A home with a sale pending is shown in Tallahassee, Fla, Sept. 23, 2009. The National Association of Realtors said on Oct. 1 that the volume of signed contracts to buy previously occupied homes rose for the seventh straight month in August as buyers rushed to take advantage of a tax credit for first-time owners that expires at the end of November. (AP)

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An American housing bubble and bust lead the U.S. economy into near-collapse. An ocean of federal funds and tax credits have helped slow the bust.

Now, some of those interventions are winding up, just as a new wave of foreclosures may be looming. An $8,000 tax credit for first-time home buyers expires next month. Lobbying is hot and heavy right now to have it extended and expanded.

Otherwise, home builders and realtors warn, home prices could skid again. They may anyway.

This hour, On Point: Home prices, housing, the U.S. economy, and what comes next.

You can join the conversation. Tell us what you think — here on this page, on Twitter, and on Facebook.

-Tom Ashbrook

Guests:

Joining us from Washington is Diana Olick, real estate correspondent for CNBC.

Joining us from Wellesley, Mass., is Karl Case, professor of economics at Wellesley College and co-author, with Yale economist Robert Shiller, of the Case-Shiller Home Price Index, the most widely cited database of housing prices in the U.S.

From Leesburg, Va., we’re joined by Thomas Lawler, housing economist and founder of Lawler Economic & Housing Consulting.

And from San Diego we’re joined by Mark Zandi, chief economist and co-founder of Moody’s Economy.com.

A pending home sale in Palo Alto, Calif. Nationwide, home resales are up 9 percent from January, new home sales have climbed 17 percent and construction, though still anemic, has risen almost 20 percent. (AP)

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Some hopeful signs out there for the economy. The GDP’s plunge has slowed — some economists see it bottoming out, and turning around.

Housing sales are up. Manufacturing — stabilized. Ditto construction. The Obama team hit the airwaves Sunday to sound a note of cautious optimism. The president and vice president hit the road this week to talk up the economy.

But hanging over it all is a dark cloud of unemployment. With jobs still scarce, what kind of recovery, if any, can we expect?

This hour, On Point: Crisis and recovery. Is the economy at a turning point?

You can join the conversation. Tell us what you think — here on this page, on Twitter, and on Facebook.

-Jane Clayson, guest host

Tom Ashbrook is on vacation.

Guests:

Joining us from New York is John Harwood. He’s chief Washington correspondent for CNBC, and a political writer for The New York Times. His latest book, co-authored with Gerald Seib, is “Pennsylvania Avenue: Profiles in Backroom Power.”

Joining us from New Haven is Robert Shiller, professor of economics at Yale University. He collaborated with economist Karl Case to produce the Case-Schiller Home Price Index, the most widely used database of housing prices in the U.S. He’s the co-founder and chief economist of Macro Markets, a specialty investment bank that trades in real estate markets. His latest book is “Animal Spirits: How Human Psychology Drives the Economy, and Why it Matters for Global Capitalism.”

Joining us from Philadelphia is Jeremy Siegel, professor of finance at the Wharton School at the University of Pennsylvania. He’s author of “The Future for Investors: Why the Tried and the True Triumph Over the Bold and the New,” and “Stocks for the Long Run: The Definitive Guide to Financial Market Returns and Long-Term Investment Strategies.”

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Ed Andrews ought to have known better.

Andrews is a longtime economics reporter for The New York Times. He’s covered interest rates and housing markets and mortgage lending; the Fed and Wall Street, busts and bubbles. So he should have known.

But life is complicated. Dreams are not always sensible. And even Ed Andrews got in over his head in the housing bubble. A house he couldn’t afford. Mortgage payments that got away from him. Too much alimony. Too little income.

Now he is one of the ocean of Americans waiting for foreclosure. This hour, On Point: The story of Ed Andrews, busted.

You can join the conversation. Tell us what you think — here on this page, on Twitter, and on Facebook.

-Tom Ashbrook

Guest:

Ed Andrews joins us from New York.  A veteran economics reporter for The New York Times, he tells his personal subprime mortgage story in his new book “Busted: Life Inside the Great Mortgage Meltdown.”

Read an excerpt from the book that appeared in The New York Times Magazine this past Sunday.

