"Negative absorption" in Santa Maria

Santa Maria, Calif., a city in northern Santa Barbara County, is facing five years of negative absorption for residential real estate, meaning it will need fewer homes as people leave to find jobs elsewhere, CalculatedRisk reports, citing a local land developer as a source.

The blog also cites a Los Angeles Times story detailing a couple’s purchase of a $412,000 home using a stated-income loan. Homes like it are now renting for $1,300 to $1,600 a month — putting the house’s current value at between $157,000 to $192,000, CalculatedRisk estimates.

"There is almost no bottom for prices in an area with negative absorption. Just ask the residents of Detroit," the finance and economics blog opined.


Fed official: Banks must raise capital faster

In testimony before the Senate Banking Committee, Federal Reserve Vice Chairman Donald Kohn said he expects to see weaker bank earnings and continued write-downs from both banks and home builders in the coming months as the credit and housing bust continues. He urged banks and home builders to build capital, and said he was disappointed that banks weren’t increasing reserves faster in the face of challenging conditions.

One has to wonder though — are they not raising reserves because they know the Fed is right behind them with a golden net?

–Morgan Brown, BlownMortgage

Mortgage experts see rates headed up

Predictions for conforming mortgage rates in the next 30 days from experts polled in Bankrate.com’s weekly Mortgage Rate Trend survey:

  • 69 percent of participants predict rates will increase

  • 25 percent of participants predict rates will decrease

  • 6 percent of participants predict rates will remain unchanged

"I am predicting that rates will remain unchanged over the next 30 days, but that doesn’t mean you should necessarily follow my advice when choosing whether to lock a rate or float it. My advice may not be appropriate for your individual situation."

–Dan Green, The Mortgage Reports


What’s your opinion? Leave your comments below or send a
letter to the editor.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription