HUD gives $2.5 million for healthy homes
2011 ************************************************************
Moody's downgrades BOA mortgage unitsMoody's Investors Service continues to lower ratings for Bank of
America's (BOA) mortgage servicing units, downgrading BAC Home
Loans Servicing LP and Bank of America NA for failing to remit
requested data on government-backed loans. Analysts said the
servicers didn't provide necessary Federal Housing Administration
and Veterans Affairs claims information for the review. Moody's,
which treats BOA and BAC Home Loan as one servicing operation,
dropped the company's rating as primary servicer of
government-insured residential mortgages to SQ3 from SQ1-.
Analysts determine a mortgage servicer's ability to prevent or
mitigate asset pool losses as markets move and then issue a
rating on a scale of SQ1, the strongest, to SQ5, the weakest.
Earlier this week, Moody's downgraded BOA's servicer rating on
prime, subprime and second lien mortgages, as well. Bank of
America services 13.1 million home loans with a total principal
balance of $2.03 trillion. Bank of America assumed Countrywide
Financial Corp.'s assets when it acquired the troubled subprime
lender three years ago. Last October, Moody's placed all of Bank
of America's servicer quality ratings on a warning for possible
downgrade after noticing irregularities in BOA's foreclosure
processes and deterioration in the company's performance
metrics.Hiring picks upThe economy added 244,000 jobs in the month, the Labor Department
reported Friday. That's up from the 235,000 jobs gained in March.
Economists surveyed by CNNMoney were expecting a slight slowdown
to a gain of just 185,000 jobs. Businesses added 268,000 jobs in
April, bringing private sector hiring so far this year to
854,000. It's the strongest month for business hiring since
February 2006, nearly two years before the start of the
recession. But while businesses continued to hire, government
staffing fell by 24,000 jobs in the month, with most of the cuts
coming at the state and local government level. The unemployment
rate edged up to 9.0%, ending a streak of four straight months of
declines. The rate often increases as the job market improves and
previously discouraged workers return to labor force. Economists
had forecast it would remain unchanged at 8.8%.MBA - commercial originations upFirst quarter 2011 commercial and multifamily mortgage
originations were 89 percent higher than during the same period
last year and 25 percent lower than during the fourth quarter of
2010, according to the Mortgage Bankers Association’s (MBA)
Quarterly Survey of Commercial/Multifamily Mortgage Bankers
Originations. The decrease from fourth quarter 2010 reflects the
industry’s usual push to finalize deals before the end of the
year, and subsequent drop-offs in first quarter numbers. “The
pace of commercial and multifamily mortgage lending continued to
increase in the first quarter of this year,” said Jamie
Woodwell, MBA’s Vice President of Commercial Real Estate
Research. “Commercial/multifamily mortgage origination volumes
for the first three months of 2011 were the highest of any first
quarter since 2002, and were nearly double the volume seen during
the first quarter of 2010.”First Quarter 2011 Originations Increased Eighty-Nine Percent
Over First Quarter 2010The 89 percent overall increase in commercial/multifamily lending
activity during the first quarter of 2011 over the same period in
2010 was driven by increases in originations for all property
types. When compared to the first quarter of 2010, this included
a 465 percent increase in loans for hotel properties, a 194
percent increase in loans for industrial properties, a 104
percent increase in loans for multifamily properties, a 92
percent increase in loans for office properties, a 91 percent
increase in loans for health care properties, and a 13 percent
increase in loans for retail properties. Among investor types,
first quarter 2011 originations for conduits for CMBS increased
391 percent compared to last year’s first quarter. There was
also a 126 percent increase in loans for life insurance
companies, a 73 percent increase in loans for commercial bank
portfolios, and a 59 percent increase for the Government
Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac.First Quarter 2011 Originations Decreased Twenty-Five Percent
From Fourth Quarter 2010First quarter 2011 commercial/multifamily mortgage originations
were 25 percent lower than originations in the fourth quarter of
2010. This includes an 83 percent decrease for health care
properties, a 48 percent decrease for retail properties, a 44
percent decrease for hotel properties, a 28 percent decrease for
multifamily properties, and a 15 percent decrease for office
properties. Originations for industrial properties increased 12
percent. Among investor types, first quarter 2011 originations
for conduits for CMBS decreased 58 percent compared to the fourth
quarter of 2010. There was also a 45 percent decrease for GSEs
and a 15 percent decrease for life insurance companies.
Originations for commercial bank portfolios increased by 21
percent.Commodity bubble keeps burstingOil slipped 66 cents to $99.14 a barrel following the report.
Before the data came out, oil was 3% lower. On Thursday, crude
sank nearly 9% -- the biggest one-day percentage drop in two
years. Crude prices neared $114 a barrel last month as fears
about supplies took hold following escalating violence in Libya.
But as investors got 'accustomed' to those concerns, oil prices
became mired in a fairly tight range...until this week. In the
past week, oil prices have tumbled more than 10% on worries that
recent disappointing economic reports may mean we are in for an
economic slowdown. Silver prices slid 4% Friday -- after sinking
7% before the jobs report. Silver has taken a big hit after the
CME raised its margin requirements, meaning traders have to leave
more on the table to buy silver futures. Gold ticked up $12.30, or nearly 1%, after dropping more than 2%
on Thursday. The dollar had been higher in early trading, but lost
ground following the government jobs report. Because crude prices
are priced in dollars, a stronger U.S. currency tends to pressures
commodities. The dollar gained nearly 2% on Thursday after the
European Central Bank left interest rates unchanged -- putting
additional pressure on oil prices. Gas prices declined on
Friday, following a 44-day string of gains -- during which the
price of gasoline surged 12%. The national average price for a
gallon of gasoline fell one tenth of a cent to $3.984 on Friday,
according to motorist group AAA.Vacation home market recovery will be slowVacation homes remain the hardest-hit sector of the U.S. real
estate market. Sales fell 1.8 percent to 543,000 in 2010,
according to the National Association of Realtors' (NAR) 2011
Investment and Vacation Home Buyers Survey. The median price was
$150,000 in 2010, down 11.2 percent from $169,000 in 2009. Now,
as with other parts of the housing market, negative equity and
foreclosures are common. Foreclosure or trustee sales in 2010
amounted to 11 percent of vacation home sales. The depressed
second-home market threatens the very health of some U.S.
resorts, where real estate and construction provide the main
lynchpins to the local economy. In Colorado ski country, the
Vail area employed 31,000 people in 2008. By the third quarter of
2010, employment was down 20 percent, with construction jobs down
46 percent.Thirty-six percent of all vacation-home buyers in 2010 did not
use a mortgage — versus 29 percent the year before — while
more than half of them financed less that 70 percent of the
purchase price, according to NAR. Of those who bought a second
home as a rental investment, 59 percent paid cash.
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