By Matt Woolsey
Forbes.com

The fastest-growing suburb in the country is Lincoln, Calif., just outside Sacramento. Its population jumped from 11,746 to 39,566, or an increase of 236%. The fastest-growing big suburb (with a population of 100,000 or more) is Gilbert, Ariz., outside Phoenix, which expanded from 112,766 people to 191,517.

While not cheap by national standards, the growth in Sacramento’s outerlying areas is strong because it’s a less-expensive alternative to Los Angeles, San Francisco or San Diego. The Phoenix area saw the greatest positive domestic migration of any American metro last year, with 115,000 more people moving into town than leaving. Affordable housing and a growing economy draw a lot of people to the city.

Rounding out the top 10 fastest-growing suburbs after Lincoln were four Phoenix suburbs: Buckeye, Surprise, Goodyear and Avondale; Plainfield, outside of Chicago; Beaumont, outside San Bernardino, Calif.; Frisco and Wylie outside of Dallas; and Woodstock, outside of Atlanta.

While Los Angeles is sometimes called the “Sultan of Sprawl”, not one of its suburbs makes the list.

Instead, Angelinos are packing their bags and heading 60 miles east to San Bernardino, where twelve of the country’s 100 fastest-growing suburbs are located. Leading the pack? Beaumont. It has experienced 130% growth since 2000.

read more HERE

WASHINGTON (Reuters) - Sales of new homes fell 6.6 percent in June to a lower-than-expected level and prices slumped from May, according to a government report on Thursday that pointed to ongoing weakness in the housing sector.

New single-family home sales fell to an annual rate of 834,000 from a revised rate of 893,000 in May, the Commerce Department said.

Analysts polled by Reuters were expecting June sales to fall to an 895,000 unit pace from a previously reported rate of 915,000 units in May.

In June, the median sales price of a new home fell 1.3 percent to $237,900 from $241,000 in May.

There were 537,000 new homes for sale in June, holding the same level reported in May. It would take 7.8 months to clear that inventory at the current sales pace, up from the 7.4 months reported in May.

more at the Washington Post

By JAMES R. HAGERTY and RUTH SIMON
from The Wall Street Journal

Tighter credit is prolonging a deep slump in home sales, but a quarterly Wall Street Journal survey of 28 major metro areas shows that the surge in inventories of unsold homes is slowing. In two of those markets — Boston and Denver — the number listed for sale has actually declined from a year ago.

The latest trends offer some hope for an eventual recovery in a U.S. housing market that generally has been cooling since mid-2005. Even so, many economists and industry executives say that recovery will be very gradual and won’t start before 2008 at the earliest. That’s partly because more’stringent lending policies are keeping many potential buyers on the sidelines, while others are holding off in hopes of prices heading even lower. Meanwhile, there is still a glut of homes on the market in much of the country, especially in Florida and parts of Arizona, Nevada and California.

Home sales and prices generally should bottom out around mid-2008, says Mark Zandi, chief economist at Moody’s Economy.com, a research firm in West Chester, Pa. “The market will not revive quickly, however,” he says. “It won’t be until the turn of the decade before housing activity returns to more normal conditions.”

The message for home sellers is that they need to be flexible on price and may have to spruce up their house to stand out against plenty of competition, including from builders desperate to shed inventory. In Atlanta’s southwestern suburbs, builder Winstar Neighborhoods is offering free Chevrolet Aveo subcompacts to buyers of certain new homes. Given the glut, buyers in most markets can take their time and bargain hard on price.

read more at The Wall Street Journal

By VIKAS BAJAJ

Countrywide Financial, the nation’s largest mortgage lender, said yesterday that more borrowers with good credit were falling behind on their loans and that the housing market might not begin recovering until 2009 because of a decline in house prices that goes beyond anything experienced in decades.

The news from Countrywide, widely seen as a bellwether for the mortgage market, initiated a sell-off in the stock market, which is at its most volatile in more than a year. The Standard & Poor’s 500’stock index fell 30.53 points, or 2 percent, to 1,511.04, its biggest one-day drop in nearly five months. The dollar dropped to a new low against the euro, edging closer to $1.40 to 1 euro. Stocks opened sharply lower in Japan this morning.

The slumping housing market has become the biggest worry for the stock market, which just four days ago set records, because of its potential impact on the broader economy and financial system.

