- Home Mortgage Rates Tie Record Low of 4.78%
- California Single-Family Home Prices Fall 3.2% in October
- Home Affordability Level in California Lower Than National Average
- Some Phoenix-area Home Prices Up but Most are Still Down
- Taipei Home and Apartment Prices Recover in Third Quarter
- Bank of America Claims it Has Revised 100,000 Home Mortgages in Past 10 Months
- San Diego Office Occupancy Expected to Hit 18.6% by Year End
- Lower Loan-to-Value Ratios Sideline More Investors in Orlando
- Lone Star Funds Rides to Chapter 11 Rescue of Supermarket Owner BI-LO
- Northern New Jersey Office Markets Looking at 18.2% Vacancy
- Sublease Space Mounts in Silicon Valley
- Nordstrom Leases 33,000 SF at CBL's Renaissance Center in Durham, NC
(WASHINGTON, D.C.) -- Thirty-year fixed-rate home mortgages averaged 4.78% during the week of Nov. 23, an all-time low, according to Freddie Mac's weekly surveys.
The mortgage averaged 4.83% in the week of Nov. 16 and 5.97% a year ago at this time. This week's average of 4.78% matched a low set during the week ending April 30 of this year..
Fifteen-year fixed-rate mortgages averaged 4.29% for the week ended Nov. 25, also a new low since Freddie Mac began tracking this product in 1991.
"Interest rates for 30-year fixed-rate loans are currently 0.8 percentage points below this year's peak set in mid-June, which shaves roughly $100 off the monthly payments on a $200,000 mortgage," says Freddie Mac chief economist. Frank Nothaft,
This week's average for 30-year mortgage loans is down from 4.32% last week and 5.74% a year ago.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 4.18% this week, down from 4.25% last week and 5.86% a year ago. The ARM hasn't been this low since Freddie Mac started tracking it in 2005.
The one-year Treasury-indexed ARM averaged 4.35%, unchanged from last week. The ARM averaged 5.18% a year ago. It hasn't been lower since the week ending July 7, 2005, when it averaged 4.33%.
The Mortgage Bankers Association this week reported mortgage-application volume was down a seasonally adjusted 4.5% for the week ended Nov. 20, compared with the week before.
(LOS ANGELES, CA) -- The California Association of Realtors reports single-family home prices fell 3.2% in October from the same period in 2008. The median price for an existing, detached house dropped to $207,500 from $307,210 a year earlier.
Sales of existing homes rose 1% in October. The association expected total 2009 sales to reach 562,400. Foreclosures represent 41% of the closed transactions, according to MDA DataQuick.
The median price for a California condominium was $267,520, down 3.6% from a year earlier and 1% from September. . Condo sales rose 9.4% from October 2008 and 5.5% from September.
(SACRAMENTO, CA) -- San Francisco, San Mateo and Martin Counties are the least affordable home markets in California while Stanisllaus County is the most affordable, according to the quarterly National Association of Home Builders/Wells Fargo Housing Opportunity Index.
The study found families earning the median income could afford 59.1 percent of the new and existing homes sold during the third quarter, down 3.6 percent from the second quarter. California's affordability was 11 percent lower than the nationwide affordability of 70.1 percent.
"As existing home inventories drop and builders sell more homes, we're seeing increased competition among buyers which has led to incremental price increases in most areas around the state," says Liz Snow, president and CEO of the California Building Industry Association.
Snow adds, "While we're not out of the woods yet, this could signal that the bottom of the market is here, and as the market improves, we could be facing an imbalance in supply and demand."
(PHOENIX, AZ) -- Some Phoenix-area home prices are slowly increasing each month but most metro markets are down, according to a new report from the W.P. Carey School of Business at Arizona State University.
The media price for Phoenix-area home sales in August was $126,500, up from a median $125,000 in July and up over the market low of $117,500 in April of this year.