A house with a pool is advertised for under $80,000 in Stockton, Calif., on March 13, 2009. The National Association of Realtors said on Monday, March 23, that sales of existing homes rose from January to February in an unexpected boost for the slumping U.S housing market as buyers took advantage of deep discounts on foreclosures. (AP)

Head-turning news in the home market this week. In the midst of the worst housing crash in decades, with foreclosures and for-sale signs all over, February new home sales suddenly ticked up 4.7 percent — 9.7 percent in the South.

That got people’s attention. But what’s really going on here?

With mortgage rates way down, new tax incentives in place, mobs of homes on the market, is it time to buy? To bid? To run from the home market? To rent? To sell? It’s been down so long a twitch can look like up. But is it?

This hour, On Point: America’s home market, in motion.

You can join the conversation. Tell us what you’re seeing. Are you selling? Buying? Renting? Waiting?

-Tom Ashbrook

Guests:

Joining us from Philadelphia is Susan Wachter, professor of finance and real estate at the University of Pennsylvania’s Wharton School and co-director of the Penn Institute for Urban Research.

From Vienna, Virginia, we’re joined by June Fletcher, “House Talk” columnist for The Wall Street Journal and author of the 2005 book “House Poor: Pumped up Prices, Rising Rates, and Mortgages on Steroids: How to Survive the Coming Housing Crisis.”

And from Washington, DC, is Elizabeth Razzi, “Local Address”  columnist for The Washington Post and author of “The Fearless Home Buyer.”

President Barack Obama unveils his plan to address the home mortgage crisis on Wednesday, Feb. 18, 2009, at Dobson High School in Mesa, Arizona. (AP)

Barack Obama went to Mesa, Arizona yesterday, a community hit hard by the nation’s housing crisis, and rolled out his plan to help up to nine million struggling homeowners.

At $275 billion, the plan is big — bigger than many had expected. But there are already those asking if it’s big enough to address the sheer scale of the problem.

And there are plenty more questions: Who exactly gets help, and who doesn’t? Where does it leave banks? And does this plan get to the root of the economic crisis?

This hour, On Point: Obama’s big move on housing.

You can join the conversation. What do you think of the plan? Have you seen the details? Are you encouraged? Confused? Are you among those eligible for help — or wondering why you’re not?

-Jane Clayson, guest host

Tom Ashbrook is on vacation this week.

Guests:

Joining us from Washington is Michael Crittenden.  He covers economic news for Dow Jones.

Joining us from Laguna Beach, Calif.,  is Susan Wachter, professor of finance and real estate at the University of Pennsylvania’s Wharton School.

And from New York, we’re joined by Robert Shiller, professor of economics at Yale University. He collaborates with economist Karl Case to produce the Case-Shiller Home Price Index, the most widely used database of housing prices in the U.S.

A Florida development. (Photo: fallsroad/Flickr)

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It’s cold up north, and the world dreams of Florida. Warm, sunny, green and beckoning.

But the Sunshine State is in a world of trouble, and the trouble is all about real estate. When houses were hot here, they were very hot. Maybe the hottest. And as long as there was a new buyer chasing the sun, it seemed it would go on forever.

Until it didn’t. New Yorker writer George Packer calls it the “Ponzi State.” He’s been out in the home foreclosure deserts of Florida, watching a world fall apart.

This hour, On Point: On the front lines of the meltdown in Florida.

You can join the conversation. Have you seen it? Do you live it? The dystopia of life in the housing meltdown in the sunshine state? What about your state? Will Florida come back? When? How?

-Tom Ashbrook

Guest:

George Packer joins us from New York.  A staff writer for The New Yorker, he’s reported on war in Iraq, atrocities in Sierra Leone, civil unrest on the Ivory Coast. He’s the author of several books, including “The Assassins’ Gate: America in Iraq.” His big article in this week’s issue is “The Ponzi State: Florida’s foreclosure disaster” (subscription required). You can watch Packer talk about the piece at newyorker.com. His New Yorker blog is Interesting Times.

