“As part of a settlement with state attorneys general, the five largest mortgage servicers are adopting new requirements for short sales, which is expected to speed-up what has been known as a lengthy process.”

Here are some of the new requirements for servicers under the settlement:

• Servicers must provide borrowers with a decision within 30 days after receiving a short sale package request.

• Servicers will be required to notify a borrower, also within 30 days, if any necessary documents are missing to process the short sale request.

• Servicers must notify a borrower immediately if a deficiency payment is needed to approve the short sale. They also must provide an estimated amount for the deficiency payment needed for the short sale.

• Servicers are also required to form an internal group to review all short sale requests.

• Banks will be considered in violation of the settlement requirements if they take longer than 30 days on more than 10 percent of the short sale requests. Violations can carry fines of up to $1 million and $5 million for repeat offenses.

“If a real estate broker can get a checklist from the bank detailing what documentation is needed, everything can be provided up front, and the bank will be required to give a thumbs-up or a thumbs-down within 30 days,” short sale specialist Chris Hanson with the Hanson Law Firm told HousingWire. “That’s not a bad deal.”

“Existing-home sales rose 4.3 percent in January to a seasonally adjusted annual rate of 4.57 million, marking the third gain for home sales in the last four months, the National Association of REALTORS® reports.”

“The uptrend in home sales is in line with all of the underlying fundamentals – pent-up household formation, record-low mortgage interest rates, bargain home prices, sustained job creation and rising rents,” NAR’s Chief Economist Lawrence Yun says.”

“While sales ticked up, inventories of for-sale homes also continued to show improvement, NAR reported. At the end of January, total housing inventory fell 0.4 percent to 2.31 million existing homes for sale, which represents a 6.1-month supply at the current sales pace.”

“The broad inventory condition can be described as moving into a rough balance, not favoring buyers or sellers,” Yun says. “Foreclosure sales are moving swiftly with ready home buyers and investors competing in nearly all markets. A government proposal to turn bank-owned properties into rentals on a large scale does not appear to be needed at this time.”

“Unsold listed inventory has steadily dropped since reaching a peak of 4.04 million in July 2007. It now is 20.6 percent below where it was a year ago, NAR reports.”

Housing Affordability Improves

“As home prices have fallen and mortgage rates at all-time record lows, housing affordability is at some of its highest levels on record.”

“Word has been spreading about the record high housing affordability conditions and our members are reporting an increase in foot traffic compared with a year ago,” says NAR President Moe Veissi. “With other favorable market factors, these are hopeful indicators leading into the spring home-buying season. We’re cautiously optimistic that an uptrend will continue this year.”

“The national median existing-home price for all housing types in January was $154,700, which is down 2 percent year-over-year.”

“Distressed sales, which tend to sell at steep discounts, continue to hamper home prices nationwide. Foreclosures and short sales accounted for 35 percent of all January home sales, which is up slightly from 32 percent in December.”

“Still, “home buyers over the past three years have had some of the lowest default rates in history,” Yun said. “Entering the market at a low point and buying at discounted prices have greatly helped in that success.”

Breakdown by Housing Type

Here’s a closer look at how home sales fared by housing type in January:

Single-family home sales: increased 3.8 percent to a seasonally adjusted annual rate of 4.05 million in January from 3.90 million in December. They are 2.3 percent above the 3.96 million-unit pace a year ago. Median price: $154,400 in January, down 2.6 percent from January 2011.

Existing condominium and co-op sales: rose 8.3 percent to a seasonally adjusted annual rate of 520,000 in January from 480,000 in December. They are 10.3 percent lower than the 580,000-unit level in January 2011. Median price: $156,600 in January, up 2 percent from a year ago.

Home Sales by Region

The following is a breakdown of existing-home sales in January by region:

• Northeast: increased3.4 percent to an annual pace of 600,000 in January and are 7.1 percent above a year ago. Median price: $225,700, which is 4.2 percent below January 2011.
• Midwest: increased 1 percent in December to a level of 980,000 and are 3.2 percent higher than January 2011. Median price: $122,000, down 3.9 percent from a year ago.
• South: rose 3.5 percent to an annual level of 1.76 million in January but are unchanged from a year ago. Median price: $134,800, which is 0.3 percent below January 2011.
• West: increased 8.8 percent to an annual pace of 1.23 million in January but are 3.1 percent below a spike in January 2011. Median price: $187,100, down 1.8 percent from a year ago.

Contract Delays, Cancellations Remain High

Twenty-one percent of NAR members in January reported delays in contracts, and 33 percent said contracts fell through, according to NAR. The number of contract cancellations remains mostly unchanged from December.

