Chinese drywall could exacerbate housing bubble bust

Is Chinese-made drywall pollutant contaminated? If so, as the story shows, it’s a legal nightmare just starting to unfold.

Dallas housing market OK for longer term or not?

A new study says the Metroplex has little risk of home prices being lower two years from now.

But, but, but, the Dallas housing market was in the tank for the second quarter.

Of most concern, I think, is that new housing starts are off even more than new home sales from a year ago. And, the market is still oversupplied.

So, is the study correct, or not?

Well, I guess area homeowners will see … two years from now.

Next round of foreclosures coming

The L.A. Times details what I first looked at more than a year ago — the likelihood of a second peak in foreclosures.

The Times primarily notes that many people who applied for mortgage modifications didn’t get them, and now their application-time grace periods are about to expire. However, it overlooks that many people either bought new, bought second houses, or refinanced, at the end of the housing bubble, in many cases with Alt-A, if not subprime, loans.

In turn, from my (until now) professional perspective, means more tough times for newspapers. Banks don’t take out ads to sell foreclosed homes. Sheriff’s may do legal ads for tax-delinquency sales, but that’s it. And, more individuals looking to sell, to pinch pennies, will do “for sale by owner” routes.

Housing prices could stay depressed for years

That’s a serious claim, and it’s not just anybody claiming it. It’s the stance of Yale economist Robert Shiller, co-creator of the Case-Shiller Home Price Indices.

Shiller says nobody should be surprised if housing prices don’t start climbing before 2012. Read his reasoning why.

Like a Phoenix from the ashes or Bubble 2.0

I guess there’s a sucker born every minute indeed, or else one who moves to the Valley of the Sun that often. A mix of Phoenicians, smaller-level spec buyers and professional real estate investment groups think Phoenix can best overcome its massive housing bubble through spec buying of houses. (Four of 10 buyers are absentee.)

Call me crazy, but, this is indeed fighting fire with fire, in a state that will probably dry up in 20 years anyway.

Major bankruptcy may be headed to Vegas

If Dubai World, as threatened, pulls out of a partnership with MGM Mirage on Vegas’ City Center, it could have a domino effect on the whole Strip.

With other construction projects there on hold or shuttered, and Vegas near ground zero of the subprime bubble, this could be the last straw for Sin City.

Which, in a sense, is fine by me.

I have no problems with gambling.

But, there’s already too damned many people in that spot in the Mohave Desert, and the Colorado River’s about to run dry in its lower stretches.

Vegas could stand to lose about half a million people. At a minimum. Probably an even million population loss wouldn't be too off the mark.

Mortgages may get some help

Bailout guru and manager Neel Kashkari says banks that agree to modify mortgages could be eligible for some federal guarantees.

Now, the bottom line is, how much of this will help bank top brass and how much will help mortgage holders?

Also, with so many mortgages sold and resold, who (all) gets the federal guarantees?

Economic silver lining in SoCal?

Home sales are up 65 percent, the biggest jump in decades.

Yes, most of it’s foreclosures, but they needed to come off the books sometime. And, at least some of the foreclosures are selling for more than asking price.

So, generally good news.

‘We are in uncharted waters’

That phrase comes from Brian A. Bethune. an economist at Global Insight. He’s talking about the U.S. housing market.

Part of the problem is something that should have been done long ago — Fannie Mae and Freddie Mac have increased their various processing fees on more risky loans.

Tell me again why we didn’t prop up mortgages Friday?

Now, the financial “experts” of our world tell us Czar Henry’s Damaged Derivates Dump won’t actually work until/unless we can get home prices stabilized.

And, gee, the proposals to buy up some defaulted houses, let judges adjust some bankruptcies, etc., would have done exactly that.

Barney (Not So) Frank promises Rep. Barney Frank, D-Mass., the Financial Services Committee chairman promises the sand-down-the-rathole measure passed Friday was just the beginning of a much larger task Congress will tackle next year.

Sure, right. That would included Barack Obama, assuming he’s elected, making sure this is OK with top campaign donor Goldman Sachs, right? And, with his Treasury Secretary, either a retained Paulson or NY Fed head Tim Geitner, right?

Schadenfreude for rich Dallas homebuyers

In the $1 million range, a full 20 months of homes stand listed for sale.

Home slump spreading in Texas?

