Rental Housing Leaders Slam Homebuyer Tax Credits

By PAUL JACKSON
November 14, 2008

As the National Association of Home Builders pushes to expand a first-time homebuyer tax credit from $7,000 to $22,000 in the name of stimulating home buying activity, two groups representing the multifamily rental housing industry slammed the idea — along with other taxpayer-funded efforts to prop up housing demand — as industry favoritism, and called on Congress to shelve the proposals.

In a letter sent to legislators, National Multi Housing Council president Doug Bibby called tax credits, seller-financed downpayments and interest rate buydowns “bailouts for the for-sale housing market, the very sector of our economy that helped trigger the global economic crisis.” The letter was sent on behalf of the NMHC and the National Apartment Association.

Homebuyer tax credits were originally touted as “critical” to housing’s rebound by both realtors and home builders, but so far the results clearly have been less than flat. Realtors suggested to MarketWatch’s Amy Hoak earlier this week that buyers aren’t biting, because the credit isn’t free money and must be repaid.

“The only issue a homebuyer tax credit addresses is the oversupply of single-family houses, which is something best left to the marketplace — not taxpayers — to correct,” Bibby said.

“Oversupply situations happen in every industry, and the housing industry will recover with or without Congressional action, just as it has in past oversupply situations. Moreover, why should taxpayers help out an industry that recognized a downturn was coming and still kept overproducing?”

The Commerce Dept. said at the end of Oct. that the supply of new homes on the market represented 10.4 months of sales in Sept., well above historical norms (although improved from one month prior). Builders have been struggling with a huge inventory overhang throughout the ongoing housing crisis, with critics saying many builders failed to adjust quickly enough to the bust of the housing bubble.

“Why would the government want to use taxpayer dollars to encourage people to buy an asset that is expected to lose up to 25 percent of its value in the next 12 to 24 months?” Bibby asked. He argued that such incentives do little to create jobs, and merely put borrowers in the situation of being upside down on their new home; instead, he argued that builders need to take their medicine and absorb those losses directly.

Bibby suggested more traditional economic stimulus measures, rather than bailout attempts.

“If Congress wants to shore up the economy, it should stop favoring specific industries and instead enact proven economic stimulus policies, such as investment incentives for business, investing in our national infrastructure, extending unemployment benefits, issuing general aid to state governments and meaningful energy efficiency tax incentives for commercial real estate.”

Write to Paul Jackson at paul.jackson@housingwire.com.

source: housingwire.com


link to the original post:
Rental Housing Leaders Slam Homebuyer Tax Credits


Fort Lauderdale Blog and Real Estate News
Rory Vanucchi
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www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Hollywood hosts meeting to discuss beach erosion problem

Hollywood recently hosted a meeting to update residents on its ongoing battle with beach erosion.

A $48 million sand renourishment project completed just two years ago appears to have made little headway in some areas of Hollywood beach that are still showing signs of depletion.

Mayor Peter Bober assured residents at the Hollywood Beach Culture and Community Center that the city is aware of the severity of the problem and is committed to pursuing all available options.

"This is a major safety issue," he said. "One of the things we are doing is looking at long-term solutions. We've got to be totally diversified and think outside the box."

Steve Higgins, the county's beach erosion administrator, outlined several avenues that the city is considering, including importing sand from the Bahamas, to researching the quality of sand created from grounded-up glass.

Sand bypassing, a method that shuttles sand from one area to another, was once thought too costly to consider, but now it is on the table, he said.

Higgins cautioned that it won't be a quick fix. Obtaining permits, he said, is often a lengthy process due to stringent guidelines to protect coral reefs.

"Coral reefs are highly protected and heavily scrutinized by the regulatory agencies to make sure that the permit applicant is not going to damage these resources," Higgins said. "It took us six years to implement the last project that we built down there, so it's not something that you can just do overnight."

Some residents at the meeting, however, said action is needed quickly.

"We can not wait till 2010," said Juan Cuesta. "This is a fight between bureaucrats and Mother Nature, and you know who will win."

"It's very frustrating to hear them talk about ideas and concepts that are virtually no different than they were two years ago," said Lee Gottlieb, a resident of The Renaissance.

Gottlieb, who said he was able to solve his building's erosion problem by planting sea oats, urged the city to pursue planting vegetation on the beach as a major part of its plan.

He said he has seen the benefits firsthand after Higgins referred him to Thaddeus Hamilton of the Broward County Soil and Water Conservation District in 2006.

Hamilton has been using plants to retain sand for years, a process that leads to the formation of sand dunes, which become natural barriers.

"Thaddeus Hamilton helped us to design and install the dune system," Gottlieb said. "If we had not done that, the ocean would be at our pool today."

Many at the meeting expressed interest in planting vegetation, though there are those against it because the dunes block their view of the ocean.

"We know of many locations where there is a pretty dedicated opposition against putting sea oats down and building a dune for those reasons," Higgins said. "I think its shortsighted, but they are within their rights and they can actually stop a project by objecting to a permit."

Gottlieb said it's still worth pursuing.

"We have the answer. It's not the only answer, but it's one important element," he said. "And I'm a firm believer that if you give Mother Nature a hand, she will take care of the rest."


source: sun sentinal


link to the original post:
http://www.sun-sentinel.com/community/news/hollywood/sfl-flbeach1116swnov16,0,7640499.story



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Credit Crunch Squeezes Florida Timeshare Industry

(ORLANDO, FL) - The global credit crunch is now hurting the $10.6 billion time-share industry. And one of the hardest hit markets is Orlando, considered the time-share capital of the world.

In the last few weeks, Wyndham Worldwide's time-share group, the world's largest time-share company, and Central Florida Investments Inc./Westgate Resorts, the industry's largest privately held company, each laid off hundreds of Orlando-area employees as a result of the tightened credit markets. In the case of Westgate Resorts, which generates more than $1 billion in annual time-share sales revenue from 28 resorts in 11 states, the company is still experiencing strong demand and sales, but the lack of liquidity is forcing the company to lay off employees practically companywide.

The Ritz-Carlton Golf Club & Spa, Jupiter FL

Westgate Resorts principals declined to comment for the story. Wyndham Vacation Ownership spokesperson Lisa Burby, however, said the current economic conditions has forced the company to slow down its development pipeline and general sales and marketing efforts next year, and focus more on the higher-end clientele that has a greater propensity to buy and pay for vacation ownership units.

"We bundle loans, put them into a conduit and securitize them," added Burby, whose company has 145 vacation ownership resorts around the world and more than 800,000 owners. "With the credit markets being as tight as they are, it is affecting us because we can't get credit as quickly (to finance new consumer loans)."

Howard Nusbaum

Basically, the lifeblood of the timeshare industry is having the ability to securitize or hypothecate consumer loans through third-party financial institutions. In return for essentially selling this consumer debt at a discount, or pledging their customers' time-share notes as collateral in return for more capital, timeshare owners gain critical liquidity to operate their day-to-day businesses and generate more sales. With the credit markets all but frozen, though, the timeshare industry is "selling itself out of business by generating consumer loans through sales while being unable to monetize them," according to a letter by Howard Nusbaum, president and CEO of the American Resort Development Association.