The increase in the past year of contract cancellations or delays has been blamed on more lenders declining mortgage applications from stricter underwriting standards and low appraisals coming in under the agreed upon contract price.

“Florida’s existing home and existing condo sales continued their positive trend in fourth quarter 2011, posting gains compared to the same period a year earlier, according to the latest housing statistics from Florida Realtors®.”

“Existing home sales rose 7 percent in 4Q 2011 with a total of 42,038 homes changing hands statewide; during the same period the year before, a total of 39,355 homes sold, according to Florida Realtors. Statewide sales of existing condos in the fourth quarter rose 4 percent compared to the year-ago sales figure.”

“Florida’s existing-home median sales price was $132,000 for the three-month period, down only 1 percent from the $133,400 reported in 4Q 2010. The median is a typical market price where half the homes sold for more, half for less.”

“In the year-to-year quarterly comparison for existing condo sales, 18,558 units sold statewide in the fourth quarter compared to 17,922 units in 4Q 2010 for a 4 percent gain. The statewide existing-condo median sales price was $88,800 in the fourth quarter; a year earlier, it was $84,400 for a 5 percent increase.”

“The quarterly numbers continue to show the steady improvement of the housing market in Florida,” says Florida Realtors Chief Economist Dr. John Tuccillo. “The upward movement in sales has been pretty much across the state. Prices have stabilized, and in general, the state’s economy is improving. With that improvement, we expect continued growth in housing activity.”

“Mortgage rates continued to hover around historical lows in the fourth quarter. According to Freddie Mac, the national commitment rate for a 30-year conventional fixed-rate mortgage averaged 4.01 percent in 4Q 2011; one year earlier, it averaged 4.41 percent.”

“ The 4Q 2011 sales data release is the last release handled under Florida Realtors’ partnership with the University of Florida’s Bergstrom Center for Real Estate Studies. Beginning with the January 2012 existing sales statistics, Florida Realtors will launch a new statewide housing market reporting partnership with 10K Research and Marketing, a division of the Minneapolis Area Association of Realtors and its Industry Data and Analysis department.10K will collect and organize housing sales data from the state’s 63 local Realtor organizations. The goal is to provide unique, localized market reports to the local Realtor boards and associations, enabling the groups and their Realtor members to serve as the definitive voice of real estate in their respective local markets.”

“At the same time, Florida Realtors will provide more comprehensive statewide housing market statistics – but the data series will only include statewide numbers. Beginning with the January 2012 report, Florida Realtors will no longer report any market data for Realtor members’ sales in the state’s metropolitan statistical areas, as had previously been reported.”

“Housing analysts expect home prices to stabilize in 2012, but that doesn’t mean buyers and sellers won’t continue to be at odds over home prices.”

“While buyers are feeling good about the housing market and saying it’s a great time to buy, seller sentiment is falling to a record low, a new report by the Mortgage Bankers Association shows. Sellers say they’re unhappy because they can’t snag the prices for the home that they want.”

“The MBA report finds a large sentiment gap between homebuying and home selling that isn’t expected to narrow for at least five quarters.”

“From 1992 to 2005, seller sentiment remained high – between 40 percent and 60 percent, according to the report. However, since 2005, seller sentiment decreased to 7.6 percent. Meanwhile, homebuyer sentiment has remained high despite unemployment and economic conditions. Nearly 80 percent of American households say now is a good time to purchase a home.”

“As home values dropped over the last few years, many sellers refused to budge on their prices to reflect current market traditions. One reason why: About 20 percent of homeowners nationwide are considered “underwater,” owing more on their mortgage than their home is currently worth.”

“ Also, some sellers realize there may be a benefit in waiting to sell or keeping the home on the market to hold out for a higher price, says the author of the report, Gary Engelhardt, a Syracuse economics professor.”

“This (trend) could hold prices high enough to drive a substantial wedge between the existing buyer and seller,” Engelhardt says. “And a poor jobs market with limited mobility, a key driver of housing-market transactions, may exacerbate this.”

“A group that includes members of Roy E. Disney’s investment fund Shamrock Holdings is planning a 70-unit condo on Miami Beach.”

“Developer Palau Sunset Harbor has paid for public notices that announce it will make its case before a Miami Beach Planning Board on Jan. 24.”

“The five-story condominium would be built on an assemblage that includes Mark’s Quality Cleaners, at 1201 20th St. a 15,000-square-foot building constructed in 1947.”

