In Los Angeles, ‘tiny homes’ spring up for homeless people

LOS ANGELES — In a parking lot in Los Angeles, a village of miniature prefab houses has sprung up, one of several sites in America’s second-largest city where so-called “tiny homes” are being put up to help the homeless get back on their feet.

The City of Angels has a large homeless population, second only to New York. Tens of thousands live rough — their tents, and their distress, are plain for any resident or visitor to see.

In the Tarzana neighborhood, 76 tiny homes paid for by the city have been erected. Each is 64 square feet (six square meters), and is equipped with two beds and shelving as well as air conditioning and heating.

Each one costs $6,500 and can be set up in just 90 minutes. Toilets and showers are shared, and state-of-the-art washing machines face large, bright orange tables under umbrellas. The set-up feels a bit like a campground.

Zuri-Kinshasa Maria Terry, 46, has just moved into the Tarzana development.

The former stripper says she ended up on the streets a year ago, after two weeks in intensive care because she had contracted Covid-19, and waited two months for the tiny home village to open.

“It was the scariest thing in the freaking world to be out there,” Terry told AFP, adding she was “still grasping” the fact that she had found a steady place to live.

In addition to allowing a certain privacy, she said the main advantage of the tiny homes is “safety,” as compared to either living on the street or in a traditional shelter.

‘Building a case plan’

The Tarzana site is guarded 24 hours a day, and while residents do not get to keep the keys to their tiny homes, they can lock it from the inside, explains Rowan Vansleve, chief finance and administration officer of Hope of the Valley, a non-governmental organization that manages the development.

The process begins with “a really hot shower, getting a great meal and then building out a case plan” to help the new resident get out of their precarious situation, according to Vansleve.

“Once you’ve got a case plan, we’re going to assign you a tiny home and you’re going to work that plan however long that takes,” he added.

Residents have access to medical care and therapy, and three meals a day are provided. They are given lodging for three months at a time, which is renewable until the resident finds permanent housing, according to Brandon Hanner, the NGO’s program manager for the Tarzana site.

Roots of the crisis

The first village of tiny homes in Los Angeles opened in early 2021 and several more followed.

Similar initiatives have sprung up in recent years elsewhere in California, including San Jose, and in Seattle.

For those who advocate for the homeless, the projects are a mixed bag.

Mayer Dahan, founder of the Dream Builders Project, says the tiny homes can be “a very positive transition” for some, but he said he worried about “the concept that solutions could be found by trying to resolve the symptoms, as opposed to the underlying issue.”

For Shayla Myers, a senior attorney at the Legal Aid Foundation of Los Angeles, one problem is that “there is far too little affordable housing for people to exit out of these shelter facilities and into permanent housing.”

While acknowledging that tiny homes are a better option for some, Myers insisted that these homes are in fact “incredibly expensive” because of the operating costs — and that California must do more.

“There is no way to solve the homelessness crisis without addressing the root causes, which are poverty, wealth inequality and a lack of affordable housing options,” she said.

But the city wants to move quickly to clear its sidewalks of encampments, especially after a judge ordered such a move, saying at least some of the homeless need to be placed in housing by the fall — and using very harsh words for the city’s strategy on the crisis thus far.

Terry said she is very aware that tiny homes are far from a perfect solution, but for the time being, “it works.”

She hopes to do training to become a real estate agent, once her situation stabilizes.

“I wouldn’t wish it on my worst enemy,” she said of living in the streets.

Agence France-Presse 

S&P CoreLogic Case-Shiller: US home prices rose 3.7% in May

WASHINGTON (AP) — U.S. home prices grew more slowly in May, but continued to show resilience in the face of the coronavirus outbreak.

The S&P CoreLogic Case-Shiller 20-city home price index rose 3.7% in from a year earlier. That’s a drop from the 3.9% increase in April and it was a smaller gain than economists had expected. Still, home prices have risen steadily despite the pandemic and lockdowns that have badly damaged the American economy.

Phoenix led the way with a 9% annual gain in home prices, followed by Seattle (up 6.8%) and Tampa (up 6%). Chicago registered the smallest increase: 1.3%.

