Gold Nugget Winners Continue to Evolve

For months we’ve been reading and hearing about how builders have been downsizing both the size and specification levels of the homes they build to cater to today’s more frugal buyers. In the first stage of that transformation, it was a practical move, and often catered more to function than form.

But now that industry architects and building pros have become more comfortable with homes that are smaller yet also more affordable, urban-oriented yet energy efficient, these second-stage homes are showing the type of creativity that win awards.

At the 2010 Gold Nugget Awards this past June, however, the winners demonstrated that only the right combination of form and function will ultimately win the accolades of the most important judges – the buyers. See the list of winners here.

In the case of 1Mission in San Diego, developer CLB Partners chose to restore a somewhat faded city block more to its 1920s glory at the street level while copying architectural cues from surrounding buildings for the upper floors. Set at the junction of the very walk-able neighborhoods of Hillcrest and north Mission Hills, the mixed-use retail and residential project combines front-facing townhomes along with flats attached to large balconies.

To tie it together, architect M.W. Steele Group introduced a public paseo and courtyard that help the two restaurants better capture potential customers. Like a much smaller version of the award-winning Uptown District project nearby that was built in the early 1990s, 1Mission proves that mixed-use projects can work even in a recession, but only if created with the right combination of location and execution.

In the City of Westminster in Southern California, Bridgecreek Development also made safe connectivity to the local community a priority when developing Morian Asian Gardens, an age-restricted condominium project in the Vietnamese-dominated Little Saigon. By blending feng shui design models with a French-inspired aesthetic, architect Danielian Associates wanted to evoke a classic Vietnam environment while also providing the more practical and social aspects of two clubhouses that bring in the best of the local climate via adjacent courtyards.

For energy efficiency, it’s harder to get greener than Los Vecinos in Chula Vista south of San Diego, which was named Green Sustainable Community of the Year. Earning the coveted LEED Platinum status and built on the site of an abandoned model (of which 84% of materials were re-purposed for the new building), this affordable Wakeland Housing & Development rental project also requires residents to complete a green training course. Given the combination of its solar array which provides 90% of its electrical needs, a turf area requiring no water and most services located within a half-mile walk, it’s certainly no surprise that Los Vecinos was accepted into the Zero Energy New Home (ZENH) program of the California Energy Commission for ongoing education purposes.

And yet for sheer creativity, Nelson Development’s Arden Estates in the West Portal neighborhood of San Francisco proves that urban infill doesn’t necessarily mean high density. After carving out seven 4,000-square-foot lots from a single undeveloped 28,000-square-foot parcel, each 3,200-square-foot home promises luxury finishes with high ceilings, generous setbacks, gardens and views, and also claims one of the highest green building ratings offered by the city.

Awarded Green Point Rated Community of the Year, the considerable architectural challenge was to blend in with both the surrounding homes as well as a the site’s keynote: Arden Wood, a Normandy-style chateau built in 1930 that has since been operating as a multi-purpose Christian Science center for spiritual healing, nursing services and education.

Yet by remaining sensitive to the neighborhood’s history and not building to maximum density, it’s projects like this that remind buyers that many builders are also artisans.

Worst over for commercial real estate?

For many months we've continued to hear about the sturm und drang in the commercial real estate market. Where's that crash we keep hearing about? It is just over the horizon, or has that sector of the real estate industry learned the lessons of the housing crash and decided to manage revaluations in a different way? According to a story in the L.A. Times, not only may the worst be over for office buildings, retail stores and industrial properties, but funding is now starting to emerge from the sidelines. From the story:

After nearly three years of declines there are signs that Southern California's beaten-down commercial real estate market has struck bottom — setting up the possibility of a rebound later this year.

In a sign of the easing, heavyweight investors armed with buckets of cash are on the prowl, looking to snap up office buildings, warehouses, shopping centers and apartments at the market's low, industry observers say. The buyers are choosy, but the most desirable buildings elicit bidding wars when they come up for sale...

Although commercial building landlords in many markets are still struggling with high vacancy rates and weak rents, the erosion in some sectors has slowed, piquing the interest of buyers. In addition, reinvigorated banks have been able to postpone or avoid liquidating billions of dollars' worth of distressed real estate loans sitting on their books, helping to solidify prices.

In a similar fashion, Southern California's housing market hit bottom more than a year ago and prices have been trudging higher ever since, partly because a feared wave of fresh foreclosures hasn't materialized.

If the commercial real estate market continues to gain strength it would represent a significant shift in economic risk because many experts had feared that mass defaults by landlords on their loans could cripple banks and drive the country deeper into recession.