“The project comprises 43 units with 500 to 999 square feet, 12 units with 1,000 to 1,200 square feet, and 15 units with more than 1,200 square feet, according to Condo Vultures, which examined plans for it filed with the Miami Beach Planning Department. It includes 13,100 square feet of ground floor commercial space.”

The developer paid a combined $8.2 million, or $150 a square foot, for the parcels, according to public records.

“ The late Roy Edward Disney was an executive at Walt Disney World and nephew of Walt Disney, founder of the entertainment company that spawned the theme parks, animation studio and other related pursuits.”

“His firm’s proposal comes as more than 4,500 units built east of Interstate 95 during the last residential real estate boom remain unsold in South Florida east of Interstate 95. The 20 towers currently being proposed in the tri-county area, if they are all built, would add 4,200 units into the market.”

“Florida, and especially South Florida, continues to face challenges: For a second straight month, home pricing in Miami shrank by 4 percent from year to year, a downward trend affecting 20 cities S&P/Case-Shiller tracked in October.”

“Florida Realtors data for November provides a more complicated picture of the market: Median pricing in Palm Beach County was down for both single-family homes and condos, while the median pricing for residences in both Broward and Miami-Dade were up.”

“Genting Malaysia Bhd (GENM) has unveiled a mammoth US$3 billion (RM9.27 billion) master plan for its Resorts World Miami development in the US, which will feature iconic skyscrapers with designs inspired by a coral reef and will serve as the centrepiece of a new three-mile Baywalk that will activate the city’s waterfront. A casino will be included if Florida’s legislature and governor approve the destination resort legislation.”

The mega project will include four hotels with a total of 5,200 rooms and two residential towers featuring 1,000 units.

“Resorts World Miami will accelerate Florida’s evolution as a global destination at the crossroads of the Americas. Our goal is to create Resorts World Miami as the most successful destination resort in the Americas,” said GENM chairman and chief executive Tan Sri Lim Kok Thay in a filing with Bursa Malaysia Thursday.”

“On May 27, 2011, Bayfront 2011 Property LLC, a unit of GENM, had purchased 5.56ha of land in downtown Miami for US$236 million with plans to build a mixed development called Resorts World Miami.”

The bayfront land, currently housing the Miami Herald Media Co, has the Omni Centre to its north, in which GENM has acquired all outstanding mortgages.

“GENM will be working with the property owner to fully control and operate the Omni Centre in the next few months. The Omni Centre includes 650,000 sq ft of shopping mall space, 350,000 sq ft of office space, a 525-room Hilton Hotel and 2,300 parking bays.”

“Including the acquisition of other properties, GENM has assembled a contiguous 30-acre (12ha) waterfront site in the heart of Miami, overlooking Biscayne Bay,” said GENM.

“Under the master plan, the residential towers take on sculptural forms that change from every perspective. Each building is designed with outside balconies adorned with LED-lit exteriors, creating a jewel-like effect that will illuminate the Miami skyline.”

“The towers sit atop an eight-storey podium where guests can immerse themselves in a two-storey, 250,000 sq ft luxury retail galleria, more than 50 restaurants, lounges, bars and nightclubs, a high-tech multimedia entertainment area showcasing the music and culture of Florida and South America, and 700,000 sq ft of convention and meeting space which includes a 200,000 sq ft column-free ballroom, the largest in the US.”

The resort will include a super-luxury hotel, a contemporary hotel, a convention hotel and a family hotel.

“Each level of Resorts World Miami is designed with outdoor terraces. The podium’s rooftop features a 1.44ha outdoor lagoon which is equivalent to 12 Olympic-sized swimming pools, and natural sand beaches. Each hotel will also have a private swimming pool.  Meanwhile, the three-mile Baywalk, from the Miami River to Margaret Pace Park, will link some of the attractions such as Bayfront Park, Bayside Market Place, American Airlines Arena, Museum Park, the Miami Art Museum currently under construction and the Omni Centre.”

Miami-based architecture firm Arquitectonica is responsible for the master plan.

“The Palm Beach County office market is holding steady. The transition from the downturn in 2008 to recovery is slow. Rents remain below pre-recession levels, and it will be some time for them to fully recover as the demand for space is directly tied to employment growth.”

“Landlords responded relatively quick to preserve occupancy in their buildings by lowering rents. The key advantage that Palm Beach County has to offer is that local government agencies are collectively working to provide incentives and assistance to local and non-local businesses in an effort to grow, expand and create new jobs.”

“The activity in the office market continues to illustrate signs of improvement, but vacancies are still higher than desired for landlords. The market experienced a decrease in vacancy by 1.7 percentage points from second quarter 2010 to a current 26.0%.”

