Mainstream Media

The wealth effect from rising house prices may not be as effective as it once was in spurring the U.S. economy.

Rather than using their properties as ATM machines to boost spending, homeowners increasingly are paying down the principal and shortening the maturities of their mortgages in a move Florida banker Rob Nunziata calls “forced savings.” Cash-in refinancings -- in which borrowers invest more of their own money in the house -- outnumbered cash-outs by more than two-to-one in the fourth quarter, according to Freddie Mac 

http://www.bloomberg.com/news/2013-05-05/diminished-housing-wealth-effec...

Here's a fact that may make your blood boil: Nearly 8,000 Occupy Wall Street protesters have been arrested in association with the activist movement, while not one banker has been prosecuted for the actions that lead up to the country's financial meltdown.

The website OccupyArrests.com has tracked 7,736 in 122 cities nationwide since the Occupy movement began in September 2011. 

Hundreds of members of Occupy Our Homes, an organization that supports homeowners facing foreclosure, protested outside of the Justice Department to speak out against homeowner abuses in the wake of the housing crisis. Seventeen former homeowners were arrested that day, according to Washington police. 

http://www.huffingtonpost.com/2013/05/23/occupy-wall-street-arrests_n_33...

http://www.commondreams.org/headline/2013/05/20-6#.UZqNeAOCAUo.twitter

http://www.commondreams.org/view/2013/05/24-5

U.S. mortgage credit probably will get tighter as federal regulators continue working on new rules to govern housing finance, Mortgage Bankers Association President and Chief Executive Officer David Stevens said.

Rules created by the 2010 Dodd-Frank Act, including measures to prevent mortgage abuses, are just starting to take effect and lenders are awaiting still more before the end of the year, Stevens said in an interview at a Bloomberg Government breakfast in Washington.

“I actually think credit is going to get tighter before it gets easier,” said Stevens, 56. 

http://www.businessweek.com/news/2013-05-01/mortgage-bankers-ceo-stevens...

The Obama administration on Thursday said it was extending the life of its signature foreclosure-prevention program by two years to help more struggling borrowers keep their homes.

The Home Affordable Modification Program, or HAMP, was to expire at the end of this year.

When it was unveiled in 2009, the administration estimated it would help 3 million to 4 million homeowners avoid foreclosure by reworking loan terms. So far, however, only about 1.1 million homeowners have benefited from a permanent mortgage modification under the program.

http://www.reuters.com/article/2013/05/30/us-usa-treasury-hamp-idUSBRE94...

HOUSES are just buildings, but homes are often beautiful dreams. Unfortunately, as millions of people have learned in the housing crisis, those dreams don’t always comport with reality.

Economic and demographic changes may severely impair the value of a home when it’s time to sell, a decade or more in the future. Will a particular home still be fashionable then? Will social and economic shifts tilt demand toward new designs and types of communities —even toward renting rather than an outright purchase? Any of these factors could affect home prices substantially.

http://www.nytimes.com/2013/04/28/business/housing-markets-future-has-ma...

Foreclosure-related U.S. home sales fell 22 percent in the first quarter from a year earlier as rising prices reduced the incentive to sell for owners who owe more than their properties are worth, RealtyTrac said.

A total of 190,121 homes in some stage of foreclosure or taken by banks were sold this year through March 31, down 18 percent from the previous three months, the data seller said today. Those deals, including short sales, or transactions in which lenders let homeowners sell for less than what they owe, accounted for 21 percent of first-quarter residential transactions, compared with 25 percent a year earlier. 

http://www.bloomberg.com/news/2013-05-30/foreclosure-deals-drop-22-as-ri...

From the peak of the boom to the bottom of the bust, households watched a total of $16 trillion in wealth disappear amid sinking stock prices and the rubble of the real estate market. Since then, Americans have only been able to recapture 45 percent of that amount on average, after adjusting for inflation and population growth, according to the report from the St. Louis Fed released Thursday.

In addition, the report showed most of the improvement was due to gains in the stock market, which primarily benefit wealthy families. That means the recovery for other households has been even weaker.

http://www.washingtonpost.com/business/economy/americans-have-rebuilt-le...

“Rather than getting big 20% to 30% gains on either sales or prices any one year, we’re going to get a gradual improvement process that is much healthier for the economy rather than a sharp rebound.”

Despite the improvements, there are still challenges to be addressed, says Shah Tehrany managing director at Franklin First Financial. 

“There is still a lot of stalled inventory so there are a multitude of people out there who are incapable of making their mortgage payments or delinquent on their mortgages and that still has to be flushed out,” he says. “The big banks in my opinion aren’t moving efficiently enough to try to rectify those situations and that process will just take time.”

Home prices are climbing too fast relative to buyer incomes, signaling that property values may fall in some U.S. cities once mortgage rates rise and reduce affordability, according to a study by Zillow Inc. (Z)

Driven in part by borrowing costs close to historic lows, buyers spent three times their annual incomes on homes at the end of last year, up from a 2.6 multiple from 1985 to 1999, Zillow said in a statement today. That means properties were almost 15 percent pricier relative to incomes than before the housing bubble of the mid-2000s, according to the Seattle-based real estate research firm. 

http://www.bloomberg.com/news/2013-04-10/home-prices-may-decline-in-some...