The May slowdown, however, broke a streak in rising sales that stretched back to September. Craig Lazzara of S&P Dow Jones Indices said it was too soon to know if April was a high water mark, or if May was “a slight deviation from an otherwise intact trend.″

The National Association of Realtors reported last week that sales of existing U.S. homes shot up 20.7% last month, snapping a three-month streak of falling sales. Mortgage rates are near historic lows.

“In a remarkable show of resilience, the housing market has stared the pandemic right in the eye and hasn’t blinked,” said Matthew Speakman, economist at the real estate firm Zillow. “Record-low mortgage rates and a shortage of available homes have fueled competition amongst buyers in the spring and early summer, leading to homes flying off the market at their fastest pace in years and home prices to continue to rise.″

The 20-city index released Tuesday excluded prices from the Detroit metropolitan area index because of delays at the recording office in Wayne County, which includes Detroit.

The Case-Shiller index is composed of a three-month average of home prices, so this month’s data includes figures from March, April and May.

-Associated Press

US sales of existing homes jump 20% after a 3-month slump

BALTIMORE (AP) — Americans stepped up their home purchases in June by a robust 20.7% after the pandemic had caused sales to crater in the prior three months. But the housing market could struggle to rebound further in the face of the resurgent viral outbreak and a shrinking supply of homes for sale.

Sales of existing homes rose last month to a seasonally adjusted annual rate of 4.72 million, the National Association of Realtors said Wednesday. Despite the sharp gain, purchases are still down 11.3% from a year ago, when homes had sold at an annual pace of 5.32 million. And Lawerence Yun, the Realtors’ chief economist, noted that sales remain roughly 20% below their pre-pandemic levels.

At the same time, housing has managed to avoid a deeper slump from the severe recession caused by the coronavirus. Demand has remained strong among buyers who have managed to weather the downturn, while record-low mortgage rates have helped sustain affordability.

“Buyers are out in force, but new listings remain the key to housing’s recovery,” said Danielle Hale, chief economist at Realtor.com. “More sellers are needed before we’ll see year over year gains in home sales.”

The number of property listings has plunged 18.2% from a year ago to 1.57 million. It’s the 13th straight month of shrinking supply on an annual basis. The shortage of homes makes it unlikely that the housing industry can significantly boost the overall economy.

Home buyers typically purchase new furniture and fix up older properties. Their ability to deliver such a spending boost is constrained if they can’t find an available house. The limited supply is also forcing up prices just when many Americans are struggling with financial uncertainty because of the recession.

The combination of steady demand and falling mortgage rates has helped fuel a 3.5% rise in the median price of an existing home over the past year to $295,300.

Home sales rose in the Northeast, Midwest, South and West last month. But the increases were most dramatic in the West, with a 32% gain and the South with a 26% gain.

Associated Press

How Much Rent Can I Afford? How to Calculate a Rent You Can Afford

The question “how much rent can I afford”  is inevitable for those who plan to spend wisely. Your income is expected to be 40 times your rent. Before deciding on what apartment to rent, it’s advisable you deduct the tax payable on the income you earn. The money left after the deduction of the tax is what the planning should be based on.

The most important thing is that other expenses such as clothing, feeding etc. are put into consideration while determining how much rent one can afford. It’s also necessary to consider the bills that would accrue from the use of the apartment. Such bills include: electricity bills, gas bills, water bills, satellite TV subscription bills etc. It is also important to consider all other relevant bills

Finding It Difficult To Calculate Your Monthly Rent? Here’s How.

Are you having issues calculating your rent?

Do you wanna know the best rent calculation technique?

Don’t worry! This discourse proffers the necessary solutions to your housing problems.

Calculating your rent might seem difficult while looking at it superficially. But it’s one of the simplest tasks that you can ever attempt. In this write-up, you’ll be taken through the most convenient rent calculating method available.

Calculating your monthly rent from your weekly rent.

Most Tenants make the mistake of calculating their monthly rent by multiplying their weekly rent by 4 and their annual rent by 12. This approach is absolutely wrong.

Maybe this is the reason your calculations have always been different from your landlord’s. In calculating your monthly rent, the right approach is to multiply the weekly rent by 52. The result is then divided by 12. You’ve successfully calculated your monthly rent. Some examples shall be made to illustrate the points above.

Incorrect: 
Weekly rent = $200
Monthly rent = $200 X 4
Monthly rent = $800

Correct:
Weekly rent = $200
Annual rent = $200 X 52
Annual rent = $10,400
Monthly rent = Annual rent / 12
Monthly rent = $10,400 / 12
Monthly rent = $866.67

You can see there’s a great disparity between the results of the first and second approach. There’s a difference of $66.67 in the two approaches.

In some cases, the year has 53 weeks. It then follows that the weekly rent would be multiplied by 53.

Monthly Rent Calculator

Determining your monthly rent, as already established above, depends on how much you can reasonably spend per month. You need to factor things like utilities, renter’s insurance and transportation cost while using a monthly rent calculator. Apply the rule of thumb, which states that no one should spend more than 1/3 of your after-tax salary on rent.

For example, if your annual salary is $50,000, that leaves you with $4,166/month. After taxes, you should have around $3,270. One third of 3270 is about $980, and that is what your monthly rent should be on $50,000 a year.

Going by this logic, the $980 should include extra-costs you’d incur for amenities your apartment does not possess.

Rent-to-Income-Ratio Calculator

How much of my income should I spend for rent? To answer this, you’ve got to figure out the rest of your monthly budgeting. Since the largest percent of your monthly income goes to rent, it’s easiest to figure out the rest of your budgeting once you determine how much rent you can afford by using our Rent-to-income-ratio calculator.

A common budgeting strategy follows the 50-30-20 rule. Applying this strategy to your finances is a great way to maintain a focus on controlling your monthly spending while also planning out your future’s finances.

The 50: The 50 of the 50-30-20 rule means that you should aim to pay no more than 50% of your income towards your monthly necessities. These necessities include expenses such as:

The cost of your groceries per month
Your utility bills like your phone bill, water, and electricity
The cost of renter’s insurance
Driver’s insurance
Health & dental insurance
And of course, how much you should spend on rent
As given above, figuring out the amount of money you should to pay for rent gets you off to a good start on budgeting for the rest of your monthly expenses and helps you lay the foundation for figuring out the rest of your finances. If you’re looking at two different apartments and one is 40% of your income and the other is 25%, you might want to calculate how that slight difference will affect the rest of your monthly budgeting for your necessary costs.

The 30: The 30 represents how much of your income should go to discretionary spending. Basically, you should allocate 30% of your monthly income to cover entertainment, dining, the gas needed for out of town trips, the costs of your hobbies, and anything else that you can live without if you had to.

The 20: The last, and often what feels like the most distant, is the 20. The last 20, according to the 50/30/20 rule, is the percentage of income that should to go towards your financial goals. Whether that is putting down money for your retirement, paying off a car loan or student loan, or saving money for a down payment for your home.

Final thoughts

With this knowledge, I hope you’ll be able to independently determine your rent and make proper housing decisions.

Thanks for reading.

source: usa.inquirer.net

Bon Jovi helps open low-income housing in US

PHILADELPHIA—Rock star Jon Bon Jovi attended the grand opening of a low-income housing development in Philadelphia that bears his initials.

The 55-unit JBJ Soul Homes will be occupied by low-income tenants and the formerly homeless.

Bon Jovi’s Soul Foundation and the Middleton Partnership provided the lead gift for the $16.6 million complex in the Francisville neighborhood. The project also received public funds.

Residents will have access to social services provided by Project HOME, a group dedicated to ending homelessness. The four-story building includes retail and office space.

Bon Jovi is a longtime advocate for affordable housing in Philadelphia, Newark, New Jersey, and many other cities. The New Jersey native once co-owned the Philadelphia Soul arena football team.

source: entertainment.inquirer.net

Don’t go broke seeking foreclosure help, say housing nonprofits

SAN FRANCISCO—Judith Camelo and her husband, both Filipino Americans, bought their house for $196,000 and refinanced it three times. When she had to retire to take care of her injured husband, their income fell. One day, she saw a man post a piece of paper on their door and leave.