Sublease space is impacting a few submarkets across the county totaling 420,709sf in second quarter 2011 compared to 456,213sf offered in second quarter 2010, representing a decrease of 7.8%. Some recent lease transactions include:

- Partsbase Inc. renewed and expanded into 17,231sf at Congress Corporate Plaza in Boca Raton.

- Gonzalez, Saggio & Harlan subleased 11,864sf at Via Mizner Plaza in Boca Raton.

- Mill Creek Residential Developers subleased 5,565sf at One Boca Place, Boca Raton.

“There were two office sale transactions totaling 274,021sf that closed this quarter. Blackstone sold 1200 Corporate Place, Boca Raton, totaling 137,021sf, to Keystone Property Group, a private investment company in Pennsylvania, for $15,250,000 or $111 psf with a cap rate of 4%. The property was 54% occupied at the time of sale.”

“Locally based private investment company Brookside Realty purchased the former Office Depot call center at 750 Park of Commerce Drive, Boca Raton, from LNR Partners for $7,000,000 or $51 psf. This transaction resolved a troubled situation.”

“The anticipated wave of distressed opportunities has been slow to materialize as banks and CMBS special servicers are modifying loans, selling loans, and negotiating discounted payoffs with the borrowers. With Florida being a judicial foreclosure state, the foreclosure process is lengthy and costly and not a preference for lenders.”

“Despite some optimistic forecasts that 2011 would see significant increases in retail leasing activity, the Orlando market has seen much of the same leasing strength as there was in 2010.”

“Tenants show increased interest in leasing, although they continue to seek short-term leases due to uncertain sales forecasts. It is taking longer now to finalize deals than in the past, as both tenants and landlords are exercising more caution in deal negotiations.”

“Due to tight money and depressed retail sales, tenants have lowered what they are willing to pay for rents. Tenant incentives continue to be an important negotiation point.”

“While backfilling of Class A boxes vacated during the recession is nearly completed, many less desirable junior box spaces remain to be filled.”

“Although average direct asking lease rates are up $0.46 psf since this time last year, they fell $0.74 below 2010 end-of-year rates. This gives some hope that if 20ll follows last year’s trends, activity will pick up in the second half of this year.”

“Net absorption for the quarter came in at negative 64,000sf. The majority of negative absorption came from small tenants vacating space in shopping centers. Only Seminole and Southwest Orange submarkets saw positive gains. Southwest Orange, home to many of Orlando’s tourist attractions, has seen increased hotel occupancy and visitor attendance, leading to increased retail activity and insulating it from the rest of the MSA’s slow growth.’

“The University of Florida’s Consumer Confidence Report states that consumer confidence among Floridians remained flat in May. Perceptions of personal finances now compared to a year ago fell, while perceptions of personal finances a year from now show an increase.”

“Expectations of national economic conditions over the next year are unchanged, while expectations of economic conditions over the next five years increased. This further backs up the forecast that the Orlando retail market has years to go before it fully regains its post-recession strength.”

“Operating conditions in Broward County continue to strengthen as the local economy emerges from a deep recession. Even amid a mid-year slump in national economic gauges, vacancy in the market inched down in the second quarter and market wide rents rose.”

“These trends will persist over the remainder of 2011 as tenant demand strengthens and developers remain sidelined, but additional stimulus will be required to provide greater momentum to the sec- tor’s recovery beyond this year. A healthy level of job growth, especially, remains paramount to drive further gains in property performance. Local employers have resumed hiring to restore staff levels depleted during the recession, but an expansion of payrolls beyond pre-recession levels will require greater confidence in the sustainability of the economic recovery.”

“Greater employment opportunities will also restore historical migration and household formation patterns in the county. While both of these measures turned positive recently after recession-driven declines, economic growth in the market will remain below potential until job growth accelerates.”

“Transaction volume in the county continues to pick up as prospective sellers increasingly come to grips with pricing expectations. Broader access to financing has pulled many smaller investors off of the sidelines, while larger investors and institutions continue to bid aggressively on best-in-class properties.”

“Cap rates on well-located, Class A properties generally range from 5% to 6%. Downward pressure on cap rates will persist, as strong demand persists amid a limited number of properties listed for sale.”

“Buyers also continue to move down the quality scale in search of higher yields. Strong Class B assets in established primary locations, for example, can price in the low-7% range, while lesser quality properties in slower demand locations price closer to 8%.”