That credit Catch-22 prompted an ARDA-led initiative to petition for federal assistance under the Emergency Economic Stabilization Act of 2008 recently passed by Congress. Specifically, in the letter drafted Oct. 22 to the White House Counsel of Economic Advisors, ARDA is "respectfully requesting Federal assistance to open frozen credit markets in the form of a federal guarantee of timeshare investment grade paper in exchange for a credit insurance fee paid to the U.S. government."

The ARDA letter went on to state: "Indications from the financial sector that has participated in numerous timeshare mortgage note sales and financing transactions involving a number of industry companies suggest some form of a credit wrap will provide immediate liquidity and this form of assistance could actually create a profit for the government while opening frozen credit markets, saving jobs and helping to maintain the industry's contribution to the U.S. economy.

The contribution represents 565,300 full- and part-time jobs, $62 billion in overall direct and indirect spending to the U.S. economy and more than $8 billion in local and state tax revenues, according to ARDA.

The contribution couldn't be felt more than in Florida, where the timeshare industry represented $14.3 billion to the statewide economy in 2005, a 25.6 percent increase from '02, according to a study conducted by PricewaterhouseCoopers in conjunction with the ARDA International Foundation, ARDA's research and educational arm.

Michael Butler

"The shared ownership industry does not have a demand problem," says Midlan International CEO Michael Butler, one of the industry's leading consultants. "The shared ownership industry is suffering from a liquidity problem with the banks. The shared ownership industry if it were able to obtain liquidity would carry on with very little negative impact. And if the government would listen to us and assist us to overcome that liquidity crisis we could keep this industry very healthy.


"The banks are getting nervous and not lending anymore. What's happening is the banks are hoarding cash. And until the market starts to thaw, our pace of sales as an industry is slowing down. As we're running out of liquidity, we're laying people off and as we're laying people off it's starting to spiral through the economy and this is the same thing that other industries are experiencing. We are experiencing it a bit more because we are so liquidity dependent to be able to turn our money over. This is going to have a major impact on Florida and Florida employees."

The Abaco Club on Winding Bay, A Ritz-Carlton Managed Club

Indeed, because Florida leads the nation in the number of time-share resorts (378) and the number of time-share units (47,400). According to the ARDA study, Florida's time-share properties and companies generated 161,100 full- and part-time jobs and $2.1 billion in tax revenue to local, county and state governments.

The majority of that economic impact, of course, is generated in Orlando, which features 125 resorts and more than half of Florida's vacation units (28,000). Additionally, Orlando is the corporate headquarters for most of the industry's biggest vacation ownership companies, including the publicly traded Marriott Vacation Club and Ritz-Carlton Club brands, Hilton, Starwood Hotels and Wyndham Worldwide's Vacation Ownership divisions, and Westgate, which represents Central Florida's seventh largest employer with more than 8,000 people.

"Once we get through this credit crisis, our industry is still positioned to be the little engine that could -- that one piece that historically shows a robustness during a downturn," Nusbaum notes. "The only reason why this one has been different is because of the credit lock up. So ARDA is doing everything it can to unfreeze those credit markets as quickly as possible.

"And that's why when on Oct. 12 the U.S. government came out and said, 'hey businesses, if you're having a problem based on the credit crisis, explain to us why that's happening, how that's happening, and how we might be a solution."

Ed Kinney

Not everybody is being drastically affected by the credit crunch. For example, Marriott Vacation Club and Marriott's high-end Ritz-Carlton Club developments are mostly self-funded through the parent company, according to company spokesman Ed Kinney, allowing the company to hold onto its mortgage notes until the market gets healthier.

"We support the trade association's efforts to act on behalf of the industry as a whole and have been actively contributing to these ideas and submissions," Kinney added. "Marriott, however, is in a far more favorable position in that we have not relied on third party lenders to support our growth and provide financing to purchasers."

Meanwhile, Starwood Vacation Ownership reports that certain markets are still performing well, including Orlando where Starwood's Sheraton Vistana and Sheraton Vistana Villages properties are having "pretty good years," according to spokesman David Matheson.

"The lack of financing and the credit crunch is less impactful to the big brands," Matheson pointed out. "But all of the hospitality and travel industry is being impacted now in one way or the other. And vacation ownership is not impervious to the challenges."

Steve Weisz

Like so many in the industry, however, Marriott Vacation Club International president Steve Weisz remains bullish on the industry. At least that was his opinion at the recent Vacation Ownership Investment Conference in Orlando.

As one of the panelists at an Oct. 8 presentation, titled, "Meet the Leaders," Weisz told a packed conference hall that he is "very optimistic in the growth and continued success of the timeshare business."


"This is a consumer-led recession, not a business-led recession, he added. "We as a company believe having a timeshare component as part of lodging is a nice complement. ... Our timeshares have held up relatively well. And our fractional and whole ownership stuff largely carries the Ritz-Carlton name that starts at $250,000 or $3 to $9 million for homes. So that's not for the faint of heart.

"The high-net worth individual is not caught up in the sub-prime (crisis). They're smart and sit on the sidelines, and that's how they made their money. We have great product in great locations, which we're fortunate to have. It will sell, it's just a matter of when."

source: real estate channel


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Rory Vanucchi
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www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Abu Dhabi Primed to Take Off with Louvre, Guggenheim in Tow

ABU DHABI, United Arab Emirates) - Even to the unintiated, Dubai has become a household name and single-handedly put the United Arab Emirates on the world map. Credit iconic projects such as the towering Burj Al Arab hotel shaped like a billowing sail, the Palm Jumeirah, Tiger Woods' first golf course design and Donald Trump's celebrated real estate development for helping shape Dubai's sudden mass appeal.

Now it's time for Abu Dhabi, Dubai's huge oil-rich neighbor to the south, to burst onto the world scene. And make no mistake that Abu Dhabi's emergence will be every bit as big, elegant and high-profile as its fellow emirate.

In fact, with 87 percent of the UAE's land mass (32,000 square miles) and 90 percent of the federation's oil and natural gas resources, Abu Dhabi is positioned to consume this part of the world in unprecedented fashion.

The Louvre Abu Dhabi

Case in point is the recent announcement that the Tourism Development & Investment Company (TDIC), the development arm of the Abu Dhabi Tourism Authority, has lined up the renowned Louvre and Guggenheim Museums to anchor Saadiyat Island Cultural District. The Jean Nouvel-designed Louvre Abu Dhabi, and the Frank Gehry-designed Guggenheim Abu Dhabi Museum are just two of the high-profile developments being built on the 10.4 square-mile natural island that lies less than 1/3 of a mile off the Abu Dhabi mainland.

Other featured projects on Saadiyat Island, projected to be the Arabian Gulf's largest single mixed-use real estate development: the Sheikh Zayed National Museum, a Lord Norman Foster-designed tribute to the late president and founding father of the seven-state United Arab Emirates; Saadiyat Beach Golf Course, which features the UAE's only Gary Player-designed course set to open next March and a soon-to-be named second layout; and the Arabian Gulf's first St. Regis Resort, a $600-million, 380-room resort with 292 additional St. Regis residences scheduled to open May 2010.

