Last week a colleague and I wrote a story about Silver Bay Realty, a new Minnetonka-based real estate investment trust formed by Two Harbors Investment, also headquartered in Minnetonka. Silver Bay was established to acquire and lease thousands of distressed single-family houses throughout the country. Because the company is in its quiet period prior to IPO aimed at raising nearly $300 million, executives were unavailable for an interview. This weekend the New York Times published an interesting story about Silver Bay and other national groups, including the Blackstone Group, that are putting big dollars into acquisition of huge blocks of distressed real estate. The story also explores the background of David N. Miller, Silver Bay's CEO and a former Treasury Department executive who helped lead the department's Troubled Assets Relief Program. Stay tuned for more about Silver Bay's IPO...
U.S. Bank and Wells Fargo are among several national banks that will implement a holiday moratorium on foreclosure sales, according to American Banker. For U.S. Bank the moratorium will last from December 17 through January 2, and Wells Fargo will start halt such proceedings two days later. Wells and U.S. Bank will suspend evictions and foreclosure sales on loans owned by the banks nationwide. Fannie Mae and Freddie Mac took similar actions.
Fewer Minnesotans are having trouble making the mortgage payment, but overall default rates remain high. The latest data on the subject shows that during October one in every 1,119 Minnesota housing units received a foreclosure filing during the month compared with one in 706 housing units nationwide.
For Minnesota, which had the 20th highest foreclosure rate in the nation, that's a 31 percent decrease from October 2011, but a 34 percent increase from the previous month.
Housing advocates say that while the foreclosure rate is still at troubling levels, a strengthening housing market, a slowly improving economy and widespread efforts to help homeowners avoid foreclosure are all helping suppress foreclosure rates -- at least compared with last year.
RealtyTrac's vice president, Daren Blomquist, said that activity levels vary wildly from state to state depending on seasonal factors and state laws regarding processing of those foreclosues. “We continued to see vastly different foreclosure trends across the country in October, depending primarily on how each state’s foreclosing infrastructure was able to handle the high volume of delinquent loans during the worst of the foreclosure crisis in 2010,” he said.
The three states with the bigges annual increases in foreclosure activity were also impacted Hurricane Sandy. That included New Jersey, New York and Connecticut.
Here's a link to the full report.
Even as the housing market improves and mortgage delinquency rates fall, foreclosure proceedings are underway on the sprawling Lake Minnetonka house of pianist Lorie Line and her husband, Tim. Documents filed with Hennepin County say the couple owe more than $2 million on the glitzy 9,100 square-foot Lake Minnetonka house, which was mortgaged for $2 million in 2005.
The news comes on the eve of preparations for Line’s annual holiday tour and that she was unavailable, but Tim Line said that the economy has taken its toll on the family finances, and that the couple plans to use proceeds from the holiday tour to satisfy the outstanding mortgage. "I'm not going to lie," said Tim. "We’re like a lot of small businesses and there aren't a lot of extra entertainment dollars out there...our business has changed dramatically in the last four years."
Citing the need to downsize because they’re empty-nesters, the couple recently put the house on the market for $4 million, which has an assessed value of just under $2.9 million. Property taxes alone are nearly $37,000. (Check out a recent story about the house).
The property is scheduled for sheriff’s auction later this year, but Tim is confident they'll be able to satisfy their debts by the time that happens. “We’re restructuring our business and our lifestyle within this new economy.”
On Tuesday morning (that's Oct. 23) a group of local and national experts will gather at the William College of Law to talk about solutions to the foreclosure crisis and its aftermath. Specifically, the focus of the event will be on tackling the crisis through local and state policies. Prentiss Cox, a University of Minnesota Law professor and expert on foreclosure issues, will moderate the event.
Also appearing: John Taylor, president of the National Community Reinvestment Coalition, Alon Cohen, Center for American Progress, Hazel Erby, St. Louis County Council and Saqib Bhatti, Service Employees International Union.
When: 9 to 11 a.m., Tuesday, Oct. 23
Where: William Mitchell College of Law Auditorium, St. Paul.
To register: click here.
The Twin Cities fared exceptionally well during July, according to the closely watched Case Shiller house price index. Year-over-year prices during July were up more than 6 percent, far outpacing a 20-city composite that showed an increase of 1.2 percent. The Twin Cities was bested only by Phoenix, which saw a 16.6 percent increase. That double-digit jump for Phoenix is primarily a reflection of just how far prices had fallen in that market.
Case Shiller said that month-to-month prices were up in all 20 regions tracked by the report and it was the second month of year-over-year increase for the index - that's something that hadn't happened for two years.
No doubt the report will help bolster confidence that the housing market is on the mend, and by some measures it's considered one of the most accurate measures of what's happening in the market because it tracks repeat sales of the same house based on public records and does not include foreclosures, but critics say that the report isn't the most timely reflection of what's happening because it's based on a rolling three-month average.
Aside from record-low mortgage rates, prices are being lifted by tight inventories and steady declines in the number of foreclosure sales. On Monday the Minneapolis Area Association of Realtors weekly market update showed that overall inventories had fallen to new lows and this morning CoreLogic said that the foreclosure rate in the Twin Cities had fallen .42 percent to 1.62 percent during July. That's below a national average of 3.25 percent.