"It's true that thousands of commercial loans must be worked out and some of these properties will enter the market in 2010," investment banker David Rifkind said. But "federal policy has been accommodating to banks and they are not being forced to realize losses."

With rents falling and the economy trembling, commercial real estate transactions had been rare during the downturn. Owners were holding on in hopes that prices would stop falling and buyers were holding back, waiting for the low point.

But a philosophical change has become apparent among investors, Rifkind said.

"There is so much money sitting on the sidelines that when distressed assets or even small pools of loans come to market, there is a flood" of interest, said Rifkind, managing partner of George Smith Partners.

"That became palpable to us in the first quarter," he said. "Money can't stay on the sidelines for long periods of time. It has to retool and be put to use."...

Click here for the entire story.

San Diego Market Monitor for 1Q 2010 now online

Each quarter, I update the Market Monitors for San Diego County and the combined Los Angeles/Ventura County region for Hanley Wood Market Intelligence. Last week, I finished up the San Diego version, which you can purchase online here. I just finished up the LA/Ventura version today, which should be online later this week.

I also thought it'd be helpful to offer an excerpt from the Executive Summary for the San Diego report that's included at the beginning of the report:

Following last quarter’s 38% rebound as buyers began to take advantage of special tax credits, new home sales rose again by 21% during the first quarter of 2010 to 673 units versus the same quarter of 2009. And, even as prices began to slowly rebound, the combination of low interest rates and tax credits helped to boost average absorption rates by 69% to 1.7 sales per month per project. Looking ahead to the rest of 2010, however, the new home market is expected to soften slightly as the tax credits expire, discounted foreclosures remain as formidable competition and Option ARM mortgages continue to re-set.

In the existing home market, the rate of annualized sales rose by 9.4% during the first quarter of 2010 to 35,628 units. At this level, existing home sales are now just 1.5% less than the long-term average noted since the beginning of 1988, due in large part to a median price of $315,000 that is now 39% below the peak of $520,000.

At the same time, after last quarter’s 12% decline, median new home prices rose by 5.9% over the last year to $549,465. Although prices rose by 18% to $466,990 in the attached sector, they fell by just over 5% for detached homes to $597,900, with each submarket in both sectors performing much differently from each other during the quarter.

Somewhat surprisingly, in terms of relative strength, per-project absorption levels during the first quarter were actually highest in the East submarket (2.3 sales per month) and the Inland North (2.0), whereas the lowest rates were noted in the South Bay (1.0) and the Coastal North (1.7)...

Although higher affordability levels compared to new homes should continue to disproportionately assist the market for existing homes, given the weak economic outlook for 2010 and the expiring tax credits, the recovery for the new home sector will likely be slow and very gradual. In the short term, jobs in the existing and emerging technology sectors and hospitality industries are expected to rebound the fastest due to existing infrastructure and prior investments...

Looking to the end of 2010, the median detached new home price is still expected to reach $618,000 – or down by about 5% over the preceding year -- owing to a mix of smaller and more affordable homes, with the value ratio falling slightly to $206 per square foot. Sales are also still projected to fall by about 4% to 2,100 homes, or about 25% less than 2008 levels and 86% less than the peak in 2004...

Riverside Press-Enterprise covers trend of smaller homes

The Riverside Press-Enterprise's Leslie Berkman recently covered the ongoing trend of builders creating smaller homes in today's environment, and spoke with MetroIntelligence Principal Patrick Duffy on the impact on the state and federal tax credits in this year's housing rebound.

Patrick Duffy, Principal with MetroIntelligence Real Estate Advisors, a Los Angeles-based real estate consultant, said, "It is too early to tell if we are in a recovery until we are working with market-based fundamentals of supply and demand without federal benefits."

You can read that entire article here.

June column for Builder & Developer now online

My column for the June 2010 issue of Builder & Developer magazine is now online. In this issue, entitled "A Spring Thaw for Project Finance,"I interview Jonathan Lee, a Vice President with George Smith Partners (GSP), a real estate investment bank and a MetroIntelligence client on the various financing programs available today buying land, developing projects or refinancing existing ones.

In addition, MetroIntelligence is now able to work with builders and developers in need of project finance/re-finance, conduct preliminary due diligence and then bring appropriate deals to GSP. An excerpt from that column:

As the building industry continues to slowly recover from its most prolonged downturn since The Great Depression, the good news is that it appears a minor thaw may be finally beginning in the credit and equity markets. The bad news is that the rules of the game have changed so profoundly that not all players will be able to adjust accordingly...

