Industry Watch

INDUSTRY DIGEST

September 25, 2005|By FROM STAFF REPORTS

North side is focus of home-buying fair

Northern Neighborhoods will hold its second-annual home-buying fair from 2 p.m. to 4 p.m. today at the Belvedere Square parking lot, on Belvedere Avenue just east of York Road. The event will offer information as well as tours of participating neighborhoods and visits to open houses. Lenders and real estate and housing professionals also will be on hand. Buses leaving at staggered times will conduct hour-long tours, including stops at open houses, along two predesignated routes. Northern Neighborhoods is a group of city neighborhood associations roughly bounded by York Road and Perring Parkway/Hillen Road, from the city line to 36th Street.

Builders' optimism declines this month

Optimism among homebuilders this month was the lowest in more than two years as the cost of energy and lumber rose in the aftermath of Hurricane Katrina, a survey showed. The National Association of Home Builders/Wells Fargo's index of builder confidence fell to 65, the lowest since July 2003, from 67 in August, the Washington-based association reported last week. The decline was the third in a row. The group's gauge of buyer traffic fell to 47 this month from 50 last month. The current sales measure fell to 72 from 73, and expectations for the next six months declined to 69, the lowest since May 2003, from 77. "Many builders appear to be taking on a more cautious attitude because of uncertainties in the economy and this post-Katrina environment," Dave Wilson, president of the builders' association, said in a statement.

Freddie Mac shifts securities strategy

Freddie Mac plans to increase the amount of adjustable-rate mortgages it packages into securities to safeguard its second-biggest source of income. Freddie Mac, the second-largest buyer of home loans, and the larger Fannie Mae guaranteed 40 percent of loans packaged as securities for sale to investors in the first half of the year, down from 70 percent in 2003, according to Inside MBS & ABS, a mortgage data service. Market share fell as the companies focused on fixed-rate loans, miscalculating the growth in mortgages with rates that fluctuate with the economy. Adjustable-rate mortgages taken out by consumers have doubled to 34 percent of all mortgages between 2002 and 2004, according to the Mortgage Bankers Association. "We are shifting our strategy," company President Eugene McQuade said in a speech last week in San Francisco. "We can't sit back and hope that the mix of mortgage products will cycle back to our traditional strengths."

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