RyanMcMaken.com

Clippings, February 1-3, 2012

2012-02-03T13:08:00.005-07:00

Denver Post, Feb 3:
New data released Thursday by the Colorado Division of Housing showed a vacancy rate of 5.4 percent in the fourth quarter of last year. That was down from 5.5 percent in the same period of 2010. The last time the fourth-quarter vacancy rate was lower than 2011's was in 2000, when it hit 4.7 percent.

Division of Housing spokesman Ryan McMaken said that the fourth quarter normally is a "high vacancy quarter."

"Usually if anybody moves out, no one moves in," McMaken said

"The overall median rent in the Denver area has now increased year over year for eight quarters in a row, and the median rent has increased by almost $60 over that time," McMaken said. "The rent growth we're now seeing is more robust than what we saw during the last expansion between 2002 and 2008."

Denver Business Journal, Feb3
The Q4 rate -- the lowest for the quarter since 2000 -- was up from the third quarter’s 4.9 percent vacancy percentage, but vacancy rates tend to rise in the fourth quarter from earlier in the year, said Ryan McMaken, division spokesman and economist.

Boulder County Business Report, Feb 3
"The overall median rent in the Denver area has now increased year over year for eight quarters in a row, and the median rent has increased by almost 60 dollars over that time," Colorado Division of Housing spokesman Ryan McMaken said in a news release. "The rent growth we're now seeing is more robust than what we saw during the last expansion between 2002 and 2008."

Colorado Springs Gazette, Feb 2
For the first seven months of 2011, the reduction in filings was largely because of lenders who slowed their processing of notices in response to criticism they received the previous year for allegedly reckless handling of foreclosure paperwork, said Ryan McMaken, a Housing Division spokesman.

However, the final five months of the year saw a stabilizing of home sale prices and other slight improvements in the housing market, which contributed to the overall reduction in foreclosure activity, he said.

In 2012, McMaken expects another reduction in foreclosure filings statewide, although not as dramatic as last year’s.

Lenders who delayed some of their foreclosure filings last year might turn around and ramp up their activity this year, McMaken said.Yet, “there’s enough slowly returning strength” in the housing market so that overall filings in 2012 should continue to decline, he said.

Loveland Reporter-Herald, Feb 2
Ryan McMaken, a spokesman for the state Housing Division, said the slowdown can't be attributed completely to improvements in the real estate market. "Many lenders slowed down the processing of foreclosures during the first half of 2011 to deal with legal issues," McMaken said in a press release.

He added, "Nevertheless, we do know that mortgage delinquencies are down and that home prices are stabilizing, so that also helped to push down foreclosure totals."

Denver Business Journal, Feb 2
“Foreclosures really slowed down during 2011, but not all of that was due to improvements in the real estate markets. Many lenders slowed down the processing of foreclosures during the first half of 2011 to deal with legal issues,” Ryan McMaken, spokesman for the Division of Housing, said in the new report.

“Nevertheless, we do know that mortgage delinquencies are down and that home prices are stabilizing, so that also helped to push down foreclosure totals,” McMaken added.

Denver Post, Feb 2
"Foreclosures really slowed down during 2011, but not all of that was due to improvements in the real estate markets," said Ryan McMaken, spokesman for the Colorado Division of Housing. "Many lenders slowed down the processing of foreclosures during the first half of 2011 to deal with legal issues.

"Nevertheless, we do know that mortgage delinquencies are down and the home prices are stabilizing, so that also helped to push down foreclosure totals," said McMaken.

...

Although foreclosure filings have fallen for the past two years, foreclosure activity remains at unusually high levels, said McMaken.

"Foreclosure sales at auction have basically been flat for the past five years and totals are still twice what we'd consider to be normal," said McMaken. "We expect more progress to be made in 2012, although the task of dealing with the existing inventory of properties in foreclosure is likely to extend beyond this year."

Clipping: January 31, 2012

2012-01-31T08:54:00.001-07:00

From the Denver Post:

Ryan McMaken, economist and spokesman for the Colorado Division of Housing, said the Alliance approach to today's rent vs. buy mentality makes sense.

