News: Real Estate, Risk, Economics. Aug. 21, 2014

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Table of Contents
(Click to sections below.)

1) Mortgage refinancers act on lower rates, home buyers don't

2) France Acknowledges Economic Malaise, Blaming Austerity – NYTimes com

3) Cleanup follows heavy storms in Phoenix area – KFVS12 News & Weather Cape Girardeau, Carbondale, Poplar Bluff

4) [Highly recommended] Loan modifications destroyed the move-up market for a generation – OC Housing News

5) [Recommended] Quantitative Ease by Carola Binder: Wage Inflation and Price Inflation

6) USDOJ: US Attorney's Office – Northern District of Ohio

7) Atlanta Fed GDPNow Forecasting Model – Federal Reserve Bank of Atlanta

8) CBRE Multifamily Report Q2 2014 | NYC Multifamily Market

9) Commercial Real Estate Price Pressure Beginning to Emerge in Some Sectors, Report Finds | REIT com

10) Estately Launches Flip, A Tinder For Real Estate | TechCrunch

11) Existing home sales spike; Philly manufacturing soars

12) Fix and flip after the rehab – YouTube

13) Most Fracking Fluids Neither Toxic nor Harmless; Health Effects Unknown for One-Third – Carrier Management

14) Op-ed: Keep Rates Low until the Hidden Jobless Return to Work

15) Realtor bids bad deal at Bolinas tax auction – Marin Independent Journal

16) The top 10 critical issues facing GSE reform | HousingWire

17) Landslides hit Japan's Hiroshima, killing at least 36 | Reuters

18) 3 from Norridge, 1 from Chicago charged in New York burglaries | abc7chicago com

  1.    Mortgage refinancers act on lower rates, home buyers don't

    "This is a classic good news/bad news scenario for the housing market," said RealtyTrac's Daren Blomquist. "The good news is that fewer cash buyers should help loosen up inventory of homes for sale and reduce competitive bidding, giving first time home buyers and other non-cash buyers more opportunities. The bad news is that some of those first time home buyers and other non-cash buyers may already be priced out of the market thanks to the rapid run-up in home prices over the past two years in many areas."

    It's not bad news for landlords.

    Add your comment.


  2.    France Acknowledges Economic Malaise, Blaming Austerity – NYTimes.com

    It's about time!

    "Due to the austerity policies of the last several years, there is a problem of demand throughout Europe, and a growth rate that is not reducing employment."

    It was the most public rejection by France of the austerity medicine that Germany has long prescribed for the eurozone — which even the German chancellor, Angela Merkel, recently acknowledged might be impeding the currency bloc's recovery.

    Add your comment.


  3.    Cleanup follows heavy storms in Phoenix area – KFVS12 News & Weather Cape Girardeau, Carbondale, Poplar Bluff

    Farther north, nearly 5 inches of rain fell around New River, the site of some of Tuesday's most chaotic scenes.

    Several homes in the town about 30 miles north of Phoenix sustained significant damage….

    Add your comment.


  4.    [Highly recommended] Loan modifications destroyed the move-up market for a generation – OC Housing News

    We agree with Larry Roberts (aka "Irvine Renter"):

    Since I don't believe house prices will drop much, I don't see much urgency to sell — of course, since I don't believe prices will rise much from here, I don't see much urgency to buy either.

    When prices are stagnant, buying a home for appreciation benefits is off the table. Buyers should focus on buying a property they want, they can afford, and that suits their family. The loan modification can-kicking ruined the move-up market for many years to come, so prices should remain flat while lenders process the loan modification redefaults. Lenders can't afford another crash, and they know how to limit future declines, so unlike Keith, I don't see much reason to fear a future drop. But like any other market pundit, I could be wrong.

    Add your comment.


  5.    [Recommended] Quantitative Ease by Carola Binder: Wage Inflation and Price Inflation

    This is a very good overview.

    Add your comment.


  6.    USDOJ: US Attorney's Office – Northern District of Ohio

    A Youngstown woman was convicted of setting fire to a rental property in order to collect insurance money, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

    Latasha Curtis, 33, is scheduled to be sentenced Nov. 13.

    Add your comment.


  7.    Atlanta Fed GDPNow Forecasting Model – Federal Reserve Bank of Atlanta

    The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2014 was 3.0 percent on August 19, up from 2.8 percent on August 13. The nowcast for inventory investment ticked up following the Federal Reserve's industrial production release on August 15 while the nowcast for residential investment growth increased following [the]… new residential construction release from the U.S. Census Bureau.

    Add your comment.


  8.    CBRE Multifamily Report Q2 2014 | NYC Multifamily Market

    New York City, the largest multifamily market in the U.S., saw a slight uptick in rent per unit year-over-year to $2,534, according to a national second-quarter multifamily report from brokerage CBRE. Year-over-year rent in the city climbed 1.4 percent. In the second quarter of 2014, New York saw a vacancy rate of 5.3 percent.

