Home Sales Not Leading Any Recovery

One in three home sales during the first quarter of 2010 was a foreclosure. There were 1.2 million foreclosure sales in 2009, a four year increase of 2,500%.

Bipartisan Home Ownership Assistance Proposal

Republican Senator Johnny Isakson of Georgia and Democratic Senator Chris Dodd of Connecticut are introducing a $16.7 billion proposal to extend the $8,000 first time home buyer tax credit through June 30, 2010, and making it available to single filers earning up to $150,000.00 and joint filers making up to $300,000.00. The Senators expect to offer their proposal as amendment to legislation scheduled for floor action this week.

Obama Administration To Commit $35 Billion For Mortgage Lending By Local Housing Agencies

Under the authority of the 2008 Housing and Economic Recovery Act, the Treasury Department, Fannie Mae and Freddie Mac are polishing the details of a new Obama administration program to purchase up to $35 billion in municipal debt to be issued by local government Housing Finance Agencies, which provide lower interest mortgage loans to first time and low income home buyers, usually at rates 0.5% to 1.0% lower than commercial lenders in the private sector. The new program is expected to buy $20 million in newly issues municipal housing bonds, plus another $15 million in variable rate demand obligations issued by the HFAs.

HFAs have financed home purchases for about 2.6 million families. Rising interest rates in the municipal bond market have choked off new lending by many HFAs, and as a result, affordable mortgage loans for low income and first time home buyers have dried up, delaying recovery of the housing construction market. While some in Congress object to the reentry of Fannie Mae and Freddie Mac into this segment of the home purchase financing market, the Obama administration seems to have a laser focus on continuing to promote home ownership among the less fortunate as one way of attacking the nation's economic woes. If your business is involved in housing construction, you should be watching eagerly for this program to be launched.

Florida Legislation Would Restrict Claims Against Home Builders

State Representative Gary Aubuchon of Cape Coral, Florida has introduced a bill into that state's legislature which would restrict the ability of new home buyers to sue their builders over construction problems. The bill tightens the requirements that home purchasers provide detailed written notice of problems to the builder, provide written documentation of the defects, and promptly respond to requests for information. Home buyers must give the builders a change to repair the problem before filing suit, and are penalized for delays in providing requested information.