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Sweeping regulation introduced by the United States to prevent future financial crises could create major “market distortions,” former Federal Reserve Chairman Alan Greenspan wrote in Wednesday’s  U.S. living standards the Financial Times reported.

The former bank chief slammed the Dodd-Frank Act, which imposes wide-ranging and strict new checks on financial institutions, for failing to “capture the degree of global interconnectedness.”

Greenspan says the reforms, passed by Congress last year, would be impossible to implement, distortive to markets and a possible threat to U.S. living standards, the FT reported.

“The act may create the largest regulatory-induced market distortion since America’s ill-fated imposition of wage and price controls in 1971,” warned Greenspan, who was Fed boss from 1987 to 2006.

Read more: Greenspan: US Financial Regulations to Cause ‘Market Distortions’ 

These ‘Market Distortions’ have already occured in the Sacramento and Placerville, California regions, in my opinion.

SACRAMENTO, Calif. (AP) – California lawmakers have approved a bill that would create the most ambitious renewable energy standards in the nation, giving utilities less than 10 years to receive one-third of their power from wind, solar and other alternative sources. 

Tuesday’s 55-19 vote in the Assembly sends the bill to Gov. Jerry Brown. The state Senate approved Senate Bill 2X last month. 

The bill’s author, Democratic Sen. Joe Simitian of Palo Alto, says it maintains California’s place as a national leader in clean energy, provides environmental benefits and will create jobs. He says the legislation also protects ratepayers from excessive costs.

Critics say the bill forces utilities to turn to more expensive sources of energy, which will drive up business costs and hurt the state’s competitiveness. 

Portion of article by The Associated Press:  http://sacramento.cbslocal.com/2011/03/29/legislature-approves-renewable-energy-rules/ 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

Despite interest rates well below 5 percent, mortgage applications continue to be in flux this month.

Loan applications increased 2.7 percent for the week ending March 18, after dropping the previous week. Earlier this month, mortgage applications posted a 15 percent drop, according to the Mortgage Bankers Association.

The unadjusted purchase index for mortgage applications increased 3 percent this week compared to the week prior. However, the purchase index remains down 15.3 percent compared to the same week a year ago.

Meanwhile, refinancing activity mostly stayed stable this week at 66.4 percent of the total applications, MBA reports.

Source: “Mortgage Applications Remain in Flux, Rise 2.7%,” HousingWire (March 23, 2011) 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

Freddie Mac this week launched a series of videos aimed at helping consumers separate foreclosure fact from fiction.  Each 90- to 120-second video, which can be viewed on Freddie Mac’s YouTube Channel dispels one of five common myths that may prevent homeowners from keeping their homes if they face foreclosure. The video series is based on content from Freddie Mac’s “Get the Facts on Homeownership” education and outreach materials.

The five myths the video series focuses on are:

Myth 1: If my house is foreclosed, I can never buy a house again — the foreclosure will stay on my record forever.

Myth 2: I should stop paying my mortgage so I can get assistance with my mortgage payments.

Myth 3: If I’m late on my monthly payments, I’ll lose my house.

Myth 4: I am getting many offers for help from a variety of people. They are probably all scams.

Myth 5: My lender is not responding to my inquiries, so I should just give up and face foreclosure.

More information at: ttp://freddiemac.mediaroom.com/index.php?s=12329&item=30554

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

The federal bailout of the U.S. financial system, which was originally forecast to cost as much as $700 billion, is expected to cost far less than expected, according to a newly released congressional report.

The federal bailout, known as the Troubled Asset Relief Program (TARP), was launched by the Bush administration in response to the 2008 financial crisis and was to include aid to struggling home owners. But TARP is expected to now cost taxpayers about $25 billion because it did not accomplish all that envisioned to help home owners avoid foreclosure, a congressional panel said.

The Treasury Department allocated $45.6 billion for three major housing programs to help home owners, including the Home Affordable Modification Program (or HAMP), a refinancing program run by the Federal Housing Administration to aid underwater home owners, and a program designed to help hard-hit areas. But the Treasury Department only spent about $1 billion in TARP money for the foreclosure prevention effort, the panel noted.