    Add your comment.


  9.    Commercial Real Estate Price Pressure Beginning to Emerge in Some Sectors, Report Finds | REIT.com

    RERC's investment survey of large institutional and regional investors showed that certain property types, particularly apartment and retail properties, were seen to be fully priced or even overpriced in some areas.

    "We are seeing pricing in most property sectors increase enough such that investors worry that a market correction is looming or that a bubble may be developing," Riggs said.

    (Emphasis on "may," meaning may not.)

    Add your comment.


  10.    Estately Launches Flip, A Tinder For Real Estate | TechCrunch

    During the beta test, those users who started trashing houses clearly loved the experience. Once they started, they ended up trashing about 18 properties per week. "It's such an efficient model for home buyers," Estately co-founder and CEO Galen Ward told me. "You know you don't want the home, so why see it over and over?"

    If you "trash" it, you won't see any price drop, etc.

    Add your comment.


  11.    Existing home sales spike; Philly manufacturing soars

    Distressed sales, which include foreclosures and short sales, made up only 9 percent of sales last month, the lowest share since the NAR starting tracking this information in October 2008.

    More homes also are being put on the market, keeping prices from rising as quickly and providing potential buyers with more choices.

    The number of homes on the market for resale rose to 2.37 million in July, the highest level since August 2012 and 5.8 percent more than in July of last year.

    Home sellers on average are still overpricing their homes. How long wil the lag last before they drop prices to move sales, or will they pull out of the market hoping to hold out for appreciation's return?

    Add your comment.


  12.    Fix and flip after the rehab – YouTube

    What do you think about Mark's latest remodel he's flipping?

    This fix and flip was bought for $125,000 and is listed for $179,900. About $15,000 in work was done on the home.

    He's had a rash of contractor problems. We're not sure just how detailed he'd care to get about that. There are many things that can be done concerning such issues: contract documents, bonds, etc.

    What are your thoughts on curb appeal/first impression? Does the interior more than offset any landscaping negatives?

    Add your comment.


  13.    Most Fracking Fluids Neither Toxic nor Harmless; Health Effects Unknown for One-Third – Carrier Management

    As the oil and gas drilling technique called hydraulic fracturing (or "fracking") proliferates, a new study on the contents of the fluids involved in the process raises concerns about several ingredients.

    Scientists presenting the work Wednesday at the 248th National Meeting & Exposition of the American Chemical Society (ACS) say that out of nearly 200 commonly used compounds, there's very little known about the potential health risks of about one-third—and eight are toxic to mammals.

    Add your comment.


  14.    Op-ed: Keep Rates Low until the Hidden Jobless Return to Work

    Adam S. Posen:

    Even if it overshoots briefly, people are unlikely to expect high inflation to stick in the face of weak demand, particularly for labor; expectations are well-anchored. This was demonstrated by the experience in the United Kingdom in 2010—11, when the Bank of England's Monetary Policy Committee held its fire on interest rates as inflation briefly spiked due to short-term shocks, and inflation came back down nonetheless.

    Agreed.

    Add your comment.


  15.    Realtor bids bad deal at Bolinas tax auction – Marin Independent Journal

    "Not very cool," said the 41-year-old Helm, adding he was given bad information by a title company that involved a parcel number mixup. "I buy trust deeds all over the state," Helm said, adding it is the first time he has been left holding the bag after a decade in the business.

    If it gave bad info, is the title company liable?

    Add your comment.


  16.    The top 10 critical issues facing GSE reform | HousingWire

    Here are the top 10 issues that still need to be addressed, according to the Urban Institute:

    Most of these questions have no easy answer, and with no sense of urgency, higher legislative priorities and a lack of compromise, little change has happened and is not expected to happen soon.

    "The current state of the GSEs can best be summed up in a single word: limbo. Despite the fact that Fannie Mae and Freddie Mac were placed in conservatorship in 2008, with the clear intent that they not emerge, there is little progress on a new system, with a large role for private capital, to take their place," Goodman said.

    Add your comment.


  17.    Landslides hit Japan's Hiroshima, killing at least 36 | Reuters

    (Reuters) – At least 36 people, including several children, were killed in Japan on Wednesday, when landslides triggered by torrential rain slammed into the outskirts of the western city of Hiroshima, and the toll could rise further, police said.

    Seven people were missing after a month's worth of rain fell overnight, loosening slopes already saturated by heavy rain over the past few weeks.

    About 240 mm (9 inches) of rain fell in the area in the 24 hours up to Wednesday morning, a record-breaking level equivalent to a month's worth of rain in a usual August, the Meteorological Agency said. Roughly half of that rain fell in one hour on Wednesday.

    Wow!

    Add your comment.


  18.    3 from Norridge, 1 from Chicago charged in New York burglaries | abc7chicago.com

    SYRACUSE, N.Y. —
    Authorities say they've arrested four people from the Chicago area in connection with multiple burglaries committed in central New York.

    Add your comment.


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