WBEZ | home foreclosure http://www.wbez.org/tags/home-foreclosure Latest from WBEZ Chicago Public Radio en Economic turmoil rattles unsettled housing market http://www.wbez.org/story/2011-08-09/economic-turmoil-rattles-unsettled-housing-market-90334 <img typeof="foaf:Image" src="http://llnw.wbez.org/npr_story/photo/2011-August/2011-08-10/Home for sale Elgin_Getty_Scott Olson.jpg" alt="" /><p><p>For most people, their biggest investment is their home. Following Standard and Poor's downgrade of U.S. credit, as well as Fannie Mae and Freddie Mac, there may be even more uncertainty about buying or selling a home right now.</p><p>Russell Zanca, 47, has a three bedroom, one and a half bath vintage brick Georgian house on the market. The anthropology professor's home is on a quiet tree-lined street on Chicago's North Side.</p><p>"It's just a nice solid house," Zanca says.</p><p>He's selling because he is getting married and will soon move into his fiancé's house, but he's been thinking about selling for quite some time.</p><p>"Really since 2008, I kept thinking, well, next year can't be worse than this year, but once we decided to get married, which was more than a year ago, that's when we started talking about what are we doing with the houses," Zanca says.</p><p>He has a buyer and hopes to close in a month or so. Still, the troubling financial news of the last several days is making him a little nervous.</p><p>"I just started thinking, what is this gonna mean, you know. And I did think, I'm glad that it looks like I have this contract and it looks like I'm getting rid of this thing now, rather than hearing this and having the house on the market and not knowing if anyone was even going to come and see it."</p><p>What worries Zanca more is what the housing market might be like a year from now when he and his new wife plan to start looking for a bigger house.</p><p>For now, the S&P's downgrade has had only one tangible impact on the housing market: It pushed nearly historic low interest rates even lower. Does this mean it's a good time to buy?</p><p>"Absolutely, absolutely." says Ron Haddad, a senior mortgage banker with Baird and Warner Financial Services in Chicago.</p><p>"The affordability for the cost of ownership is at an all-time low," Haddad says. "Interest rates are so low; the prices with a lot of the properties in our area are absolutely at amazing levels. It makes sense to buy."</p><p>Mabel Guzman of the Chicago Association of Realtors agrees.</p><p>"For the person on the street it's about jobs," Guzman says. "So if they have job security, they're going to make that long term investment into real estate. If they don't and they feel, well, I feel the trend is changing, I could be downsized, I'm not seeing a lot of growth in my sector that I work in, then I will make short term decision to rent, until I feel things have turned around."</p><p>Guzman adds that even buyers, who are in a good position right now, and sellers for that matter, might find the frenetic pace of financial news lately and the huge volatility in the markets, to be too much.</p><p>"They're overwhelmed." Guzman says. "Their head is exploding and unfortunately there are dollar signs coming out of it."</p><p>Real estate experts and economists say it's really still too soon to tell if the financial news of the last week or so will have any long-term impact on the housing market.</p><p>But to be sure, it wasn't great to begin with and is still struggling to recover from the last housing crisis and it doesn't need another. <div class="fullattribution">Copyright 2011 National Public Radio. </p> Tue, 09 Aug 2011 23:01:00 -0500 http://www.wbez.org/story/2011-08-09/economic-turmoil-rattles-unsettled-housing-market-90334 The cost of owning 150,000 foreclosed homes http://www.wbez.org/story/2011-07-06/cost-owning-150000-foreclosed-homes-88815 <img typeof="foaf:Image" src="http://llnw.wbez.org/npr_story/photo/2011-July/2011-07-07/foreclosed_lawns_001.jpeg" alt="" /><p><p>When you are the nation's largest owner of foreclosed homes, even little things can get expensive fast. Such is the case for mortgage giant Fannie Mae, which as of March 31 had a mind-boggling 153,000 foreclosed homes <a href="http://phx.corporate-ir.net/phoenix.zhtml?c=108360&p=irol-SECText&TEXT=aHR0cDovL2lyLmludC53ZXN0bGF3YnVzaW5lc3MuY29tL2RvY3VtZW50L3YxLzAwMDA5NTAxMjMtMTEtMDQ2NjA2L3htbC9zdWJkb2N1bWVudC8xL3BhZ2UvMTY%3d" target="_blank">on its books</a>.</p><p>One example — mowing the lawn. Two men swoop in on a foreclosed town house in Lanham, Md., quickly mowing and edging the small front yard. Fannie Mae owns this home, so it's paying for the lawn crew to come every two weeks or so to keep up the curb appeal.</p><p>But it's not just this lawn. There are tens of thousands more. Fannie Mae officials won't say how many lawns it's paying to maintain, so we've done some back-of-the-envelope calculations of our own:</p><p>Say only half of the homes have lawns, a conservative estimate, that's still more than 75,000 lawns.</p><p><blockquote></p><p>153,000/2</p><p>X 6 (a six-month grass-clipping season)</p><p>X 2 (mowing twice a month)</p><p>X $40 (a reasonable guess at how much it costs to mow a lawn)</p><p>= $36.7 million</p><p></blockquote></p><p>Again, this is very rough estimate, but that's a whole lot of money to spend on lawn care.</p><p><strong>An Expensive Upkeep</strong></p><p>"This is just one of the costs that Fannie and the rest of us will pay to dig out of a very big hole," says Karen Petrou, who watches Fannie Mae's books closely at her firm Federal Financial Analytics.</p><p>When she says "the rest of us," she means it. Fannie Mae's tab from U.S. taxpayers is up to <a href="http://projects.propublica.org/bailout/entities/158-fannie-mae" target="_blank">$86 billion</a> since September 2008 when it was taken into government conservatorship.