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MBA Advocacy Update
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As Congress continued its recess, activities in Washington were punctuated on Tuesday night by the second Oval Office address of the President's term and discussion over the weekend of a possible new stimulus package.
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Commercial/Multifamily News |
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Article Abstracts |
Top National News |
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New Council of Regulators to Tackle Systemic Risks
Washington Post (DC) (09/07/10) P. A11 Dennis, Brady
The new Financial Stability Oversight Council is expected to hold its first meetings regarding how it plans to monitor the entire financial system for systemic risks; how to identify and supervise firms that could pose systemic risks; and how to prevent firms from becoming so large, complex and leveraged that they pose a danger to the global economy. The council -- which will be led by Treasury Secretary Timothy Geithner and include the heads of federal financial regulatory agencies -- will direct regulators to issue new rules governing capital, liquidity and leverage levels and impose restrictions on systemically important firms. If firms become too risky, the council must reach a two-thirds majority to break them up.
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The Good News About Rising Mortgage Rates
Wall Street Journal (09/07/10) Evans, Kelly
The Mortgage Bankers Association's upcoming data on mortgage-application activity might show whether the prospect of higher mortgage rates is spurring consumers to buy homes; mortgage rates tend to move in lock-step with bond yields, which suddenly rose by a significant amount on Friday. Federal Reserve policy makers want to keep mortgage rates low to boost the economy and the housing market, and some observers believe they will introduce more policy-easing measures at their next meeting on Sept. 21. Still, the Fed is unlikely to make hasty decisions, considering the central bank may be willing to live with risk that gets people to buy homes due to concerns that rates will rise even further.
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Ginnie Mae Mortgage-Backed Securities Have a Solid Record
USA Today (09/07/10) Waggoner, John
Mortgage-backed securities guaranteed by the government or packaged by Fannie Mae or Freddie Mac have become a top-performing investment. Meanwhile, the average mutual fund that invests in MBS issued by Ginnie Mae has risen 24.8 percent over the past three years, including reinvested interest, according to Lipper. The government's placement of Fannie Mae and Freddie Mac in receivership provided MBS with a boost, and interest soared when the Federal Reserve announced it would buy $1.25 trillion of MBS.
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BLB Says Mortgage Jobs Rose in July
American Banker (09/07/10) P. 8 Collins, Brian
The Bureau of Labor Statistics reports a 1 percent increase in employment in the mortgage industry to 246,700 in July from the prior month, with a jump in refinancing applications prompting firms to take on 2,300 full-time employees. The Mortgage Bankers Association says 78 percent of mortgage applications were for refinancings in July, marking the highest level since spring 2009.
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Save Your House
Washington Times (09/07/10) P. B1 Cole, Rebel A.
DePaul University real estate and finance professor Rebel Cole says efforts to modify mortgages for struggling homeowners have failed largely because second-lien holders are unwilling to take losses, and homeowners do not qualify for assistance when they default on their first mortgages and continue making payments on their second. Cole says federal bank regulators could put a stop to problems in the Home Affordable Modification Program by requiring second liens to be classified as severely delinquent as first liens, but he believes they are hesitant to do so because Bank of America, Citibank, J.P. Morgan Chase and Wells Fargo hold more than $400 billion in second liens and would face capital constraints as a result.
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Employment Stays in Holding Pattern
Nonfarm employment fell by 54,000 in August, with private sector employment increasing by 67,000 to partially offset a 121,000 decline in government jobs, 114,000 of which were temporary Census positions, the Bureau of Labor Statistics reported Friday.
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The Week Ahead
Congress spends one more week away from Washington; the House and Senate return to Capitol Hill on Sept. 13.
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Commercial Briefs
Mariner Real Estate Management LLC, Leawood, Kan., a real estate investment and management firm, purchased a portfolio of nearly $760 million in real estate loans from the Federal Deposit Insurance Corp.
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Dealmaker of the Day
Bellwether Real Estate Capital LLC, Cleveland, Ohio, originated $82.5 million in financing for office, retail, industrial and multifamily properties in Ohio.
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QuoteLink
"Despite weak CRE fundamentals and increasing levels of delinquencies and defaults, 90 percent of CMBS loans are still performing."
--Kingsley Greenland, CEO of Debt X, New York.
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