“It was a foreclosure notice,” Camelo says. She saw a loan modification advertisement on television and went to the firm for help. She was asked to pay $975 initially and $1,402 the second time. Then she never heard from them again.

Camelo was just one of the thousands of victims of foreclosure rescue scams, a growing epidemic, according to nonprofit housing counselors. Many of the scams target minority and limited-English speaking communities.    



If asked to pay, stay away

“You shouldn’t be paying for loan modification assistance,” says Leah Simon-Weisberg, legal director of Tenants Together. “If you’re asked to pay, stay away,” she added at a press briefing held by nonprofit housing assistance agencies, hosted by New America Media.

“Go to a nonprofit counseling agency for advice,” says Maeve Elise Brown, executive director of Housing and Economic Rights Advocates (HERA), “they’re given grants by donor institutions like San Francisco Foundation to help out people in housing distress.”

That’s what Camelo eventually did. She sought assistance from HERA, which helped her modify her loan and stave away foreclosure and eviction.

“I say do not trust individual attorneys who say they will help you modify your loan,” says Brown. “I’m sorry to say that some of my colleagues in the law profession cannot be trusted on this.”

Foreclosure scams

Foreclosure rescue scams show no signs of abating, and could increase given the slow reversal of the housing bust. Another 700,000 homes are in the foreclosure pipeline in the state, says Vanitha Venugopal, program director of Community Development and Investment at the San Francisco Foundation.

“One million homes were foreclosed in California during the housing bust, and blacks and Latinos have had two times the foreclosure rates of whites,” Venugopal says.

Her program is devoting $2 million in the next two years in an awareness drive to warn minorities of foreclosure rescue scams and to direct them to nonprofit housing counselors for proper help.

The San Francisco Foundation set aside $5.3 million to help prevent foreclosures through counseling and $4 million for rehabilitating vacant properties.

“In two years, 14,000 people have received counseling, 1,900 homes were saved and 1,334 properties were rehabilitated, but many more people need help and the scams are getting bolder,” she cautions.

Worst hit

Minorities have been the worst hit by the housing crisis, says Kevin Stein, associate director at California Reinvestment Coalition, who blames lending institutions.

“First they were redlining minority communities by refusing to provide housing loans,” Stein says, “then they went into reverse redlining targeting minority communities with highly predatory loans, now they’re swinging back to redlining again.”

While the Homeowners’ Bill of Rights and the national mortgage settlement have mitigated some of the problems, there is lack of enforcement by the federal authorities and lack of compliance and accountability on the part of banks and other financial institutions, Stein says.

“Selling loans to non-banks complicates matters and cash buyers of foreclosed homes for investment worsens the problem,” Stein adds.

HERA’s Brown also accuses banks of refusing to release all their real estate properties on the market, creating a false sense of tightness in the ownership and rental markets. “It’s a form of market manipulation,” charges Brown, “increasing pressures to sell to investor-buyers who out-buy common homebuyers.”

Renters vulnerable

House ownership as part of the American Dream is becoming out of reach, the shortage of rental housing is also compounding the difficulties of working people, says Gloria Bruce, deputy director of the East Bay Housing Organization (EBHO).

As it is, says Cruz, an average restaurant worker must work 75 hours a week to be able to afford a $1,000 a month apartment. The federal definition of “low income” she says is a household income of $46,000 a year. “So a lot of working people are struggling.”

Simon-Weisberg agrees: “Foreclosures of rental properties are displacing tenants, creating false vacancy rates that drive up rents.” She adds that foreclosed landlords exacerbate tenants’ problems by not making repairs or not returning security deposits.

Booming technology companies do not plan for the housing of their growing staff, leaving the problem for local governments to deal with, gentrifying low-income neighborhoods, depleting available housing and driving up rents.

