Sales of new California homes slide 44%
The pace of home sales at California new-home communities continued to remain slow in April, but year-over-year sales declines shrunk slightly for another consecutive month, the California Building Industry Association reported today.
The monthly CBIA/Hanley Wood Market Intelligence report showed that new-home sales in April were 44 percent below April 2007. While a significant decline, the drop is an improvement from the year-over-year decline of nearly 49 percent in March.
Jonathan Dienhart, director of published research for HWMI, notes the trend in year-over-year sales percentages is positive, but is very gradual.
"The fact that year-over-year declines are shrinking is a good sign," Dienhart said. "But unfortunately it is occurring very gradually, meaning it’s going to be a slow process for the market to finally hit bottom and start to turn around."
N.J. cites anti-racketeering law in mortgage fraud suits
New Jersey officials have charged 15 corporations and 21 individuals with violating the state’s anti-racketeering statute in alleged mortgage fraud schemes prosecutors said involved 25 properties and more than $5 million in fraudulent loans.
Three separate civil suits allege violations of the state’s Consumer Fraud Act and the New Jersey Racketeer Influenced and Corrupt Organizations (RICO) Act.
In Essex County, the state attorney general’s four-count complaint against A&E Mortgage Co. LLC alleges the company conspired with real estate appraisers, a title company, straw buyers and sellers to carry out fraudulent equity stripping transactions. Complete Title LLC of Woodbridge, Premier Real Estate Appraisal Service LLC of Toms River, and Hammond Appraisal Service LLC of Burlington were also named in the suit.
A second suit against Ultimate Real Estate Solutions LLC alleges the Gloucester County company used the names and credit scores of "investors" to acquire properties through fraudulent mortgage applications, then leased these properties to rent-to-own consumers. Ultimate allegedly collected the rental payments from rent-to-own consumers but did not pay the mortgages on the properties. Empire Equity Group, Inc., doing business as 1st Metropolitan Mortgage Services of Mount Laurel, was also named in the suit.
In a third suit, American Millenium Co. LLC is accused of recruiting buyers to purchase "investment" properties with no money down, and conspiring with appraisers and a title company to inflate property values to defraud lenders. Defendants include American Millenium, doing business as American Mortgage Co. of Florham Park; Equititle LLC of Morganville; The Addison Group LLC; a Bridgewater appraisal firm; Radell Appraisal Services of Bloomfield; Valentine Morrisson LLC; and Green Ink Investments.
Two more builder bankruptcies
The Wall Street Journal reports that two home builders — Oakridge Homes LLC in California and M.W. Johnson Construction Inc., which builds in three states — have filed for Chapter 11 bankruptcy protection. Levitt and Sons LLC and Tousa Inc. are among the other builders in bankruptcy proceedings, WSJ reports.
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