According to GSP Vice President Jonathan Lee, who focuses largely on the residential sector, although the thaw in lending has unofficially begun, it won’t really matter until banks have re-set the land on their books to current values. In the interim, Lee is seeing lenders reaching out to established builders as either fee builders or as JV partners to protect their investments by maintaining entitlements and building out what’s already been started.

And yet the Catch-22 here is builders don’t want to JV unless land values are re-set to current value, but lenders aren’t strong enough yet to do so. As for buying new land, assuming a private builder can out-bid a public company, the terms for leverage are going to be strict, with hard-money interest rates and 50% loan-to-value (LTV) ratios...

Click here for entire column.

The Unacceptable Face of Capitalism

Yesterday, I received an email from Mick Pattinson, a longtime builder and founder of the Building Industry Coalition for Economic Recovery. Mick was one of the first home building executives I met when I started working in the building industry, and as President of Barratt American, he was also a prominent voice for the industry through local, state and national BIA groups.

While the email itself was a reminder of a special seminar this week at the Pacific Coast Builders Conference (PCBC) entitled Surviving Lender Action, as well as a summary of a recent lawsuit against lenders who had pulled promised funding immediately prior to the real estate crash, it was his commentary entitled "The Unacceptable Face of Capitalism" that I found compelling. I asked and received permission to reprint that commentary here on this blog:

THE UNACCEPTABLE FACE OF CAPITALISM, by Mick Pattinson

What happened to Wall Street?

Before Congress and the eyes of the world the executives of financial giant Goldman Sachs admitted that they bet against America. They created financial instruments that they compared with manure so that they and their clients could place big bets on mortgages and housing. For the winners there were fortunes to be made, even if our financial system was taken to the point of destruction and our children handed a debt burden of unimaginable proportions.

In his latest best seller "The Big Short" author Michael Lewis tells the stories of others who made the same bet against subprime and the financial institutions who pedaled them. Savvy investors who from their insider's vantage point could predict the end game. They forecast the mass of foreclosures across the country, the broken dreams and busted businesses. They saw the evaporation of life savings and the arrival of massive unemployment. They knew we faced a financial Armageddon and they placed their bets in the Wall Street casino. Big bets that paid off when the misery index was at its maximum and our financial institutions were forced to beg for a bail out to save our financial system.

This is the unacceptable face of capitalism. Power brokers who were supposed to generate the capital to drive the American economy are instead creating financial instruments of mass destruction. Worthless mortgages given triple A ratings because the big financial houses paid the agencies to do it. As simple as that. A rigged game if ever there was one.

With all of our regulatory agencies asleep at the switch or outsmarted by the slick operators of Wall Street, the law abiding citizens of the country were left defenseless. None more than America's homebuilders. Big Builder magazine recently predicted that 80% to 90% of the nation's private home builders will close their doors before the recovery arrives. A recovery that still appears to be a long way off.

One of the great mysteries for builders has been the failure of banks to conduct "workouts" during this recession. Unlike previous downturns when lender and borrower would come together to solve problems and mitigate the damage this time lenders have just rushed for the exit door. This time co-operation and patience has been replaced with arrogance and litigation.

Today's hearings and media revelations are filling in the blanks and giving us the "rest of the story". The events leading up to the great bank bailout of 2008 are very revealing to America's home builders. Why did profitable and solvent builders suddenly lose their funding? Why were projects suddenly being appraised and re-appraised until the lender got the number he was looking for? Why were performing loans torpedoed for no apparent reason? Why were builders the victims of "contrived defaults"?

We can now see the scale of the catastrophe created on Wall Street and what it meant for our industry. A trillion dollars lost on the subprime fiasco and the total undermining of housing markets all over the country. Do we need bank reform? Of course we do, but streamlined and efficient regulatory oversight is more important.

It doesn't end there. While the citizens of America have suffered mightily the culprits have not. Most of those responsible for this national nightmare are still in the positions they held, while others have left with big pay offs. This too is the unacceptable face of capitalism.

We can only hope that the hearings now underway in Washington D.C. as well as the work of investigative journalists and authors will generate the charges that justice demands. This November the politicians will feel the countries anger at the polls but that will not be enough. Those who put their personal greed ahead of the national interest need to pay a price as well.