Simon-Weisberg also warns of the rise of “company towns” with “mega-buyers like Equity Residential in Palo Alto and Blackstone in Sacramento” buying properties in bulk, making them unavailable to common homebuyers. Tenants in such company towns, she says, virtually have no protection from their big landlords.

Options available

There are options, EBHO’s Bruce says. “There is a misconception that low-cost housing is public housing—no, there are nonprofits that build and maintain low-cost rentals, but the waiting lists are long.”

Bruce is calling for the passage and enactment of Senate Bill 391 in the state legislature to dedicate funding for low-cost housing.

The housing advocates advise homeowners, would-be homeowners and tenants to “be aware of your rights” and go to nonprofit housing advocates for reliable assistance.

This is crucial, says Cheyenne Martinez-Boyette of Mission Economic Development Agency, because homeowners who are underwater need expert guidance in navigating the “murky channels” of the foreclosure process.

And housing advocates emphasize, it’s really help that no one needs to pay an arm and a leg for.

source: bsiness.inquirer.net

Bonds OK’d for affordable-housing project in Henderson

CARSON CITY — The state Board of Finance on Tuesday cleared the way for construction of a 210-unit apartment complex in Henderson for moderate- and low-income families.

Up to $16 million in tax-free bonds will be issued through the state Housing Division to finance the project consisting of 10 three-story buildings containing two- and three-bedroom units.

The Fore Property Co. will be the developer and has built 11 other senior and affordable-housing projects in Nevada.

State Treasurer Kate Marshall sought and gained assurances that the developer would not enjoy excess profits if all the units were occupied. She said the law permits a 15 percent profit.

If there were higher profits, Marshall suggested, rents could be lowered on the project, which is expected to take about 18 months to build.

John Fore of the development company told the board profits would not exceed 15 percent.

Gov. Brian Sandoval questioned if Nevada workers would be hired for the job. Fore said his firm is based in Las Vegas and will employ local workers.

The apartments will be located on two parcels along Boulder Highway, near Equestrian Drive in Henderson. Each site will have its own swimming pool, clubhouse, picnic areas and other amenities.

The units will be restricted to tenants who earn less than 50 percent or 60 percent of the area’s median income. According to the plans, a two-bedroom unit for a family with an income of 50 percent or less than the median income would pay rent of $650 a month. For a three bedroom, the rent would be $730.

Citibank, according to documents supplied to the board, will buy the bonds. Coupled with the state bond financing, there will be other sources of financing, bringing the total project cost to $28.2 million.

source: lasvegassun.com

U.S. home prices rise 8.1 percent, most since June 2006

WASHINGTON — U.S. home prices rose in January at the fastest annual pace since June 2006, just before the housing bubble burst. The gain shows the housing recovery is strengthening ahead of the all-important spring buying season.

The Standard & Poor's/Case-Shiller 20-city home price index climbed 8.1 percent in the 12 months ending in January. That's up from a 6.8 annual gain in December. Prices rose in all 20 cities. Eight markets posted double-digit increases, led by a 23.2 percent gain in Phoenix. Prices rose 17.5 percent in San Francisco and 15.3 percent in Las Vegas, one of the nation's hardest hit markets during the crisis.

Prices rose in 11 of 20 cities on a month-over-month basis. The monthly numbers are not seasonally adjusted and reflect the slower winter buying period.

The S&P/Case-Shiller index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The January figures are the latest available.

Home prices nationwide are still 29 percent below their peak reached at the height of the housing bubble in August 2006. They are only back to where they were in August 2003.

Still, steady price increases should help make the housing recovery sustainable and add to economic growth. Higher home prices encourage more people to buy before prices rise further.

"Over time, persistently rising house prices also boost household wealth, make lenders more willing to lend because the asset they're underwriting is appreciating, and ease pressure on local government budgets that get revenue from property taxes," Jonathan Basile, director of economics at Credit Suisse, wrote in a research note.

Other recent reports have shown a strengthening recovery in housing, helped by near-record-low mortgage rates. Construction of single-family homes rose in February at the fastest pace in 4 ½ years. Sales of previously owned homes rose last month to their fastest pace in more than three years.

