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Market Data: US housing starts jump 9.3 percent Economy: Home builders still supporting communities Financing: William Lyon Homes receives support Legal Notes: California suing Fannie and Freddie Senior Housing: Low-income NYC nursing home building sells
Both housing starts and permits rise sharply in November, largely on the strength of multi-family units Privately owned housing starts in November were at a seasonally adjusted annual rate of 685,000. This is 9.3 percent above the revised October estimate of 627,000 and is 24.3 percent above the November 2010 rate of 551,000. Single-family housing starts in November were at a rate of 447,000; this is 2.3 percent above the revised October figure of 437,000. The November rate for units in buildings with five units or more was 230,000. Privately-owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 681,000. This is 5.7 percent above the revised October rate of 644,000 and is 20.7 percent above the November 2010 estimate of 564,000. Single-family authorizations in November were at a rate of 435,000; this is 1.6 percent above the revised October figure of 428,000. Authorizations of units in buildings with five units or more were at a rate of 224,000 in November.
Sales of existing homes in November rise to ten-month high Existing-home sales rose again in November and remain above a year ago, according to the National Association of Realtors. Also released today were periodic benchmark revisions with downward adjustments to sales and inventory data since 2007, led by a decline in for-sale-by-owners. Although re-benchmarking resulted in lower adjustments to several years of home sales data, the month-to-month characterization of market conditions did not change. There are no changes to home prices or month's supply. The latest monthly data shows total existing home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 4.0 percent to a seasonally adjusted annual rate of 4.42 million in November from 4.25 million in October, and are 12.2 percent above the 3.94 million-unit pace in November 2010. NAR chief economist Lawrence Yun said more people are taking advantage of the buyer's market. "Sales reached the highest mark in 10 months and are 34 percent above the cyclical low point in mid-2010 - a genuine sustained sales recovery appears to be developing," he said. "We've seen healthy gains in contract activity, so it looks like more people are realizing the great opportunity that exists in today's market for buyers with long-term plans." Home builder confidence climbs to highest level since May 2010 The National Association of Home Builders/Wells Fargo index of builder confidence climbed to 21, the highest level since May 2010, from a revised 19 in November that was lower than first reported, the Washington-based group said today. Economists projected an index of 20, according to the median forecast in a Bloomberg News survey. Readings below 50 mean more respondents said conditions were poor. Confidence among U.S. homebuilders rose in December for a third consecutive month, a sign of stabilization in the housing market. Mortgage applications decline by 2.6 percent even as rates drop to new 2011 low Mortgage applications decreased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending December 16, 2011. The Market Composite Index, a measure of mortgage loan application volume, decreased 2.6 percent on a seasonally adjusted basis from one week earlier. The Refinance Index decreased 1.6 percent from the previous week. The four week moving average for the seasonally adjusted Market Index is up 0.26 percent. The four week moving average is down 1.53 percent for the seasonally adjusted Purchase Index, while this average is up 1.32 percent for the Refinance Index. MBA study shows potential buyers ready to commit but seller sentiment remains negative Prospective homebuyers believe now is a good time to buy, given today's low home prices and low mortgage interest rates, but potential sellers are nearly unanimous in reporting that it is not a good time to sell a home, citing difficulty in finding buyers at desired sales prices, according to a study released today by the Mortgage Bankers Association (MBA). The study entitled "The Great Recession and Attitudes Toward Homebuying," conducted by Gary V. Engelhardt, Professor at Syracuse University and sponsored by MBA's Research Institute for Housing America (RIHA), utilizes 30 years of data from the University of Michigan's Survey of Consumer Attitudes to examine consumer attitudes toward homeownership before, during and after the most recent recession to see if consumer sentiment changed toward home buying and selling.
