News

Southern California's distressed home sales - the combination of foreclosed home sales and short sales - made up more than half of the region's resale market in February, according to a new report from DataQuick. Foreclosure resales accounted for 37.1 percent of resales last month, while short sales were an estimated 19.8 percent. Absentee and cash buyers, primarily investors, are purchasing these homes in record numbers, but DataQuick expects this spring will see an infusion of more traditional buyers.

With so much attention focused on the House's efforts to stamp out four federal foreclosure programs, a bill making its way through the Senate - which like its House counterpart would effectually terminate the Home Affordable Modification Program (HAMP) - has received less attention but is progressing nonetheless. Pundits insisted such legislation would fall flat in the Senate, but members of the chamber's Banking Committee are pushing their bill forward on the argument that the free market, on its own, is working where government programs are faltering.

House Republicans may have succeeded in passing legislation to end federal housing programs that are intended to provide assistance to unemployed homeowners and support efforts to clean up vacant foreclosed homes, but their Democratic counterparts aren't going to take it lying down. Rep. Barney Frank, the top-ranking Democrat of the House Financial Services Committee, has introduced legislation that would require the biggest banks and hedge funds to cough up $2.5 billion to keep those very same programs alive.

Freddie Mac and the Independent Community Bankers of America (ICBA) announced Friday the extension of their eight-year alliance agreement, which gives ICBA member banks increased access to the secondary mortgage market. First announced in 2003, the Freddie Mac-ICBA partnership is designed to help ICBA members serve more customers and stay competitive in a dynamic marketplace. The new alliance agreement extends the relationship between the two organizations through March 2012.

Two recent studies about investors who buy vacant and deteriorating homes and resell them paint vastly different pictures of the effects such actions have on neighborhoods. A report from the Federal Reserve Bank of Cleveland says many cities are being hurt by investors who purchase homes and sell them quickly without regard for back taxes on the property. But another report says investors who play the game fairly are actually contributing to the growth and overall health of ailing neighborhoods and helping families at the same time.

Radar Logic's 25-metro-area RPX Composite price slumped to its lowest value last week since its peak in June 2007. Based on data from home sales that closed during the 28 days ending January 3, 2011, the value was at $183.18 per square foot. That's 34 percent lower than the 2007 peak value of $278. The company says last week's reading is lower than the price for any other date since May 14, 2003.

The delinquency rate on loans included in commercial mortgage-backed securities (CMBS) conduit and fusion transactions increased 17 basis points in February to 9.18 percent, according to Moody's Investors Service. Moody's noted that while still rising, increases in CMBS delinquencies have been moderating since June 2010. During February loans totaling $4.1 billion became newly delinquent, while previously delinquent loans totaling $3.0 billion became current, worked out, or liquidated.

There were many who opposed the hefty bank bailouts after the financial crisis set in, and they still have their ethical argument against the government's decision, but the fiscal argument is growing faint. Treasury announced this week that over 99 percent of the funds disbursed to banks through the Troubled Asset Relief Program (TARP) have now been recovered. Even the largest bailout of all - that of Fannie and Freddie - is expected to shrink by nearly half over the next 10 years.

According to a community advocacy group in California, home value losses from foreclosed homes in California have cost a minimum of $632 billion, and could end up costing as much as $1 trillion. California is considered one of the ""hardest-hit"" states in the country, and according to the report, one in every five foreclosures in the United States is in California. One state lawmaker has proposed legislation in an attempt to recover lost tax revenue by forcing lenders to pay $20,000 for each home foreclosure they initiate in California.

Solidifi U.S. announced this week the completion of an internal audit to ensure the company meets or exceeds financial regulatory reform. The company based its audit on the demands of the now-sunset Home Valuation Code of Conduct (HVCC), the Federal Housing Administration's (FHA) appraiser independence guidelines, the requirements of the Dodd-Frank Act and its supporting interim final rules, and revisions to regulators' interagency guidelines.