More Americans are putting their houses on the market, suggesting they believe the housing market will continue to strengthen.

The number of available homes for sale rose 10 percent last month, the first monthly gain since April. Even with the gain, the inventory of homes for sale was still 19 percent below a year ago.

Investment in housing, including home construction, contributed to the nation's economic growth last year for the first time since 2005; from 2006 through 2011, a drop in housing investment dragged economic growth down.

source: lasvegassun.com

Feds hit Wells Fargo with mortgage-fraud suit

NEW YORK -- The U.S. attorney in Manhattan has accused Wells Fargo of defrauding a government-backed mortgage insurance program, in another major civil case brought in the wake of the housing bust and financial crisis.

The mortgage-fraud suit, filed by U.S. attorney Preet Bharara, seeks "hundreds of millions of dollars" in damages for claims the U.S. Department of Housing and Urban Development has paid for defaulted loans "wrongfully certified" by Wells Fargo.

The suit alleges the San Francisco banking giant falsely certified loans insured by the government's Federal Housing Administration.

“As the complaint alleges, yet another major bank has engaged in a longstanding and reckless trifecta of deficient training, deficient underwriting and deficient disclosure, all while relying on the convenient backstop of government insurance," Bharara said in a statement.

Adding "accelerant to a fire," Bharara said, was Wells Fargo's bonus system that rewarded employees based on the number of loans it approved.

The lawsuit alleges the bank failed to properly underwrite more than 100,000 loans it certified to be eligible for FHA insurance. When Wells Fargo discovered problems with the loans, it failed to notify HUD, which administers the FHA program, as required, the suit said. The action alleges more than 10 years of misconduct.

"The extremely poor quality of Wells Fargo's loans was a function of management’s nearly singular focus on increasing the volume of FHA originations -- and the bank’s profits -- rather than on the quality of the loans being originated," Bharara's office said in a statement.

Wells Fargo denied the lawsuit's allegations, saying it acted in good faith and in compliance with government regulations.

"Many of the issues in the lawsuit had been previously addressed with HUD," Wells Fargo said in an emailed statement. "Wells Fargo is the leading FHA lender and has acted as a prudent and responsible lender with FHA delinquency rates that have been as low as half the industry average. The Bank will present facts to vigorously defend itself against this action. Wells Fargo is proud of its long involvement in the FHA program, which has helped so many people obtain affordable mortgages and become homeowners."

The Wells Fargo case is the fifth such mortgage-fraud case against a major lender brought by Bharara's office.

Three of those cases settled this year: CitiMortgage Inc. for $158.3 million, Flagstar Bank F.S.B. for $132.8 million, and Deutsche Bank and MortgageIT for $202.3million. A lawsuit against Allied Home Mortgage Corp. is pending.

A separate mortgage-fraud task force led by the New York attorney general brought an unrelated lawsuit against JPMorgan Chase & Co. last week.

Wells Fargo stock fell on news of the lawsuit. The bank's share's lost 70 cents, or 2%, to $35.10 in Tuesday trading.

source: latimes.com

New Rules for Renters

Look for the next housing bubble in the rental market. Apartment rents will rise 5% in 2012, says commercial real estate brokerage Marcus & Millichap. Landlords report receiving multiple applications for each listing and are picky about tenants. The market for single-family rentals is just as competitive. In Minneapolis–St. Paul, Renters Warehouse broker Brenton Hayden calls demand "insatiable."

Rachel LeBlanc scoured online listings for an apartment in Boston’s Back Bay but couldn’t find much that was affordable—or even available by the time she requested a showing. LeBlanc called Charlesgate Realty, a brokerage specializing in rental properties. An agent helped her find a studio for $1,600 a month (the fee was one month’s rent). LeBlanc leased the apartment the same day she saw it and will move in September.

With a pro or on your own, it’s best to start your search at least two months before you want to move. Expect to supply proof that you earn two to three times the monthly rent. Landlords might set a minimum credit score (680 is common in Boston). Landlords probably won't negotiate on rent but may be flexible on pet deposits or utility costs. Or you may get a deal in exchange for signing a longer lease or helping to maintain the property. Hot markets have attracted scammers. Beware listings that sound too good to be true, and don’t pay anything until you’ve seen the place in person.

This article first appeared in Kiplinger's Personal Finance magazine. For more help with your personal finances and investments, please subscribe to the magazine. It might be the best investment you ever make.

source: kiplinger.com

Mortgage delinquencies rose in second quarter, trade group says

The Mortgage Bankers Assn. says home loans with at least one missed payment but not yet in foreclosure rose to 7.58% in the second quarter from 7.4% in the first quarter.

The nation's slowly improving housing market hit another bump last quarter, with more borrowers missing payments amid continued high unemployment, a report from a trade group shows.

The Mortgage Bankers Assn., in a quarterly delinquency survey issued Thursday, said home loans with at least one missed payment but not yet in foreclosure increased in the second quarter to 7.58% of all mortgages. That's up slightly from 7.4% in the first quarter.

A separate survey from foreclosure listing firm RealtyTrac Inc. said the number of homes going into foreclosure rose 6% in July compared with a year earlier, the third straight month of year-over-year increases.

That trend reflected the fact that last year many foreclosures were on hold as banks focused on cleaning up flawed processes for seizing homes after the "robo-signing" scandals.

The Mortgage Bankers Assn. survey said the quarter-to-quarter increase in delinquencies appeared to result instead from a fundamental change: The slowing of the economy's recovery during the first half of the year.

Although in no way reversing the longer-term trend of declining delinquencies — the missed-payment rate was 8.44% a year earlier — the increase raised eyebrows at the lender group.

"It's not the direction you would want to see," Mortgage Bankers Assn. economist Michael Fratantoni said in an interview. The key determinant, he said, will be the job market, which has shown signs of improvement lately.

In a brighter sign, the percentage of loans in all stages of the foreclosure process, or at least 90 days past due, dropped to 7.31% in the second quarter from 7.44% in the first quarter and 7.85% a year earlier.

The slow decline in this "seriously delinquent" category shows that lenders are gradually working through the huge backlog of soured loans made during the housing boom, Fratantoni said.

Federal Housing Administration loans entering foreclosure were a notable exception. The percentage of loans in foreclosure soared to 4.23% in the second quarter to a record high. Foreclosure starts for FHA loans also increased to 1.53%, also a record high.

The increase was due to major lenders, particularly Bank of America Corp., starting up foreclosures on loans that had been delinquent but held up because of to the federal government's investigations into faulty foreclosure practices, said Shaun Donovan, secretary of Housing and Urban Development, which oversees the FHA.

"We had a significant period of time where Bank of America was not starting foreclosures or completing foreclosures for FHA loans," Donovan said in an interview with The Times. "What you are seeing is basically many, many months-long backlog of particularly Bank of America claims that are being submitted, and have caused artificially that rate to rise."

"It doesn't reflect an underlying trend overall for the broader portfolio," he added.

The report confirmed signs that California, once the poster child for collapsing housing markets, is generally in recovery mode.

Across the nation, 4.27% of all home loans were in the foreclosure process at the end of the second quarter, the home lenders group said. In California, 3.1% of residential mortgages were in foreclosure.

That compared with 13.7% in Florida, 7.7% in New Jersey and 6.5% in New York, all states in which foreclosures are processed through the courts, resulting in huge legal entanglements. Most foreclosures in California are processed more quickly without judicial reviews.

Fratantoni said that with home prices rising again in many California markets, more struggling homeowners are finding it possible to sell their homes rather than see them taken away in foreclosures.

source: latimes.com

Seniors struggle as land rent for manufactured homes rises

Terrence Thudium sits at a bluish-gray “almost-granite” countertop in his recently refurbished kitchen. He speaks with a combination of fear and fight. The disabled Vietnam War veteran uses words such as “extortion,” “ridiculous” and “exhausted.”

