Crisis in new-home market by Nina Gotzmannova

It seems like no one is interested in buying a new home in United States. This year is the worst year since 2000 for the house builders, house sellers and of course for U. S. economy. People have never bought less new homes like this year. In July people were more likely to buy a new home. But in August the numbers showed something else. Sales dropped more than 8%. According to Commerce Department there were only 795.000 houses sold in August. This is really a sorrowful record, because there have never been sold less houses since 2000. In comparison with several years in past the sales has dropped almost 21%. There is also a large gap in the prices. The median price of sold houses was in August $225.700. The price fell by 7.5%. It is the biggest drop in percentage terms in 37 years. The average sales price tumbled too, with 8% slightly more than the median price. A new house was bought in August for $292.000, which is the lowest price in almost two decades. But after all, there is at least some good news. The sales fell only in the South and in the West. In Northeast and Midwest people are still buying houses, and more than in July. This all is a sign of the subprime mortgage crisis and housing bubble, the economy crisis which began in United States in March this year. The crunch credit already showed the unpleasant results, now in a form of decreasing real-estate market.

related story: http://news.yahoo.com/s/ap/20070927/ap_on_bi_go_ec_fi/economy;_ylt=AkrUTHM6TiqH5WMtt8x14wSs0NUE

by Nina Gotzmannova for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

America still in danger of recession by Corina Ciubotaru

Following the recent housing market slump, that America is just beginning to overcome, house prices are lower than they've ever been in the last 16 years. The annual price fall in the country's 10 major cities has reached 4.5%. Many major cities have hundreds of unsold homes so the only ones where prices are still rising are Dallas, Charlotte, Atlanta, Portland and Seattle. Since the collapse of the market, banks have been in their own heap of troubles and became less willing to grant loans given that failure to pay old ones is what triggered the situation. There has been a reduction also in the number of houses built and the entire construction industry was affected. The problems of American economy had an impact on other markets as well and the dollar has been recently falling in relation to the euro, but since the Fed cut the interest rate for banks, things have become better for a while. Still, unemployment is increasing, home sellers aren't willing to reduce prices and many fear a recession is coming to the U.S.A. since August data is worse than they expected after the Fed's cut in early September, from 5.25% to 4.75%. This cut alone was enough to surprise and please lenders, as it was previously viewed as only an unlikely possibility and now it will probably be up to the Fed again to sort out the dollar's problems and thus setting the economy on the right course once again. Could another half-point reduction be the answer?

related story: http://news.bbc.co.uk/2/hi/business/7012639.stm

by Corina Ciubotaru for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

US housing problems by Claudia Sonea

Apparently Wall Street concerns regarding house slumps are not without reason. Irvine, California.-based RealtyTrac Inc. revealed the number of foreclosure filings were up 115 percent from 113,300 last year in the same month, August. Also there is even a striking difference from one month to another, so from July to August the number jumped 36 percent, proving that more and more people are unable to make timely payments on their mortgages or sell their homes due to the national housing problem. Default notices, auction sale notices and bank repossessions were among the filings. According to RealtyTrac Chief Executive James J. Saccacio as a large number of subprime adjustable rate loans will reset and it will lead to a new wave of increased foreclosure activity. The main problem is subprime loans and adjustable rate mortgages, because in the beginning the rates were more than acceptable, but in time the banks increased them leaving the borrower without the possibility of paying. There are also figures that show that many of the houses end up back to the borrowers due to the fact that they are not picked up in the estate sales. In August the number of repossessions reached 42,789, the highest foreclosure rates in the country being registered in Nevada, California and Florida. Nevada reported one foreclosure filing for every 165 households, California one filing for every 224 households, while Florida had one foreclosure filing for every 243 households. The 10 states with the highest foreclosure rates were Georgia, Ohio, Michigan, Arizona, Colorado, Texas and Indiana. How will this influence the stock market and how will it be affected by the Fed decision? There is no good forecast for the next month for Wall Street. Stay connected and track to see where everything is heading.

related story: http://news.yahoo.com/s/ap/20070918/ap_on_bi_ge/foreclosure_rates;_ylt=AgQoMICw4XvXni7rrnpgIfms0NUE

by Claudia Sonea for PocketNews (http://pocketnews.tv)

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Welcome to Stockton: foreclosure capital USA by Delia Cruceru