In all, Saadiyat Island, located 15 minutes from the Abu Dhabi International Airport, will comprise 150,000 residents and 9,000 rooms in 29 mostly 5-star hotels when the project is completed around 2018. In one of its first U.S. interviews, TDIC marketing and public relations director Alan Gordon told the Real Estate Channel that Saadiyat Island's mix of palace homes, smaller single-family homes, and townhomes start at around $1.5 million.

Guggenheim Abu Dhabi

"Our goal and objective is we are a master developer who is charged with creating major destinations in Abu Dhabi only - to support the tourism growth with a strong focus on culture, leisure and the environment," added Gordon, whose emirate is more than four times the size of Dubai in gross domestic product at approximately $163 billion. "Saadiyat Island is thought thru holistically so it comes together as a complete destination. It's very much tied to who Abu Dhabi is. That is a strong point about Abu Dhabi and its identity.

"We're looking back to look forward; Respectful of the past from a cultural perspective. Not so much heritage, but more from a cultural perspective. That then, allows an identity to move forward."

In some respect, while Dubai is the glitzy Las Vegas of the Eastern Hemisphere, Abu Dhabi is becoming the cultured New York City.

The world is taking notice with the Wall Street Journal recently naming Saadiyat Island one of the top 10 future destinations in the world.

"Where else can you walk from the Louvre to a Guggenheim to the Sheik Zayed Museum, go and play golf on a Gary Player ocean-facing golf course, then go and stay a night in the St. Regis that sits here overlooking the ocean," says Gordon, whose TDIC has some 100 real estate projects in the works. "Saadiyat island will be home to an incredible array of offerings that will create this cultural center if you like - one that will support the cultural exchange of culture and the mutual understanding of culture both ways. This is very much a case of the cultures being shared. Sort of a gateway if you like for cultures."

In some respect, Abu Dhabi's signature Saadiyat Island is also the gateway to a whole new Arab World, one that has all the makings of even more marvelous Arab destination than Dubai.


source: real estate channel


link to the original post:
http://www.realestatechannel.com/international-markets/residential-real-estate/abu-dhabi-primed-to-take-off-with-louvre-guggenheim-in-tow-64.php



Fort Lauderdale Blog and Real Estate News
Rory Vanucchi
RoryVanucchi@gmail.com

http://www.lasolaslifestyles.com/
http://www.fortlauderdaleliving.net/

Public safety column: Thieves go high tech

By Sallie James SunSentinel.com
November 14, 2008

Thieves can be imaginative when it comes to stealing your money, with some of the most popular schemes involving automatic teller machines or phony land deals.

High-tech crooks have found ways to install removeable card readers in the machines, enabling them to steal personal information from the card you slip it into the slot, said Broward Sheriff's Sgt. Jay Leiner.

They've also figured out ways to hook up tiny cameras that record your personal identification numbers.

When you complete your transaction, the thieves remove the equpment, hook it up to a computer, and download your personal information, Leiner said.

Related links

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Everything they need to know is contained in the magnetic strip on your card.

"They run the numbers and make up cards," Leiner said.

For thieves, it's a lucrative business. For the victims, it means untold headaches.

"It's becoming quite commonplace, especially at gas stations," Leiner said. "We might not see it for months at a time, and then we see it happen several times -- a couple times a month and then it disappears," he said.

To avoid becoming a victim:

Pull on the spot in the ATM or gas pump where the card goes in. If anything comes off, don't use the machine.

Be watchful of your surroundings. The thieves are usually watching because they don't like to leave their equipment unattended.

In another twist, thieves have also used hand-held card readers to steal credit card information from restaurant customers, said Palm Beach County Sheriff's Sgt. Keith Conley.

The waiter skims the cards of his customers, and gets paid for every card he skims, Conley said.

The thief who owns the skimmer downloads the credit card information to a computer, without the victim ever knowing, Conley said.

Real-estate rip-offs are another type of burgeoning crime, police said.

One of the most common involves fake real estate sales.

An alleged landowner tries to sell land that he doesn't own or that doesn't even exist, Leiner said.

In October, the Broward Sheriff's Office charged a North Lauderdale man with grand theft for selling an imaginary six-acre stretch to a buyer for $100,000.

The victim made two payments a year apart without ever seeing the property or obtaining a legal description of the tract, Leiner said.

"If you are going to be buying land, you might want to go look at it, check the county records and see who owns it, see if it's up for sale," Leiner said.

Stay Safe appears every Saturday in the Local section. Send questions or column suggestions to StaySafe@Sun-Sentinel.com, or to Stay Safe, Sun-Sentinel, 200 E. Las Olas Blvd., Fort Lauderdale, FL 33301

Sallie James can be reached at Sjames@sun-sentinel.com or 954-572-2019.


source: sun sentinal


link to the original post:
http://www.sun-sentinel.com/news/local/crime/sfl-1114publicsafetycol,0,1821664.story


Fort Lauderdale Blog and Real Estate News
Rory Vanucchi
RoryVanucchi@gmail.com

www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Housing Prices Spur Property Tax Appeals

BY AMY REEVES

INVESTOR'S BUSINESS DAILY

Posted 10/30/2008

As if it weren't bad enough that one's home may have fallen 20% or more in value since purchase, the property tax bill can add insult to injury.

"Property tax assessments are going to lag a little behind (real home values)," said Eric O'Keefe, editor of Land Report magazine. "They're not in real time."

The gap between full assessments can range two to 20 years depending on jurisdiction. Typically it's the lower end of that range, but a lot can happen even in a few months.

For homeowners hit by value declines since the end of the housing boom, a year's lag can make a huge difference in their tax bill. So it's not surprising that many are appealing their property tax assessments.

In parts of Northern California, assessors have reduced tax values on nearly a third of residential properties, many bought in the boom. Property tax appeals are running four times higher than last year in El Dorado County, near Sacramento.

Nationwide Appeal?

In Southern California, the Orange County Register reports that its populous district is seeing 72% more appeals than last year.

Meanwhile Georgia's Macon and Bibb counties plan to add another tax-assessment office to deal with a burgeoning workload, while "unprecedented" appeals are cited in a report from the New Orleans area.

Those in the tax business are sensing a nationwide trend.

"All we can tell you is that, anecdotally, we've seen more interest," said Pete Sepp, spokesman for the National Taxpayers Union, a nonpartisan group for tax limits. "Clearly individuals are more motivated than they were a year or two ago."

It doesn't cost much to try getting property taxes reassessed lower. The procedure varies from state to state, but generally filing an appeal costs $25 or less — in some places, it's even free. Some localities, such as Fairfax County, Va., let a person do the whole procedure by mail.

The main limitation is time. The window for filing an appeal may be as little as 30 days after a homeowner gets an assessment. Be prepared to swing into action to make a case.

