Charlotte-area home sales take off

By Stella M. Hopkins

Fueled in part by a hefty tax credit, Charlotte-area home sales jumped nearly 20 percent last month, the first gain in more than two years.

There were 2,210 houses, townhouses and condos sold last month through the Carolina Multiple Listing Services. That compares with 1,848 in October 2008, when the economy took a nosedive.

The hefty increase marks the first time since February 2007 that sales rose on an annual basis. That's the most robust signal yet of the industry's recovery but still leaves sales below the 2003 level.

The first time homebuyer's tax credit, just extended and expanded to existing homeowners, is likely to continue propelling sales.

As evidence of the Charlotte market's staying power, MLS pending sales were up one-third compared with a year ago, according to data recently released by the Charlotte Regional Realtor Association. That's the second month in a row of increases. Those sales represent signed contracts that haven't yet closed and are an important barometer.

Sales prices continued a downward trend, falling 9.5 percent from a year ago, to an average of $196,204. Foreclosures and other distressed sales are weighing on prices.

MLS transactions account for the bulk of area sales.

Fewer Underwater Mortgages

Fewer people are underwater on their mortgage--further evidence that the real estate free-fall may be slowing. Just 21% of all single-family homeowners owe more on their mortgage balances than their homes are worth, according to a third quarter residential real estate report from Zillow.com. That is down from 23% at the end of the second quarter. That's good news because it should help reduce the number of homeowners losing their homes to foreclosure. Being underwater is one of the two factors that lead to foreclosure, the other being, of course, not having enough income to make the monthly payments. But there's a second, less-positive factor that contributed to the reduction in underwater borrowers: foreclosures. So many people have already lost their homes that the ranks of those underwater are slowly dwindling.

Source: Zillow.com, CNNMoney.com

Nat'l Assoc. of REALTORS to launch new UNIVERSAL MLS!

The National Association of Realtors® has acquired technology to create a database of all properties in the United States so Realtors® can better assist consumers in a high-tech, fast-paced business world. The technology acquisition includes licensed data and secured data aggregation services from LPS Real Estate Group, a wholly owned subsidiary of Lender Processing Services Inc. NAR will use the assets to develop the Realtors® Property Resource™, a parcel-centric information database covering all of the more than 147 million property parcels in the country as a resource for NAR members. NAR is planning to launch RPR™ in the second quarter 2010.

NAR CEO Dale Stinton said, "These acquisitions will allow Realtor® interests to control the program and the content. Realtors® need to respond quickly to today's tech-savvy consumers, and the RPR provides a means for multiple listing services (MLS), commercial information exchanges (CIEs) and real estate brokerage business models to support the Realtor® community, rather than requiring Realtors® to purchase data aggregated by third parties." RPR(TM) is not a national MLS, and will carry no offers of cooperation and compensation, Stinton added. "It is a private, NAR members-only benefit. The assets acquired by NAR will be directed through a wholly owned subsidiary corporation, Realtors Property Resource, LLC," Stinton said.

Fannie Mae announces deed for lease program

Fannie Mae is implementing the Deed for Lease Program under which qualifying homeowners facing foreclosure will be able to remain in their homes by signing a lease in connection with the voluntary transfer of the property deed back to the lender.

The new program is designed for borrowers who do not qualify for or have not been able to sustain other loan-workout solutions, such as a modification. Under Deed for Lease, borrowers transfer their property to the lender by completing a deed in lieu of foreclosure, and then lease back the house at a market rate.

To participate in the program, borrowers must live in the home as their primary residence and must be released from any subordinate liens on the property. Tenants of borrowers in this circumstance may also be eligible for leases under the program. Borrowers or tenants interested in a lease must be able to document that the new market rental rate is no more than 31% of their gross income.

Leases under the new program may be up to 12 months, with the possibility of term renewal or month-to-month extensions after that period. A Deed for Lease property that is subsequently sold includes an assignment of the lease to the buyer. For additional information about the Deed for Lease Program, including full details on program eligibility, please review the Guide Announcement by clicking here.

Tax Credit Extended and Expanded!

Senate and House approve homebuyer tax credit extension

The Senate voted unanimously Wednesday night and the House of Representatives on Thursday to extend the $8,000 tax credit for homebuyers beyond its scheduled November 30, 2009, expiration date. The bill will be sent to the White House for his signature possibly as early as tomorrow. The credit would be available until April 30, 2010. Under the new legislation the credit will also now apply to repeat homebuyers.

Under a compromise reached late last week, the tax credit for veteran homeowners will apply only to those who have lived in their current residence for at least five years. The credit for these buyers will be capped at $6,500 while first time buyers will continue to receive $8,000.

Income levels will be extended from the current limits of $75,000 for a single purchaser and $150,000 for couples to $125,000 and $225,000 respectively. Above those limits there are diminishing credits available.

Mobile Blog Test

-Ford Craven, REALTOR

Crescent Resources Files Bankruptcy Petitions

By Bruce Henderson
bhenderson@charlotteobserver.com
Posted: Wednesday, Jun. 10, 2009

Charlotte-based Crescent Resources, one of the leading real estate developers in the Southeast, said today it has filed Chapter 11 bankruptcy petitions.

The company said it will continue to operate as it tries to reduce debt and improve its capital structure. Crescent has raised $110 million in financing from its existing lenders to continue operations as it reorganizes.

Chief executive Art Fields has retired and will work with the company as an advisor, Crescent said. Andrew Hede, Crescent's chief restructuring officer, will also serve as CEO.

The Observer reported Crescent's struggles with $1.4 billion in debt, and the possibility of bankruptcy, in May. The company expanded into 10 states in the Southeast and Southwest, including booming states that were later hard hit by the real-estate bubble.

“Despite the unprecedented challenges facing the real estate industry, we believe Crescent's underlying business model is solid, and our assets remain very attractive,” Hede said in a statement.

Crescent is a joint venture of Duke Energy and Morgan Stanley Real Estate Funds.

The Two Latest Signs Housing Is Recovering

Here’s more evidence that the housing market is recovering.

Two major home builders, Toll Brothers Inc. and Hovnanian Enterprises Inc., say their losses were shrinking compared to last year because buyers are coming back to the market.

Other encouraging news came from IHS Global Insight, a research firm, which said home prices fell on average at an annual rate of 2.2 percent in the first quarter in 199 of 330 metropolitan areas. That compares with a 12.5 percent decline in the fourth quarter of 2008 in 312 metropolitan areas.

"While it's too early to see a bottom of this housing downturn," the report said, the latest data "may signal that the market is beginning to stabilize."

Source: The Wall Street Journal, James R. Hagerty and John Spence (06/04/2009)

Two Real Estate Agents Sue Over CSI Episode

Melinda and Scott Tamkin, two associates with Keller Williams Realty in Beverly Hills, Calif., are suing a writer for the CBS show “CSI” because they allege they were portrayed unkindly in a show because of a real estate deal that didn’t work out right.

The "CSI: Crime Scene Investigation" episode featured a real estate practitioner named Melinda who dies. Her husband Scott, a mortgage broker, is suspected of killing her.

The Tamkins believe they were portrayed in the episode and sued writer and producer Sarah Goldfinger for defamation and invasion of privacy. They are seeking $6 million in damages, alleging that the show kept potential customers away.

The Tamkins represented the owners of a home that Goldfinger wanted to buy in 2005, according to the lawsuit. Goldfinger pulled out when the sale was in escrow.

Source: The Associated Press (05/23/2009)

Forecasters say recession nearing end

More than 90 percent of economists think the recession is nearing its end, but they don't expect the economy to soar anytime soon. Nearly 75 percent of economists, surveyed by the National Association for Business Economics, say that the recession will end in the third quarter. Another 19 percent think the turnaround will come in the fourth quarter. The rest are betting on the first quarter of 2010.

Americans seem to believe that things are getting better too. The Conference Board's Consumer Confidence Index rose 14.1 points in May to 54.9, the second month in a row in which there has been an increase. Forecasters say that home sales will bottom out in the second quarter, an important stabilizing factor.

Source: The Associated Press, Jeannine Aversa (05/27/2009)

NAR: Existing-home sales jump

Existing-home sales rose in April with strong buyer activity in lower price ranges, according to the National Association of Realtors. Existing-home sales increased 2.9 percent to a seasonally adjusted annual rate of 4.68 million units in April from a downwardly revised pace of 4.55 million units in March. Yet, home sales were 3.5 percent below the 4.85 million-unit level in April 2008, according to NAR.

