Although home foreclosures are again expected to top two million this year, Fannie Mae is creeping back into the market for mortgages with no downpayment. Coming from a new program called Affordable Advantage, the mortgages are available to first-time home buyers in four states and are created in conjunction with the states’ housing finance agencies. The program is expected to stay small, said Fannie Mae spokeswoman Janis Smith. While some experts are concerned about the revival of such mortgages, the surprise is the support these loans have received, even from critics of exotic mortgages, who say low downpayments themselves were not the problem, except when combined with other risk factors like adjustable rates or lax underwriting. Moreover, they say, the housing market needs such nontraditional lending, as long as it is done prudently. At Harvard’s Joint Center for Housing Studies, Eric Belsky, the director, said the loans might be the type of step necessary to restart the housing market, because downpayment requirements are keeping first-time home buyers out. The Affordable Advantage loans are 30-year fixed mortgages, with mandatory homeownership counseling, available to people with credit scores of 680 and above (720 in Massachusetts). The buyers have to put in $1,000 and must live in the homes. (www.nytimes.com)
New York Times (9/4/10); John Leland

Whether located in a city or suburb, few apartments built today are sufficiently commodious for traditional families. Even if big enough, apartments in desirable locations typically are unaffordable. Unsubsidized apartments built today are almost exclusively designed for and marketed to people without school-age children. This situation poses a bit of a dilemma for anti-sprawl advocates aspiring to concentrate a significant amount of future metropolitan growth in more urban, environmentally sustainable communities. And there is an economic hurdle. Given the value of urban — or urbanizing — land and the cost of construction, making family-size units affordable would require financial incentives. Counties would have to subsidize development by directly or indirectly reducing the per-unit cost of land, and by providing tax breaks for developers and occupants. Why tinker with the housing market at public expense? “It is in the public interest to create new, sustainable communities with a full range of housing choices, among them choices for families with school-age children,” answers Roger Lewis, a practicing architect and a professor emeritus of architecture at the University of Maryland. (www.washingtonpost.com)
Washington Post (8/28/10); Roger K. Lewis

The back-to-basics strategy in which buyers now purchase a home as a place to live rather than a “get rich quick” vehicle plays to the strength of the Texas real estate market. Buyers get a lot for their money, as always, plus the tail wind of a growing economy. The state never experienced a housing boom like the East and West coasts, or Nevada and Arizona, because prices never rose that much. Dallas prices increased less than 26% from 2000 to their peak in the summer of 2006, according to Case-Shiller. That compares with a national average, taken from 20 metro areas, that more than doubled in the same time. Prices in Miami and Los Angeles were not far from tripling. Texas remains a location where starter homes can still be built for about $100,000. That should be a distinct advantage when people start forming households again. In the past decade, the country has averaged 1.3 million new households a year. But that fell to 772,000 in 2008 and only 398,000 in 2009. More young adults are moving back with parents and doubling up in apartments. As companies start hiring again, that pent-up demand will break out, and housing will become a growth engine once more. The housing slump may feel like it will never end, but the seeds of recovery have been planted.  (www.star-telegram.com)
Fort Worth Star-Telegram (9/1/5/10); Mitchell Schnurman

Law enforcement officials, politicians and historic preservationists in St. Louis have concluded that brick thieves have often been to blame for the 391 fires that have occurred in the city’s vacant buildings over the past two years. Buildings are deliberately torched to quicken the harvest of St. Louis brick, which is prized by developers throughout the South for its distinctive character. It is a crime that has increased with the recession. Where thieves in many cities harvest copper, aluminum and other materials from vacant buildings, brick rustling has emerged more recently as a sort of scrapper’s endgame, exploited once the rest of a building’s architectural elements have been exhausted. “Cleveland is suffering from this,” said Royce Yeater, Midwest director of the National Trust for Historic Preservation. “I’ve also heard of it happening in Detroit.” After the fire that devastated much of St. Louis in 1849, city leaders passed an ordinance requiring all new buildings to be made of noncombustible material. That law, along with the rich clays of eastern Missouri, led to a flourishing brick industry here. Historians say that at the industry’s height, around 1900, the city had more than 100 manufacturing plants, and St. Louis became known for the quality, craftsmanship and abundance of its bricks. “They love it in New Orleans and the South — wherever they’re rebuilding, they want it because it’s beautiful brick,” said Barbara Buck, who owns Century Used Brick. “It really gives the building a dimension, a fingerprint.” (www.nytimes.com)
New York Times 9/19/10); Malcolm Gay