Countrywide’s stark assessment signaled a critical change in the substance and tenor of how housing executives are publicly describing the market. Just a couple of months ago, some executives were predicting a relatively quick recovery and saying that most home loans would be fine with the exception of those made to borrowers with weak credit who stretched too far financially.

Executives at Countrywide had for some time been more skeptical than others but the bluntness of their comments yesterday surprised many on Wall Street. In a conference call with analysts that lasted three hours, Countrywide’s chairman and chief executive, Angelo R. Mozilo, said home prices were falling “almost like never before, with the exception of the Great Depression.”

read more at The New York Times

Just for fun, we thought we’d add this advertisement from The New York Times website, just in case you’re interested. Enjoy. - JS

1 CENTRAL PARK WEST CONDOMINIUM (Upper West Side)

The Space
Rooms: 16.0
Bedrooms: 6
Bathrooms: 8.0
Library: Yes
Kitchen: Eat In
Windowed kitchen: Yes
River views: Yes
Park views: Yes

Period: Post-War
Built: 1996
Building Type: Hirise
Doorman: Yes
Attended lobby: Yes
Concierge: Yes
Elevator attendant: Yes
Roof garden: Yes
Health club: Yes
Pool: Yes
Garage in building: Yes
Laundry in building: Yes

How about this price and taxes!
Listing ID: 228094
Last updated: 6/29/2007
Type: Condominium
Price: $29,750,000
Maintenance/CC: $7,700
Monthly real estate tax: $8,100
Approx. square footage: 5,778

That’s right. For just under 30 million dollars, this can be all yours!

Talk about real estate boom. Wonder if they’ll drop the price to 29.4 ML ?

By Chris Reese
from YAHOO! NEWS

NEW YORK (Reuters) - U.S. new home sales in May fell more than expected while consumer confidence in June fell to a 10-month low amid anxiousness about jobs and the business climate, adding to signs of sluggish economic growth this year.

Sales of new U.S. homes fell 1.6 percent last month to an annual rate of 915,000 from a downwardly revised rate of 930,000 in April, the Commerce Department said on Tuesday. Analysts had been looking for May new home sales of 925,000.

While sales fell, sales prices rose. The median sales price of a new home climbed 1.5 percent in May to $236,100 from $232,700 in April. That marked a reversal for new homes from April, when prices fell a record amount but sales rose strongly.

“Housing’s contribution to (economic) growth will be negative in both the second quarter and the third quarter,” said Steven Wood, chief economist at Insight Economics in Danville, California.

CONFIDENCE SLIPS

Consumer confidence in June also fell more than expected.

The Conference Board said its index of consumer sentiment fell to 103.9 this month, the weakest since August 2006, from an upwardly revised 108.5 in May. Economists polled by Reuters had been looking for a reading of 105.5.

The data as a whole had little impact on the bond market, but stocks erased early gains on the relatively gloomy economic news.

read more at YAHOO! NEWS

And this won’t effect the economy? Riggghhhtttt!

June 12 (Bloomberg) — U.S. foreclosure filings surged 90 percent in May from a year earlier as more homeowners fell behind on their monthly mortgage payments, RealtyTrac Inc. said.

There were 176,137 notices of default, scheduled auctions and bank repossessions last month, led by California, Florida and Ohio, the Irvine, California-based seller of foreclosure data said in a report today. The median price for a U.S. home slid 1.8 percent the first three months of 2007 as the housing slump entered its second year, according to the National Association of Realtors. The filings rose 19 percent from April.

A jump in foreclosures at a time of year that traditionally is the busiest for home sales means the slide in prices probably isn’t over, said James Saccacio, chief executive officer of RealtyTrac. Typically, more than half of all home sales occur in the April to June period, according to Freddie Mac, the No. 2 mortgage buyer.

More at Bloomberg

Actually, the headline should read “Home Sellers Taking It In The Shorts”. - JS

from YAHOO!
By MARTIN CRUTSINGER, AP Economics Writer

WASHINGTON - Sales of new homes surged in April by the biggest amount in 14 years, but the median price of a new home dropped by the largest amount on record. The mixed signals left no clear picture of whether the worst of the nation’s housing slump is over.

The Commerce Department reported that sales of new single-family homes jumped by 16.2 percent in April to a seasonally adjusted annual rate of 981,000 units. That was far better than the tiny 0.2 percent gain that economists had been expecting.

However, the median price of a new home sold last month fell to $229,100, a record 11.1 percent decline from the previous month. The big price decline indicated that builders are slashing prices in an effort to move a huge overhang of unsold homes.