There are two main reasons to adjust an assessment, according to Sepp. One, the assessor may have incorrect data on the home — the square footage, the number of bathrooms, or some such thing. These matters can be readily cleared up with empirical proof.

Today's Big Issue

The more likely cause of a reassessment these days, however, is a change in the market value of a property. That can be a trickier thing to prove, as an owner has to show that properties comparable to his own are going for lower prices.

So where does a homeowner start? Some appraising agencies put their data online, which can make it even easier to find general standards of assessment. If a homeowner can find another property that seems similar to his own on the relevant points, and it has just sold for less, that could be all the data needed.

But for evaluating one's own property, O'Keefe suggests finding out who originally appraised it, and giving him or her a call. With a storehouse of data on local properties, appraisers can easily make updates.

"Personally that's what I did," he said. "I saw a jump in the assessed value of my property, so I called the original appraiser and asked, 'Has it really gotten that much appreciation?' They said yes, because the appraiser had done an update."

Homeowners can also request documentation, such as worksheets and paper records, on how the property was assessed.

When Finding Fault Is Good

This can be a good place to spot errors in an evaluation, such as if it claims a new roof has been added when in fact it was just patched.

Sepp advises homeowners to swallow their pride and see all of their property's faults. Each of them could reduce the tax bill.

"Why pay for drawbacks to your home?" he said. "You might as well point it out to the assessor, because anybody who seeks to buy it will find it immediately. It's not like you're keeping some secret."

A homeowner still not sure of a property's true worth could hire his own appraiser to reassess it. But, of course, the homeowner would have to decide whether the $300 to $500 typically paid for such an appraisal is worth the potential tax savings.

Mostly Do-It-Yourself

Owners of commercial property, and those with a lot riding on the outcome, might want to hire a lawyer.

But both O'Keefe and Sepp say it should not be necessary for the ordinary homeowner to hire legal help. Most appeals boards are made up of local citizens, so a homeowner doesn't need arcane technical knowledge to make a case.

The main roadblock one is likely to meet is that governments don't want to give up a source of funds — especially true in the current tight times.

O'Keefe suggests gauging the mood of the municipal board.

"Are they pro-development?" he said. "Are they interested in trying to encourage certain types of investment in the area? If so, they might be more lenient."

source: ibd


link to the original post:
http://www.investors.com/editorial/IBDArticles.asp?artsec=27&issue=20081030


Fort Lauderdale Blog and Real Estate News
Rory Vanucchi
RoryVanucchi@gmail.com

www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Housing Prices Spur Property Tax Appeals

BY AMY REEVES

INVESTOR'S BUSINESS DAILY

Posted 10/30/2008

As if it weren't bad enough that one's home may have fallen 20% or more in value since purchase, the property tax bill can add insult to injury.

"Property tax assessments are going to lag a little behind (real home values)," said Eric O'Keefe, editor of Land Report magazine. "They're not in real time."

The gap between full assessments can range two to 20 years depending on jurisdiction. Typically it's the lower end of that range, but a lot can happen even in a few months.

For homeowners hit by value declines since the end of the housing boom, a year's lag can make a huge difference in their tax bill. So it's not surprising that many are appealing their property tax assessments.

In parts of Northern California, assessors have reduced tax values on nearly a third of residential properties, many bought in the boom. Property tax appeals are running four times higher than last year in El Dorado County, near Sacramento.

Nationwide Appeal?

In Southern California, the Orange County Register reports that its populous district is seeing 72% more appeals than last year.

Meanwhile Georgia's Macon and Bibb counties plan to add another tax-assessment office to deal with a burgeoning workload, while "unprecedented" appeals are cited in a report from the New Orleans area.

Those in the tax business are sensing a nationwide trend.

"All we can tell you is that, anecdotally, we've seen more interest," said Pete Sepp, spokesman for the National Taxpayers Union, a nonpartisan group for tax limits. "Clearly individuals are more motivated than they were a year or two ago."

It doesn't cost much to try getting property taxes reassessed lower. The procedure varies from state to state, but generally filing an appeal costs $25 or less — in some places, it's even free. Some localities, such as Fairfax County, Va., let a person do the whole procedure by mail.

The main limitation is time. The window for filing an appeal may be as little as 30 days after a homeowner gets an assessment. Be prepared to swing into action to make a case.

There are two main reasons to adjust an assessment, according to Sepp. One, the assessor may have incorrect data on the home — the square footage, the number of bathrooms, or some such thing. These matters can be readily cleared up with empirical proof.

Today's Big Issue

The more likely cause of a reassessment these days, however, is a change in the market value of a property. That can be a trickier thing to prove, as an owner has to show that properties comparable to his own are going for lower prices.

So where does a homeowner start? Some appraising agencies put their data online, which can make it even easier to find general standards of assessment. If a homeowner can find another property that seems similar to his own on the relevant points, and it has just sold for less, that could be all the data needed.

But for evaluating one's own property, O'Keefe suggests finding out who originally appraised it, and giving him or her a call. With a storehouse of data on local properties, appraisers can easily make updates.

"Personally that's what I did," he said. "I saw a jump in the assessed value of my property, so I called the original appraiser and asked, 'Has it really gotten that much appreciation?' They said yes, because the appraiser had done an update."

Homeowners can also request documentation, such as worksheets and paper records, on how the property was assessed.

When Finding Fault Is Good

This can be a good place to spot errors in an evaluation, such as if it claims a new roof has been added when in fact it was just patched.

Sepp advises homeowners to swallow their pride and see all of their property's faults. Each of them could reduce the tax bill.

"Why pay for drawbacks to your home?" he said. "You might as well point it out to the assessor, because anybody who seeks to buy it will find it immediately. It's not like you're keeping some secret."

A homeowner still not sure of a property's true worth could hire his own appraiser to reassess it. But, of course, the homeowner would have to decide whether the $300 to $500 typically paid for such an appraisal is worth the potential tax savings.

Mostly Do-It-Yourself

Owners of commercial property, and those with a lot riding on the outcome, might want to hire a lawyer.

But both O'Keefe and Sepp say it should not be necessary for the ordinary homeowner to hire legal help. Most appeals boards are made up of local citizens, so a homeowner doesn't need arcane technical knowledge to make a case.

The main roadblock one is likely to meet is that governments don't want to give up a source of funds — especially true in the current tight times.

O'Keefe suggests gauging the mood of the municipal board.

"Are they pro-development?" he said. "Are they interested in trying to encourage certain types of investment in the area? If so, they might be more lenient."

source: ibd


link to the original post:
http://www.investors.com/editorial/IBDArticles.asp?artsec=27&issue=20081030


Fort Lauderdale Blog and Real Estate News
Rory Vanucchi
RoryVanucchi@gmail.com

www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Sterling takes a pounding

By Katie Hunt
Business reporter, BBC News

Britons are likely to be making fewer trips to the US.

This time last year, bargain-hungry shoppers headed across the Atlantic to New York's swanky department stores in droves.

With the pound worth more than $2, they sought out cheap iPods, designer clothes and gourmet restaurants.

But few will be flying to New York to do their Christmas shopping this year.

