Paulson, speaking at CNBC’s Delivering Alpha conference, said he is still high on housing.

“It’s not too late to get involved. I still think buying a home is the best investment any individual can make. Affordability is still at an all-time high,” said Paulson.

Large-scale investors, however, may not be behind the surge in home flipping. They may, in fact, be the cause of it.

“Now that the institutional investors are doing buy and hold, a lot of these guys [individual investors] can’t compete with their checkbooks,” said Rick Sharga, formerly an executive at Carrington who now works for Auction.com. “In some cases the individual investors are flipping them to the institutional investors.”

While many of the large funds have teams that renovate homes, in some cases they would rather pay a premium for a move-in-ready property, rather than waste time and money remodeling.

“So the flippers are kind of the in-between middleman who is getting the property into good rentable condition and then selling to the institutional investors,” explained Blomquist.

(Read more: Map: Tracking the US real estate recovery)

Article source: http://www.cnbc.com/id/100896253

All this could have a significant impact on the housing recovery.

(Read More: Reverse Mortgages Backfiring on Seniors)

“If the investors gets sidelined—along with first-time buyers who are already sidelined—this housing market falls apart quickly,” says Mark Hanson, a California-based housing and mortgage analyst. Hanson points to still-high levels of negative equity, which has kept many homeowners stuck in place.

Connecticut-based Carrington Mortgage Holdings, a hedge fund that had been buying distressed homes, recently stopped.

“We think the market is a little bit too frothy,” said Carrington’s Rick Sharga in an interview last month. Home prices are now up 12 percent from a year ago nationally, according to CoreLogic, but have risen far more greatly in formerly distressed markets where investors originally focused their purchases.

“The general consensus right now is that the bargains are drying up when it comes to buying foreclosed properties,” adds Sharga.

(Read More: Rising Rates Turn Investors From REITs)

That is largely due to a lack of distressed homes for sale. The number of foreclosure sales in the first quarter of this year fell 22 percent from a year ago, according to RealtyTrac, a real estate website. The number of short sales, when the home is sold for less than the value of the mortgage, also fell, as rising prices provided less incentive for banks to agree to such deals. Some claim banks are actually holding onto repossessed homes, waiting for prices to rise higher.

Investors accounted for 19 percent of home sales in April, according to the National Association of Realtors, down from 24 percent in all of 2012. Investors include individual buyers as well as large hedge funds, but the hedge funds have been getting much of the attention, credited with juicing prices in the hardest hit housing markets like Phoenix and Las Vegas. Their so-called REO-to-Rent strategy (Real Estate Owned-to-Rent) has evolved into a new asset class, with two of the companies that engage in the practice going public this year as real estate investment trusts (REITs).

Article source: http://www.cnbc.com/id/100799067

Granite Point Capital, a Boston-based hedge fund, has leased 4,800 square feet at 109 State St. in Boston’s Financial District.

Granite Point Capital will relocate from its current location at 222 Berkeley St. in Boston’s Back Bay, according to a statement.

NAI Hunneman Senior Vice President Jeffrey Becker and Vice President Bonny Doorakian represented the landlord, Daniel René Safar and Marcel Safar of Daniel René Commercial Real Estate, in the transaction. Rebecca Galeota, of Cushman Wakefield, represented Granite Point Capital.

“After all the attention we have paid to our building and our business, we are thrilled to be able to attract a tenant such as Granite Point Capital to make the move to the property,” said Marcel Safar, general manager of Daniel René Commercial Real Estate. “It has been a challenge to convince the market that our level of services are on par and our finishes and design can even surpass the most sophisticated offices in the city. We thank Jeff and Bonny for showing this to the market and we hope to build on this success in our future acquisitions.”

Granite Point will occupy the entire fifth floor, and Daniel René will conduct the buildout.

Article source: http://www.bankerandtradesman.com/news147736.html

A few weeks ago the National Association of Home Builders put out a report asserting that new lower loan limits going into effect in October at Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA) “will reduce housing demand and place downward pressure on home prices in major housing markets.”

On the blog that day, I wrote that the games were only beginning.

Now another report, this time from researchers at George Washington University, is suggesting just the opposite, that lower loan limits may raise cost for a very few borrowers, but overall will not affect most mortgage shoppers.

The report focuses on the FHA, claiming, “The FHA still could serve 95 percent of its historic targeted market even if the maximum FHA loan limit were reduced by nearly 50 percent.” Its market share right now (30 percent) far exceeds its target population.

“FHA’s expansion played a major role in keeping the housing market afloat during the economic collapse of 2008 and 2009,” said Robert Van Order, co-author of the report. “However, we now are left with large loan limits that were set when home prices at the top of the bubble. They don’t reflect current market conditions and are unlikely to assist the FHA in reaching its historical constituencies – first time, minority and low income homebuyers.”

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But others will be closing their doors next month, despite the movie-rental chain’s last-minute reprieve from liquidation.

A $229 million deal to turn Blockbuster over to a group of hedge funds and Blockbuster bondholders was agreed to by a New York bankruptcy judge, after disgruntled creditors, including movie studios and Yahoo, signed on to a revised deal.

That means 17 Blockbuster stores out of 24 listed in the inner Bay Area will stay open, at least for a while longer. “We’re fine, we’re fine,” said a sales clerk in the Alameda store.

Of those scheduled to shut their doors in April, three are in San Francisco – on Church Street, Geary Street and 16th Street in Potrero Hill – and one each in Albany, San Leandro and Alamo.

