Fast Facts

Calif. median home price: April 2011: $293,570 (Source: C.A.R.)

Calif. highest median home price by region/county April  2011: Marin $726,060 (Source: C.A.R.)

Calif. lowest median home price by region/county April 2011: Merced $103,890 (Source: C.A.R.)

Calif. Pending Home Sales Index: March 2011: 128.7 (Source: C.A.R.)

Calif. First-time Buyer Affordability Index: First quarter 2011: 53 percent (Source: C.A.R.)

Mortgage rates: Week ending 5/26/2011 30-yr. fixed: 4.60 fees/points: 0.7% 15-yr. fixed: 3.78 fees/points: 0.7% 1-yr. adjustable: 3.11% Fees/points: 0.5% (Source: Freddie Mac)

Weekly Fraud Alert: Federal Audits Accuse Lenders of Defrauding Taxpayers

A set of confidential federal audits accuse the nation’s five largest mortgage companies – Bank of America, JPMorgan Chase, Wells Fargo, Citigroup, and Ally Financial – of defrauding taxpayers in their handling of foreclosures on homes purchased with government-backed loans, according to a story in the Huffington Post.

The audits accuse the lenders of violating the False Claims Act. The audits were completed between February and March, according to four officials briefed on the situation. The internal watchdog office at HUD referred its findings to the Department of Justice, which now must decide whether to file charges.

Source: Huffington Post

Real Estate Investors Set to Become More Active

Real estate investors are expected to be more active in their local markets by a three-to-one margin compared with typical home buyers over the next 24 months, according to a survey released by Move, Inc.

The survey also suggests local markets may be heating up with renewed investor interest and activity, as nearly 70 percent of investors expect it will be easier to find properties in the near future. Real-estate investors (62%) told Move they’re paying more attention to home values in their local markets, and only 43.5 percent say it will be harder to find bargains. Those who are already in the market are starting to feel optimistic, as well as two out of five investors expecting it’ll be easier to sell their properties in the next six months.

An uptick may be in the offing; some investors (22%) are bullish and expect prices to rise in the next six to 12 months, while almost half expect prices to remain relatively the same. Nearly a quarter of real estate investors expect prices will fall in the next six to 12 months

It is set to get heated out there. The Move Investor survey also suggests investors may be positioned to compete vigorously with traditional first-time homebuyers for hot deals:

65.5 percent said they expect the problems first-time buyers are having in getting mortgages will make it easier for them to compete for properties.

18.5 percent say they’ll be cash-only buyers, a strategy that’s out of reach for most first-time buyers.

80.5 percent expect cash discounts from sellers.

Source: Move, Inc.

Home Prices Nationwide Increase in April Compared With March

CoreLogic’s April Home Price Index increased on a month-to-month basis by 0.7 percent between March and April, marking the first such increase since the conclusion of the federal home buyer tax credit. 

However, home prices nationwide, including distressed sales, declined by 7.5 percent in April 2011 compared with a year earlier. Excluding distressed sales, year-over-year prices declined 0.5 percent in April 2011 compared with April 2010 and by 1.6 percent in March 2011 compared with March 2010. Distressed sales include short sales and real estate owned (REO) transactions.

Source: CoreLogic

California Housing Starts Rise 2 Percent in April

Total housing starts in California, as measured by the number of building permits issued, rose 2 percent in April, according to the California Building Industry Association.

According to statistics compiled by the Construction Industry Research Board (CIRB), builders pulled permits for 3,474 total housing units in April, an increase of 2 percent compared with the same month a year ago, but down 23 percent from March.  Permits for single-family homes totaled 1,978, down 16 percent from April 2010, but up 10 percent from the previous month, while multifamily permits totaled 1,496, up 43 percent from a year ago, but down 45 percent from March.

Source: California Building Industry Association

Short Sale Soundoff: 2011 Short Sale Research Study

CoreLogic recently announced the release of its 2011 Short Sale Research Study, “CoreLogic Analysis on Short Sale Trends, Risks, and Opportunities.” The study was designed to take a rigorously scientific, data-driven look at current trends in short sales and to identify inherent risks and opportunities associated with these transactions.

“Suspicious” short-sale transactions are those where a lender may have incurred unnecessary losses due to the short sale transaction quickly followed by a resale transaction for a substantially higher price where that higher price is not supported by an underlying increase in property value. The focus of the study was to quantify the potential losses associated with these suspicious short-sale transactions.

“This study reveals that short sales that show another sale transaction closing on the same day account for 16 percent of all suspicious short sales in the industry. These same-day resales are on average $50,000 greater than the lender agreed upon short sale price,” said Tim Grace, senior vice president of Product Management and Analytics at CoreLogic. “The study also validates an industry perception related to Limited Liability Company buyers in short-sale transactions: while they comprise only two percent of all buyers, they comprise more than 25 percent of buyers in suspicious short-sale transactions.”

Key findings from the study include:

It is estimated that lenders, servicers, and investors may incur potential losses in excess of $375 million in 2011 due to suspicious short sale transactions. This is up more than 20 percent from $310 million in estimated losses for 2010.

Rates of suspicious transactions are on the rise. In the first half of 2010, approximately one in every 52 (1.9 percent) short sale transactions appears to be suspicious, wherein the lender may have incurred unnecessary loss.

Some of the states with the largest short sale volume (California, Arizona, Colorado, and Florida) are now the same states with the highest rates of suspicious short-sale transactions. This convergence results in maximum negative impact on the industry.

Source: CoreLogic

Home Prices Decline 4.2 Percent in First Quarter

The latest S&P/Case-Shiller Home Price Indices show that the U.S. National Home Price Index declined by 4.2 percent in the first quarter compared with the fourth quarter.  Nationally, home prices are back to their mid-2002 levels.

The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 5.1 percent decline in the first quarter of 2011 compared with the first quarter of 2010. In March, the 10- and 20-City Composites posted annual rates of decline of 2.9 percent and 3.6 percent, respectively.

Source: S&P/Case-Shiller