Sterling has been one of the biggest victims of the global financial meltdown - losing more than a quarter of its value since July.

It has now fallen below $1.50 for the first time since 2002. The pound is also at its weakest level against the euro since the currency was created in 1999.

See the pound's performance against the dollar

"People really aren't going to want to make international holidays," says Simon Derrick, chief currency strategist at Bank of New York Mellon.

'Worst recession'

Sterling's problems are linked to the wider economic picture.

The UK is expected to have the worst recession of all the G7 rich nations and this means investors think UK assets will perform poorly.

"Like everywhere, the UK economy is slowing down," says Daragh Maher, senior currency strategist at French investment firm Calyon.

Sterling has been like an elastic band that had been stretched too far and when it gave, it was vicious Daragh Maher, Calyon

"But the perception is that we have over-borrowed more than countries, so the payback will be greater."

Falling interest rates put further pressure on sterling.

Last week, the Bank of England delivered a shock one-and-a-half percentage point cut in UK interest rates to 3%, the lowest level since 1955.

Economists expect rates to fall further.

It means that investors get a lower yield on pound deposits and sterling-denominated debt, making them less attractive.

This could pose a problem for the government, as it is expected to issue debt to pay for the banking bail-out.

Falling fast

It is unusual for a currency to fall so far, so fast.

Only twice in recent history has sterling fallen by such a degree.

On 16 September 1992, the pound was withdrawn from the European Exchange Rate Mechanism, triggering a fall from around $2 to $1.40.

Iceland's financial crisis has made it more affordable for travellers.

Sterling fell by a similar degree in 1980 as a commodity bubble burst.

Mr Maher says that the pound at $2 was significantly overvalued and puts the currency's long-term intrinsic value at around $1.60.

"It's been like an elastic band that had been stretched too far and when it gave, it was vicious," he says.

Mr Derrick at Bank of New York Mellon says it is feasible that the pound could hit $1.40 in the near future and one euro could be worth more than 85 pence.

Winners

The fall in sterling could benefit manufacturers as the weak pound makes UK-made goods more competitive on international markets.

Similarly, overseas visitors may view the weak pound as reason to visit the UK.

"The recent fall in sterling and the approaching Olympics in 2012 give us a tremendous opportunity to promote Britain's attractions as a destination to the world, " says Tom Wright, chief executive of Visit Britain.

But, with the world entering an economic downturn, demand for UK exports and holidays may dwindle, as hard-up consumers opt to conserve their cash.

Comfort

For those planning to take summer holidays abroad, there is some comfort.

While the pound has weakened against most major currencies, particularly the dollar, euro and yen, it has held up against others.

Sterling has risen 10% against the Australian dollar since the end of June, as falling commodity prices have undermined the Australian economy.

And if you really want to maximise your hard-earned pounds, Iceland's financial crisis has made the notoriously expensive country more affordable.

The pound has gained about 25% against the Icelandic crown since the end of June, when Iceland's economy began to hit the rocks.

source: bbc


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Bretton Woods II - five key points on the road to a new global financial deal

• guardian.co.uk, Friday November 14 2008 00.01 GMT
• The Guardian, Friday November 14 2008

John Maynard Keynes in 1944 at the UN International Monetary Conference in Bretton Woods, New Hampshire. The summit's agreement shaped with postwar economic effort. Photograph: Hulton Archive

International institutions

While the summit is almost certain not to create a new "Bretton Woods" system overnight, countries led by Britain and France want an enhanced role for the International Monetary Fund, to improve surveillance of complex financial markets and help prevent such excesses building up in future. They also favour increased funding for the IMF.

Gordon Brown made well-publicised efforts to persuade Gulf states to make large contributions to its coffers, while there is also pressure on China, and Japan has pledged $100bn of reserves.

The additional money would enable the IMF to finance more bail-outs to countries suffering runs on their currencies and banks.

The US is less keen on this because new streams of funding would dilute its voting rights within the Washington-based institution.

Similarly, the keenness of oil-rich Gulf states to contribute will be tested now that oil prices have more than halved from their summer peaks.

Global regulation

There is a widespread recognition that regulation of financial markets has been far too weak in recent years. Authorities have been increasingly aware of the excesses building up in such markets, like those for mortgage-backed securities, but have failed to increase regulation.

There is also, though, a recognition that too hasty regulation in response to a crisis, like that of the Sarbanes-Oxley Act brought in by the US Congress in 2002 in response to the Enron scandal (and designed to improve corporate responsibility and combat corporate and accounting fraud), could be counter-productive.

So, there will be discussion of a new global regulator that can force banks and hedge funds to be more transparent about their borrowings and their investment positions.

Such an organisation would force banks to hold greater capital cushions or make them pay bonuses in shares that would have to be held in a company for, say, five years, to make sure it was the longer-term interests of the shareholders that was the focus rather than the bankers' own short-term interests.

There is also discussion of a temporary suspension of "mark to market" accounting rules under which banks are required to report the current value of their assets at times when pricing those assets - such as sub-prime mortgages - is virtually impossible.

Recapitalisation of banks

This is already happening around the world, with most countries following the British model. The US government announced changes to its $700bn bail-out for its banking system on Wednesday, under which it will buy fewer toxic mortgage-backed securities from banks and instead recapitalise banks by buying shares.

This weekend's G20 meeting will discuss a possible response to the problem of banks running out of capital - which probably would be based on a Spanish-style system whereby banks have to hold a bigger capital cushion in good times, which they can draw upon in bad times.

Building such a system will not happen overnight but G20 leaders will probably commit themselves to such action. There is also likely to be discussion of new rules to simplify derivatives products and improve the transparency of the markets in which they are traded.

Fiscal/monetary policy

One aim of the G20 summit is to coordinate global action on interest rates in an effort to pump some life back into the world economy and avoid deflation, or falling prices.

Most governments have already begun to cut and many are also either embarking on, or considering, tax cuts or spending increases to help reflate countries' economies - especially as the impact of interest rate cuts in many economies is being hampered now by the poor availability of credit.

Brown is trying to lead globally coordinated tax cuts. But public deficits in Britain have grown so large in recent years that the country is one of the worst-placed of the main economies to afford a big fiscal giveaway.

New world order

Recent decades have been dominated by western industrialised nations grouped together under the banner of the Group of Seven, but the summit, this weekend, billed as G20, marks a significant shift.

Large-scale economies such as China, India and Brazil now have a place at the table and are demanding a much greater say in global economic oversight because they consider the old "Anglo-Saxon" free-market dogma to be dead.

Reflecting this shift, Brown has indicated that it could be possible to get an agreement on the Doha round of trade talks, which collapsed in Geneva earlier this year amid bitter recriminations between the US and India.

The French president, Nicolas Sarkozy, for his part, will use the summit to suggest that the days of the dollar as the world's reserve currency are over.

source: guardian uk


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California economy loses $28 billion yearly to health effects of pollution

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David McNew / Getty Images

The downtown L.A. skyline is visible through smog from the 110 Freeway.

Most of the losses are attributable to 3,000 annual deaths, a Cal State Fullerton study says. The study underscores the economic benefits of meeting federal air quality standards.

