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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Pogeu Mahone who wrote (160407)	10/27/2008 12:31:28 AM
From: Jim McMannis	Respond to of 306849

Companies start competing for bailout money biz.yahoo.com Insurance firms, auto companies and foreign banks petition for part of $700 billion bailout WASHINGTON (AP) -- The bailout is now the hottest lobbying game in town. Insurers, automakers and American subsidiaries of foreign banks all want the Treasury Department to cut them a piece of the largest government rescue in U.S. history. The betting is that many with their hands out will be successful, especially with financial markets in a stomach-churning dive and predictions the economy is about to tumble into a deep recession. These groups argue that the credit squeeze is so severe and the risks to the economy so dire that their industries need financial support as well. The Treasury is considering requests from a variety of industries, but has not decided whether to expand the program, officials said Saturday. Lobbying efforts are intensifying. The Financial Services Roundtable wrote Treasury officials on Friday requesting that the initiative to buy $250 billion in bank stock grow to cover insurers, auto companies, securities dealers and U.S. subsidiaries of foreign companies, including banks. The Treasury's plan is intended to bolster banks' tattered balance sheets and get them to resume making loans. As the Treasury now interprets it, these additional groups would not participate in the bank stock program. They could receive help from a separate part of the $700 billion rescue that will buy bad assets from financial institutions. Steve Bartlett, the president of the Roundtable, urged the Treasury to broaden the definition of those eligible for the stock purchase program. "The institutions that are excluded play a vital role in the U.S. economy by providing liquidity to the market," Bartlett wrote Neel Kashkari, the Treasury Department official running the bailout program. Referring to U.S. subsidiaries of foreign companies, Bartlett said, "This is a global crisis and to not recognize the U.S. firms controlled by foreign banks or companies would create further impediment to the market's recovery." A financial industry official said Treasury Secretary Henry Paulson met over the past week with various groups, including hedge fund managers, that were petitioning for assistance. The official spoke on condition of anonymity because the Treasury has not made a decision. This official said the discussions with insurance industry executives were being held in advance of what are expected to be disappointing earnings reports by some insurance companies in the coming week. The official said the insurance industry would like to get government purchases of their stock on a mandatory basis, duplicating the agreement Paulson struck two weeks ago with nine major banks. Paulson pressured the big banks to go along with the program as a way of removing the stigma that might be attached to the payments if only a few major banks had received them. Some insurers technically would be eligible for stock purchases now if they own subsidiaries that are savings and loan institutions regulated by the Office of Thrift Supervision. Last month, American International Group, the country's largest insurance company, received an $85 billion loan from the Federal Reserve. Since then, it has gotten further support in an effort to withstand the biggest upheavals on Wall Street since the Great Depression. Complicating the government's decision-making is that the Bush administration will not be in charge after Jan. 20. Paulson, who has said he has no intention of staying on the job, has pledged to consult with both campaigns on his bailout actions. Democrat Barack Obama's presidential campaign said Friday it supported the effort by the auto industry to get money from the $250 billion made available for stock purchases. That would be in addition to $25 billion recently approved by Congress for low-interest loans to help the struggling industry retool and build fuel efficient vehicles. The debate over expanding the bailout comes as the Treasury is rushing to get money out the door to the primary recipients: banks that sharply curtailed lending after suffering billions of dollars of losses on mortgage-related assets as home foreclosures soared in the housing slump. Lawmakers are pressuring the Treasury to do more in the foreclosure area, as well. Sheila Bair, head of the Federal Deposit Insurance Corp., told Congress about efforts to provide government-backed loan guarantees for mortgages that are reworked to help homeowners in danger of default. That would give banks an incentive to speed up refinancing efforts because the government would back part of the reworked loan. The Treasury also is moving ahead to get bank stock purchases approved. It announced on Oct. 14 that it was spending $125 billion to buy stock in nine of the largest financial institutions. An announcement was expected Friday about a second round involving 20 to 22 other banks. But it was decided each bank would announce its own agreements with the Treasury, out of concern that excluded banks could suffer a stock sell-off from disappointed investors. PNC Financial Services Group Inc. announced Friday it was acquiring National City Corp. for $5.58 billion, in what was the first instance of a bank using fresh investments from the bailout program to make an acquisition. PNC said it had received $7.7 billion in cash through selling stock to the government under the program.