US housing starts jump 9.3 percent 
BloombergBuilders broke ground in November on more houses than at any time in the past 19 months, led by a surge in multifamily units, signaling the market is stabilizing heading into 2012. Starts increased 9.3 percent to a 685,000 annual rate, exceeding the highest estimate of economists surveyed by Bloomberg News and the most since April 2010, Commerce Department figures showed. Building permits, a proxy for future construction, also climbed to a more than one-year high. Work on multifamily units like apartments and townhouses is growing as the rental market improves. Single-family-home construction may be starting to strengthen as lower home prices and borrowing costs near record lows draw in some buyers. Builder confidence rises for third consecutive month NAHB Builder confidence in the market for newly built, single-family homes edged up two points from a downwardly revised number to 21 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) for December. This marks a third consecutive month in which builder confidence has improved, and brings the index to its highest point since May of 2010. “While builder confidence remains low, the consistent gains registered over the past several months are an indication that pockets of recovery are slowly starting to emerge in scattered housing markets,” said Bob Nielsen, chairman of the NAHB. NAHB Chief Economist, David Crowe, said, “This is the first time that builder confidence has improved for three consecutive months since mid-2009, which signifies a legitimate though slowly emerging upward trend.” 38 percent of homes paid with cash 
Housing IntelligenceDespite record low mortgage rates, 2011 has seen a surprisingly high level of cash home purchases. Between tight lending standards and a desperate search for yield by investors, cash purchase of homes (especially distressed properties) became even more common in 2011 than last year. According to data from Housing IntelligencePro, 38 percent of homes purchased in 2011 were bought with all cash. That’s up from 34 percent in 2010, and double the 19 percent rate in 2006. The trend is likely to continue in the near term, with investors being responsible for an increasing share of home purchases as prior home owners abandon the ownership market and head back to rentals. Demand for rentals drives big rise in home building The Wall Street Journal Residential construction surged in November, sparking cautious hope that the U.S. housing market is gaining traction. Housing starts hit a seasonally adjusted annual rate of 685,000 units, the highest level in 19 months, the Commerce Department said. Starts in November were up 9.3 percent from October and 24.3 percent ahead of the November 2010 figure. Much of November's increase came from the construction of apartments, town houses and other multifamily developments, evidence that rising demand for rental housing has encouraged developers to begin building again. Starts of residential developments with two or more units saw a 25.3 percent increase, while starts of single-family homes, which make up about 65 percent of the housing market, rose 2.3 percent. Separately, the Architecture Billings Index, another indicator of future construction, also rose last month. Lennar to open in Pacific Northwest 
BloombergLennar Corp., bought more than 650 sites in the Portland, Ore., and Seattle areas, following competitors Toll Brothers Inc., and MDC Holdings Inc., into the Pacific Northwest. The Seattle-area purchases from closely held Premier Communities, LLC, and of sites in 11 Portland-area communities are expected to generate about 200 home deliveries in the second half of 2012 for Miami-based Lennar, according to a statement. Terms weren’t disclosed. The move is the first entry by Lennar into a new market since early 2010, when it began operations in Atlanta. “Both Seattle and Portland are currently benefiting from diversified economies and stabilizing home prices,” Jon Jaffe, Lennar’s chief operating officer, said. November home sales higher than 2010 PRNewswire November home sales were 8.1 percent higher than sales in November 2010, according to The RE/MAX Monthly Housing Report, a survey of housing data from 53 metropolitan areas. November is the fifth consecutive month to show a year-over-year sales increase. At the same time, the number of homes for sale, or inventory, continued to fall for the 17th straight month. November home prices were 1.4 percent higher than October, making the fifth month in 2011 that prices have risen month-to-month. However, home prices remained 4.2 percent lower than prices in November last year. "This market is trying hard to stabilize itself with home sales significantly stronger than one year ago, even though we are entering the holiday season when sales traditionally decline," said Margaret Kelly, CEO of RE/MAX, LLC.
Illinois puts $15 million toward affordable housing 
The Huffington PostIllinois has been criticized in the past for placing people with developmental disabilities in state-run institutions. Mental health advocates and those concerned about the state's dismal financial situation have criticized the practice as being bad for the disabled and for the budget. Now, Gov. Pat Quinn is looking to make some changes. Quinn announced that he would set aside $15 million from the "Illinois Jobs Now!" program to launch "Home First Illinois," an affordable housing program for people with disabilities, according to the Illinois Housing Development Authority. “By increasing accessible and affordable housing opportunities for our state's residents with disabilities, we are helping to increase their independence and improve their quality of life,” Quinn said. http://www.huffingtonpost.com/2011/12/19/home-first-illinois-state_n_1157038.html?ref=chicago
US stocks rise as housing data beat estimates Bloomberg U.S. stocks rose as better- than-estimated data on housing starts added to expectations the world’s largest economy will weather Europe’s debt crisis. Commodity, industrial and financial industries had the biggest gains in the S&P 500 among 10 groups. PulteGroup, Inc., and Lennar Corp., added more than 5.4 percent as builders broke ground on more houses than at any time in the past 19 months. Alcoa Inc., Caterpillar Inc., and Bank of America Corp., advanced at least 2.6 percent. Jefferies Group Inc., climbed 22 percent as the investment bank reported profit that beat estimates. The S&P 500 rose 2.6 percent to 1,236.22, as 492 out of 500 stocks gained. “The U.S. market is the most inviting,” Mark Luschini, chief investment strategist at Janney Montgomery Scott, LLC, said. Home builders still supporting communities 
NAHBDevastated by the economic downturn, there was no relief in 2011 for the home building industry. Thousands of builders went out of business and many others continue to struggle to make ends meet on a daily basis. Yet home builders around the country are still putting aside their challenges to help less fortunate members of their communities. “Home builders are making extraordinary sacrifices as they try to survive the ongoing economic downturn, and yet their generous spirit continues to shine in selfless acts of charity every day across the country,” said Bob Nielsen, chairman of the National Association of Home Builders. “NAHB’s members are doing everything in their power to help others and preserve the American Dream of homeownership for those who are less fortunate.”