Louis Sahagun
November 13, 2008

The California economy loses about $28 billion annually due to premature deaths and illnesses linked to ozone and particulates spewed from hundreds of locations in the South Coast and San Joaquin air basins, according to findings released Wednesday by a Cal State Fullerton research team.

Most of those costs, about $25 billion, are connected to roughly 3,000 smog-related deaths each year, but additional factors include work and school absences, emergency room visits, and asthma attacks and other respiratory illnesses, said team leader Jane Hall, a professor of economics and co-director of the university's Institute for Economics and Environment Studies.

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The study underscores the economic benefits of meeting federal air quality standards at a time when lawmakers and regulators are struggling with California's commitment to protecting public health in a weak economy.

The $90,000 study does not propose any particular action. But in an interview, Hall said, "We are going to pay for it one way or the other. Either we pay to fix the problem or we pay in loss of life and poor health. . . . This study adds another piece to the puzzle as the public and policy-makers try to understand where do we go from here."

The California Air Resources Board is scheduled to vote Dec. 11 on whether to adopt broader rules that would force more than 1 million heavy-duty diesel truckers to install filters or upgrade their engines. Truckers and agribusiness have argued against stricter regulation, saying it is too expensive for them to invest in clean vehicles at a time of economic uncertainty.

Mary Nichols, chairman of the air resources board, said the findings will "be useful to all of us. Our board members hear on a regular basis from constituents who are concerned about the costs of regulations, and seldom hear from people concerned about their health because they are collectively and individually not as well organized."

In the meantime, the two regions continue to pay a steep price for generating air pollution ranked among the worst in the country. In the South Coast basin, that cost is about $1,250 per person per year, which translates into a total of about $22 billion in savings if emissions came into compliance with federal standards, Hall said. In the San Joaquin air basin, the cost is about $1,600 per person per year, or about $6 billion in savings if the standards were met.

The savings would come from about 3,800 fewer premature deaths among those age 30 and older; 1.2 million fewer days of school absences; 2 million fewer days of respiratory problems in children; 467,000 fewer lost days of work and 2,700 fewer hospital admissions, according to the study.

The study noted that attaining the federal standard for exposure to particulates would save more lives than lowering the number of motor vehicle fatalities to zero in most of the regions examined.

The hardest hit were fast-growing communities in Kern and Fresno counties, where 100% of the population was exposed to particulate concentrations above the average federal standard from 2005 to 2007. High rates of exposure were also found in San Bernardino and Riverside counties, where diesel soot is blown by prevailing winds and then trapped by four mountain ranges.

Considered the most lethal form of air pollution, microscopic particulates expelled from tailpipes, factory smoke stacks, diesel trucks and equipment can penetrate through the lungs and enter the bloodstream. Exposure to these fine particles has been linked to severe asthma, cancer and premature deaths from heart and lung disease.

"In the South Coast basin, an average 64% of the population is exposed to health-endangering annual averages of particulates," Hall said, "and in the most populated county -- Los Angeles -- it is 75%.

"In most years, the South Coast and San Joaquin basins vie with the Houston, Texas, area for the worst air pollution trophy, but this year we took it back," she said. "That's not a prize you want to be handed. Essentially, imported T-shirts and tennis shoes are being hauled to Omaha and the big-rig diesel pollution stays here."

Nidia Bautista, community engagement director for the Coalition for Clean Air, described the findings as "staggering, and a reminder that health is too often the trade-off when it comes to cleaning the air."

Angelo Logan, spokesman for the East Yard Communities for Environmental Justice, put it another way: "At a time when government is handing out economic stimulus packages, we could use an economic relief package to help us deal with environmental impacts on our health, families and pocketbooks."

Hall agreed. "This is a drain that could be spent in far better ways," she said.

Sahagun is a Times staff writer.

louis.sahagun@latimes.com

source: la times


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U.S. moves to prop up those at risk of foreclosure

Bush administration directs Fannie and Freddie to ease mortgage terms, hopes to set standard for lenders

BARRIE MCKENNA

With a report from Associated Press

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November 12, 2008

WASHINGTON -- In a sign that the U.S. housing crisis is getting worse, not better, the Bush administration and the mortgage industry are moving to stop a fresh wave of Americans from losing their homes to foreclosure.

The government yesterday directed Fannie Mae and Freddie Mac to ease terms on hundreds of thousands of delinquent home loans. The announcement follows similar foreclosure prevention plans by major commercial banks, including Bank of America Corp., Citigroup Inc., and JPMorgan & Chase Co. The bank said that Citigroup's efforts, for example, would save as many as 130,000 homeowners from foreclosure.

"We need to stop the downward spiral," said James Lockhart, director of the U.S. Federal Housing Finance Agency.

This week's actions mark a renewed effort by the government and banks to tackle the heart of the mortgage crisis - the millions of American households losing their homes or threatened with foreclosure as the United States slides into recession. The various loan workout plans would touch roughly 1.6 million homeowners.

The move by Fannie Mae and Freddie Mac, which own or guarantee nearly 60 per cent of all U.S. home mortgages, should set a standard for the rest of the industry, Mr. Lockhart said.

Anything that keeps homeowners out of foreclosure is a good thing, agreed Celia Chen of Moody's Economy.com. But she said these programs "only nibble at the problem."

Some U.S. authorities also criticized the plan as inadequate. Federal Deposit Insurance Corp. head Sheila Bair said the plan "falls short of what is needed to achieve wide-scale modifications of distressed mortgages, particularly those held in private securitization trusts."

Those mortgages could prove much trickier to modify.

As many as 12 million homeowners are now "underwater" on their mortgages, meaning they owe more than their homes are worth, she said.

By the end of June, more than four million homeowners were behind on payments or in foreclosure, data from the Mortgage Bankers Association show. That represents 9 per cent of borrowers with a mortgage.

And Moody's Economy.com estimates that 8.5 million U.S. homeowners will default on their mortgages between 2008 and 2010. Roughly 5.2 million of them will lose their homes.

Troy Courtney, for example, left his Mill Valley, Calif., home after many attempts at a loan modification. Mr. Courtney had two loans on the house and could not persuade the loan manager to modify terms.

"I feel like I missed the boat," said the San Francisco police officer, 44.

Economist Nouriel Roubini of New York University said the underlying problem is that Americans have too much debt.

"You cannot grow yourself out of a debt problem," he said. "When debt to disposable income is too high, increasing the denominator with rebates is ineffective and only temporary. You need to reduce the debt."

The Fannie Mae and Freddie Mac plan targets homeowners most at risk - those who've missed at least three loan payments, live in their homes and haven't declared bankruptcy. Under the arrangement, Fannie Mae and Freddie Mac will pay loan service companies $800 for every homeowner for which they arrange more affordable monthly payments (defined as 38 per cent of gross household income), either by cutting interest rates, extending loan terms or deferring payment of principal.

The program is set to begin Dec. 15.

Citigroup said it would target borrowers at risk of foreclosure by cutting interest rates to as low as 3 per cent and stretching payment periods to as long as 40 years.

