Wachovia Sells Land, Construction Loans to LandCap. “Sources: Wachovia Corp. (NASDAQ:WB) sold land and construction loans secured by 2,900 housing lots for $40 million to a joint venture headed by residential land company LandCap Partners. The loans have a book value of $75M-$80M... The agreement gives LandCap the right to buy more loans from Wachovia, which had almost $19B in commercial land loans… Keith Gumbinger, VP of research firm HSH Associates Inc.: “The fact the deal got done is a positive.'' The loans were issued for real estate in Arizona, California, Florida and Illinois.” (Bloomberg, Aug. 20)
Royce Builders Halts Construction Due To Mortgage Crisis. Texas: “Royce Builders has built thousands of homes in Texas. But now, the company said it is putting the brakes on home building. Royce… currently has 60-70 homes under construction. They said after they are complete, they will not be building any more. They have already laid off 160 employees and only 60 employees are still on the job. Royce Builders said the mortgage crisis is to blame. The company said they can't get loans because banks are now reluctant to lend money for real estate. The company has another 80 homes under contract that will not be built.” (KHOU, Aug. 19)
Builder Confidence Remains at Historic Low. "The National Association of Home Builders/Wells Fargo Housing Market Index remained mired in pessimism in August, holding firm at 16 from July and matching the historic low reached earlier this year. Still, the NAHB said the sales expectations index, a component of the HMI, rose two points to 25 from July to August, an increase it attributed to the passage of housing stimulus legislation. There also was a one-point rise in the index gauging current sales conditions, to 16. The component gauging traffic of prospective buyers remained unchanged at 12.” (Big Builder Online, Aug. 18)
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