To: Pogeu Mahone who wrote (160407)	10/27/2008 12:39:04 AM
From: Jim McMannis	Respond to of 306849

South Florida's existing-home sales up for second straight month Driven by prices that have fallen back to 2004 levels, South Florida bargain hunters lifted existing-home sales for the second straight month. miamiherald.com The state of South Florida's long-struggling housing market is illustrated through the recent history of a modest, two-bedroom home in Coral Gables. Two years ago, the squat dwelling a short walk from Miracle Mile sold for $570,000. Last year, the lender foreclosed and put it up for sale. Now the house, at 27 Sevilla Ave., has a potential buyer. Asking price: $252,900. Falling prices pushed existing-home sales up across South Florida in September for the second straight month compared with the same period a year ago, according to figures released Friday by the Florida Association of Realtors. Single-family homes sales jumped 52 percent in Broward compared with a year ago; condo sales rose 38 percent. Miami-Dade single-family home sales were up 14 percent; condo sales fell by 1 percent. Not surprisingly, the activity was driven by a sharp drop in prices. Single-family home prices were off 26 percent in Miami-Dade and 25 percent in Broward. Condo prices dove 23 percent in Miami-Dade and 26 percent in Broward compared with September 2007. The drop restored median prices for single-family homes to 2004 levels. With an overload of unsold homes, banks are unloading foreclosed properties at steep discounts and sellers are lowering prices to compete. The lower price for the Sevilla Avenue home means the sale will likely go through. ''We think we now have a buyer who can get financing,'' said South Miami real-estate agent Hagen Hendrix, who has watched seven previous contracts on the home crumble when buyers couldn't secure a mortgage. The ever-lower prices mean homes are now getting into the strike zones of an increasing number of potential buyers, said Bill Kerdyk, president of Kerdyk Real Estate. ``Many can't get financing, but we're ultimately finding buyers because prices are getting so attractive.'' The median price of a single-family home in Miami-Dade in September was $274,600; it was $259,300 in Broward. For condos, the median Broward price was $129,600; Miami-Dade's median condo price was $212,200. LONG TIME COMING Statewide, home sales jumped after a nearly three-year slumber, the Realtors organization reported. Single-family home sales were up 24 percent in September compared with the same period last year; condo sales were up 11 percent. Mirroring the situation in South Florida, statewide prices were down, dropping 22 percent for single-family houses and condos. For September, the median statewide price for a single-family home was $175,100 and $153,800 for condos. Ever since the market turned cold, industry watchers have been saying a recovery would require a steep drop in prices, followed by increasing buying activity that reduces the outsized inventory of homes for sale, and ultimately a balance between buyers and sellers that results in prices stabilizing -- and eventually rising. ''The fact that resales are up is a positive sign and may be signaling a bottom,'' said real-estate analyst David Dabby. But he added that it could be a long march to price appreciation, and much depends on the rate of foreclosures. A Moody's Economy.com analysis predicts that Florida mortgage defaults -- which don't necessarily result in foreclosures -- will crest in the middle of next year. ''We are in the process of a long journey,'' Dabby said. ``For instance, the average price of an existing condo in Miami-Dade did not go up between 1984 and 1995.'' INVENTORY SMALLER On a positive note, the increased sales activity did make a dent in Broward's inventory of unsold homes, reducing it 5 percent in September compared with September 2007. Miami-Dade's inventory increased 6 percent year over year, though the number of unsold homes in September declined in Miami-Dade compared with the previous month. The shifting fortunes of the Sevilla Avenue home mirror the mercurial real-estate market. Two years ago, real-estate agent Hendrix said, he brokered an 8.9 million euro sale of a castle in Tuscany. Today he has 248 foreclosed homes listed for sale. ''Times change,'' said Hendrix, an agent with Avatar Real Estate Services. ``I was selling castles and private islands. Now foreclosures in Miami are selling pretty well.'' recommend email print share Buzz up! Join the discussion Note: If this is your first time using our NEW commenting system, you will have to LOG OUT and then LOG BACK IN. 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