REAL Trends Comment: Sales were up from March (which is a seasonal event) but down from last April (a cyclical event). As we reported in the REAL Trends April Housing Market Report, sales did not improve from March in our study. Further the seasonal adjustment in the NAR report was smaller (2.9%) than the normal monthly adjustment which is usually in the range of 10.5% to 12.4% - that is April sales are usually 10.5% to 12.4% higher than they are in March. We would enjoy more than anyone the news that the market is improving but the data just doesn't show it - yet.

An NAR practitioner survey in April showed first-time buyers declined to 40 percent of transactions, implying more repeat buyers are entering the traditional spring home-buying season. It also showed the number of buyers looking at homes has increased 14 percentage points from a year ago.

National median existing-home price: for all housing types, was $170,200 in April, which is 15.4 percent below 2008. Distressed properties, which accounted for 45 percent of all sales in April, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.

Total housing inventory: at the end of April, rose 8.8 percent to 3.97 million existing homes available for sale, which represents a 10.2-month supply at the current sales pace, compared with a 9.6-month supply in March. "The gain in inventory is largely seasonal from sellers entering the spring market," Yun says. "Even with the rise, inventory over the past few months has remained consistently lower in comparison with a year earlier."

Source: NAR

Local home prices rise, best among 20 markets

Charlotte Oberver Staff Report

Posted: Tuesday, May. 26, 2009

Charlotte-area home prices showed a slight monthly gain in March, the first uptick since last summer, according to a widely watched index released today.

Sales prices rose .3 percent compared with February results from the S&P/Case-Shiller Home Price Index. That was the best monthly performance among the 20 urban markets measured by the index and another milestone that could signal the region's housing market has reached a bottom.

Charlotte-area sales prices remain down compared with March 2008, marking a full year of declining prices. But at 9.3 percent, the yearly decline also showed a tiny improvement over February's reading.

Comparisons to a year earlier are important because they compare similar periods and reduce the impact of seasonal effects, such as the typical rebound of home sales during the spring.

Still, monthly results can signal a trend. The Charlotte market started a string of monthly declines in July and peaked at a loss of 2.6 percent in December's index. The index is especially meaningful because it measures repeat sales of existing houses.

Nationwide, the index recorded a 19.1 percent decline for the first quarter, compared with the first three months of 2008. That was the sharpest drop in its 21-year history.

However, March was the second consecutive month since October 2007 in which the index for the 20 markets did not post a record annual decline.

With its 9.3 percent yearly decline, the Charlotte area remained in fifth place in March, behind smaller annual declines in Denver, Dallas, Boston and Cleveland. Those are the only five regions in which annual declines are under 10 percent.

Denver posted a .1 percent monthly increase and Dallas home prices remained flat in March.

Phoenix remains the hardest market in the index, with a decline of 36 percent compared with March 2008.

HUD rescinds $8000 tax credit down payment

Earlier this week, HUD Secretary Shaun Donovan mentioned that the first-time homebuyer tax credit could be used as a down payment, but that may no longer be the case.

The mortgagee letter with the program details has since been removed from the HUD website; a call to the FHA confirmed this had occurred.

The employee I spoke with said the program is essentially pulled as of now, but nothing official has been released regarding the fate of the so-called tax credit advance.

So as it stands now, it appears as if the tax credit cannot be used for a down payment. It’s unclear why the FHA withdrew (or at least stalled) the program, though it could have something to do with perceived risk involved.

Allowing first-time homebuyers to purchase a property with nothing down is certainly high-risk, and the practice of using tax credits for down payments is fairly similar to the seller paid down payment assistance loans that nearly sunk the FHA.

Last summer, FHA Commissioner Brian D. Montgomery said the agency realized $4.6 billion in “unanticipated long-term losses,” largely due to an increased number of seller-funded loans in its portfolio.

The loans, which accounted for 14 percent of all FHA loans outstanding and 31 percent of all FHA foreclosures, are no longer available.

If they hadn’t been banned, the FHA would have needed appropriations of $2.5 billion to operate.

While I’m sure the program could help some borrowers in need, it could also lead to abuses, which may outweigh the positives.

