Home prices in 10 largest cities rise for the third straight month in August, a sign a housing recovery taking hold: Case-Schiller (story developing)
Current DateTime: 01:03:47 27 Oct 2009
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This news plus homebuyer tax credit extension this week...
so many reasons to buy!
US Commercial Property Up in Third Quarter: Index
Published: Tuesday, 3 Nov 2009 | 5:18 AM ET Text Size By: Reuters
The prices of investment-grade commercial real estate rose more than 4 percent in the third quarter, possibly signaling an end to the sector's year-long downward spiral, according to an leading property index released Tuesday.
Current DateTime: 05:17:16 03 Nov 2009
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Realty Check with Diana OlickWinterize Your PortfolioAustralia Raises Rates Again
The 4.4 percent third-quarter increase in the MIT Center for Real Estate's transaction-based index (TBI) index is the first positive price change in the index in more than a year and the largest increase since the market downturn began in mid-2007.
"One quarter does not a trend make and we are still well below normal trading volume," David Geltner, director of research at MIT/CRE, said in a statement. "Nevertheless, this is the strongest sign of a bottom that we've had in two years."
The U.S. commercial real estate market has been in a downward spiral for more than two years. Borrowers are facing shortfalls in financings when loans come due. Some borrowers are struggling to meet even monthly payments.
The delinquency rate of U.S. commercial real estate loans securitized into Commercial Mortgage-Backed Securities (CMBS) hit 4.8 percent in October, up from 4.36 the prior month and dwarfing the 0.77 rate of a year earlier, according to Trepp, which tracks CMBS loans.
The TBI tracks the prices that institutional investors, such as pension funds pay or receive when buying or selling commercial properties such as shopping centers, apartment complexes and office towers.
The price index at the third quarter stood at 36.5 percent below its 2007 peak, up from its 39 percent deficit seen last quarter, which now could be the trough and suggests the U.S. commercial property market may have finally found a price bottom.
In addition, the number of transactions rose for the second straight month in the third quarter to 90 from 42 in the second quarter.
"The big news this quarter is not just that the price index increased, but that transaction volume substantially increased for the second quarter in a row, reflecting the first increase in market sentiment in two years," Geltner said.
MIT/CRE also compiles indexes that gauge movements on the demand side and on the supply side of the institutional property market.
The demand-side index -- which tracks the changes in prices that potential buyers are willing to pay -- rose to 42 percent below the 2007 peak, up from 48 percent last quarter. It ended eight consecutive declines.
The 12 percent jump was the first increase in the demand index after eight consecutive quarters of decline.
People need to read the prospectus. This ETF is based on the Dow Jones US Real Estate Index. http://www.proshares.com/funds/ure.html
This index primarily tracks commercial real estate not housing or residential real estate. If you click on IYR ticker which also tracks this index and click on holdings, you'll see there is very little residential involved in this index, but that it is primarily commercial including mall, hotels, and REITs.
Senate Nears Deal on Keeping Tax Credit for Home Buyers
Published: Wednesday, 28 Oct 2009 | 5:01 PM ET Text Size By: Reuters
The Senate's top Democrat and top Republican each voiced support on Wednesday for extension of a soon-to-expire $8,000 tax credit for home buyers, but left unclear when the chamber would act.
"There has been general agreement by a significant number of senators, Democrats and Republicans, to get this done," Senate Majority Leader Harry Reid, a Democrat, said on the Senate floor.
The chamber's top Republican, Senator Mitch McConnell, also said most senators support the measure. "I certainly share his view," McConnell said.
The tax credit for first-time home buyers, which has helped lift the housing market out of its worst slump since the Great Depression, is set to expire on Nov. 30 and senators have been negotiating over how best to extend it.
Under an agreement reached by key senators, the tax credit would be extended through the end of April and be expanded to cover repeat buyers who have been in their homes at least five years, sources familiar with the plan said.