Thudium lives in Mountain View Community, a manufactured housing park for seniors in Henderson. He signed a 20-year lease for land there and settled in a manufactured home he purchased for $75,000. Over the next five years, he spent another $75,000 transforming it into his home. He tore down a hall wall for circulation, added ceramic tiles in the kitchen and redesigned just about every feature to make it perfect.

Thudium is proud of the investment but faces a dilemma. The rent for the land his house sits on has jumped from $680 to $747 in four years. He pays almost the same amount in land rent as his neighbors pay to rent land and a home.

When Thudium settled in Mountain View, park owner Hometown America Communities allowed only homeowners to rent land. When Equity Lifestyle Properties, Inc., took over the park earlier this year, they opened it up to renters.

Thudium can move his home off the lot, but that would cost him more than $5,000. For a 67-year-old, that’s not practical.

“If you try and pay $1,000 per month in mortgages and $800 in rent, you got no money,” Thudium said. “It’s ridiculous. It shouldn’t be this bad. It’s not like renting the house and the land ... which is going for the same dollar figure I’m paying for land. Isn’t that extortion?”

Thudium’s lease dictates that park owners can raise the land rent a minimum of 3.5 percent as long as they give 90 days notice. Thudium signed the lease believing that would only happen in inflation emergencies. He was wrong.

Equity Lifestyle Properties agreed to freeze land rent for the next two years. But there is nothing preventing the company from increasing rent afterward.

So Thudium is trapped at the mercy of the park owners, hoping his rent doesn’t extend beyond what his disabled veterans benefits and social security income can afford. He has already been forced to put off any vacations or trips home to Chicago. He dreads the day rent creeps above $900, the maximum he can afford.

“Look at all I got invested,” Thudium said. “I’m 67, I can’t do this crap again another time. I’m exhausted, and I’m not done with (fixing the house).”

Equity Lifestyle Properties did not comment.

For the past 13 legislative sessions, the Nevada Association of Manufactured Homeowners (NAMH), which represents manufactured home owners, has proposed a rent justification bill to help homeowners like Thudium.

The bill would require park owners to justify raises in rent to a board if rent is increased more than a certain percentage. Each time, it failed.

Doris Green, president of the NAMH, said land rent at many manufactured home parks in Clark County has skyrocketed since the recession.

If owners, often seniors, become sick or lose a spouse, many are forced to move out. That opens the door for the park to take ownership of the homes and rent them new tenants. Green said she sees it frequently at Cabana Park, where she lives.

“Now what we have in our own park is people who have moved out or abandoned their home, and now (the park owners) are renting it (out),” Green said. “We have about one-third of the park out to renters.”

Pat McHugh, 74, has lived in Mountain View for the past 14 years. As the economy faltered and rent increased, she watched friends leave the mobile home park as their savings dried up. McHugh, who runs Pat’s Sunshine Shuttle service for her neighbors but barely breaks even with the business, fears that when her lease is up, she will suffer a similar fate.

“I am very fearful that in another four years I will not be able to afford to live here,” McHugh said. “I love living here, but I may not be able to afford it.”

Still, not everyone in Mountain View worries about rent. Joanne Miller, 78, said she has had no issues but also knows she’s lucky to continue to work.

A rent justification bill could help allay residents’ fears. Bob Varallo, a consultant for the NAMH since 1997, said members will try again to get the bill passed. He has little hope they’ll succeed.

Outside Thudium’s home, a moat of red rocks surrounds the walkway. Visitors are forced to trek up his driveway and around the corner of his house to ring his doorbell.

He wants to put eight cement steps in place to make access easier, but paying $1,200 for it makes no sense to him.

Improving the land around his house is pointless, Thudium said. If he decides to move his home to a new lot, it won’t go with him. If he abandons the home, it only will make it a more attractive property for the park to rent out.

Thudium sees no way out of his predicament. He has tried writing letters to park owners, but they just scan back the page of the lease he signed agreeing to accept land rent increases.

Thudium beamed with pride the day he signed those documents. Now, he’s not so sure.

“First time I owned a house,” Thudium said. “Boy did I get stuck.”

source: lasvegassun.com