KB Homes CEO Jeffrey Metzger says the housing market is softening more in Austin and San Antonio.

Mortgage woes cross the pond

The UK’s largest mortgage lender, HMOS, looks very shaky. And, it’s list of problems is the same as similar agencies over here, beginning with undercapitalization and collapsing shares.

Dallas housing market not out of woods yet

Pre-existing home sales slumped 18 percent in August. The median price dropped 3 percent.

The only reason Dallas home prices haven’t cratered like SoCal, Vegas, South Florida and Phoenix is that they didn’t balloon as much in the first place.

Contrary to Texans for a Sound Economy and other numbnuts, being a more moderate Republican governor (Schwarzenegger, to a degree, Charlie Crist in Florida) doesn’t doom your state economy to hell.

It’s the economy, stupid. Period.

Government takes over Fannie and Freddie

Fannie Mae and Freddie Mac are to go into receivership, it seems.

Per my post earlier today, “It’s the economy, stupid,” took on a whole new level of meaning. Also, in the face of history that Fannie and Freddie knew they were overextending themselves, yet continued to overextend more while paying top execs big money, combined with the Bear Stearns bailout this year, is also going to increase the “help the rich, ignore the poor” claims against the Bush Administration.

That said, Daniel H. Mudd, the chief executive of Fannie Mae, and Richard F. Syron, chief executive of Freddie Mac, reportedly will get the boot as part of the takeover. Of course, BushCo had no choice on that.

And that said, the “It’s the economy, stupid,” just had either an atomic bomb or a hot, steaming pile of crap dropped in the middle of it. Pick your metaphor.

DFW housing prices continue mild slide

Dallas home prices dropped 3.2 percent from June 2008-June 2007, according to S&P data.

That’s the best performance rate among the 20 top metro areas surveyed by S&P/Case-Shiller.

That said, the Snooze’s Steve Brown still sounds too optimistic that the bottom is here. As he notes, this is about the same degree of slump DFW has had the past few months. Let’s not talk yet about turning corners.

There were closer sites with adequate space and adequate security concerns addressable. This wasn’t a security issue, it was an issue of Dems not wanting to face 18 months of failures and cop-outs.

Merced ground zero in housing crunch and housing greed

A full 85 percent of homes in Merced County, Calif., have negative equity.

Result? Many homeowners who would like to sell are being told to not even bother unless they list their homes at the foreclosure price.

It’s a more extreme version of what could shake out in a number of metropolitan areas in the next few years.

At the same time, let’s not feel too sorry. Per details of the story, many Merced homebuyers were engaged in spec buying, and bought too late in the cycle, or too far down the Ponzi chain.

And, not all were locals; as many as one-quarter were outside the area.

Beyond that, Cal-Merced flopped, as anybody could have told, with UC-Davis relatively nearby, or Sac State just up the road, too.

That said, caveat emptor. I don’t feel sorry for spec buyers.

10 percent of Dallas homes go underwater

One out of every 10 Dallas homes purchased last year sold for a loss.

And, 10 percent of people who have bought homes here in the past five years are upside down right now.

True, it’s not Stockton, Calif., which has a 38 percent year-over-year decline in home values, but it is a reminder that Dallas isn’t scot-free on any economic slowdown.

Alt-A defaults climb

Even as subprime foreclosures seem to be stabilizing, the problems are increasing in Alt-A mortgages, the next class above subprimes.

While many subprime loans were 2/28s or similar, i.e. interest-only the first two years, many alt-As, and even some primes, were 5/25s or 7/23s or similar. And now, the piper is calling the tune on the 25- or 23- year period.

And, here’s more on the uncharted territory of the mix of falling home prices, mixed with rising oil and food prices, that’s pushing more of these alt-A and even prime homes into trouble.

Foreclosure forecast for 2008 to be revised upward

At the start of the year, the national residential foreclosure forecast was for 2 million for 2008.

Just one not so small problem. We’re already at 1.4 million foreclosures.

And, bank repos as a percentage of foreclosures are up from 24 percent a year ago to 30 percent.

The one possible silver lining. Per the story, California in general and the Central Valley in particular remain Ground Zero.

Why a silver lining?

We might get some people moved out of the more water-unsustainable parts of the Golden State sooner rather than later.

Of course, the dark cloud would be Californios moving out and “discovering” some other place.