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Posted
Aug 12 2009, 10:16 AM
by
Jim Jubak
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Psst! Want to make some money from the collapse in commercial real estate? Here’s a fund manager who knows how.
The commercial real estate sector is in chaos. And the market is still collapsing, with delinquencies on commercial mortgages still climbing (see this post).
You'd think there would be money to be made out of that situation if you can pick the winners and avoid the soon-to-go-bust. And you'd be right.
Bing: The commercial real estate market
I don't have any faith in my own ability to sort through the haystack of commercial real estate stocks, trusts, partnerships, and what not. I know I don't have the experience or the contacts in real estate to separate the sinking ships that will indeed go to the bottom from the sinking ships that will ultimately survive the storm.
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Posted
Aug 04 2009, 10:41 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 The next shoe to drop in the real estate downturn? Commercial properties, which are seeing rising defaults on loans that were bundled together into commercial mortgage-backed securites, The Economist notes.
The housing market may be on the path to recovery at this point. But commercial property sales are way down because no one wants to sell at a loss. "Those owners are implicitly assuming that a rebound is imminent, yet the downturn may be prolonged," writes the magazine. That's going to hurt banks, which are slow to write down property loans. The issue really won't be forced until the loans come due to be refinanced.
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Posted
Jun 30 2009, 12:25 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
It's official: California is broke.
For months, the most populous U.S. state has been in the throes of a historic budget crisis, as lawmakers have repeatedly failed to agree on how to resolve a $24 billion deficit.
What was once the country's richest state is preparing to issue IOUs to a host of creditors, according to the Financial Times. Among the dubious recipients of these IOUs: contractors, information-technology companies and food-service groups that cater to prisons. Funding for education and interest payments on its bonds are guaranteed by state law.
Gov. Arnold Schwarzenegger is taking a hard line with legislators, accusing them of offering up a piecemeal solution to the state's woes: "I will veto any majority tax increase bill that punishes taxpayers for Sacramento's failure to live within its means. It's time for the Legislature to send me a budget that solves our entire deficit without raising taxes," the Governator said Monday.
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Posted
Jun 10 2009, 04:00 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Housing inventory came down a bit in May, but not enough to put a real foundation on faltering home prices. ZipRealty reported “the supply of homes available for sale in 28 major metropolitan areas at the end of May was down 3.9% from a month earlier.”
ZipRealty figures do not include many houses in foreclosure because banks have not put all of them on the market.
The slight improvement in home inventory is misleading. There is no evidence that home prices have stopped falling. Government figures show that even homeowners who renegotiate mortgage payments to lower amount end up defaulting in record numbers. Unemployment is likely to hit 10% by Labor Day and many economists expect it to stay at that level into next year. Rising joblessness almost certainly means more abandonment of homes.
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Posted
May 20 2009, 03:35 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
The housing market and housing starts are still facing deep and intractable problems. Mortgage rates may be low, but bank standards for home loans are higher. No financial firm wants to be stuck owning more houses that have been foreclosed upon. Developers won’t build what they cannot sell.
Homes are also less likely to sell in the future as unemployment rises toward 10%. If joblessness goes into the double digits and stays there for several quarters, a recovery of the housing market will be nearly impossible.
The only group that seems to have confidence in a recovery in housing prices is vulture investors who are taking advantage of home values that have dropped 50% to 60% in some markets. According to The Wall Street Journal, the vultures often go house-to-house looking for the best prospects. The paper writes that “some are spending their days looking for deals in far-flung suburbs and staking out courthouse auctions.”
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Posted
Apr 16 2009, 02:00 PM
by
Andrew Horowitz
Rating:
Money Blog: Top Stocks Blog - MSN Money
 It appears we are on an unstoppable journey toward higher foreclosures and delinquency levels than we have seen in decades. The change over the last few months has been startling, and the East Coast states are holding many of the top positions, with Rhode Island leading the list during the past few months.
We have seen the 90+ day delinquency rate for properties go from a weighted average of 0.09% in May of 2007 to 0.25% in May 2008. Now it's edging toward 1%. But the problem is really with the worst areas, seen below.
Commercial Real Estate Delinquencies as of 4/2009
- Rhode Island 3.58%
- Montana 2.65%
- Florida 2.48%
- Indiana 2.45%
- South Carolina 2.38%
- Arizona 2.32%
- Michigan 2.10%
- Nevada 2.04%
- Tennessee 2.02%
- Hawaii 1.78%
Foreclosure rates are also moving higher as such states as Michigan, Nevada and Georgia all approach 1% this month. It is getting so bad that
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Posted
Mar 06 2009, 01:50 PM
by
Matt Koppenheffer
Rating:
Money Blog: Top Stocks Blog - MSN Money
The housing market is a mess, and I have a feeling that we'll be seeing criminal fallout from shady deals coming to light for a long time. For investigators it will be like playing real estate Whac-A-Mole -- if all the moles popped up at the same time. One area that seems like it will be ripe with ne'er-do-wells is the real estate appraisal industry. Though I imagine most appraisers stuck with the conventions of the industry (even though I'm not sure I agree with those conventions), many mortgage fraud schemes wouldn't have gotten off the ground in the first place without an appraiser that would play along. Why do I bring this up? Even with all the other shenanigans going on out there -- Citigroup, Bank of America, John Thain, Bernie Madoff -- the story of this convicted appraiser jumped out at me. Read More...
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Posted
Jan 22 2009, 08:01 AM
by
Andrew Horowitz
Rating:
Money Blog: Top Stocks Blog - MSN Money
The earnings stampede continues. Apple's (AAPL) news of higher-than-expected numbers seemed to be a temporary relief to what was gearing up to be an ugly season. Early on in today's session, Google (GOOG) was riding on the coat tails of the initial market move higher from the overnight excitement surrounding the Apple announcement. Even with the downturn today (which has erased most of yesterday's gains), there remains a hopeful outlook for the Tech sector.
What we know is that Google has made giant strides in increasing its market share beyond search. What we need to know is how the global downturn will effect earnings since the majority of Google's earnings is based primarily on advertising revenue.
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Posted
Dec 15 2008, 05:05 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
What's the best route as you near retirement: Use extra money to pay off the mortgage or pad your investments? That question deserves a new look in light of the economic events of 2008, argues Mr. GoTo, a baby boomer and blogger who comes down on the side of paying off the house. The No. 1 reason: A guaranteed rate of return of 6% (or whatever your mortgage rate is) tax-free. "Compare that to what we have experienced in the markets recently," Mr. GoTo says.
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Posted
Nov 14 2008, 05:12 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
"Miss M" at M is for Money has a sense of humor about her predicament. She called her post "If my house is underwater, where is my ocean view?" This post will help people who live where housing prices are reasonable and stable -- yes, these places exist -- to understand how others could owe more on their homes than they're worth. For those of you who have firsthand experience with this problem, maybe you won't feel so all alone.
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