The city of Stockton, a town in central California, hold on title that it citizens wouldn't want it to have, the foreclosure capital of the nation, according to a study released by RealtyTrac, an online service that tracks foreclosure sales. Stockton has a population of nearly 300.000 people and it has one in 27 households foreclosing on a property and 8000 foreclosures until now. "It's not the CEO of Intel who lives in Weston Ranch, but the guy who details his car," Geri Taylor, broker at Weston Ranch Realty for twelve years told AFP. "They just were not prepared for this." The spokesman for RealtyTrac says that foreclosures are common in areas where people wanted to take advantage of the hot real estate market but they couldn't afford it. "They were on a very thin margin and anything affecting their monthly payment could push them into foreclosure very easily," he said. Gloria Johnson a broker from the Weston Ranch area modified her business practices to help homeowners to avoid foreclosure and wrecked credit. "It is almost like begging, but I am doing everything I can to help these people maintain their dignity," she said. There are houses on the market from 2006 and still unsold and the average prices slipped with 10%. In Bay Area county in August a total of 7,299 new and resale houses and condos were sold, meaning 1.7 percent down from 7,423 in July and down 24.9 percent from 9,713 a year ago.

related story: http://news.yahoo.com/s/afp/20070913/ts_alt_afp/useconomyproperty;_ylt=Ak7nmBMW7SeXXMhuwv9u9v6s0NUE

by Delia Cruceru for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

Alam Greenspan book reveals all about the housing bubble by Nina Gotzmannova

Alan Greenspan, former Federal Reserve Board Chairman, has written a biography and begins to talk. Scheduled to be released on Monday, the inside look at the life of the second-longest serving chairman in the history of the Fed is the beginning of revealing some secrets. He admits he didn't see the danger of providing mortgages for people with questionable credit histories. The incapability of paying the mortgage and low interest rates combined with the demand of buying real estates has lead to a phenomenon known as housing bubble. Following decrease in home price let many home owners with a mortgage debt higher than the value of the home. Greenspan was criticized for this since 2001 until his retirement in 2006. In 2001 Fed cut the interest rates to their lowest level in decades. Fed probably kept the rates too low for a longer time than necessary and allowed people to uncontrolled behavior in the real estate market. In a CBS interview Greenspan acknowledges that he noticed the practices and the potential danger to economy only in late 2005. But the danger was real. In March 2007 the subprime mortgage industry collapsed and many of the lenders were bankrupted. In the same time the prices and the house sales fell dramatically. According to National Association of Realtors the sales fell down 13 percent and the prices 6 percent. However, in March 2007 was the Federal Reserve Board Chairman Ben Bernake. He had to deal with the financial crisis. By this time Alan Greenspan was retired and despite he is still considered as an influential economist, he can only say sorry now and maybe reveal more about the real estate market in his book.

related story: http://news.yahoo.com/s/ap/20070913/ap_on_bi_ge/greenspan_mortgages;_ylt=ArWjhUR4sUebA..RkSpstfSs0NUE

by Nina Gotzmannova for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

Mortgage rejection rates higher in 2006 by Delia Cruceru

In a new Federal report it is showed that companies that lend money continue to charge black and Hispanic homebuyers higher interest rates more often than white buyers. In 2006 almost 53 percent of blacks received high interest rates on mortgage loans, 46 percent Hispanics compared to only 18% of whites. They also found that the denial rate for rate for all home loans was 29 percent last year, up from 27 percent in 2005. "The incidence of higher-priced lending for blacks and Hispanic white borrowers is notably greater than for non-Hispanic whites," the Federals Reserve said in the report. "Similar patterns are shown in racial and ethnic differences in denial rates." In the analysis Federals said that minorities like Hispanics or blacks were far more likely than whites to be denied outright when they applied for mortgage loans. "Irresponsible lending practices have placed working families, minorities and more recently an increasing number of middle-income borrowers at risk of losing their homes," said John Taylor, president of the National Community Reinvestment Coalition. Surging foreclosures and the delinquency rates on subprime mortgages will hurt more the Hispanics and black people according to consumers advocates. The report showed that the areas with most delinquency rate are in the Midwest: Ohio, Indiana and Michigan, the south Atlantic region, the Gulf Coast and portions of Texas, Oklahoma and Colorado.

related story: http://news.yahoo.com/s/ap/20070912/ap_on_bi_ge/mortgage_discrimination;_ylt=AljRY9u.GVZFgynf6tA4AU6s0NUE

by Delia Cruceru for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.