Kannapolis - NC Research Facility Update

Rowan-Cabarrus Community College recently signed a lease agreement with Castle & Cooke for a $26 million classroom and laboratory building on the NC Research Campus. This extension onto the campus is key to the college's efforts to grow its biotechnology programs in order to prepare our local workforce for the many new life sciences jobs being created there.

As RCCC makes strides to break ground on their new building, groundbreaking research forges ahead at the NCRC. A landmark $1 million donation from Charlotte businessman Herman Stone has launched On the Shoulders of Giants: Carolina's Campaign to Cure MS, an effort to raise $5.2 million to fund multiple sclerosis research at the Campus. Elsewhere in the City, Harmony Labs is investing $3.5 million to expand their facilities and create new jobs.

Beazer to pay $30.5 million in suit

Shareholders had sued the homebuilder, saying they were misled about business practices.

Bloomberg News

Posted: Wednesday, May. 06, 2009

Beazer Homes USA Inc. agreed to pay $30.5 million to settle a class-action lawsuit over allegations it misled shareholders about problems with its mortgage-lending practices that led to a federal investigation.

Under terms of the settlement, the company denies any wrongdoing, Beazer said Tuesday in a statement. The settlement is subject to final approval by U.S. District Judge Clarence Cooper in Atlanta.

Shareholders sued in March 2007 and accused company directors of failing to prevent improper business practices including illegal mortgage lending. Beazer's illegal mortgage lending practices allowed the Atlanta-based company to sell more homes and conceal its declining business, shareholders said in the complaint. The lawsuit followed an Observer series that found the company arranged loans some buyers couldn't afford and violated federal lending laws.

Beazer, once a major Charlotte-area homebuilder, said insurance would cover the settlement payout. The settlement covers shareholders who purchased stock from Jan. 27, 2005, to May 12, 2008, according to court filings.

In September, Beazer settled with the U.S. Securities and Exchange Commission over claims it fraudulently misstated its earnings. The agreement didn't require the company, which denied wrongdoing, to pay any financial penalties.

Beazer rose 51 cents, or 16.7 percent, to $3.57 in New York Stock Exchange trading. The stock has climbed 126 percent this year after falling 79 percent in 2008.

Population Growing Fastest in Raleigh, North Carolina

North Carolina is attracting new residents faster than any other area in the United States according to a recent Census Bureau study. The Raleigh-Cary, North Carolina metro's population rose 4.3 percent between July 1, 2007 and July 1, 2008, gaining almost 45,000 people. Austin-Round Rock, Texas was the second fastest-growing metro, adding 60,000 to the area for a 3.8 percent increase.

In terms of actual numbers, the Dallas-Fort Worth metro area gained the most, adding more than 146,000 persons to its population. Three other metro areas also became home to more than 100,000 from 2007 to 2008, including Houston (130,000), Phoenix (116,000) and Atlanta (115,000).

Metropolitan areas in the South in general are also among the fastest growing immigrant destinations. Phoenix and Atlanta both have well over a half million immigrants, and Las Vegas and Orlando each have more than one-quarter million foreign-born residents.

Source: Census Bureau

Many markets undervalued

Good news for many markets, according to a new report by IHS Global Insight titled 'House Prices in America', for the nation, as a whole, the market is slightly undervalued and prices have fallen 9.9 percent from their peak in 2007.

For the fourth quarter, the rate of decline was the greatest in the current housing cycle, the study said. Statewide average home price declines for 2008 exceeded 20 percent in the four so-called 'sand' states Arizona, California, Florida and Nevada.

Open Houses Are Still Worth It, Practitioners Say

Despite a changing market, many real estate professionals say open houses are still a good way to showcase a home.

Open houses work just as well as they did a few years ago when the market was very competitive, says Trudy Severa, an associate with Long & Foster in Reston, Va.

"Anything you can do helps," says Severa. "It's a numbers game, and there is no way to know the residual effects [that an open house can have]."

Some practitioners have had success joining forces with others to produce a group tour. For instance, seven different practitioners recently held a neighborhood open house in Washington, D.C., where participants could view eight listings ranging in price from $500,000 to more than $1 million.

