President Bush inidcated on Wednesday that he's inclined to veto a homeowner's assistance package movign through congress, saying that in its current form it gives undue coverage to "speculators." The AP reported that "the measure, aimed at preventing foreclosures, would have the government step in to insure up to $300 billion in new mortgages for distressed homeowners." Read more here.
The House Financial Services Committee on Thursday approved H.R. 5830, the FHA Housing Stabilization and Homeowner Retention Act. The bill, a top legislative priority for NLC, is the final piece of the House plan to stabilize the housing market and reign in the skyrocketing foreclosure rate. Passage paves the way for a comprehensive package of housing legislation to come together on the House floor in the coming weeks. Read more on the National League of Cities' website here.
According to the Mortgage Bankers Association, 900,000 households were in the foreclosure process during the fourth quarter of 2007, the highest number ever recorded, and up 71 percent over 2006. The Federal Reserve announced that 8.8 million homeowners will have zero or negative equity by the end of March, representing about 10 percent of all homeowners.
In Congress last week the House Committee on Financial Services considered a number of bills aimed at mitigating the home foreclosure crisis. The committee passed two bills, H.R. 5818, the Neighborhood Stabilization Act of 2008, and H.R. 5579, the Emergency Mortgage Loan Modification Act of 2008.
Read more about these efforts at the National League of Cities' website.
CaliforniaCityNews has been covering local government actions related to the mortgage crisis for some months now. Town Halls and information sessions are a common method used to educate and reach out to the public. In a troubling sign of the times the size of these town halls has gown tremendously as reported in the city of Salinas. There are nearly 1,200 homeowners in Salinas on the brink of foreclosure, according to the State and Consumer Services Agency.
Some of them were likely among the hundreds who sought help with their loans Thursday at a workshop at Sherwood Hall in Salinas.
In a joint effort of state and county officials, the Foreclosure Prevention Workshop was aimed at homeowners having trouble making payments and wanting to stave off foreclosure before it knocks on their doors. Nearly 300 families sought advice during the afternoon event. Full story here in the Monterey Herald.
The California Housing Finance Agency (CalHFA) announced it is accepting applications from local government entities for low-interest loans for the development of affordable single family infill housing projects through its Residential Development Loan Program (RDLP). RDLP is an innovative loan program designed to assist local communities in promoting infill development for affordable owner-occupied housing.
$20 million in RDLP funds are available to California cities, counties, housing authorities, redevelopment agencies, and community development commissions for low-interest loans for site acquisition, predevelopment, and construction costs of infill ownership housing.
Read CalHFA's full press release here or visit their website www.calhfa.ca.gov.
Staving off what just a few months ago looked like a backbreaker for the city of Half Moon Bay, its city council has entered into an agreement to develop 24 acres of wetlands. The issue, as you might recall, is that these "wetlands" weren't really wetlands at all, that is until a city pipeline ruptured and created an artificial basin for the water run-off. No city surveying records or government documents record the land being wetlands prior to the pipeline break and resulting runoff.
An article in the Half Moon Bay Review Wednesday notes the city has "until the end of 2011 to smooth out all impediments to construction on Beachwood and 12 adjacent acres or pay Keenan $18 million plus interest to settle the deal." The city had few options in this situation after the U.S. District Court awarded $36.8 million to the developer, Keenan. THis amount is thought to be about quadruple the city's annual budget, and threatened bankruptcy and possible disincorporation.
Voters approved nearly $3 billion in bond monies for affordable housing as part of 2006's Proposition 1C. Now elected officials trying to divvy up those funds are faced with a quandary -- allocated by population, or based upon the quality of proposed projects? This has set up a good old northern-southern state feud, and the LA Times has the story.
Some property tax bills may be slashed as home values have dropped off a cliff. County assessors throughout the state are re-valuing the prices of homes and cities and counties are bracing for the commensurate decline in revenues. More than 40,000 homes suspected of losing value since their purchase are under review by the Kern County Assessor, a process that will reduce property tax bills for many homeowners, but also shrink a critical source of revenue to county services and schools.
Just a bit to the south in Ventura County The city of Simi Valley takes an $820,000 hit. Still further south, the city of Lemon Grove sees revenue drop from falling sales tax receipts. Lemon Grove faces a deficit for the first time in four years. Both southern California cities have reputations for being well run financially and are expected to weather the financial storm just fine.
The city of Paso Robles turns the tables on the RHNA process by proclaiming "Sure we'll take the counties housing - if you show me the money!" The citys plan was rejected out of hand as being too radical. It would require "political changes too drastic too fathom."
Curious... Housing that pays for itself is now considered political action "too drastic to fathom."
We’re willing to take extra numbers because we’ve got jobs, but only if we get extra money,” Ed Gallagher, Paso Robles housing programs manager, told the community planners tasked with dolling out housing allotments to the cities in the county.The planners, members of the regional housing subcommittee for the San Luis Obispo Council of Governments, were meeting to discuss how to best allocate the state’s regional housing needs numbers — a controversial process that is intended to help counties deal with growth. The proposed overall state allocation will go before SLOCOG for approval this spring.
As policymakers scramble to find a solution to the mortgage meltdown, special interests are gearing up to protect the status quo. Not that thats all bad - the first rule during a crisis should be "do no harm". And with Sacramento politicans thats a bit of advice rarely heeded.
The latest attempt to address the situation lost by one vote in committee in a classic Sacramento political brawl. The Los Angeles Times covers the play by play in this article. The story is also covered in The San Jose Mercury News.
So while the Nero's fiddle, Rome continues to burn. In fact, Bay Area foreclosure filings continued to double, triple and quadruple at the end of 2007 compared to a year ago, with one home in every 93 slipping away from its owners.
"This is not a phenomenon limited to a certain type of socioeconomic class and geography," said Rick Sharga, vice president of marketing for RealtyTrac. "There's no one area of the country, or the state for that matter, that's immune." Read about how the issue is affecting the bay area here.