Some high-end renters prefer the added amenities — swimming pool, clubhouse, security and well-equipped gym — that come with the monthly rental price. Others don't know whether a job transfer will take them out of the market. "They don't want to get too attached to a property," McMaken said.

And then there's the whole issue of the flat housing market and the potential of not being able to get the money out of a house that the buyer puts into it.

"If you bought a house in '08, it's going to be several more years till you get back your money as far as equity goes," McMaken said.

Clippings: January 25, 2012

2012-01-25T20:32:00.007-07:00

In The Denver Post
Mortgage loan payoffs hit 10-year low
January 25, 2012
"Real estate activity perked up a bit during the fourth quarter, which would reflect some very recent growth in employment and some mild increases in home prices." said Ryan McMaken, spokesman for the Colorado Division of Housing. "But overall, the fourth quarter's activity wasn't enough to keep 2011 from being another flat year."

The Colorado Springs Gazette
January 25, 2012
Mortgage loan payoffs fall in Springs area
But if there’s a sign of good news, it’s that mortgage payoffs in El Paso County totaled 8,023 in the fourth quarter of 2011 — an increase over each of the first three quarters of last year and a possible indication that housing activity is picking up, said Housing Division spokesman Ryan McMaken. The other 20 counties in the report also saw increases in the fourth quarter when compared with the third quarter.

“After two years of declines in mortgage rates without any big increases in activity, the fact that we did start to see some activity in the fourth quarter is a hopeful sign,” McMaken said.

Still, he cautioned, it will take several quarters to know if a trend is under way. The fourth-quarter numbers might suggest that more people have been able to afford a down payment or have accumulated enough equity in their homes that they can refinance, McMaken said.

“It’s just been very difficult for people to either purchase, to sell or to refinance, and that has just basically really pushed down the amount of release activity,” he said. “So if it’s pushing back up, it just might suggest that those trends are reversing themselves a little bit.”

Colorado Springs Business Journal
January 25, 2012
Statewide mortgage payoffs lowest since 2000
“The surprise really is that in spite of three years of declining interest rates, there hasn’t been activity,” McMaken said.

He said one explanation could be that most of the people who are eligible and qualified for refinancing probably did it in 2009 when rates first dropped. Of course, many people would not be qualified for refinancing today because real estate values have declined and they don’t have enough equity in their homes to get loans on the amount they owe.

There is also little activity in home sales as buyers aren’t motivated.

“It’s not like 2005 when everyone ran saying ‘if we don’t buy now, we’re going to be priced out because real estate always goes up,’” McMaken said. “We all thought that way.”

Now the reverse is true, and buyers aren’t rushing to get into the market.

The mountain communities are exceptions to the low deed release rates reported in the rest of the state, McMaken said. Those areas are still suffering, but there is more activity there than there is along the Front Range and in counties where home prices are the lowest like Weld and Pueblo counties.

My latest in the CSM

2012-01-13T10:26:00.000-07:00

From The Christian Science Monitor:

Serious debt problems will continue, experts say

Over the past 10 to 15 years, total debt outstanding in the US has grown as a much faster pace than population, and little has been done to deal with the debt in spite of widespread unemployment, flat personal income, and declining collateral values.

By Ryan McMaken, Guest blogger / January 13, 2012

Read the full article.

My remarks in Bloomberg

2011-12-13T09:11:00.004-07:00

Bloomberg recently published a piece that mentioned Colorado Real Estate:

Plummeting Income Shaves Household Cash
By Frank Bass and Timothy R. Homan - Dec 7, 2011 10:00 PM MT
http://www.bloomberg.com/news/2011-12-08/plummeting-income-from-investments-shaves-u-s-household-cash.html

Prices for existing U.S. homes fell over the decade in one of five U.S. counties, according to data compiled by Bloomberg. Pitkin County, Colorado, homeowners were hardest hit. The median value of a home in the central Colorado county, home to the Aspen/Snowmass ski complex, fell $304,800, almost 10 times the decline in Oakland County, Michigan, the second-biggest loser.

The median sales price was $1.2 million for the 63 homes sold during the third quarter of 2010 in the Aspen area, said Ryan McMaken, chief economist for the Colorado Division of Housing. During the third quarter of 2011, 68 homes were sold with a median sales price of $637,000, he said.