As for the rest of that email, here it is:

PCBC

As a reminder, our Surviving Lender Action Seminar is scheduled for the Pacific Coast Builder's Conference this Wed, June 9th from 9:00-11:00am in Moscone Center Mezzanine room 228, San Francisco. There is no fee to see this seminar. Again, this seminar is designed to help builders and other privately held industry related businesses survive the current liquidity crisis. Discussion will include damage assessment through the reappraisal process, exhaustion of cash, discontinuation of funding, and subsequent loan default. The emphasis of the program will be a detailed discussion of prejudgment remedies and lender liability, and life after chapter 11 & chapter 7. Speakers include workout specialists, attorneys and accountants who are very current and experienced with these topics and have helped guide dozens of companies through difficult situations.

Lawsuits

A bankrupt arm of Sacramento's New Faze Development filed a $10 million lawsuit Monday against banks in Dixon and Stockton alleging that they cut off promised funds to a key housing project just as the real estate crash began.

Read more: http://www.sacbee.com/2010/04/13/2674007/builder-sues-two-banks-for-10.html#ixzz0l5tHSyra

More importantly, we would like to hear of any successes of lawsuits filed against any lenders who forced a default in spite of promises made to the borrower.

Please share with us if you hear of any so we can spread the word.

"The Recovery: Is it Real?" San Diego Conference materials now online

The materials provided for Beacon Economics' "The Recovery: Is it Real?" annual conference in San Diego on May 21st are now available online.

As part of our ongoing association with Beacon Economics, MetroIntelligence Real Estate Advisors Principal Patrick Duffy wrote the sections on residential and commercial real estate.

If you want to read just the section on residential real estate, click here to download.

If you want to read just the section on commercial real estate, click here to download.

And if you want to download the entire conference book, click here to download.

Orange County housing market better than its neighbors?

According to a recent story by the Orange County Local News Network (OCLNN), the county's housing market was stronger during April 2010 than its surrounding counties. Nonetheless, as I told the reporter Mike Reicher, the real test of this strength will be when the market is forced to operate on its own:

A true test of the market may come in June when sales boosts from tax credits will have passed, said Patrick Duffy of MetroIntelligence Real Estate Advisors. “Hopefully the training wheels the federal government provided will help the housing market regain independence,” he said.

Click here to read entire story.

Notes from the May 21st edition of The Kiplinger Letter

For some time now, I've been subscribing to The Kiplinger Letter, which is a weekly newsletter summarizing trends in politics and economics for managers and other decision-makers.

The May 21st edition was chock full of interesting remarks on housing and economics that I wanted to share here:

• The red ink hemorrhage at Fannie Mae and Freddie Mac is far from finished.

The tally of losses since Uncle Sam took the two over will likely double
before all the bad loans made during the housing bubble years are washed out.

So far, the feds have funneled about $146 billion to the two mortgage giants,
and Obama has pledged to cover the duo’s losses, no matter how deep, through 2012.

There’s little chance Congress will undertake an overhaul this year,
and it probably won’t finish up next, either. Republicans want to tackle the issue now,
while there’s a sense of urgency, so they can wind down Fannie and Freddie’s role
over five years or so.

But Democrats won’t agree. They fear that would deal a blow
to the housing market. The two quasi-governmental agencies, along with the FHA,
the Federal Housing Admin., now make or buy nine out of 10 new mortgages.

Delay has an indirect upside. Odds are Fannie and Freddie will be cut back,
but not eliminated, when lawmakers finally hash out what to do with them.
In the interval…more time for banks to repair their balance sheets and beef up lending
and for a private secondary market to revive. Otherwise, lending would be constrained.

• The slowdown in mortgage foreclosures isn’t necessarily good news.

Though the pace is decelerating, it isn’t because fewer homeowners are falling behind.
Lenders are simply taking longer to pull the trigger…12 months instead of about six.

Banks hope that by holding loans and letting delinquent borrowers stay put for now,
they’ll stave off a tidal wave of foreclosures and help to stabilize housing prices.
Short term, it’s good news for hard-hit areas such as Las Vegas and Miami.
But it will drag out the adjustment process. Now the number of foreclosures
isn’t likely to peak until sometime next year. One in eight mortgages is in distress...

• Europe’s woes spell a break for mortgage seekers, purchasing or refinancing.

For the time being, investors are loading up on U.S. Treasuries, pushing yields down
to about 3.2%. That’s translating into a dip in the 30-year fixed rate for mortgages.

The effects won’t last much longer, though. If Greece, Portugal and Spain
get a better grip on their budgets, following through in the coming weeks on promises
to rein in spending, investors’ worries will shift to the mounting pile of U.S. debt
and resulting inflationary pressures. Look for Treasury yields to bounce back up...