Source: “TARP’s Lower Cost Reflects Troubles of Foreclosure Effort,” Dow Jones Business News (March 16, 2011) and “U.S. Senate Panel to Step TARP Oversight-Chairman,” Reuters News (March 17, 2011) 

Unfortunately this, along with restrictions from the Fed’s regarding loans in the Sacramento and Placerville, California regions continue to restrict economic recovery. Other related articles at: www.sierraproperties.com

A bill proposed in California, if approved, would charge banks $20,000 every time they foreclose on a home in the state.

Bob Blumenfield, a San Fernando Valley-based assemblyman, introduced the bill Wednesday in an effort to curb property tax losses from skyrocketing foreclosures in the state.

The bill calls for money collected from the banks to be funneled back into school districts, police and fire departments, small-business loans, among other state and city services and programs, the Associated Press reports.

Source: “California Lawmaker Proposes Bill That Would Charge Banks $20,000 Fee Per Foreclosure,” Associated Press (March 16, 2011) 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

More businesses are seeking greater mobility and are opting for computer tablets over laptops, according to a recent study from Robert Half Technology.

The study shows that companies expect to increase tablet usage by 50 percent within the next two years.

“Tablets are simply more mobile,” says Soowan Scheuermann, marketing manager for the staffing firm. “They’re lighter and smaller. It’s more feasible to carry around a tablet to make notes than it is with a laptop.”

Companies have plenty to choose from in tablets too as tech companies continue to introduce new models ever since Apple recreated the tablet market with the launch of its iPad in 2009. Apple had sold nearly 15 million iPads through December 2010. But besides Apple’s iPad 2, which recently debuted, companies such as Motorola, Acer, Samsung, LG, Blackberry, and HTC also are launching tablets.

Goldman Sachs estimates that overall tablet sales would increase by 500 percent in 2011.

Source: “Laptops Gather Dust as Business Turns to Tablets,” San Antonio Express-News (March 10, 2011) 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com

Of particular note this month are the following: (1) listings are still down but increasing. (2) Inventory is very low in many markets – particularly the Placerville and Cameron Park areas. Is there a reason prices dropped by 12% with a 5 month inventory in Cameron Park? Help me out here! Even the divide has very low inventory. With an overall inventory of under 6 months.

Banks are announcing an increase in their staffing for modification and short sale negotiators, and there is a substantial drop in new delinquencies…

Some things don’t change much; 1/3 the activity is still in El Dorado Hills, nothing happening in the higher priced homes and we still have 90%+ of the sale activity under $600k. 3 out of 4 transactions are still under $400,000. Worse yet 63% are under $300,000 and 43% are under $200,000! Prices once again dropped another 2.5% or $4.00 per foot from the previous month and 5% since December.

Well, I say let the “Shadow inventory” come – we need listings, so I am told and as these reports validate.

Information courtesy of Vitek Mortgage Group – Placerville, California. (Commentary solely that of the author), Steve Cockerell, Branch Manager    www.SteveCforloans.com

The Internal Revenue Service (IRS) has clarified that some homeowners who receive financial assistance from the federal government under the Home Affordable Modification Project (HAMP) will not be required to pay taxes on that support. Specifically, funds received from the U.S. Treasury Department’s Housing Finance Agency (HFA) Innovative Fund for the Hardest-Hit Housing Markets (The “HFA Hardest Hit Fund”) and the Department of Housing and Urban Development’s (HUD) Emergency Homeowners’ Loan Program are exempt from taxation.

These aid programs provide financial assistance to struggling homeowners, either by making payments on the homeowner’s mortgage loan or by providing financial support during an owner’s transition to lower-income housing. Since payments under these programs are not made in exchange for any service performed by the homeowner, they can be excluded from the homeowner’s gross income for tax purposes under the general welfare exclusion.

Homeowners and lenders also should not report any mortgage interest deductions or receipts for payments made by a government agency. Placerville, El Dorado County, California region homeowners need to know this and pass on this information!

Complete details at:  “Guidance on Tax Consequence of Distressed Homeowner Payments Provided (IRS Notice 2011-14)” 

Information credit given to the first tuesday Journal Online; by first tuesday Realty Publications, Inc.

The number of U.S. homes in some stage of foreclosure fell drastically last month, reaching a 36-month low, RealtyTrac reports.

Source: “Foreclosures Plunge 27%-Biggest Drop on Record,” CNNMoney.com (March 10, 2011) and“Foreclosure Activity Slows Sharply in February,” Associated Press (March 10, 2011) 

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com