An open house can be an opportunity to talk to potential buyers who are interested but who might be unsure about the uncertain market, says Mario Rubio, a practitioner with Rubio Real Estate in Annandale,Va. He suggests having a loan officer/mortgage banker on hand at the event to answer questions.

Source: The Washington Times, Cary Lee Dailey (04/10/2009)

Fed sees signs recession may be easing

By JEANNINE AVERSA
AP Economics Writer

Posted: Wednesday, Apr. 29, 2009

WASHINGTON The Federal Reserve said Wednesday it see signs the recession is easing and that the economic outlook has "improved modestly" since last month.

Against that backdrop, Fed Chairman Ben Bernanke and his colleagues left a key interest rate at a record low of between zero and 0.25 percent, and decided against taking any new steps to shore up the economy.

Aggressive action already taken - including a $1.2 trillion effort last month - should gradually help bolster economic activity, the Fed said. It did, however, leave the door open to future action if needed.

Fed policymakers offered a less dour assessment of the economy than the one provided at its previous meeting in mid-March.

"The economy has continued to contract, though the pace of contraction appears to be somewhat slower," the Fed said. The worst of the recession - in terms of lost economic activity - could be past.

The economic outlook has "improved modestly" since the March meeting, partly reflecting some easing of strains in financial markets, the Fed said. Even so, "economic activity is likely to remain weak for a time," the Fed added.

And, while consumer spending has shown "signs of stabilizing," it is still being constrained by rising unemployment, falling home values and hard-to-get credit, the Fed said.

Meanwhile, weak sales and credit difficulties have forced businesses to cut spending and lay off workers, the Fed said.

To nurture economic activity, the Fed pledged anew to keep its key bank lending rate at a record low "for an extended period." Economists predict the Fed will keep the rate there well into next year.

Looking ahead, the Fed didn't rule out expanding existing programs or creating new ones to bolster the economy.

At its March meeting, the Fed launched a $1.2 trillion effort to lower interest rates and get Americans to boost spending, which would help spur economic activity.

Specifically, the Fed in March said it would start buying government debt - $300 billion over the next six months - and would buy an additional $850 billion worth of mortgage-backed securities and debt from mortgage giants Fannie Mae and Freddie Mac.

The Fed on Wednesday said it will continue to evaluate "the timing and overall amounts" of its government securities purchases in light of evolving economic and financial conditions.

Cramdown Bill Faces Senate Opposition

The bill that would let judges modify the mortgages of home owners in bankruptcy, known as cramdown, is facing still more troubles as it moves to the U.S. Senate.

"I hope we can muster the courage and find the votes, although I know it will be hard," says Senate Majority Whip Richard J. Durbin, an Illinois Democrat. "It's hard to imagine that today the mortgage bankers would have clout in this chamber, but they do."

The bill Senators are being asked to vote on a measure that would require home owners be at least two months delinquent and have an outstanding balance of less than $729,750 to qualify. If a bankruptcy judge lowers the amount they owe, borrowers would have to split any ultimate profit with the lender if they sell while in bankruptcy proceedings.

Scott E. Talbott, senior vice president of government affairs for the Financial Services Roundtable, predicted that passage is unlikely. "The uphill battle that the bill has faced for years has continued. It will be very difficult to garner the votes," he says.

Source: Washington Post, Renae Merle (04/28/2009)

North Carolina has the least expensive closing costs!

New York, Texas, Florida. For the second straight year, those are the most expensive states in which to get a mortgage. Nationwide, the average origination and title fees on a $200,000 mortgage this year totaled $3,118, according to Bankrate's annual survey of closing costs. The fees in the survey don't include taxes, insurance or prepaid items such as prorated interest or homeowner association dues.

Fees in New York City were highest, averaging $4,016 in Bankrate's survey. Houston came in second, with fees that averaged $3,975. After that came Buffalo, N.Y., with fees averaging $3,845, and then Miami, at $3,683. North Carolina had the least expensive closing costs in the survey, at an average of $2,650. The previous year, Indiana took the last spot.

The annual survey of online lenders is conducted by obtaining fee estimates for a $200,000 mortgage in each state's most populous city.

Source: Bankrate.com

Is FHA key to housing turnaround?

Federal Housing Administration loans can be a very good deal for homebuyers, especially those who don't have a lot of cash or whose credit rating isn't stellar, experts say. FHA loans now account for 20 percent of new mortgages, up from 3 percent in 2006. What's more, the number of authorized FHA lenders has increased 500 percent in two years.