"With the unemployment rate rising and rising, more and more borrowers are getting into financial distress because of loss of income," said Sanjiv Das, chief executive of CitiMortgage. "It is a problem the country will face for some time to come, so it is very important to reach out to borrowers before they become delinquent."

Even U.S. authorities acknowledge the plan has limitations. The government is not stepping in to forgive all or part of any mortgages.

"There is no silver bullet to address the housing downturn," said Neel Kashkari, the Treasury's interim assistant secretary for financial stability.

"We are experiencing a necessary correction and the sooner we work through it, the sooner housing can again contribute to our economic growth."

The scope of the problem is much larger than the relatively small part of the problem that is in the hands of Freddie Mac or Fannie Mae.

The dismal shape of the housing market is making loan modifications increasingly tricky. As U.S. home prices continue falling, a growing number of homeowners are underwater on their mortgages.

These homeowners have little incentive to honour their debts, and many of them will choose to simply walk away from their homes.

And U.S. officials said most troubled mortgages are held by entities other than Fannie and Freddie.

Mr. Lockhart urged those lenders to follow Fannie Mae and Freddie Mac's lead. Beyond moral suasion, the government can't make that happen.

Economist Ed Yardeni said Fannie and Freddie remain "hobbled" by inadequate capital and so they are unable to vastly grow their mortgage portfolios. He urged the government to nationalize the two agencies, and let them lend as much as $2-trillion at a heavily discounted rate of 4 per cent.

"That would be a much more effective way to bail out the financial system, the housing market, and the economy," Mr. Yardeni said.

The Treasury Department seized the two government-created entities in early September because of their ailing finances.

A break for homeowners

Some of the biggest U.S. banks and mortgage companies plan to cut home-loan payments for borrowers facing foreclosures. Here are some of the current and planned initiatives to help homeowners avoid foreclosure:

Citigroup

Will reach out to about 500,000 homeowners with $20-billion in new mortgages during the next six months.

Helped about 370,000 people with $35-billion in mortgages avoid foreclosure since 2007.

Restructured more than 120,000 mortgages, including granting extensions, during the first half of 2008.

JPMorgan Chase

Will halt foreclosure on some loans as it works to make payments easier on $110-billion of problem mortgages.

Plans to assist 400,000 families with $70-billion in mortgage loans in the next two years.

Helped an additional 250,000 families with $40-billion in mortgages under existing loan-modification programs.

Bank of America

Will cover more than $120-billion in unpaid loan balances.

Announced two plans this year to help reduce customers' loan payments by as much as $11-billion.

Modified 226,000 loans this year.

Fannie Mae, Freddie Mac

Will reduce principal or interest rates on some loans and extend terms of others.

Programs won't include money from the Treasury's $700-billion bank rescue package.

Source: Bloomberg

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Mall owner in liquidity crunch

General Growth Properties, a nationwide owner and manager of shopping malls, said in a Securities and Exchange Commission filing that it might be forced to file for Chapter 11 bankruptcy if it could not refinance nearly $1 billion in debt coming due in December.

It owns four shopping malls in South Florida:

• Bayside Marketplace in Miami
• Village of Merrick Park in Coral Gables
• Pembroke Lakes Mall in Pembroke Pines
• Mizner Park in Boca Raton

General Growth (NYSE: GGP) shares fell 14 cents on Wednesday to close at a new low of 35 cents after Standard & Poor’s said it was dropping it from the S&P 500.

In addition to the nearly $1 billion due in December, it has more than $3 billion coming due in 2009, a legacy from General Growth’s 2004 purchase of the Rouse Co. for $7.2 billion plus $5.4 billion of assumed debt.

Bill Hemingway, managing director of Integra Realty resources’ Miami office, said General Growth’s local mall properties may not be performing poorly, even though retailing in general is down.

“I don’t think the properties will go dark, but there may be some rent adjustments in the near future because of the expected poor Christmas season,” he said. “It would have to be on an area-by-area and property-by-property basis.”

He added that General Growth’s over-leveraged debt strategy appears to be backfiring in the current retail and debt climate.

source: South Florida Business Journal


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Apartment Market Weakens

From the National Multi Housing Council (NMHC): Weakening Economic Conditions Create Challenging Conditions For Apartment Sector, According to National Multi Housing Council Survey (hat tip Jon Lansner at the O.C. Register)

“Nine straight months of job losses have begun to cut into the demand for apartment residences,” said Mark Obrinsky, NMHC’s Vice President of Research and Chief Economist. “While favorable demographics and a lower homeownership rate will benefit the apartment industry over time, owners and managers will first have to work their way through the current economic downturn before the benefits of that increased demand are likely to show up. Until then, economic worry will cause some people to “double up” by moving in with a friend or returning to their parents’ house.”

The Market Tightness Index, which measures changes in occupancy rates and/or rents, dropped from 40 last quarter to 24. This was the fifth straight quarter in which the index has been below 50. (For all of the survey indexes, a reading above 50 indicates that, on balance, conditions are improving; a reading below 50 indicates that conditions are worsening; and a reading of 50 indicates that conditions are unchanged.)

Click on graph for larger image in new window.

This graph shows the quarterly Apartment Tightness Index.

As NMHC chief economist Obrinsky noted, it is common in a recession for apartment vacancies to rise, as households double up by moving in with a friend or family member. However an added factor in this recession is all the single family homes being offered as rentals. This is additional competition for apartments and might also be impacting demand for apartments.

source: calculated risk


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Boat sales not completely sunk

While attendance may be down at the 49th annual Fort Lauderdale International Boat Show and boat sales have run into choppy seas, some positive signs persist for both the show and boat sales across South Florida.

The show, which ran Oct. 30 through Nov. 3, saw a 4 percent decrease in attendance from last year for all of the days of the show, excluding the final Monday, a show spokeswoman said.

Show Management, the managerial agency, did not immediately provide exact headcounts for each day or final figures. The spokeswoman estimated that between 130,000 and 140,000 people attended last year.

Sales figures may not be available until a week after the show ends, but the general outlook was positive, according to Show Management COO Andrew Doole.

However, the show's projected economic impact, which includes hotel bookings and restaurant sales, has been revised from $720 million to $650 million.

The financial crisis caused some concern for vendors and show organizers, he said. Still, “I think everybody here is pleasantly surprised at the crowd we’ve got.”

The crowd was relatively steady, thanks to increased marketing efforts abroad. The show targeted Russia, the Middle East and South America, in particular, Doole said. The result: a 15 percent increase in international attendance.

International attendance was helped by the fact that many new marinas have been built in Central and South America and the value of the U.S. dollar, which, until recently, had declined against many foreign currencies, Doole said.

“The boats here are a bargain at the moment,” he noted.

While the dollar and the soft market for smaller boats have caused many price tags to drop, not every boat is a bargain. Some brokers and builders said the megayacht sector –those boats longer than 80 feet and often priced in the millions – are selling just fine.

