Housing

Cracks In the Foundation

Ron Tang — Thu, 24 Apr 2008 07:47:00 -0400

While Hillary Clinton, Barack Obama and John McCain appear anxious to move into the White House, none of them have much to say about housing. Yet rarely a day goes by that the headlines don't mention the current housing crisis and its threat to the financial markets and the economy. This has led to a strange disconnect between the presidential campaigns and national reality.

Subprime lending and the ensuing foreclosures are being blamed for the crisis, but the problems and blame go much deeper. The fact is, our nation does not have a housing plan, and has not had one for… more

Viewpoint: Fed's Mortgage Move is a Good Start

Ron Tang — Fri, 21 Dec 2007 00:00:00 -0500

With foreclosures reaching record levels and predictions for further trouble ahead, the Federal Reserve Board on Tuesday unanimously approved potentially sweeping changes to how mortgages are marketed, made, and serviced, especially in the nonprime market. Will the Fed be able to meet its goal of a "comprehensive set of protections to consumers" when the comments come flying?

The proposed revisions to regulations under the Truth in Lending Act are designed to realign relationships in the mortgage business, so borrower and lender are once again interested in the same result: a good mortgage.

The rules, unlike guidelines bank regulators issued over the last… more

The Countrywide Conundrum

Articles — Fri, 09 Nov 2007 11:41:00 -0500

It's more than a little difficult to imagine Angelo Mozilo, the embattled chief executive of mortgage lending giant Countrywide Financial, being a Drucker disciple. But just last year he didn't hesitate to paint himself that way and, in at least one sense, he was right.

"As the late Peter Drucker once said, the entrepreneur always searches for change, responds to it, and exploits it as an opportunity," Mozilo told an audience of bond holders, bankers, and others. "This is the essence of Countrywide's culture."

Countrywide, lashed like many other companies by the subprime storm, isn't crowing as much anymore. A few weeks… more

Beyond the Mortgage Meltdown

Communications — Thu, 20 Sep 2007 05:00:00 -0400

A New America Event
09/20/2007 - 12:00pm

The current -- and predicted future -- turmoil in the mortgage market highlights an important challenge to the American dream of homeownership: how to make certain that those who enter into homeownership are able to sustain that status, protecting family stability and building equity in a critical asset. Thirty years ago, those who owned homes had fixed rate mortgages and substantial equity, and foreclosure was a rare event. However, many Americans were denied the opportunity to become homeowners because of inefficient mortgage markets, underwriting based more on “rules of thumb” than analysis of the likelihood of loan repayment, and, frequently, discrimination.

By the end of the 1990s, positive changes in all three dimensions helped raise America’s homeownership rate, especially for lower-income and minority families. But in part because of excesses that have encouraged and enabled many to support homeownership based solely on debt, without building assets or equity, we are now at serious risk of losing many of those gains.

Both Congress and bank regulators are considering how to help those currently in trouble and to bring the mortgage industry back into better alignment with sound practices. Can potential homeowners and those who work with them use more direct saving, education and other strategies to return to sustainable homeownership while retaining, and in fact enhancing, broadened ownership opportunities? At this event, the panel of experts listed below offered both novel solutions and improvements to proven programs to boost savings and encourage asset-building through sustainable homeownership.

Video of this event is available at right, while an MP3 audio recording can be downloaded below.

The Congressional Savings and Ownership Caucus is Co-Chaired by Sen. Kent Conrad (D-ND), Rep. Jim Cooper (D-TN), Rep. Phil English (R-PA), Rep. Tom Petri (R-WI) and Rep. Earl Pomeroy (D-ND).

Pop-Up Cities

Articles — Tue, 01 May 2007 10:14:00 -0400

Three years ago, Alejandro Gutierrez got a strange and tantalizing message from Hong Kong. Some McKinsey consultants were putting together a business plan for a big client that wanted to build a small city on the outskirts of Shanghai. But the land, at the marshy eastern tip of a massive, mostly undeveloped island at the mouth of the Yangtze River, was a migratory stop for one of the rarest birds in the world -- the black-faced spoonbill, a gangly white creature with a long, flat beak.

McKinsey wanted to know if the developer, the Shanghai Industrial Investment Corporation,… more

Mining Money Out of Downtown Space

adminn — Fri, 20 Apr 2007 19:00:00 -0400

Only a sap, it seems, would believe that you can pull money out of thin air.

But an interesting proposal is floating around L.A. that would, in effect, do just that -- and it might well work, raising meaningful sums for worthwhile aims such as affordable housing.

The basic idea is not too different from the city's move this month to sell 9 million square feet of unused "air rights" from over the Convention Center, easing the way for developers operating elsewhere downtown to make their buildings taller. These deals are expected to generate as much as $200 million for the city… more

Future for Los Angeles Middle Class is Uncertain

Articles — Fri, 13 Apr 2007 17:12:00 -0400

You may remember the ruckus that arose a couple of years ago when a local Spanish-language television station, Channel 62, put up a billboard publicizing its newscasts. Next to the words "Los Angeles," the abbreviation "CA" was crossed out and "Mexico" written in its stead.

Many reacted angrily, saying the sign was glorifying illegal immigration. Others accused the complainers of being racist xenophobes and maintained that the ad was simply celebrating the region’s Latino flavor.

Whatever you thought of the promotion, I’m here to tell you: We are, in at least one sense, perilously close to becoming Los Angeles, Mexico.

I am… more

Vegas’ Next Act? Urban Reality

Articles — Sun, 01 Apr 2007 20:24:00 -0400

I realize now how fitting it is that the billionaire godfather of mainstream Las Vegas was an agoraphobe. Not unlike Howard Hughes barricading himself in his penthouse suite, on a midweek road trip to Vegas last week I only left my gigantic hotel complex once -- and that was to take a limousine ride to see a new monster project being built.

I mean, really, that hotel had every type of service you could imagine -- shopping, restaurants, entertainment of all kinds -- and there was no reason to leave. I was in the bosom of cradle-to-grave consumerism, and from my… more

Outside the Sub-Prime Loan Box

Articles — Fri, 16 Mar 2007 23:53:00 -0400

Imagine you’re a mortgage lender, and somebody comes to you with a marginal credit record, work experience that includes as many employers as Liz Taylor has had husbands and no Social Security number. Would you hand him a bunch of money to buy a house?

I’m guessing that you wouldn’t, especially not this week, what with the ongoing meltdown among sub-prime lenders -- those that specialize in making loans to people with shaky credit or erratic incomes.

But Leo Simpser well might. He’s managing director of the Hispanic National Mortgage Assn. in San Diego.

Don’t let the name fool you. Although it calls… more

A Grand Vision for Affordable Housing

Articles — Fri, 09 Feb 2007 23:40:00 -0500

Eli Broad has suggested that once its big makeover is complete, Grand Avenue will be comparable to the Champs-Elysees. That’s bunk. But it may look a little like Sesame Street, and that’s terrific.

The children’s public television program -- which, in the words of a recent study by a University of New Hampshire scholar, has "strived to exemplify and create an egalitarian and more tolerant community" -- has had a tough time being replicated in the real world. This is especially true in L.A., which is highly balkanized along racial and class lines.

The $2-billion Grand Avenue Project, though, may prove an… more