Housing News
Freddie Mac is bleeding money, still asks for $10.6 billion more
Freddie Mac hemorrhaging
Today, Freddie Mac announces their first quarter numbers, reporting that with a $6.7 billion loss and requests that the Treasury Department issue a $10.6 billion bailout. The Treasury lifted the $100 billion limit on Freddie Mac last December, indicating there is room for more money to be handed out.
Between Freddie Mac and counterpart Fannie Mae, a total of $137.5 billion has already been received from the Treasury since it took over both companies in 2008.
Although recent signs point to a real estate recovery, politicians continue to appear to be indecisive about how to handle the situation ranging from more regulation to abolishing Fannie and Freddie altogether.
Sticking point for both Republicans and Democrats
New Jersey Representative Scott Garrett (R) said, “I find it mind-blowing that Democrats reject the opportunity to engage in a serious conversation about reforming the entities that are clearly the government’s biggest toxic liabilities.” Garrett continues his criticism saying, “Taxpayers are continually losing money on these failed enterprises, and at some point, we must say enough is enough.”
Massachusetts Representative Barney Frank (D) has called for a complete abolishment of Fannie Mae and Freddie Mac which of course means he would replace it with a system of his own.
ABC News reports that “thus far the administration’s only action has been the April 14 release of a series of questions for public comment on what to do with the mortgage giants.”
It is unclear what the next move is, as Timothy Geithner, Secretary of the Treasury notes that no major changes will be made in the next year.
CC Licensed image courtesy of stuartpilbrow via Flickr.com.
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Housing News
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
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Housing News
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.
…Click here to continue reading this story…
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Joe Loomer
May 6, 2010 at 8:25 pm
The Kings and Queens of rhetoric are fighting their battles as the serfs and paupers suffer in this feudal system. Truly amazing how much political banter and posturing can be pulled out of every little nuance and gesture. Ain’t change grand! Doesn’t look any different to me.
Navy Chief, Navy Pride
Jonathan Benya
May 7, 2010 at 3:48 pm
Just another day in Washington it seems. I wonder how much complete indecision here is costing the American taxpayers? I don’t really have an opinion on what should or shouldn’t be done, but aren’t the politicos getting paid to actually work on this issue rather than just sit and watch on the sidelines?
Missy Caulk
May 8, 2010 at 11:26 am
My bank was closed my FDIC that held my loan and the loan is now overseen by Freddie. The now closed bank told us to mail our May payments there. I called them and said, NOT without a loan number.
Finally got the loan number on May 1st and mailed it. I always mail it early to hit their account on May 1st.
Let’s see today is the 8th and it still has not hit my bank account. In 28 years of home ownership I have never been late, and was NOT happy about the loan being overseen by their processing company.
I heard the gov’t controls 96% of all home loans now….have you heard that? Scary if true.