Other benefits of FHA loans include easy loan modifications for borrowers who fall behind, easy refinancing plans if rates decline, and low rates overall, which don't rise if the borrower has a low credit score. There are no income restrictions on FHA loans, so even borrowers with good incomes may find them attractive.

FHA loans still require a pre-settlement inspection of the home, but the process isn't nearly as arduous as it once was, says George Hanzimanolis, past president of the National Association of Mortgage Brokers.

Source: CNNMoney.com"

Gmail - REAL Trends E-mail UCertified green professionals on the rise

More than 2,725 builders, remodelers and other homebuilding industry professionals have now achieved the Certified Green Professional designation. The National Association of Home Builders (NAHB) designation is awarded after the successful completion of 24 hours of classroom instruction on green building techniques and business practices, two years' industry experience, a commitment to continuing education and adherence to the CGP code of ethics."

Real estate prices seen leveling

Nationally, housing prices have been in free fall for two years. According to the Altos 10-city Composite Price Index, there are some fragile signs of stability. Though the hardest hit markets, Las Vegas in particular, has not seen any slowing in the housing bust.

The Altos 10-City Composite Price Index increased by 1.1 percent during both March and the first quarter of 2009. Prices of properties listed for-sale increased in 18 of 26 major markets and were down in eight markets according to the Real-Time Housing Market Report, jointly published by Altos Research and market analysis consultancy Real IQ.

Asking prices fell at the fastest rate during March in Salt Lake City followed closely by Las Vegas - down 4.0% and 3.9% respectively. Listing prices of single-family homes rose at the fastest rate in San Francisco-up 3.8% in March. Prices in seven markets-New York, Boston, Houston, Los Angeles, San Diego, Miami and Charlotte-are now showing three months of sequential listing price increases."

$8000 Loan for an $8000 payback?

States Contemplate Loans for Home Buyers
The $8,000 first-time home buyer mortgage tax credit, which is part of the Recovery and Reinvestment Act of 2009, is a great boon. But, it doesn’t help people who don’t have money for a down payment and closing costs.

Now some states are contemplating offering an $8,000 loan to home buyers before they close on the condition that they repay the loans as soon as they get their federal tax credits.

The idea has been adopted in Missouri, which advances the money to those who take out first mortgages offered through the state’s housing finance authority. The New York State Builders Association is lobbying the State of New York Mortgage Agency to adopt a similar strategy.

“A lot of states are trying to get through the technical aspects of this," says Gregory Brown, an assistant vice president for government affairs at the National Association of Home Builders. "I feel very confident they’ll find a way to make it work.”

Meanwhile, some home builders are taking matters into their own hands, offering programs that purchase the tax credit from borrowers prior to closing.

“This is a legitimate monetizing program that actually works,” says David Abrahamson, vice president of S.E. operations for American Home Key Mortgage Company, which makes the loans for many participating builders in the southeast.

Source: The New York Times, Bob Tedeschi and HousingWire.com, Paul Jackson (04/10/2009)

Origins of the Easter Bunny

The Easter bunny has its origin in pre-Christian fertility lore. Then, it was called the "Easter hare" after the wilder, leaner, more rare group entirely in the genus Lepus. Both rabbits and hares were the most fertile animals known (bearing four to eight litters a year, with three to eight young in each litter) and served as symbols of new life during the spring season. The Easter hare was a sacred companion of the goddess of spring, Eostre.

The bunny was first used as a symbol of Easter in 16th century Germany and was introduced to American folklore by the German settlers who arrived in the Pennsylvania Dutch country during the 1700s. The arrival of the "Oschter Haws" was considered "childhood's greatest pleasure" next to a visit from Christ-Kindel on Christmas Eve. The children believed that if they were good, the "Oschter Haws" would lay a nest of colored eggs.

Thus the custom of making nests also spread to America. Children would build their nest in a secluded place in the home, the barn or the garden. Boys would use their caps and girls their bonnets to make the nests. The use of elaborate Easter baskets would come later as the tradition of the Easter bunny spread through out the country.

In honor of revival, renewal and resurrection, have a Happy Easter!