President Barack Obama speaks to reporters during a meeting about the economy with Congressional leaders, Friday, Jan. 23, 2009, in the Roosevelt Room of the White House in Washington. From left are, House Minority Leader John Boehner of Ohio, House Speaker Nancy Pelosi of Calif. and the president. (AP)

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The economy just gets worse. The new Obama administration is pushing urgently for a huge stimulus package. $825 billion. Now Republicans are saying no. Too big, too much spending, said minority leader John Boehner yesterday.

But the leading free-market economist of the last generation, Ronald Reagan’s top economic adviser in the White House, is saying yes to stimulus.

Economist Martin Feldstein says it wouldn’t be his first choice, but there is now no other way. We’re out of options.

This hour, On Point: Uber-economist Martin Feldstein on the global economy and the stimulus challenge.

You can join us. Are you ready to hit the giant spend button in Washington to save the economy? Are you with the Republican minority in resisting?

-Tom Ashbrook

Guest:

Joining us in our studio is Martin Feldstein, economics professor at Harvard University, president emeritus of the National Bureau of Economic Research, and former chairman of the Council of Economic Advisers under President Reagan. The Wall Street Journal says he “may be the most influential economist of his generation.” He’s taught everyone from Obama advisor Larry Summers and the new head of the Congressional Budget Office, Doug Elmendorf, to Bush advisors Lawrence Lindsay and Glenn Hubbard. A longtime advocate of free-market economics, he’s known as the “father” of the George W. Bush tax cuts.

More links:

Feldstein made waves recently by coming out strongly in support of a major stimulus package. Here you can read his recommendations on the economy to Congress.

A Wall Street Journal blog post provides an interesting look at Dr. Feldstein’s network of former students, who continue to populate Washington’s upper echelons. The Journal also notes that he’s found a new voice.

Meanwhile, Nouriel Roubini has real concerns that 2009 will bring even worse financial news. George Soros thinks there’s a right way and a wrong way to save the banks. And the New York Times’ Paul Krugman remains uncertain about President Obama’s direction on the economy.

A realty sign stands outside a new home for sale in southeast Denver on Thursday, Nov. 20, 2008. (AP)

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Wall Street got its bailout. Detroit now has its backers.

What about the little homeowner whose mortgage is sinking the family budget? The millions and millions of homeowners facing woe and foreclosure, whose collective problem is drowning the national economy?

There is still a raging debate over whether homeowners should get a lifeline at all. But plans are being made. Super-low mortgage interest rates or new tax breaks may be on the way.

But for whom? New homeowners? Struggling homeowners? Can we afford this?

This hour, On Point: Bailing out the home-owning world.

You can join the conversation. Would bargain-basement mortgage interest rates and foreclosure relief turn your town, your life, the national economy around? Do you want your failing neighbors to get a helping hand from Washington? Do you want a piece of that pie, too?

-Tom Ashbrook

Guests:

Joining us from New York is Michael Corkery, a reporter for The Wall Street Journal covering housing and home-building. His most recent piece, looking at the Treasury Department’s proposal to push down mortgage rates, was headlined “Lower Rates Help Sell Houses, but Market Faces Broader Ills.”

Also from New York, we’re joined by Dwight Jaffee, a professor at the Haas School of Business at the University of California at Berkeley. He is currently visiting at New York University’s Stern School of Business.

And from Wellesley, Mass., we’re joined by Karl Case, professor of economics at Wellesley College. A national authority on the economics of housing and real estate, he collaborates with economist Robert Shiller to produce the Case-Schiller Home Price Index, the most widely used database of housing prices in the U.S.

A house under foreclosure in Antioch, Calif., Aug. 14, 2008. (AP)

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Despite the giant banking bailouts underway in Washington, it is now clear we are not finished paying the piper for the subprime mortgage mess.

After the banks, there stand millions more homeowners facing foreclosure. If they go down, the battered housing market — and maybe the whole economy — goes with them.

But bailing them out — block by block, house by house, loan by loan — presents all kinds of hazards, moral and otherwise. Who gets saved? Who doesn’t? How? And how do home prices find a real bottom?

This hour, On Point: Facing up to dealing with the home foreclosure wave.

You can join the conversation. Who should be saved? Do we all go down if a trillion more dollars in mortgages go belly up? Share your thoughts.

-Tom Ashbrook

Guests:

Joining us from Washington, DC, is Diana Olick, real estate correspondent for CNBC and author of the Realty Check blog.