According to Stephen Melman, director of economic services for NAHB, the long list of pluses for corner houses includes design flexibility, shorter driveways, sunnier interiors, more visibility and greater on-street parking. The equally long list of downsides includes tiny backyards, less privacy, more noise, annoying streetlights and headlights and a need to keep a closer eye on young children. Ray Hartshorne, partner with Chicago’s Hartshorne Plunkard Architecture, appreciates the corner home’s potential for design flexibility. The chance to put the home’s entry on either of two facades opens all kinds of design possibilities inside and out. With two sides visible, the home will appear larger from the street, even if it’s not. And because only one side rather than two faces a neighbor’s home, a corner house offers increased light, views and ventilation, Hartshorne said. The corner house also delivers lawn and garden flexibility. “For people who love tinkering with their yards, you have a beautiful, inviting expanse,” he said. “They tend to favor a bit more formality on the better-traveled streets, and a bit more privacy with the side yard on the less well-traveled of the two streets.” Diane Saatchi, senior vice president of Long Island realty firm Saunders & Associates in Bridgehampton, N.Y., pointed out that in some communities, planners don’t make the corner lots large enough. “The front-yard setback is the largest, and corner lots therefore have two front-yard setbacks, which makes the house envelope smaller,” she said, noting the result can be a too small corner house, or one with too little backyard. “Developers will shy away from corner lots,” said Don Smyczynski, president of Naperville, Ill., developer H&D Enterprises Group. “The house typically doesn’t have a backyard and because you’re putting in a sidewalk on both sides of the house facing streets, your cost is more, and you have a more difficult house to sell. Most of the time, the developer will make a little less money.” Still, a corner home will always attract a certain buyer. A corner home “is a rare home,” said Hartshorne. “It’s a home that’s distinctive in a world that makes distinctive homes more valuable.” (www.chicagotribune.com)
Chicago Tribune (9/3/10); Jeffrey Steele

At a time when most builders have put down their tools, Pulte Group Inc. has started a 184-unit town house development overlooking the Passaic River in Garfield, N.J. The project, first proposed in 2006, is on the 13.3-acre site of the old Garden State Paper plant, which was shuttered at the end of 2001. Pulte is betting that, even with mortgage money tight and potential buyers worried about the weak job market, there will be demand for new town houses starting at around $300,000. “Who knows when this real estate market will turn around?” said Paul Schneier, president of Pulte’s New York/New Jersey division. “We’re operating on the basis that this is a great location and a great value. There aren’t a lot of options for new construction in North Jersey. Builders in the state have pulled back dramatically on activity since the recession began in late 2007. Last year, builders in New Jersey got building permits for only 12,421 housing units — the smallest number since World War II. And this year’s pace hasn’t picked up much. Patrick O’Keefe, an economist who follows the housing market for the Roseland accounting firm J.H. Cohn, expects only about 13,000 to 13,500 housing units to be started in the state this year, which would make 2010’s production level the second lowest on record. Builders say it’s difficult to get bank loans for construction, but Pulte, a publicly traded company, has its own funds for construction and doesn’t have to rely on loans, Schneier said. (www.mctdirect.com)
McClatchy-Tribune Regional News (9/6/10); Kathleen Lynn, The Record, Hackensack, N.J.