Pulte Homes to buy Centex

$1.3 billion deal will create nation's largest homebuilder. Both companies are major players in the Charlotte area.

By J.W. Elphinstone
Associated Press

Posted: Thursday, Apr. 09, 2009

NEW YORK Pulte Homes Inc. is buying Centex Corp. for $1.3 billion in stock in a deal that will create the nation's largest homebuilder and could spark further consolidation in an industry that is suffering the worst real estate recession in a generation.

The transaction of the homebuilders – both major players in the Charlotte region – will combine Pulte's strength in active-adult and retirement housing with Centex's hefty market share of first-time homebuyers.

The acquisition also will give Pulte large tracts of land in Texas and the Carolinas, two of the most resilient real estate markets, and a presence in 29 states and Washington, D.C.

The new company, which also will include the Del Webb, DiVosta and Fox & Jacobs brand homes, will keep the Pulte name and headquarters in Bloomfield Hills, Mich. There will be an unspecified number of job cuts.

“It allows us to not only survive, but thrive in any economic climate,” said Richard Dugas Jr., Pulte's president and chief executive, who will retain those titles over the combined enterprise.

Pulte had the largest market share in the eight-county Charlotte region in the fourth quarter of 2008, and the second-largest for the whole year, with 9 percent of all single-family detached homes, residential real estate consultant Chuck Graham said. Centex ended last year with the fifth-largest market share in the region, 5 percent of single-family detached homes. That was up from about 4 percent for the rest of 2008, Graham said. In Mecklenburg, the builder had 203 permits in 2008, the most of any builder.

But by last year, Centex was already pulling back in the Charlotte area, combining its Charlotte and Raleigh offices in Raleigh and maintaining a minimal staff in Charlotte, Graham said. Pulte, on the other hand, was poised for growth in the region, particularly with its acquisition of Del Webb, meant to cater to the surging active-adult population, he said.

Wednesday's deal touched off investors speculation that other homebuilders with battered stock prices may be easy targets.

Faced with a 75 percent slide in new-home sales from the peak in mid-2005, homebuilders have slashed construction and prices but have been slow to join forces.

This deal “is a game-changer, pure and simple,” said Centex Chairman and Chief Executive Timothy Eller, who will become Pulte's vice chairman and will work as a consultant for two years following the acquisition's completion.

The combined company will have twice the revenue of its next largest rival, D.R. Horton Inc. Pulte and Centex pulled in a total of $11.6 billion in the last 12 months, compared with D.R. Horton's $5.8 billion.

The new industry behemoth also will be better poised to take advantage of the market's recovery, which executives said is just beginning.

Pulte lost almost $3.73 billion over the past two years, more than wiping out all of its profits for the prior three years. Centex lost $2.66 billion last year, erasing its earnings for the prior four years.

Shares in both companies have lost more than half their value from their 52-week highs last year.

Pulte is offering Centex shareholders 0.975 shares of its common stock for each share of Centex that they own. The transaction is valued at $10.50 per Centex share based on Pulte's Tuesday closing stock price of $10.77. That represents a 38 percent premium to Centex's closing price of $7.62 Tuesday.

Staff Writer Kirsten Valle contributed

EW YORK Pulte Homes Inc. is buying Centex Corp. for $1.3 billion in stock in a deal that w

NC Interactive Foreclosure Map

http://www.charlotteobserver.com/104/story/642521.html

Slowing decline in home sales

According to Radar Logic's January 2009 RPX Monthly Housing Market Report, sales in the 25 metropolitan statistical areas (MSAs) the report tracks declined 6 percent in the year ending January 2009, compared to 36 percent in the prior year.

The slowing annual decline of transactions was due to an increase in motivated sales, which Radar Logic defines as sales to third parties at foreclosure auctions and sales of foreclosed homes by financial institutions and foreclosure service firms. While this rapid growth in motivated sales reflects the increase in foreclosures over the last year, it also reflects significant demand for homes that are priced at 'motivated' discounts.

REAL Trends Comment: As readers can tell the housing market appears to show signs of improvement over the past few months. However, various sources of data show more of a seasonal improvement and not a cyclical improvement. Simply put even in tough markets we expect to see an improvement as we enter the spring months and a decline as we enter the fall of each year. That is a seasonal change not a cyclical change.