Joining us from New York is Daniel Alpert, a founding partner of investment bank Westwood Capital. His Freedom Recovery Plan, developed to help homeowners with troubled mortgages, was written about recently by New York Times columnist Joe Nocera. The column generated a large response, and Alpert responded to critics on Nocera’s blog. You can also read his Westwood Capital report “Putting a Floor Under American Homes: How Low Do We Go?”

From Bethesda, Maryland, we’re joined by Guy Cecala, CEO and Publisher of Inside Mortgage Finance Publications, Inc., which publishes the newsletter Inside Mortgage Finance.

A California house under foreclosure. (AP)

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“Contagion” is the hot and ugly word of the week. A finance meltdown hitting markets around the world now, and hitting them hard.

London, Frankfurt, Paris, Brazil, Argentina – Iceland! And reaching into businesses from car showrooms to vacation planners.

But the tap root of this crisis still goes down to the American home and housing market, and the fancy finance that sent home prices and lending practices roaring off the map. Fixing that problem reaches deep into national policy and individual lives.

This hour, On Point: American housing and finance. What went wrong, and how to fix it.

You can join the conversation. What new rules should be in place? Should we make it more difficult to buy a home? Should we stop banks from playing with mortgage securities? Should we put up big firewalls on Wall Street to head off future disasters? Tell us what you think.

-Tom Ashbrook

Guests:

Joining us from London is Philip Coggan, global markets editor for The Economist. Its latest piece on the global financial turmoil is headlined “No end in sight.”

Joining us from New York City is Dwight Jaffee, professor of banking, finance, and real estate at the University of California at Berkeley, and a visiting professor at New York University.

Susan Wachter, professor of finance and real estate at the University of Pennsylvania’s Wharton School.

A townhouse for sale in Brooklyn, N.Y. (AP Photo/Mark Lennihan)

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Housing and crazy-easy money drove the U.S. economy. Now, a housing tumble and tight credit are hurting.

If you’re trying to sell a home, you know. May numbers, out this week, show home prices down 16 percent from a year ago in major markets nationally. Down 23 percent from their peak in ’06.

But month-to-month, April to May, down just one percent. Could the crashed and trashed and foreclosure-haunted American housing market be bottoming out?

This hour, we’ll go to L.A., Philadelphia, Boston, and Chicago to look at what’s selling, how and where, and ask if a housing-market bottom is in sight.

Is it a bloodbath in your neighborhood? Is it turning around? Do you have a home on the market? What are you hearing from would-be buyers? Buyers, what do you expect to get a deal done? Realtors, are we turning the corner, out of the great housing crisis of ‘08, or are we still in the thick of it?

Join the conversation — right here on this page — and tell us what you think in the comments section below.

-Tom Ashbrook

* * *

Guests:

Joining us from Philadelphia is Susan Wachter, professor of finance and real estate at the University of Pennsylvania’s Wharton School. She’s a big-picture analyst of real estate nationwide.

With us from Los Angeles is Peter Viles. He watches the real estate market for the Los Angeles Times and writes the paper’s “L.A. Land” real estate blog.

Joining us from Chicago is Susan Diesenhouse, business and real estate reporter for The Chicago Tribune.

And with us in Boston is Kimberly Blanton, real estate reporter for The Boston Globe. She reported this week on Boston home prices showing some “spring.”

Links:

Here are roundups from Bloomberg and The New York Times on the Case-Shiller nationwide home price survey released this week with numbers from May.

]]> http://www.onpointradio.org/2008/07/real-estate-realities/feed 23 http://www.onpointradio.org/2008/06/home-prices-and-the-economy http://www.onpointradio.org/2008/06/home-prices-and-the-economy#comments Thu, 26 Jun 2008 14:00:00 +0000 Wen Stephenson http://www.onpointradio.org/2008/06/home-prices-and-the-economy/

The numbers out this week show a housing market going to hell in a handbasket — if we’re not already there. Prices plunging at historic rates, home sales dropping all over.

As Congress haggles over a landmark bill to provide relief for beleaguered homeowners, everyone wants to know if we’ve hit bottom yet, or if there’s farther to fall. And if we’re due for a bounce, will it come in weeks, months, or many, many years?

