Economy Watch: Foreclosures On ‘Pause’
- Dec 17, 2010
December 17, 2010
By Dees Stribling, Contributing Editor
RealtyTrac, which follows the U.S. residential foreclosure market, said that foreclosure filings—the grim spectrum of default notices, scheduled auctions and bank repossessions—were reported on more than 262,300 properties in November, a 21 percent decrease from the previous month and a 14 percent decrease from November 2009. One in every 492 U.S. housing units received a foreclosure filing during the month.
The reason isn’t that the housing market is getting any better. Instead, chalk it up to robo-signing and related foreclosure paperwork problems. “Fallout from the foreclosure robo-signing controversy forced lenders and servicers to hit the pause button on many foreclosures while they scrambled to revamp their internal procedures and revise or resubmit questionable paperwork,” James J. Saccacio, CEO of RealtyTrac noted in a statement. Worth repeating: he said “pause,” not “stop.”
Despite a 20 percent monthly decrease in foreclosure activity, Nevada posted the nation’s highest state foreclosure rate for the 47th straight month, according to RealtyTrac. One in every 99 Nevada housing units received a foreclosure filing in November, nearly five times the national average. Utah’s foreclosure rate leapfrogged to second highest in November after being sixth highest the previous month. One in every 221 Utah housing units received a foreclosure notice during the month, which is more than twice the national average.
Retailers Stand to Win Big on Debit-Card Fee Caps
Retailers got an early Christmas gift on Thursday with the prospect of new rules that would limit how much they pay to debit-card issuers when customers use debit cards to buy items at their stores. Though the new rules proposed by the Federal Reserve aren’t finalized yet, Visa and MasterCard stand to lose billions, and the retailers stand to gain them.
In fact, according to the Merchants Payment Coalition, about $10 billion a year is at stake. The Fed estimates that the actual cost of a debit-card transaction is about 7 cents; the coalition, which isn’t on the banks’ side, claim that the banks are charging about 63 cents a transaction.
One of the Fed’s proposals would require card issuers to charge no more than actual costs, while an alternate proposal would cap the fee at 12 cents a transaction. Either way, issuers stand to lose, and are complaining loudly about the proposals, making the standard argument in such cases, that the change will cost consumers.
Home Starts Up in November
The U.S. Department of Housing and Urban Development reported on Thursday that housing starts jumped by 3.9 percent in November compared with October’s revised numbers, a surprising uptick. The annualized homebuilding rate for the month was 555,000 units.
The way was led by single-family starts, which were up 3.9 percent month-over-month. Multifamily starts (five units or more) dropped 18.2 percent, though that end of the residential market is always more volatile than single-family housing. The number of permits issued for future construction of single-family housing slipped in November, however, dropping 4 percent. Multifamily permitting was down 24.2 percent.
Wall Street managed to have an up day on Thursday, with the Dow Jones Industrial Average gaining 41.78 points, or 0.36 percent. The S&P 500 advanced 0.62 percent and the Nasdaq enjoyed an uptick of 0.77 percent.