William Lyon Homes receives support for Plan of Reorganization 
Business WireWilliam Lyon Homes, which develops new home communities in California, Arizona and Nevada, announced that it has filed voluntary Chapter 11 cases to seek confirmation of the pre-packaged Plan of Reorganization after obtaining overwhelming support from both its senior lender and senior note holders. In excess of 97 percent in dollar amount and in excess of 93 percent in number of holders of its senior notes that cast ballots, voted to approve the pre-packaged Plan, as did the company’s senior secured lender. The Lyon family also supports the Plan. “The action enables us to efficiently restructure our debt and create a capital structure that will provide a foundation for future growth,” said Chief Executive Officer General William Lyon.
KB Home opens first ZeroHouse 2.0 in California 
Business WireKB Home unveiled one of the first Net-Zero energy production homes in California at its Whisler Ridge community in Lake Forest. At the event, the national home builder and Lake Forest Mayor Peter Herzog hosted a group of school children for a guided tour of the innovative new home, dubbed ZeroHouse 2.0. The offering of the house continues a national rollout of the Net-Zero energy homes that KB Home started earlier this fall, with Orange County and homebuyers throughout Southern California now being able to choose a KB home that may eliminate their monthly electricity charges entirely. “To be able to open up your bill from the power company and have it be close to nothing is a great feeling,” said Steve Ruffner, president of KB Home’s Southern California division.
Affordable senior housing lands in Phillips 
Finance & CommerceAs subsidized housing developments go, the American Indian Community Development Corp.’s $8 million senior housing project in Minneapolis’ Phillips neighborhood came together in surprisingly quick fashion. The mostly HUD-financed project, which broke ground last month advanced from concept to construction in less than two years, said Michael Goze, chief executive officer of the nonprofit American Indian Community Development Corp. (AICDC). “It was one of those things that was meant to be,” Goze said. When it opens next fall, the Bii Di Gain Dash Anwebi development will bring 47 affordable senior housing units to the neighborhood, which has a large Indian population. Goze said he did not know of any existing affordable housing exclusively for seniors in the neighborhood.
California suing Fannie and Freddie The Wall Street Journal California Attorney General Kamala D. Harris filed suit against Fannie Mae and Freddie Mac, seeking to force the firms to answer a detailed list of questions after the firms' federal regulator sought to block an open-ended inquiry by the state. The lawsuits, filed in San Francisco County Superior Court, are the latest salvo by Ms. Harris against the mortgage-finance giants and their regulator, the Federal Housing Finance Agency. Last month, the office issued subpoenas asking the firms to provide extensive answers to a range of questions about the mortgages they purchased and the foreclosed properties they own in California. The FHFA said it had directed Fannie and Freddie not to comply with the subpoenas, calling them "frequently vague and ambiguous," and asked the attorney general to withdraw them.
Nursing home to get new style, site The Wall Street Journal Plans for a pioneering nursing home designed to offer senior citizens greater independence are poised to move forward now that a controversial land swap on the Upper West Side has closed. Jewish Home Lifecare will build a 24-story nursing home which will use a model for elder care that combines new approaches to design and staffing. The model eschews long institutional corridors and shared rooms, in favor of small pods with private rooms that are designed to feel more like typical homes. The staffing model also differs, with the same two nursing assistants dedicated to each apartment cluster, performing cooking, light housekeeping and facilitating board games and other recreational activities. Jewish Home will receive $35 million from the developers. Low-income NYC nursing home building sells 
Senior Housing NewsThe East Fifth Street building of the largest senior care home in New York City’s East Village recently sold for $25.5 million, according to papers filed through the NYC Department of Finance, Office of the City Register. The future of Cabrini Center for Nursing and Rehabilitation, a non-profit with 240 beds for low-income seniors, has been uncertain as its lease is set to expire in April 2012. The center is sponsored by the Missionary Sisters of the Sacred Heart of Jesus. Local community board members pleaded with the attorneys of the building’s buyers in a letter to extend Cabrini Center’s lease. “This nursing home regularly maintains 97 percent occupancy and is able to sustain a positive cash flow even as other facilities close due to overwhelming financial challenges,” reads the letter.
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