To read the entire letter or subscribe, visit www.kiplinger.com.

San Diego housing recovery expected to slow

San Diego Union-Tribune reporter Roger Showley covered Beacon Economics' lastest economic conference in San Diego on Friday, May 21st. In addition to the recent conference in Los Angeles, I also wrote the sections on residential and commercial real estate for this conference book, one of which was cited in Showley's piece:

"Office vacancies, currently about 19.3 percent, will fall only to 13 percent over the next four years as employment growth remains sluggish. Industry norms consider a healthy office vacancy rate to be less than 10 percent.

“Looking ahead to the rest of 2010 through 2012, the health of the office market will be largely tied to the extent of increased government spending on biotech and technology,” said Patrick S. Duffy of MetroIntelligence Real Estate Advisors, who wrote the chapter on commercial real estate in the Beacon report.

High vacancies will mean bargains for investors in some office buildings, he said, but values will still end up 36 percent below their peak of 2006."

Click here to read entire story.

"What's Next L.A.?" Conference Materials Now Online

The materials provided for Beacon Economics' "What's Next L.A.?" annual conference in Los Angeles on May 5th are now available online.

As part of our ongoing association with Beacon Economics, MetroIntelligence Real Estate Advisors Principal Patrick Duffy wrote the sections on residential and commercial real estate.

If you want to read just the section on residential real estate, click here to download.

If you want to read just the section on commercial real estate, click here to download.

And if you want to download the entire conference book, click here to download.

The next Beacon Economics conference will be May 21st in San Diego. If you'd like to attend that conference, click here to register. For special discounts on registration, please contact us at MetroIntelligence at 818-584-1848.

A Spring Thaw for Development Finance?

As the building industry continues to slowly recover from its most prolonged downturn since The Great Depression, the good news is that it appears a minor thaw may be finally beginning in the credit and equity markets. The bad news is that the rules of the game have changed so profoundly that not all players will be able to adjust accordingly.

In order to prepare for this new environment, MetroIntelligence is now partnering with George Smith Partners (GSP), a leading real estate investment bank which regularly taps its vast network of sources for customized equity and debt on residential and commercial properties throughout the U.S.

Whether the assignment is finding an equity partner to buy land or refinancing a stabilized apartment property, MetroIntelligence is now able to provide objective reviews of a sponsor’s assumptions in order to bring appropriate opportunities to GSP -- as well as to ensure that builders and developers are fully aware of their options.

According to GSP Vice President Jonathan Lee, who focuses largely on the residential sector, although the thaw in lending has unofficially begun, it won’t really matter until banks have re-set the land on their books to current values.

In the interim, Lee is seeing lenders reaching out to established builders as either fee builders or as JV partners to protect their investments by maintaining entitlements and building out what’s already been started. And yet the Catch-22 here is builders don’t want to JV unless land values are re-set to current value, but lenders aren’t strong enough yet to do so.

As for buying new land, assuming a private builder can out-bid a public company, the terms for leverage are going to be strict, with hard-money interest rates and 50% loan-to-value (LTV) ratios.

Not surprisingly, GSP’s Lee says that most of the projects getting financing today are infill projects closer to employment centers, stressing that broken developments in tertiary markets with high rates of foreclosures will take much longer to rebound.

For builders looking to dip their toes into construction financing for new projects, Lee says that as opposed to the one or two banks actively lending six months ago, today there are closer to four or five banks plus half a dozen hard-money lenders. Nonetheless, both of these types of lenders would want to chop up larger projects into phases to minimize their exposure.

But for builders looking to revive dormant projects, the view is cloudier, with a delicate dance involving a builder with deep enough pockets to buy back his note at a discount with new recourse money that ultimately protects the lender. Of course that assumes we’re talking about a single-family project, as financing for new condominiums is virtually nonexistent.

However, Lee does offer up an intriguing idea in which a multi-family project could conceivably be financed based on apartment underwriting standards but with the appropriate release clauses and a caveat that -- under the right conditions and assuming available mortgage financing – the units could eventually be sold as condos.

As for traditional apartments, with the worst of the downturn likely behind us, lenders are starting to wade back in with the right operators in the best markets but still with extremely conservative LTV ratios.

Certainly, any return to the days of easier credit will be long and arduous, especially given that total outstanding AD&C loans were reportedly down by 23% year-over-year in the fourth quarter of 2009.

Yet for those builders and developers who can adapt to the new environment and partner with the right sources for capital, a greater share of both the market and its future spoils await.

