Distressed RE Looms Large in Next Year

Three quarters of commercial real estate executives surveyed by KPMG LLC said distressed real estate would have an impact on their investment strategies over the next 12 months.

Still, two-thirds of those surveyed said they consider property investment opportunities as better today than they were one year ago.

Greg Williams, national leader of KPMG’s building, construction and real estate practice, said, “for most commercial real estate executives, the fundamentals behind real estate demand remain a concern and this seems to indicate that prices in many markets may not have hit bottom yet.

“Executives are struggling to find sectors and markets that can deliver a reasonable return on their investments commensurate with the risk involved.”

Among the bright spots for commercial real estate investors are multifamily properties, as many consumers remain reluctant to purchase homes in the current economic environment. The survey found that 34% of respondents believe a significant amount of multifamily development will begin in the next year; the next highest sector was office at 22%, followed by retail, 20%; hospitality, 19%; and industrial, 17%.

Almost six in 10 commercial real estate executives believe today’s key economic problems, including unemployment, job growth and cost of living in their primary markets will be better this time next year, with 34% believing these factors will be at the same levels they are right now.

Daily Briefing | Thursday, October 6, 2011

  • Thirty-Year Drops Below 4% for First Time

    The 30-year fixed-rate mortgage, continuing to test new lows, dropped below 4% for the first time in modern history to 3.94% during the week ending Oct. 6, according to Freddie Mac’s weekly survey.

  • Congressman to Meet with FHFA Chief on White House Refi Plan

    Rep. Elijah Cummings, D., Md., ranking member of the House Oversight Committee, and other members of Congress are set to meet with GSE regulator Ed DeMarco Thursday afternoon to discuss President Obama’s yet-to-be released refinancing plan.

  • HAMP Modifications Begin to Flag

    Servicers completed only 25,400 HAMP modifications in August — the lowest number of monthly completions this year, according to new figures released by the Treasury Department.

  • More than One-in-Three Prime PL MBS Loans Now Underwater

    Fitch Ratings has found more than one-third of loans underlying prime private-label mortgage-backed securities are now underwater, and it could get even worse.

  • Underwater VA Borrowers Offered Loan Payment Rewards

    GMAC Mortgage LLC, Fort Washington, Pa., and Loan Value Group, Rumson, N.J., have partnered in an effort to provide cash incentive rewards to certain VA borrowers who are under water on their loans, make timely and consistent payments on their mortgages and meet other criteria.

  • Walter May Get More Servicing

    An analyst for FBR Capital Markets thinks Walter Investment Management could see the servicing rights for more loans coming to it from the Bank of America/Fannie Mae transaction.

  • Witnesses: Now Not Time to Drop the Mortgage Interest Deduction

    The tax code may be broken, but now’s not the time to fix it, at least as it pertains to the mortgage interest deduction and other write-offs afforded home owners, witnesses testified at a Senate hearing on tax reform options.

  • FHA Launching Probe of HECM Program

    The Federal Housing Administration, facing a dramatic increase in technical defaults on reverse mortgages, will launch a major review of its program with a possible overhaul coming down the road.

  • CoreLogic: Home Values Continue Their Downward Drift

    Home prices in the U.S. decreased 0.4% in August on a sequential basis, the first monthly decline in four months, according to new figures released by CoreLogic.

  • Senate Panel Sets Vote on CFPB Chief for Thursday

    The Senate Banking Committee will vote Thursday morning on the nomination of Richard Corday to be the first director of the Consumer Financial Protection Bureau.

  • Senate Banking Committee Approves CFPB Chief Along Party Lines

    The Senate Banking Committee Thursday voted 12-10 to approve the nomination of Richard Cordray to be the first director of the Consumer Financial Protection Bureau.

Article source: http://www.nationalmortgagenews.com/dailybriefing/2010_447/distressed-re-looms-large-1026868-1.html

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