The jump in sales was the biggest increase since a 16.4 percent surge in new home sales that occurred in April 1993.

However, analysts cautioned against reading too much into the big gain, especially in light of other surveys showing that builder confidence has sunk in recent months over worries that troubles in the subprime mortgage market will further crimp demand in coming months.

The strength in sales was led by a 27.8 percent surge in the South. Sales were also up in the West by 8.5 percent and in the Northeast, where they rose 3.8 percent.

Sales fell in the Midwest, dropping by 4 percent.

read more at YAHOO! NEWS

US mortgage giants Fannie Mae and Freddie Mac are developing new types of loans to help borrowers with high-risk mortgages avoid losing their homes.
The move comes amid turmoil in the sub-prime lending market, which offers higher priced loans to people with low wages or poor credit histories.

With US home repossessions hitting a record high last year, the situation has caused concern on Wall Street.

The two firms are looking at “more consumer-friendly sub-prime products”.

‘Challenging task’

Sub-prime mortgages are typically variable rate, starting with a low interest rate which can then rise sharply.

Fannie Mae and Freddie Mac said they were aiming to introduce new 30-year, and possibly 40-year, fixed rate deals, with the chance for existing sub-prime customers to switch.

Their announcement came after a high-level group of mortgage industry executives, federal officials and bankers met to discuss the difficulty in the sub-prime market.

They have agreed on a goal of keeping deserving borrowers with high-risk mortgages in their homes.

“It is going to be a very challenging task…we’ve not going to be able to save everybody,” said Sheila Bair, chairman of the Federal Deposit Insurance Corporation.

More at BBC.com

Bur$atil has been posting alot about the housing bubble. It’s BAD down here. I live right down the road from the hospital they are speaking about in this article. There’s more brand new EMPTY houses than you can count. Since I’ve been here I can’t tell you how many people in the neighborhood have lost their homes already. They pre-purchased, moved in when the homes were built, the taxes and insurance went through the roof….. they can’t re-mortgage……and BAM……they’re out on the street. The shame of this is……they are going to build MORE housing units for employees, when there’s already soooooo many here, but that workers can’t afford. And my question is, why in God’s name do the developers keep building unaffordable housing? Who do they think is going to move in? Why not build moderate priced housing so people can actually afford to live here? Doesn’t make sense to me.

MIAMI — As chief executive of South Florida’s largest health organization, Brian Keeley never dreamed he’d be contemplating fabric swatches and paint samples. Then again, he never thought he’d be jumping into the housing business.

But faced with the prospect of opening a sixth hospital without the 800 employees needed to staff it, Baptist Health South Florida plans to build and/or buy affordable rental housing to attract nurses and other workers.

“No deposits. No owner leases. Just move right in. We’ll even decorate it for you,” Keeley said. “The sole condition is you have to work for us.”

Baptist Health is not alone. Miami-Dade’s second-largest employer, the University of Miami, and the much tinier Keys Federal Credit Union have plunged into the housing market, signaling the emergence of a trend that, experts say, will spread across the state.

“Employer-assisted housing is the new buzz, the coming thing,” said Jaimie Ross, president of the Florida Housing Coalition. “South Florida will see it first because that’s where housing prices are highest, but it will work its way up.”

In January, the statewide median price of a single-family home slipped by 2 percent over the previous year to $239,300, but, according to a 2005 census estimate, the median household income in Florida hovers near $42,000. That’s a ratio of nearly 6-to-1.

Nowhere is the mismatch greater than in South Florida, where the median price of a single-family house averages more than $380,000. That’s seven times higher than the median household income in Broward and Palm Beach counties, and eight times more than in Miami-Dade, according to Ned Murray, an urban planner at the Metropolitan Center of Florida International University.

“Before the market exploded in 2004, the ratio between home value and median household income was about 4-to-1, a gap that could reasonably be filled by various government programs,” Murray said. “But when we get to a 7-to-1 or 8-to-1 ratio, all government programs fail. I think that’s bringing employers to the forefront.”

Doing the math — and listening to departing staffers — is what brought Keeley to the same conclusion.

Baptist’s chief executive said many employees, giddy over escalating home values but fed up with rising property taxes and homeowners insurance, are cashing in on their houses and moving to the “new Florida” — the Carolinas, Tennessee and Georgia.

Full article at the Sun Sentinel