A cyclical improvement will show when sales, inventory and time on market changes are positive when comparing the same month of this year to the same in month in"

Ten Cities Where Americans Are Relocating

Lauren Sherman, 03.30.09, 04:00 PM EST

U.S. migration may be down overall, but these vibrant metro areas are still attracting newcomers.

Unemployment is on the rise, credit is tight, and consumers aren't spending--which means they aren't picking up and moving much either. Very few places in America saw significant population growth in 2008.

But the buzzing metropolitan area of Denver bucked that trend. Its population increased by 2.17% in 2008. In 2007, it increased by 2.09%. In 2008, Denver was the 10th-fastest growing metro area in the U.S.

What's Denver got that other places don't?

For one, according to an October 2008 survey conducted by Pew Research Center, Denver is the most popular city in America. People like it for its skiing, culture and vibrant nightlife, as well as its business opportunities. As of January 2009, the metro area's unemployment rate was 6.5%. That's high, but still two percentage points below the national average of 8.5% for the same month.

Despite the overall economic slowdown, some parts of the country keep on moving ahead, attracting more and more newcomers--even if it's at a slower pace than in more sound economic times. These places still offer a semblance of stability, as well as great weather, cultural life and, in many cases, affordability.

Behind the Numbers
To determine the fastest-growing metro areas in the country, we used 2008 population estimates for metropolitan statistical areas with a population over 1 million, released March 19, 2009, by the U.S. Census Bureau. MSAs are geographic entities defined by the U.S. Office of Management and Budget for use by federal agencies in collecting, tabulating and publishing federal statistics.

We then compared the 2008 population estimates to the previous year's data to see which areas had grown the most, percentage-wise.

Nine places fared even better than Denver, though they share similar qualities: more business opportunities, better weather and more affordable housing. The top three areas according to the data are Raleigh, N.C., ranking first, which jumped 4.29% to nearly 1.9 million; Austin, Texas, which came in second, with a 3.77% increase to almost 1.7 million; and Charlotte, N.C., which moved up 3.36% to 1.7 million.

All these areas' increases were smaller in 2008 than they were in 2007, (Raleigh increased by 4.7% in 2007, Austin by 4.29% and Charlotte by 4.2%), but a slight slowdown is not necessarily a bad thing, according to William Frey, Ph.D., a demographer at the Brookings Institute, an independent research and policy group based in Washington, D.C. "Part of the story here is the rapid rise in growth in the middle of decade," says Frey. "That growth was unnatural."

The in-migration that happened in the middle of this decade certainly had a lot to do with the housing boom. When that went bust, so did those crazy population balloons. But these particular places are still growing because instead of building an economy that relies heavily on one industry (in Las Vegas, it's hospitality; in New York, it's finance), most of the metro areas on our list serve as headquarters for a diverse range of companies.

For example, Austin's biggest employers include University of Texas, Advanced Micro Devices (nyse: AMD - news - people ) and Dell (nasdaq: DELL - news - people ). That wide range might have something to do with the area's relatively low January 2009 unemployment rate of 6.4%.

This is the opposite of what happened in true housing boom-and-bust towns like Las Vegas. In 2004, Vegas--a foreclosure mecca--saw a population increase of 4.6%, followed by 3.66% in 2005, 3.98% in 2006 and 3.22% in 2007. In 2008, that number fell to 2%.

The Power of Business
When it comes down to it, a buzzing business community is a metro area's most important characteristic, says Sean C. Safford, a professor at the University of Chicago and author of Why the Garden Club Couldn't Save Youngstown: The Transformation of the Rust Belt. He studies the social economics of U.S. cities and metro areas.

"Perception is driven by the vibrancy of the companies in an area," he says.

However, that doesn't mean that these metros won't suffer from a slowdown in population when 2009's numbers are released next year. Charlotte, for example, reported a 10.5% unemployment rate for January 2009, likely related to the fact that Bank of America (nyse: BAC - news - people ) is headquartered there. That high unemployment rate almost guarantees stunted growth in 2009.

"We don't quite yet know what the impact [of the ongoing recession] will be for 2009 populations," says Frey. "But we do know it's not going to get any better."

Indeed, where Americans are relocating today has little to do with where they'll be moving tomorrow.