“Under 100 feet or under 80 feet, those guys are dying,” said Tim Johnson, a broker at International Yacht Collection’s Fort Lauderdale office. But, since most of International Yacht Collection’s boats are “well above” 100 feet and its clientele is extremely affluent, the company’s business is steady, he said.

“People ask me on a daily basis: ‘Isn’t the price of fuel affecting your business?’ Oh, give me a break,” Johnson said.

Mike Dickman, director of marketing for HMY Yacht Sales in Dania Beach, said that most of HMY’s boats are in the mid range – 45 feet to 80 feet – exposing them to more market pressure than the biggest boats. Still, early sales from this year’s show forecast a better year than last, he said.

The credit crunch may make financing a boat more difficult, but it didn’t play a large role, said Frank Herhold, executive director of Marine Industries Association of South Florida. However, it could impact lower-end sales where the industry is seeing a slowdown, he said.

“My gut feeling is [getting financing is] a little bit tougher but it’s there,” Herhold said. “I haven’t had dealers tell me they lost a sale because they couldn’t get financing.”

At any rate, the high-end deals are mostly cash, he noted.

South Florida Business Journal reported data in late September showing that new boat sales here declined 26 percent for the first half of 2008 compared to the same period in 2007.

The decline is a large concern for the marine industry, which has an estimated $13.5 million impact on the region and accounts for more than 150,000 jobs.

source: south florida business journal - by Bill Frogameni


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Bruce Springsteen spends $4.6M in Wellington

by Christine Scott, published Tuesday, November 11 1:39 PM ·

Mr. Springsteen

Bruce Springsteen bought a five-bedroom, six-bath home at 3561 Ambassador Road in Wellington from William Farish, Jr., and his wife, Kelley, for $4.6 million on Sept. 26.

According to the Daily Business Review, Springsteen purchased the property through an entity titled Stone Hill Trust.

The 5,946-square-foot home is in the Equestrian Club Estates subdivision, which is home to the the annual Winter Equestrian Festival. Springsteen's 15-year-old daughter, Jessica, is an equestrian.

Springsteen is largely considered one of the greatest American popular recording artists in history. Known for penning songs that reflected the working class roots of his New Jersey upbringing, "The Boss," has won eighteen Grammy Awards, an Academy Award, and sold over 65 million albums in the U.S and 120 million worldwide.

Springsteen first started playing small clubs in the 1960s, but it wasn't until 1973 that he released his first major label album, Greetings from Asbury Park, N.J. The album, along with second release, The Wild, the Innocent & the E Street Shuffle, were critical successes.

His third album, Born to Run, made Springsteen a household name name. The album included hits "Born to Run" and "Thunder Road."

He would go on to make a handful of other acclaimed albums before 1984's Born in the U.S.A., arguably his most popular album. It contained timeless classics "Born in the U.S.A.," "Dancing in the Dark" and "I'm on Fire."

Springsteen has continued to tour and record original material, most recently The Magic, which was released in Oct. 2007.

He married his second wife, Patti Scialfa, in 1981. The couple resides primarily in the affluent community of Rumson, N.J.

Springsteen paid $3.1 million for the nearby property at 3561 Ambassador Road on June 20.

Mr. Farish has been the principal overseer of Lane's End Farm, a breeding establishment for thoroughbred race-horses owned by his parents. He has served as an executive vice president and director of W.S. Farish & Co., an investment management company. He also founded Woodford Racing, LLC, a racing stable with over 50 horses.

The University of Virginia graduate was as a personal aide to former President George H.W. Bush and worked with Texas Commerce and Merrill Lynch.

Mrs. Farish has worked at the American Horse Council in Washington as a research associate. She graduated from Rollins College.

There have been 849 sales in Wellington in 2008, with a median price of $312,000.

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Mortgage assistance plan could save the homes of many South Floridians

Troubled borrowers embroiled in the worst housing debacle in decades will get lifelines from the government and the banking industry.

The Federal Housing Finance Agency and other agencies said Tuesday they plan to speed up the process for renegotiating hundreds of thousands of past-due home loans held by Fannie Mae and Freddie Mac.

Tuesday's announcement, along with recent loan-modification strategies from major banks, could go a long way toward easing the nation's housing slump.

"This will be a way to keep people paying their mortgages, staying in their homes and breathing a little bit," said Paula Siegel, 60, a Boynton Beach resident who hopes to benefit from a loan restructuring by Countrywide Financial Corp.

Citigroup, Bank of America and JP Morgan Chase & Co. have agreed to modify delinquent mortgages after getting money from the federal government. As part of the $700 billion bailout, the U.S. Treasury is handing out cash to recapitalize struggling banks.

South Florida, in particular, has been hammered by plummeting home prices and foreclosures during the past few years. Many people stretched to buy homes they ultimately couldn't afford.

One in every 124 households in Broward County was in foreclosure in September, according to RealtyTrac, an Irvine, Calif.-based company. One in every 238 households is facing foreclosure in Palm Beach County. RealtyTrac is set to release October numbers on Thursday.

"It's time that the government is taking the bull by the horns and helping the people down at the bottom who need help the most," said Lew Freeman, a banking consultant in Fort Lauderdale and Miami.

Fannie and Freddie, taken over by the federal government in September, own or guarantee nearly 31 million U.S. mortgages. Officials do not yet have an estimate of how many people would qualify for the new program, which goes into effect Dec. 15.

Borrowers would have to be at least 90 days behind on their home loans and would need to owe 90 percent or more than the home is currently worth. Excluded would be investors who do not occupy their homes and borrowers who have filed for bankruptcy.

Borrowers would benefit by getting reduced interest rates and having loans extended from 30 years to 40 years. In some cases, the principal amount would be deferred interest-free.

"The most important element is the principal write-downs," said Brad Hunter, a housing analyst based in West Palm Beach. "Modifying loans to lower the interest rates helps some, but not enough."

Citigroup said late Monday it is freezing foreclosures for borrowers who live in their own homes, have good incomes and stand a decent chance of making lowered mortgage payments. The bank is targeting homeowners in Florida and other states with large unemployment and foreclosure rates. The program is expected to affect about $20 billion in mortgages.

Late last month, Chase expanded its mortgage modification program to an estimated $70 billion in loans.

There's no public record of large regional players such as Fort Lauderdale-based BankAtlantic and BankUnited of Coral Gables taking the government handouts, said Ken Thomas, a Miami-based economist and banking analyst. Until then, they may not be so willing to modify home loans, he said.

"Once they're approved for government assistance, I would expect them to follow a similar [loan-modification] program," Thomas said.

Bank of America said it will modify an estimated 400,000 loans held by newly acquired Countrywide as part of an $8.4 billion legal settlement reached with 11 states, including Florida, in early October.

Even though banks stand to lose money on the renegotiated mortgages, "they'll still have people in the houses protecting their interest," Thomas said. "The last thing you want to see in a neighborhood is newspapers out front and the grass three feet tall."

This report was supplemented by the Associated Press

Paul Owers can be reached at powers@sunsentinel.com or 561-243-6529.

source: sun sentinal

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http://www.sun-sentinel.com/business/sfl-flzmortgage1112sbnov12,0,1949108.story

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