Want to see if the financing quotes you're getting for your projects are competitive? Interested in rolling over maturing debt for land, apartments or other commercial uses?

Contact MetroIntelligence at 818-584-1848 for more information!

May column for Builder & Developer magazine now online

My column for the May 2010 issue of Builder & Developer magazine is now online. In this issue, entitled "Green Building Grows from Infant to Toddler,"I review the pros and cons that builders have so far encountered by building green homes as well as future growth prospects. An excerpt:

Now that green building is leaving its infancy and becoming a full-fledged (and often cranky) toddler, although its support among both the public and the industry remains high, some solid pros and cons are beginning to emerge.

According to the 4^th Annual Green Building Survey by the law firm Allen Matkins, Construction Technologies Group (CTG) and Green Building Insider, support among over 1,600 design and construction professionals for green building remains extremely high at 92%.

Not surprisingly, the growth of the global green building sector is on a tear, totaling over $500 billion in 2009 and expected to continue growing at a compound annual growth rate of nearly 110% between now and 2015.

And yet as these same professionals now have a few projects completed, they’ve come to realize that accompanying the greater complexity of green building is the perception of more construction risk.

To counteract that risk, some important strategies have emerged, including retaining specialized consultants (including those certified by groups such as the U.S. Green Building Counsel’s Leadership in Energy and Environmental Design, or LEED), measuring and re-commissioning existing systems to maximize energy savings, regular testing and, to tie it all together, shifting the risks through insurance contracts.

You can read the entire column by clicking here.

What's next for L.A. commercial real estate?

Want to get an idea of how MetroIntelligence Real Estate Advisors sees the past and future of L.A. commercial real estate? As part of our ongoing association with Beacon Economics, we've been writing the real estate sections for their conference books. Here are the bullet points summarizing our thoughts for the coming year and beyond:

• As employers resist hiring new workers and opt to cut expenses further by opting for sub-lease space, the office market in Los Angeles County will remain under pressure through the first part of 2012. Look for rents to fall by another 9% by the end of 2010 as vacancies remain just above 18%.
• Although the retail market in Los Angeles has borne the brunt of The Great Recession, the region's population density has helped it plod along much better than many other markets in the U.S. Look for asking rents to continue falling by another 5% by the end of 2010 as vacancies remain elevated before gradually trending down by early 2011.
• While not immune from larger economic forces, the combination of the ports and one of the largest manufacturing sectors in the country will help the industrial sector rebound to healthy levels by mid 2012. For now, look for rents to fall by another 4% by the end of 2010 as vacancies remain stuck at about 8%.

What's next for L.A. residential real estate?

Want to get an idea of how MetroIntelligence Real Estate advisors sees the past and future of L.A. residential real estate? As part of our ongoing association with Beacon Economics, we've been writing the real estate sections for their conference books. Here are the bullet points summarizing our thoughts for the coming year and beyond:

• Falling home prices in Los Angeles County have made them exponentially more affordable, with 37% of households able to buy the median-priced home at current interest rates, up from just 2% to 3% during the last half of 2005 through all of 2007.
• Although the S&P/Case-Shiller Index has shown small increases of home prices in recent quarters, those rises could be short-lived as interest rates rise and support by the federal government in the form of tax credits expire.
• A combination of state tax credits favoring new homes as well as cost cutting by home builders has helped new home sales rebound by 66% since the trough in the first quarter of 2009; yet since prices took longer to crest during the boom, they're still falling slightly even after declining by 24% since peaking at nearly $525,000 in mid 2007.
• Due to price declines of 36% over the past two years year, sales of existing homes - of which about 35% are foreclosures - rose by 75% during the same time period; between the third and fourth quarters of 2009, both sales and prices managed to rise by just over 6%.
• Due to price declines of 24% over the past two years, sales of existing condominiums rose by 110% during the same time period; between the third and fourth quarters of 2009, condo sales continued to rise by 19% even as prices began to rebound by a small yet positive 1.4%.
• Due to larger economic issues, apartments remain under considerable pressure, with vacancy rates rising by 50% over the past two years to 7.5% and forcing rents down by 8% during the same time period to $1,614 per month, which are projected to fall by another 6.7% by the end of 2010.
• Although the pace of new foreclosures did temporarily dipped due to various moratoria throughout most of 2009, they did began to rise again by nearly 7% between the third and fourth quarters of 2009, and more recent indications show rises in loan defaults between February and March of 2010.

To read the entire section, click here to download in a .pdf format.