Real Estate News This Week!

Here are some short reports in the news this week related to real estate and investing.

*** Banks Chipping Away at Foreclosures ***

The inventory of foreclosures held by private banks dropped for the fourth straight quarter to $50.4 billion in property value according to the Federal Deposit Insurance Corporation. The REO level at the end of the third quarter is down 1.5% from $51.3 billion in the previous quarter and 5% lower than the $53.1 billion a year earlier.

Loans between 30 and 90 days delinquent declined for the sixth straight quarter to $100.2 billion in the third quarter. The peak for early delinquencies came in the fourth quarter of 2008 when delinquencies were nearly $160 billion in value. Bank balance sheets are improving as they work their way through foreclosure inventories, with the FDIC reporting a 48% increase in bank earnings from the previous year.

*** Existing Home Sales Up in October ***

Sales of existing homes rose 1.4% in October, putting a dent in the large inventory that’s been keeping prices down. The annual rate for existing home purchases in October was 4.97 billion homes, up from 4.90 billion in September. This was higher than expected by analysts, and was a jump of 13.5% from the 4.38 million unit rate of a year ago.

Total housing for sale inventory dropped by 2.2% to 3.33 million homes. This represents an 8 month supply, down from the previous month’s 8.3 month supply. Inventory hit a record high of 4.58 million in July of 2008.

*** U.S. Consumer Confidence at Highest Level in Five Months ***

In November, the Thomson Reuters/University of Michigan final index of consumer confidence rose to a five month high at 64.1. This is the highest index level since June and up from 60.9 in October. However, a 9% unemployment rate and concern over the economic problems in Europe are weighing on consumers’ spirits.

Though this index level is up, it’s still firmly in recession territory. The index survey in part looks at current conditions which reflect consumer perceptions of their financial situation and whether they consider it a good time to buy high-ticket items like cars.

*** Realtor Held Liable for MLS Mis-information ***

A recent court ruling in Boston held that a listing real estate broker was liable for an error in the zoning shown for a property in the MLS, Multiple Listing Service. The court held that it was the duty of the Realtor® to independently verify the zoning information. The MLS indicated that a property was zoned for business use, which would allow the buyers to operate a hair salon business.

However, the property was in fact zoned for residential use only. The real estate agent had relied on information from the seller client, and the court found that the standard disclaimer in the listing does not protect the agent from liability.