First-time buyers would continue to get an $8,000 credit, while repeat buyers of primary residences would be eligible for a credit of $6,500, the sources said.
They said the credit would be available for individuals making up to $125,000 a year and couples earning up to $225,000 per year.
Timing of a Vote Uncertain
While extending the credit enjoys widespread support, its fate is caught up in a spat between Reid and McConnell over unrelated issues.
Reid had wanted to attach a bill to extend the homebuyer credit as an amendment to legislation to lengthen insurance benefits for unemployed workers. The Senate voted to take up the insurance benefit bill on Tuesday, but did not attach the homebuyer tax credit to the measure.
Current DateTime: 02:03:03 28 Oct 2009
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New Home Sales Post Surprise DropMortgage Applications FallSenate Vote on Home-Buyer Credit Unlikely TodayTrack the DJ Housing Index HereRealty Check with Diana Olick
Despite that apparent roadblock, Senate Finance Committee Chairman Max Baucus, who has been involved in negotiations over the tax credit, told Reuters late on Tuesday that he expected the Senate would vote on the bill sometime this week.
"There are various paths and whichever works first is the one that is going to be" followed, he said, referring to the possibility that the Senate could vote on the bill independently or as part of separate legislation.
A spokeswoman for Reid said the unemployment insurance measure could get pushed to next week as lawmakers try to resolve differences over unrelated issues, which would delay consideration of the homebuyer credit extension.
"We will get this extension passed," she said.
A report last week showed sales of previously owned homes hit a two-year high in September as buyers rushed to take advantage of the credit before its expiration date. However, a report on Wednesday showed new home sales, a much smaller segment of the market, tumbled unexpectedly last month.
Separately, a report from the Mortgage Bankers Association on Wednesday that demand for mortgages has fallen for the past three weeks as buyers move to the sidelines.
A buyer would have to close on the purchase of a home before Nov. 30 to take advantage of the current tax credit.
Democrats Agree to Extend Home-Buyer Tax Credit: Dodd
Published: Tuesday, 27 Oct 2009 | 3:31 PM ET Text Size By: Reuters
Top Democrats in the Senate have reached an agreement to extend the soon-to-expire $8,000 tax credit for first-time homebuyers, Senate Banking Committee Chairman Christopher Dodd said Tuesday.
"We have that. Done," Dodd told reporters.
He declined to specify the details of the agreement.
But a Republican who has worked with Dodd cautioned that they were still negotiating on the measure, which could come up for a vote Tuesday evening as part of a package that would extend unemployment benefits.
"We're close, we're close but I can't get into any details until it's a done deal," said Republican Senator Johnny Isakson.
The popular tax credit, which has helped lift the housing market out of its worst slump since the Great Depression, is set to expire on Nov. 30.
Dodd and Isakson want to extend the credit through June of next year and broaden it to anyone buying a primary residence, not just first-time buyers.
Senate Majority Leader Harry Reid had backed a narrower version which would extend the full credit through March and gradually phase it out through the end of 2010.
Dodd said that the deal would merge the two proposals.
The House, which would also need to approve the measure, has yet to act.
The issue is front and center for financial markets. U.S. stocks sold off and the dollar moved sharply higher on Monday after a misleading media headline said research firm ISI Group had written that the tax credit probably would not be extended when it expires Nov. 30.
A Senate vote is expected around 6 pm Tuesday on whether to take up a bill to extend insurance benefits for unemployed workers.
If Senate Majority Leader Harry Reid can get the 60 votes needed to do that, it would clear the way for further votes and he has said he would offer a tax credit extension as an amendment.
It is not clear when those votes would take place. While it is possible those votes could come later on Tuesday night
The home buyer extension not in the bag yet..and what it looks like, if it does pass, might not help a whole lot..especially in view of all the fraud that occurred during the current program. Parents buying homes in their 8 yr old son's name..existing home owners lying about their status..etc. One could say..who cares..a sale is a sale..but congress will find a way to screw it up.