But there could be more. The company, once the world’s largest movie-rental outlet, with 9,100 stores, reported a loss of $64.8 million in the last quarter. Under the purchase agreement signed with the hedge fund group last month, Blockbuster said 609 of its remaining 3,300 U.S. stores were to be shut as part of an “initial liquidation.”

A sales clerk at the Daly City Blockbuster, not currently on the list, said she’d been told hers might close in November. On the other hand, the Pinole store, which is on the list, might be re-evaluated, a sales clerk there had heard.

To what extent the new owners are re-evaluating remains to be seen. Having made what is called a “stalking horse” bid for the Dallas company, they might be looking to flip the property for a higher price.

Asked what she’s going to do in April, a sales clerk at the Church Street store replied, “Stand on a street corner, hope people feel sorry for me and give me money.”

Coincidence?: Turns out the scheduled auction of the Westin San Francisco, which we noted in Thursday’s column, is off. The creditor seeking the foreclosure suddenly got the $22 million loan owed by the hotel’s owners, a Goldman Sachs real estate entity and a Dallas private-equity firm.

“The borrower paid off the loan in full (Wednesday) night,” said an attorney for the Carlton Group, a foreclosure and debt restructuring firm, after it had posted the auction notice that morning on behalf of its client, Deutsche Bank.

All this occurred after we made inquiries – which got the silent treatment – and a small item appeared in the Wall Street Journal.

News of the payment was e-mailed to interested parties Thursday morning, and showed up in bold capital letters on the Carlton Group’s website, over the original notice of the auction.

Dare we say The Chronicle gets results?

Cold decaf: Remember how hard Peet’s Coffee Tea tried to buy Diedrich Coffee, the Castroville (Monterey County) roastery and chief supplier to the fast-growing single-cup coffee market?

The Emeryville chain thought it had the $226 million deal closed in November 2009, when along came Green Mountain Coffee, known for its Keurig single-cup coffee dispensers and K-cup portion packs, and snatched it out of Peet’s hands with a better offer.

Adding insult to injury, the Vermont company on Thursday signed a partnership deal with Starbucks, under which the latter’s coffee (and its Tazo tea) will be sold in Green Mountain’s K-cups portion packs at Starbucks’ 11,000 outlets, plus supermarkets, drugstores and other retail establishments throughout North America.

Instant reaction: Green Mountain shares up 41 percent at the close of trading Thursday; Starbucks up 10 percent.

Peet’s, down 11.5 percent.

Good trade: Nice numbers for California’s exporters. They had the best January ever, according to trade figures released Thursday by the U.S. Commerce Department.

The state’s $11.75 billion worth of exports marked a 14.5 percent increase over January 2010, driven by both manufactured goods, and especially raw materials and agricultural products. This was in line with U.S. exports which rose to record levels. But other states did even better, with California’s share of the nation’s export pie falling, according to an analysis of the Commerce Department data by San Rafael’s Beacon Economics. (sfg.ly/iiE5jW)

Future prospects may depend on the price of oil, said Jock O’Connell, Beacon’s international trade expert.

“Economies tend to go wobbly and global supply chains start experiencing serious palpitations whenever oil futures float much over the $100 a barrel mark,” he said.

Job grievance: It’s not exactly hi-ho, hi-ho, and off to work we go these days in the Golden State.

According to a just-released survey of “work environment well-being” in the nation’s 50 states, California dropped from sixth to 21st place. No. 1: South Dakota, followed by Nebraska, Montana, Wyoming and North Dakota. Unsurprisingly, “work environment well-being” was down nationally.

“Healthy behavior” and “emotional health” improved, however, while “physical health” stayed about the same in the latest Gallup-Healthways Well-Being Index, which measures good feelings in a number of categories.

The most well-being state overall, according to its rolling survey of 1,000 Americans: Hawaii. Other states feeling pretty good include Alaska, Colorado, Minnesota and Utah. California comes in at No. 18. (sfg.ly/hPBymj).

Blogging: www.sfgate.com/ columns/bottomline. Facebook page: sfg.ly/doACKM. Tweeting: @andrewsross. E-mail: bottomline@sfchronicle.com.

This article appeared on page D – 1 of the San Francisco Chronicle

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/03/10/BU5C1I7HHK.DTL

There is no official settlement.

There is no multi-billion dollar fund or penalty and there is no word from Federal Regulators as to how the banks will ultimately “fix” the foreclosure paperwork issues.

Yet.

But a meeting here in DC of the fifty state attorneys general was too good to pass up for a couple of hundred protesters demanding, “a strong settlement that includes principal reduction on millions of mortgages.”

I have to hand it to the Iowa deputy attorney general, Tam Orminston, who put himself into the middle of a crowd of troubled, and angry borrowers, led by National People’s Action and PICO National Network. One by one borrowers told of their mortgage woes, amid shouts of “That ain’t right!” from the surrounding crowd.

The protesters called a potential $20 billion settlement with the big banks “chump change,” even though that number is far from agreed upon. As I stood watching, Missouri Attorney General Chris Koster came over to our camera to chat. He was advocating that a settlement be done quickly and almost sounded as if he were willing to back off some of the demands of a 27 page settlement “framework” from Iowa attorney general Tom Miller, who is leading the 50 state foreclosure investigation, that outlines new foreclosure procedures and loan modification mandates for the banks as part of a potential settlement. That document will be presented to all the AGs this afternoon but was leaked to the press Friday.

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