“Foreign capital continues to enter the South Florida region, with well-capitalized buyers seeking hard assets amid minimal returns available in other types of investments. Much of the foreign capital has focused on adjacent Miami-Dade, but Broward assets continue to receive greater consideration.”

2011 forecast

“Employment: This year, 13,000 jobs will be created in Broward County, a 1.9% gain and an improvement from 2010, when 20 positions were cut. Projected job growth in 2011 will restore total employment to 90% of its pre-recession peak.”

“Construction: Developers will complete only 150 rentals in 2011; last year, 745 new units were placed into service. Approximately 2,000 units are planned, equaling 3% of the existing stock of large properties.”

“Vacancy: The vacancy rate in large properties will decline 110 basis points in 2011 to 5.5%, the same level at the start of the recession. The release of pent-up demand and de-bundling of households combined during the recession produced a 200 basis point drop last year.”

“Rents: Large property asking rents will rise 2.1% this year to $1,090 per month, compared with a 1.3% increase in 2010. Effective rents will advance 3.0% to $1,033 per month in 2011 after adding 2.3% last year.”

“The Southwest Florida region experienced changing economic conditions over the past few years and continues to address concerns related to the housing bubble and banking crisis. Additionally, federal, state, and local budget issues appear to be a concern as local revenues and property values continue to decline due to lagging foreclosures.”

“ Rising inflation and higher oil prices may curtail potential for economic recovery. However, the Federal Reserve’s Open Market Committee (FOMC) indicates the economic recovery is proceeding at a moderate pace and labor markets are improving, but hampered due to increasing energy prices, depressed housing sector, high unemployment and tight credit.”

“ The April 2011 regional unemployment rate of 10.5% was slightly higher the state rate of 10.4%. On a positive note, the regional unemployment rate decreased 15.4% from April 2010 to April 2011, whereas the state unemployment rate decreased only 7.8% for the same period. The Lee County Economic Development Office announced that businesses are taking advantage of the economic incentives, leading to the creation of nearly 1,000 jobs in the next few years.”

“Consumer Confidence Index was 68 in April, down from 72 in March 2011 and 78 from the prior year, indicating that consumers view the economy and their personal position as weakening and can be partly attributed to Middle East unrest, natural disasters, and rising prices at the pump.”

“Regional gross and taxable sales increased from March 2011 to April 2011. Gross and taxable sales in Southwest Florida increased 16.5% to $4.5 million and 14.8% to $2.5 million, respectively.”

Office overview

“The overall vacancy rate by property type in the Fort Myers/Naples office market increased slightly to 18.8% for the 2Q of 2011. The overall weighted average rental rate was $20.27 psf – up slightly from the 1Q of 2011.”

“Leasing activity (YTD) for the Southwest Florida office market was positive at 317,966sf, with negative 215,978sf of net absorption year to date.”

 Office forecast

“Overall vacancy for Southwest Florida has finally reached a point of stabilization and is expected to decline through 2Q 2012. Overall net absorption (YTD) increased this quarter and is expected to remain consistent for the remaining term. Office leasing continues to increase and overall rent growth is expected to rise slightly over the next 12 months. It appears that businesses are taking advantage of economic incentives and preparing for future expansion.”

“Economic indicators continue to improve, and we look for a long, slow recovery period as businesses expand. Office development has come to a stand-still, and completions are expected to decline as the market will see user sales plateau and existing inventory decrease.”

“Current transactions are being fueled by investor demand, with increased interest in distressed assets. This will appear most beneficial for credit buyers and properties with solid fundamentals and occupancy rates.”

 Industrial overview

“The overall vacancy rate by property type in the Fort Myers/Naples industrial market declined slightly to 15.8% for the 2Q of 2011. The direct weighted average rental rate was $6.01 psf – up slightly from 1Q 2011.”

“Leasing activity (YTD) for the Southwest Florida Industrial market was positive at 573,140sf, with positive 199,440sf of overall net absorption (year-to-date).”

 Industrial forecast

“Overall the industrial market has seen improvement within the past 12 months and can be attributed to declining pressure on prices and an increase in imports. As a result, the number of transactions increased earlier this year, however slowed somewhat in 2Q 2011 due to moderate slowdown in manufacturing and volume of import/export activity.”

“Some construction/expansion completions are prevalent in the market, however overall net absorption (YTD) declined this quarter. Industrial leasing continues to increase, and overall rent growth is expected to rise slightly over the next 12 months. There appears to be a strong demand for industrial/warehouse, and for industrial/flex in the market.”

“Further, economic indicators suggest a decline in vacancy. Recent sales have seen an increase in the amount of distressed assets despite increased performance in the industrial arena.”