHA Relaxes Anti-Flipping Rule Starting February 1, 2010:
[...] Earlier this month, the Housing and Urban Development Department which oversees the Federal Housing Administration stepped up their effort to curb the foreclosure crisis by vowing to speed up the resale of foreclosures. This week comes the announcement making it official that from February 1, 2010 through February 1, 2011, the FHA is lifting the rule that prohibits insuring a mortgage on a home owned by the seller for under 90 days. This rule has been informally called the “anti-flipping rule.” [...]
- AgentGenius:
#agnow [...] Earlier this month, the Housing and Urban Development Department which oversees the Federal Housing Ad… http://bit.ly/7x8ROg
Benn Rosales
Conal Campbell
Elijah May
Lani Rosales
Tara Steele
Marti Trewe
Charlene Jimenez
HUD and Treasury Vow to Help Stabilize Real Estate Market: comments http://bit.ly/7dnsvP
This is great news regarding the moratorium on the anti-flipping rule.
Hopefully this will incentivise even more investors to purchase these homes at auction and then resell them at a market rate to a financed buyers.
Before this change in our area, many of the flipped homes were going to buy and hold investors at a discount and most of the REO homes were going to cash and high down conventional buyers, at the exclusion of FHA buyers.
The banks seem more motivated by expediance and moving a file off their desk, than they are by the bottom line. I suspect that investors who purchase homes at trustee sales to flip will be more motivated by the bottom line and will therefore consider a higher offer from a pre-approved FHA buyer over a lower offer from a cash or conventional investor.
HUD and Treasury Vow to Help Stabilize Real Estate Market http://ow.ly/YaFS
Lani, interesting blog post at
frontporchrepublic.com/2010/01/the-politics-of-ingratitude/
by John Médaille, a Catholic theology instructor and real estate agent.
Excerpt:
“This attitude of “socialism for me and capitalism for thee” is widespread. I am a member of the Real Estate profession, and I reckon that 99.79% of my colleagues are ardent believers in the “free market.” They also demand that the government support the housing market. Indeed, few markets are as government-dependent as is the housing market, and Realtors divide their free time into complaining about government interference and demanding more government support”
This is exactly the thing that drives me crazy about AgentGenius and the real estate profession in general.
Surprising news. Fantastic data. In my region, property sales even has stuck for two years.
The biggest problem is the fact that we think the banks are too big to fail, yet it was their poor screening that allowed so many homes to be sold to people who cannot afford them.
-Tyler
RT @agentgenius: Earlier this month, the Housing and Urban Development Dept which oversees the Federal Housing Ad… http://bit.ly/7x8ROg