Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.real From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: real Mon, Jun 29 1992 Date: Mon, 29 Jun 92 05:27:36 EDT Message-ID: 06-29 0000 DECISIONLINE: Real Estate USA TODAY Update June 29, 1992 Source: USA TODAY:Gannett National Information Network TWO QUAKES HIT SOUTHERN CALIF.: Two powerful quakes shook Southern California on Sunday. The first quake, estimated at 7.4 in magnitude, was centered about 110 miles east-northeast of Los Angeles. It was followed by a second quake measuring 6.5. Gov. Pete Wilson declared a state of emergency in Riverside and San Bernardino counties, making available state relief aid and low-interest loans. THRIFTS SHOW IMPROVEMENT: U.S. savings and loans reduced problem assets - troubled loans and foreclosed real estate - 21% last year from 1990, to $45 billion, according to USA TODAY's analysis of the nation's 2,188 thrifts. Behind the drop: Many thrifts with lots of problem assets have failed. Others have written off or sold the problem assets. And lower short-term interest rates helped borrowers handle debt. (For more, see special Thrifts package below.) COURT RULING EXPECTED; Monday is the final day of the Supreme court's term before adjourning for the summer. The justices are expected to hand down a key ruling on property rights that could force governments to pay landowners if zoning or environmental rules strip property of its commercial value. FED TO CONSIDER LOWER RATES: The Federal Reserve will debate lowering interest rates when its Open Market Committee meets Tuesday and Wednesday in Washington. Lacy H. Hunt, chief economist of HSBC Holdings in New York, hopes the Fed will push the federal funds rate down 0.25% point, to 3.5%, possibly sparking banks to cut their prime rate, the base rate for many commercial and consumer loans. ANALYSTS FORECAST SPENDING: U.S. construction spending figures will likely show a 0.1% rise in May, according to seven forecasts in a Bloomberg News survey. An increase in residential building likely contributed to steady construction spending during May, say analysts at Fleet:Norstar Financial Group in Providence, R.I. The Commerce Department will release the figure Wednesday. AIRPORT BILL PASSES ILL. HOUSE: The Illinois House Friday passed a bill creating a Metropolitan Airport Authority to oversee the development of the $11 billion Chicago's third airport. The Lake Calumet Airport would be the most expensive ever built in the USA. Opponents say it would uproot 50,000 people living on or near the southeast Chicago site and destroy wetlands. A tough fight is expected in the Senate. N.D. TO OFFER LOWER RATES: The North Dakota Housing Finance Agency will offer $22 million in First Time Homebuyers program loans at record low interest rates of 7.39%. To receive a loan, applicants must meet specific income guidelines and not have owned a home in the past three years. N.M. RECEIVES EMERGENCY GRANT: The Department of Housing and Urban Development has awarded a $487,330 emergency grant to the village of Chama, N.M., to make repairs to low-income housing units. At least 37 of the units are unsafe, say officials. WAL-MART PLANS MINN. STORES: Officials from Wal-Mart Stores, Inc., have reached a preliminary agreement to buy 47 acres for planned stores in Minnetonka, Minn. The company to build a Wal-Mart discount store and a Sam's Club members-only warehouse on the Carlson Center property on I-394. N.Y. UPHOLDS RENT REGULATIONS: New York lawmakers Friday rejected a motion to consider a bill to eliminate rent regulation protection for tenants with incomes over $100,000 per year. the bill also called for abolishing rent protection for luxury apartments which rent for more than $2,000 per month. SPECIAL PACKAGE ON THRIFTS: FEWER MORTGAGES HELD BY S&LS: Despite financial improvements, many analysts say the S&L business can't produce enough profits to sustain 2,000 S&Ls. Thrifts have lost their traditional role - making and holding long-term, fixed-rate mortgages - because of the fast-growing secondary mortgage market. By 1990, S&Ls held only 42% of mortgages, down from 68% in 1985, says Auburn University economist James Barth. OTHERS ENTER MORTGAGE MARKET: Agencies such as the Federal National Mortgage Association now buy mortgages from thrifts and other lenders, package them into securities and sell them to investors. Because making a mortgage loan no longer means having to hold it for years, non-S&L mortgage bankers began growing aggressively, making mortgages, pocketing origination fees and selling the mortgages in the secondary market. FOCUS TO BE ON SECONDARY MARKET: Analysts expect that a few S&Ls will continue to make and hold home mortgages, most specializing in adjustable-rate mortgages. Some will continue to make and hold fixed-rate mortgages, say analysts. Others are expected to make mortgage loans, sell them in the secondary market, and earn fees by collecting payments and keeping records for the investors who hold the mortgages. (End of package.) Real Estate Editor: Christopher Goldthwaite. (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. 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