</p><p>In just the first quarter of this year, Fannie racked up $488 million in foreclosure-related expenses, including holding costs (insurance, taxes and maintenance); valuation adjustments for changes in market value; gains/loss when the property is sold; legal fees; eviction costs; weatherization costs to prevent the pipes from bursting; costs to secure the property; and repair costs.</p><p>At that town house in Lanham, Md., the repair costs will add up to nearly $15,000. Chipped bold paint colors are covered with a neutral tone; a stolen air conditioning unit and missing copper pipes are replaced; new light fixtures and wall-to-wall carpeting are installed.</p><p>"We want to make sure that we're comparable with the market or with the neighborhood," says Elonda Crocket, an executive at Fannie Mae who deals with managing its massive portfolio of foreclosed properties.</p><p>She says the goal is to stabilize the neighborhoods where they have foreclosed homes and to get the properties to a condition where first-time homebuyers can imagine themselves moving in.</p><p>"We want to make sure that we can maximize our return on the investment," she says.</p><p>In 2010, Fannie Mae did similar repairs on 87,000 foreclosed homes.</p><p>"It makes them — I think — indisputably the largest purchaser of paint and general appliances for these homes they're fixing up," says Guy Cecala, publisher of Inside Mortgage Finance.</p><p>But if you think mowing tens of thousands of lawns and buying acres of new carpet is expensive, Petrou says just imagine the alternative.</p><p>"If they don't maintain the houses, then the neighborhoods go downhill, other people are put at risk and the housing crisis gets worse because you have still more downward pressure on overall house prices," Petrou says. <div class="fullattribution">Copyright 2011 National Public Radio. </p> Wed, 06 Jul 2011 23:01:00 -0500 http://www.wbez.org/story/2011-07-06/cost-owning-150000-foreclosed-homes-88815 Existing home sales post first gain in seven months in May http://www.wbez.org/story/existing-home-sales-post-first-gain-seven-months-may-88513 <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-June/2011-06-29/Home for sale Elgin_Getty_Scott Olson.jpg" alt="" /><p><p>Pending sales of existing U.S. homes bounced back from a seven-month low in May, but demand for home loans sank last week and the market continues to struggle under the weight of a glut of unsold properties.</p><p>The National Association of Realtors said on Wednesday its Pending Home Sales Index increased 8.2 percent to 88.8, bouncing back from April's seven-month low. Pending homes sales lead existing homes sales by a month or two.</p><p>The rise in contracts is merely a correction after an 11.3 percent decline in April, leaving a picture intact of a housing market that continues to bounce along the bottom.</p><p>That fact was underscored by a Mortgage Bankers Association report, which showed applications for loans to buy homes dropped 3 percent last week to the lowest level since Feb. 25.</p><p>"Although today's number could bring some cheer to investors who are on the prowl for good news, the fact of the matter is that the housing sector is still a long way from a meaningful recovery,'' said Peter Buchanan, a senior economist at CIBC World Markets in Toronto.</p><p>Economists had expected home resale contracts to rise only 3.8 percent after a previously reported 11.6 percent drop.</p><p>U.S. stock indexes were slightly higher, while bond prices were mostly lower. The dollar was down against a basket of currencies.</p><p>The weak housing market is constraining economic growth and economists do not see a recovery any time soon in a sector that is grappling with an oversupply of homes, which is keeping prices subdued.</p><p>According to the Realtors, there were 3.72 million used homes on the market in May, excluding the so-called shadow inventory.</p><p>Data on Tuesday showed a moderation in the pace of decline in single-family home prices in April.</p><p>The S&amp;P/Case-Shiller composite index of single-family homes in 20 metropolitan areas slipped 0.1 percent on a seasonally adjusted basis after falling 0.3 percent in March.</p><p>Last month, pending home sales increased in all four regions, with the Midwest and West notching double-digit gains. In the 12 months to May, pending home sales rose 13.4 percent.</p><p>(Reporting for Reuters by Lucia Mutikani; Editing by Neil Stempleman)</p><p>&nbsp;</p></p> Wed, 29 Jun 2011 16:01:00 -0500 http://www.wbez.org/story/existing-home-sales-post-first-gain-seven-months-may-88513 Illinois home foreclosures up 5 percent in May http://www.wbez.org/story/illinois-home-foreclosures-5-percent-may-87934 <img typeof="foaf:Image" src="http://llnw.wbez.org/story/photo/2011-June/2011-06-16/87134629.jpg" alt="" /><p><p>Illinois home foreclosure activity rose more than 5 percent in May compared to the previous month.&nbsp;</p><p>A report released Thursday by Irvine, Calif.-based <a href="http://www.realtytrac.com/mapsearch/illinois-foreclosures.html?accnt=15590">RealtyTrac shows Illinois with 10,574 foreclosure filings last month</a>. Filings include default notices,&nbsp; auction-sale notices and bank repossessions.&nbsp;</p><p>The filings represent one in every 500 housing units in the state. That rate is almost 30 percent lower than in May of last year and ninth-highest nationally.&nbsp;&nbsp;&nbsp;&nbsp;</p><p>Foreclosures had fallen more than 16 percent in April compared to March, but RealtyTrac attributed decreases in many states to paperwork processing delays&nbsp; rather than a housing recovery.&nbsp;</p><p>Nevada continued to have the nation's highest foreclosure rate - one in every 103 housing units.&nbsp;</p><p>Other states with foreclosure rates higher than Illinois are Arizona, California, Florida, Georgia, Idaho, Michigan and Utah.</p></p> Thu, 16 Jun 2011 14:52:00 -0500 http://www.wbez.org/story/illinois-home-foreclosures-5-percent-may-87934