Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.real From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: real Fri, Mar 20 1992 Date: Fri, 20 Mar 92 05:44:41 EST Message-ID: 03-20 0000 DECISIONLINE: Real Estate USA TODAY Update March 20-22, 1992 Source: USA TODAY:Gannett National Information Network MORTGAGE BANK IPOS COOL: Investors are having second thoughts about a new Wall Street fad, selling initial shares of mortgage banks. Six mortgage lenders are preparing for initial public offerings. Two firms completed IPOs this year; another 10 are considering them. This means the Rodney Dangerfield of the financial world - mortgage bankers - could finally be getting some respect. (For more, see special Mortgage package below.) RTC VALUES CONCERN OVERSTATED: Some real estate brokers and lenders are saying the Resolution Trust Corp. is driving down values in an effort to unload the property it inherited from defunct savings and loans. But experts surveyed recently by the Senate Banking Committee praised the RTC. "By and large, the prices ... are fair - indeed, in some cases, surprisingly high," says a Boston investment adviser. SALES TINY PERCENTAGE OF WHOLE: Resolution Trust Corp. critics say its policy of disposing of thrift assets as quickly as possible - by auction if necessary - has sent prices down in many hard-hit markets such as Florida. But some experts say sales are too small to affect the overall market. Since its inception in 1989, the agency has sold $7.5 billion of property, 0.15% of the USA's stock of commercial real estate. BROKERS BECOMING OPTIMISTIC: Real-estate brokers are growing optimistic about their prospects this year, according to a recent poll by Better Homes and Gardens Real Estate Services. Only 27% of the brokers polled said buyers are putting off purchases because of concerns about the economy. That's down from 66% in December. Only 28% said sellers are lowering prices to sell homes, down from 55% in December. HOUSING IS MORE AFFORDABLE: Housing in America became more affordable as 1991 ended, with some of the best opportunities found in the Midwest, according to a survey released on Thursday. Elkhart-Goshen, Ind., jumped from fourth place to the top of the Housing Opportunity Index published quarterly by the National Association of Home Builders. Seventeen other Midwestern areas were among the top 25. ROBERT-MARK OUT OF NEW YORK: Robert-Mark Inc. said Thursday it was selling its New York State real estate brokerage business to Weichert, inc., along with certain other of its assets, thus leaving the New York real estate market. The company also will cease operations at offices that Weichert will consolidate. Robert-Mark said ongoing liquidity difficulties made the sale necessary. FIXED-RATE MORTGAGES STABLE: The rates for 30-year fixed-rate mortgages from the Federal Home Loan Mortgage Corp. were listed at 8.88% Thursday, unchanged from Wednesday and up from 8.85% the week before. They were at 9.50% a year ago. For 30-year adjustable-rate mortgages, the rates were 6.04%, unchanged from Wednesday but up from 5.99% the week before. A year ago they were at 7.45%. ARM INDEXES UNCHANGED: The one-year Treasury ARM index rates were listed at 4.64% Thursday, unchanged from Wednesday but up from 4.55% the week before. A year ago they were at 6.32%. For the 11th District ARM index, rates were at 6.002%, unchanged from Wednesday and unchanged also from the week before. A year ago they were at 7.858%. T-BONDS DECLINE: Treasury security rates for the 30-year bonds showed a decline Thursday, listing at 7.95%. That's down 0.05 from rates of 8.01% Wednesday and down 0.08 from 8.04% the week before. A year ago T-bonds were at 8.33%. SPECIAL PACKAGE ON MORTGAGE: FIRMS GETTING NEW ATTENTION: Mortgage banks specialize in making home loans, which can then be held or sold in the secondary market. They've been around for years, but haven't gotten much investor attention before the savings and loan crisis. Mortgage firms have moved to fill the void left by collapsing thrifts. Many saw earnings surge last year, as falling interest rates prompted homeowners to refinance. MARKET OFFERED CAPITAL: Hungry for capital to fuel their expansion, mortgage bankers turned to the stock market. Until this year, only one firm was publicly traded. But rising interest rates are cooling the refinancing wave: Applications are down 53% from late January, according to the Mortgage Bankers Association. "Wall Street went a little gaga," says Kenneth Campbell of Audit Investments Inc. FIRMS HAVE SELLING POINTS: Campbell and other analysts say the firms still have selling points, including market share. Mortgage bankers now originate more than half of all home loans, up from about 25% in the mid-1980s. Some mortgage banks make most of their profits by servicing loans they've sold to others. A decline in refinancing activity can bolster earnings by reducing attrition in their portfolios. (End of package.) Real Estate Editor: Beth Mann. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM