Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.real,americast.usa-today.real From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: real Wed, Sep 9 1992 Date: Wed, 9 Sep 92 04:29:47 EDT Message-ID: 09-09 0000 DECISIONLINE: Real Estate USA TODAY Update Sept. 9, 1992 Source: USA TODAY:Gannett National Information Network FANNIE MAE PREPAYMENTS SURGE: Prepayments on Fannie Mae mortgages surged in August as homeowners found stronger incentives and opportunities to refinance their mortgages, the agency reported Tuesday. Some analysts expected prepayments to accelerate more in light of last week's dramatic pick-up in Freddie Mac prepayments. Analysts think faster prepayments will follow due to rate cuts on July 2. (For more, see special Prepayments package below.) AMERICAN CUTS CASH FLOW: Cash flow at American Real Estate Partners L.P. is being reduced by about $100,000 a month as a result of a tenant's bankruptcy filing, Bloomberg Business News said Tuesday. Integra, a Hotel and Restaurant Co. that leased two hotels in Miami and Phoenix from the partnership, filed for Chapter 11 bankruptcy protection in July. AMERICAN WILL FILE A CLAIM: American Real Estate Partners L.P. will file a claim with a bankruptcy court of about $2 million for lease and other payments due from Integra. Integra has filed for Chapter 11 bankruptcy protection. Bloomberg Business News said Tuesday that American would reduce cash flow by about $100,000 a month because of the loss from properties Integra rented. O&Y RELINQUISHES INTEREST: Olympia & York Developments Ltd. said Tuesday it will relinquish its interest in its 55 Water Street building in Manhattan to the property's noteholders. O&Y Water Street Finance Corp. has reached an agreement to restructure the building's debt. Under the agreement, noteholders will exchange their second notes for 100% equity in the building, or about 20 million common shares. COMMISSIONERS ACCEPT PLAN: Harbor Commissioners in Long Beach, Calif., Tuesday accepted a plan to purchase more than 60 acres of land for future port development and expansion of Toyota's export operation. The land belongs to Union Pacific Resources Co., Union Pacific Railroad and Toyota Motor Sales U.S.A. The port and UPRC also announced talks that could lead to the port's purchase of an additional 600 acres. MALAYSIA WILL TRY ECOTOURISM: The government of Malaysia will test a plan called ecotourism to preserve its vast rainforests and make money at the same time. The proposed Tree Tower Canopy Walkway, located in Pasoh Forest Reserve, will utilize existing research facilities to let tourists see the wonders of the rain forest. Government officials said Tuesday they hope to expand to other Malaysian rainforest sites. FIXED-RATE MORTGAGES FALL: The rates for 30-year fixed-rate mortgages from the Federal Home Loan Mortgage Corp. were listed at 7.94% Tuesday, down from Thursday and down from 8.01% the week before. They were at 9.14% a year ago. For 30-year adjustable-rate mortgages, the rates were 5.24%, down from Thursday and down from 5.26% the week before. A year ago they were at 6.93%. ARM INDEXES UNCHANGED: The one-year Treasury ARM index rates were listed at 3.52% Tuesday, unchanged from Thursday and unchanged from the week before. A year ago they were at 5.70%. For the 11th District ARM index, rates were at 5.258%, unchanged from Thursday and unchanged from the week before. A year ago they were at 6.998%. T-BONDS DECLINE: Treasury security rates for the 30-year bonds showed a decrease Tuesday, listing at 7.22%. That's down 0.14 from rates of 7.36% Thursday and down 0.16 from 7.38% the week before. A year ago T-bonds were at 8.00%. SPECIAL PACKAGE ON PREPAYMENTS: MORE PREPAYMENTS WERE EXPECTED: Prepayments on Fannie Mae mortgages didn't speed up quite as much as analysts thought they would in August, Fannie Mae reported Tuesday. Speeds 9.5% mortgages advanced to 724% of the Public Securities Association model from 564%, while 9% mortgages prepaid at 597% PSA, up from 412%, according to analysts at First Boston. PREPAYMENTS WILL INCREASE MORE: Many homeowners didn't have time to close on the mortgage applications they put in just days after the rate cut in early July, so analysts expect prepayments to increase more. The time between a mortgage application and a closing is generally about 60 days. Analysts believe the August prepayment data could reflect rates at least 20 basis points higher. LOWER RATES WILL SPEED PAYMENTS: If rates keep falling, analysts believe homeowners will have even greater incentives to refinance their mortgages. That might cause speeds on 8.5% and 9% mortgages to peak at very high levels. Faster prepayments will hurt investors. If rates stay at current levels, prepayments would probably rise for the next two months before leveling off, analysts said. (End of package.) Real Estate Editor: Martin Baucom. (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