However, prices have dropped by more than 50 percent in Glendale, Peoria and Mesa since their peak in 2006, the report notes. All other Valley cities, including Scottsdale and Paradise Valley, show price declines of more than 30 percent.
Still, says Karl Guntermann, the Fred E. Taylor Professor of Real Estate at the W.P. Carey School of Business, "the local housing market is regaining some measure of stability."
Guntermann cautions that investors buying foreclosed homes and first-time buyers using the federal tax credit are pushing up prices. He says the large number of foreclosures expected to hit the market in 2010 "makes it difficult to predict the direction of house prices with any certainty."
Taipei World Trade Center
The Taiwan News reports third-quarter single-family home prices reached a record high of NT $601,000 (US $18,674) per ping. One ping equates to about 35.57 square feet.
According to My Housing magazine, the average price of housing under construction last year in Taipei City rose to NT $599,000 per ping *3,305 square meters), before falling to NT $576,000 per ping in the first half of 2009.
Average prices for pre-sold apartments reached NT $908,000 per ping in Taipei's affluent Dean district.
(CHARLOTTE, NC) -- Bank of America claims it has modified 100,000 residential mortgages in the past 10 months, including 31,000 revisions in the third quarter alone.
The Charlotte, NC-based bank says it is providing mortgage payment relief through its newly created National Homeownership Retention Program.
"The NHRP is one of the proprietary foreclosure prevention programs we use in addition to the federal government-sponsored Home Affordable Modification program," explains Jack Schakett, credit loss mitigation strategies executive for Bank of America home loans.
"Through this and other programs, Bank of American has provided relief through completed and trial modifications to more than 600,000 customers since the beginning of last year."
(SAN DIEGO, CA) -- With the unemployment rate in metro San Diego topping 10 percent and operating incomes falling, more companies have reduced their space demands or closed offices, driving down occupancy levels and rents, according to a fourth-quarter Office Research Report by Marcus & Millichap.
Still, says Kent Williams, regional manager of Marcus & Millichap's San Diego office, "We are seeing a lot of buyer and seller activity."
Williams forecasts office vacancy to reach 18.6 percent by year end, a 340 basis point spike from 2008, when the average rate increased 230 basis points.
Asking rents this year are projected to fall 4.8 percent to $28.91 per square foot, while effective rents will drop 9.8 percent to $23.54 per square foot. Concessions are expected to amount to 18.6 percent of asking rents, up from 14 percent of asking rents at the end of 2008.
(ORLANDO, FL) -- Slumping space demand in metro Orlando will push up the vacancy rate by year end to 17.1 percent on negative absorption of 1.5 million square feet, according to Marcus & Millichap. The vacancy rate rose 180 basis points in 2008.
Asking rents are projected to reach $20.96 per square foot at year end, a decline of 3.8 percent from last year. Effective rents are forecast to decrease 7 percent to $16.89 per square. In 2008, asking rents were flat, while effective rents tumbled 1.6 percent.
"Concerns over property fundamentals and lower loan-to-value ratios on acquisition loans have sidelined many investors in Orlando," says Dan Colachicco, regional manager of the Orlando office of Marcus & Millichap.
(GREENVILLE, SC) -- Dallas, TX-based Lone Star Funds is pulling Southern-based BI-LO LLC out of Chapter 11 with a $350 million cash infusion. Lone Starr is providing $150 million in equity cash and $200 million in committed term loan financing.
BI-LO's plan of reorganization, presented to the U.S. Bankruptcy Court in Greenville, SC, shows that Lone Star will also provide for a $150 million ABL facility for working capital and other normal business needs.
"Today marks a significant milestone and an important next step in our restructuring efforts," says BI-LO president and CEO Michael Byars.
He adds that the plan sponsored by Lone Star and the plan submitted the Creditors' Committee "create additional choice for BI-LO's creditors and encourage competition that we expect will maximize the value of the estate for the benefit of the company and its stakeholders."
(ELMWOOD PARK, NJ) -- Northern New Jersey office markets have been hit hard this year by company employee layoffs. A total 129,500 workers are expected to lose their jobs this year compared to terminations of 81,600 in 2008, according to Marcus & Millichap.
Even so, New Jersey office inventory will expand by 933,000 square feet this year after 729,000 square feet was brought online in 2008. Northern New Jersey will receive 577,000 square feet; Central New Jersey will get 356,000 square feet. No completions are scheduled in the southern part of the state.
"Despite easing investment demand, office deals continue to be close in some markets across New Jersey," says Michael Fasano, regional manager of Marcus & Millichap's New Jersey office.
Vacancy is expected to rise by 180 basis points to 18.2 percent in 2009, after increasing 80 basis points in 2008.
Asking rents are forecast to fall 0.7 percent to $25.47 per square foot this year. Effective rents will retreat 5.3 percent to $20.55 per square foot. Asking and effective rents increased 2.3 percent in 2009 and 0.5 percent in 2008.
(SAN JOSE, CA) -- The Silicon Valley's late entry into the 27-month-old Recession has driven a sharp climb in vacancy levels since the start of the year, reports Marcus & Millichap. Further weakness is project to extend into 2010.
Mass layoffs at major tech corporations and increased company failures have contributed to softening occupancy levels as firms continue to thin space requirements and the amount of sublease space mounts, says Steven Seligman, regional manager in the Palo Alto, CA office of Marcus & Millichap.
"Transaction velocity has dropped off significantly since the beginning of 2009, as uncertainty regarding the length and depth of the downturn has kept the pricing disconnect wide and the majority of investors on the sidelines," says Seligman.
(ASBURY PARK, NJ) -- iStar Financial Inc., a New York Stock Exchange-traded REIT, is moving into the developer ranks as it takes over responsibility from Asbury Partners to redevelop the Asbury Park Boardwalk and Convention Hall.
Asbury Partners defaulted on a $70 million loan from iStar. But the transition is not going through a conventional route. IStar will be holding a public sale Dec. 15 in New York of the collateral that Asbury Partners Holdings and Cherokee Asbury Park put up to get the $70 million loan.
Asbury Partners Holdings LLC and Cherokee Asbury Park LLC comprise Asbury Partners.
"We're just changing the partners," Timothy McDonough, a consultant with Roseland Advisors and the mayor of Hope Township in Warren County, NJ, tells the Asbury Park Press.
"There will be no change in the land that would be a concern of Asbury Park residents. What iStar is going to do is go out and try and bring in other developers, other investors, so this is great for Asbury Park. "
Douglas Katch, a Freehold, NJ commercial lawyer, explains the deal this way to the Asbury Park Press:
"This is not a foreclosure but is a collateral liquidation via a public sale under the Uniform Commercial Code.
"What iStar is doing here is really no different than what banks do when you default on your car loan. When a bank lends you money to buy a car, the bank securitizes that loan, using the actual car as collateral.
"If you default on your loan obligations to the bank, the bank will take possession of the collateral (the car) and then sell the car, using commercially reasonable efforts, usually via a public sale."
(DURHAM, NC) -- Seattle-based Nordstrom Inc. has leased 33,000 square feet at Renaissance Center in Durham, NC where it plans to open its first Nordstrom Rack store in fall 2010. Terms of the lease were not disclosed by the landlord, CBL & Associates Properties Inc. of Chattanooga, TN.
The Nordstrom Rack store will be located between Cost Plus World Market and Pier 1 Imports. The center is across the road from The Streets of Southpoint mall where Nordstrom has operated a full-line store since 2002.
Jan Willis, vice president of leasing for CBL, says Nordstrom Rack "will complement the attractive retailer lineup" at Renaissance Center.
CBL & Associates Properties owns, holds interests in or manages 163 malls and shopping centers in the U.S., including 88 regional malls and open-air centers. The properties are in 27 states and total 87.8 million square feet, including three million square feet of non-owned shopping centers managed for third parties.
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