We’ll crunch numbers with top housing experts, and hunt for silver linings.

This hour, On Point: Home prices, and where they’re taking us.

- Guest host Jane Clayson

Guests:

Karl Case, professor of economics at Wellesley College and co-author, with Yale economist Robert Shiller, of the Case-Schiller home price index, the most widely cited database of housing prices in the U.S.

Eric Belsky, executive director of the Joint Center for Housing Studies at Harvard University, which publishes the annual report, “State of the Nation’s Housing.”

Carl Chapman, a realtor based in Phoenix, Arizona.

When Wall Street giant Bear Stearns was on the ropes last month, it took the federal government less than two days to leap in and guarantee a bailout for a bank with a reputation for playing fast and loose in the markets.

With millions of homeowners around the country up against foreclosure and millions of homes already lost, it’s taking Uncle Sam a little longer.

But should Washington be bailing out mortgage holders who bought too much house on terms that are now biting hard?

This hour, On Point: The great debate. How much help is the right help for homeowners on the brink?

-Tom Ashbrook

Guests:

Rep. Barney Frank, Democrat from Massachusetts, chairman of the House Financial Services Committee.

Sarah Lueck, reporter for The Wall Street Journal covering Congress’s efforts to address the housing crisis.

Joseph Mason, professor of finance at Drexel University and senior fellow at the University of Pennsylvania’s Wharton School.

Josh Nassar, vice president for federal affairs at the Center for Responsible Lending.

If you want to see the madness and the grisly aftermath of the U.S. housing boom and bust, look at Florida. It’s not alone. Vegas, Phoenix, San Diego, Detroit — they’ve all got horror-story numbers now. But the biggest home price drops in the country were in Miami last year.

Empty condos, collapsing values. The heart of the Florida meltdown — in Miami, the southwest, the Gulf Coast — could be Exhibit A for what went wrong in American real estate.

The condo vultures are out now. And there’s a story to tell.

This hour, On Point: Florida real estate, and the great American meltdown.

-Tom Ashbrook

Guests:

Wayne Archer, executive director of the Bergstrom Center for Real Estate Studies at the University of Florida.

Peter Zalewski, founder of Condo Vultures, a real estate investment consulting firm.

Mike Larson, real estate analyst for Weiss Research.

Susan MacManus, professor of political science at University of South Florida.

When President Bush unveiled his administration’s plan last week to help Americans — more than a million of them — struggling to pay subprime mortgages, critics immediately called it “too little, too late.”

In communities all across the country — from the inner city to well-heeled suburbs — foreclosures are rampant. And the worst of the subprime mortgage meltdown may be yet to come.

Just in time for the holidays: bankers versus American homeowners who only wanted a piece of the American dream.

This hour, On Point: the real human cost of the subprime mortgage debacle.

-Jane Clayson

Guests:

Greg Ip, economics reporter for The Wall Street Journal.

Eric Halperin, Washington director of the Center for Responsible Lending.

Christopher Hudak, Housing Counseling Coordinator for the Boulder County Housing Authority.

Mayor Douglas Palmer, mayor of Trenton, New Jersey, and president of the U.S. Conference of Mayors.

Former Wall Street hotshot, now Treasury Secretary, Hank Paulson is orchestrating a big banks “mega-fund” to help mop up the subprime mortgage mess — and try to get some of that bad debt off the books and avoid a deeper credit crunch that could still stove in the U.S. economy.

The stakes are high, but still critics are crying foul. Wall Street titans made vast fortunes playing fast and loose in the run-up, they say. So should Washington be saving their bacon now, when ordinary Americans at the other end of the meltdown are losing their homes?

This hour, On Point: Main Street, millionaires, and moral hazard in the subprime mess.

-Tom Ashbrook

Guests:

David Henry, senior writer at Business Week.

Robert Shiller, professor of economics at Yale University and co-founder of Macro Markets, a specialty investment bank that trades in real estate markets.

Robert Kuttner, co-founder and co-editor of The American Prospect magazine.

Roger Ehrenberg, former Wall Street banker, financial blogger at Informationarbitrage.com and president of Monitor 110, a financial intelligence firm.