“There aren’t a lot of fire sales, but there hasn’t been the sort of demand that existed prior to the financial crisis,” McMaken said. “It’s pretty clear there have been some declines.”

9News, November 16

2011-12-13T09:08:00.002-07:00

9News picked up our October foreclosures release.

Fox 31, November 8

2011-12-13T09:07:00.003-07:00

Fox 31 picked up our release on 3rd Q foreclosures.

On 9News, September 15

2011-12-13T09:03:00.001-07:00

9News picked up the August release on foreclosures.

Interview with Colorado Public Radio

2011-08-26T10:06:00.000-06:00

Interview with Colorado Public Radio, August 11, 2011

Reporter: Which means the future’s bright for buyers who are looking to rent out their investment. Competition for single family homes will likely drive rents higher. Ryan McMaken is an economist with the Colorado Division of Housing. He says that competition for rentals could be a lasting effect of the recession.

Ryan McMaken: People who want to rent houses or live in a single family house they can’t afford to buy one right now, they don’t have the down payment they don’t have the credit rating and so on they’re going to rent instead.

2011-08-20T10:19:00.001-06:00

9News invited me in to discuss the second quarter foreclosure stats for Colorado. The story is here.

Fox31 covers the latest report on apartments

2011-08-20T10:10:00.002-06:00

Fox31 stopped by to interview me on the latest apartment vacancy and rent report. Here's the story.

The Government-Benefits Bubble

2011-07-20T08:55:00.003-06:00

Originally posted at the Mises Economics Blog

by Ryan McMaken

The New York times recently noted that “Economy Faces a Jolt as Benefit Checks Run Out.”

Close to $2 of every $10 that went into Americans’ wallets last year were payments like jobless benefits, food stamps, Social Security and disability, according to an analysis by Moody’s Analytics…

By the end of this year, however, many of those dollars are going to disappear, with the expiration of extended benefits intended to help people cope with the lingering effects of the recession.

When this happens, it will be just the latest bubble to pop.

As far back as 2008, Peter Schiff and other Austrian-minded observers contended that with the various stimulus packages, the feds were just blowing up a government benefits bubble to replace the real estate bubble, which had in turn replaced the dot-com bubble.

The government benefits bubble can’t be maintained forever, so once the stimulus runs out, and as unemployment insurance runs out for millions of unemployed workers, that bubble will burst too, and spending, consumer confidence, and demand for purchasing real estate will fall again.

The NYT piece has some interesting statistics on this, and below, I add some more.

Click for more.

AP: Colorado foreclosures fall 24 percent in May

2011-06-14T09:33:00.004-06:00

The AP picked up my foreclosure story today. Carried at 9News:

Colorado foreclosures fall 24 percent in May

DENVER (AP) - Foreclosures in Colorado are continuing to fall.

According to the Colorado Division of Housing, they fell 24 percent in May compared to last year.

The department says May was the sixth consecutive month during which both filings and sales were down when compared to the same month a year earlier.

Division of Housing spokesman Ryan McMaken says lenders and servicers have been proceeding slowing the foreclosure process during the past seven or eight months and there are fewer foreclosures to report.

Series of articles on Colo. Public Radio

2011-06-02T23:04:00.007-06:00

I recently was interviewed in person by Ben Markus over at Colorado Public Radio. They've been incorporating pieces of the interview into recent segments.

Here's a piece of an earlier remote interview:

Foreclosure fillings fell last quarter by 27%. Ryan McMaken is the chief economist at the Colorado Division of Housing.

McMaken: It’s quite a drop, even compared to all the other first quarters, so that we can forget about seasonal issues, the numbers are still down considerably from an average first quarter number.

McMacken [sic] says this may signal growing strength in the real estate market. Initially, the slow down in foreclosure fillings came from banks halting so-called robo-signing. Some lenders and got into legal trouble for approving foreclosures without even reading the documents. But McMaken says that’s probably not the cause for the slowdown now.

Late December foreclosure stats update

2011-02-14T15:10:00.007-07:00

Here's a December 22nd foreclosure update for 9news.

Time-lapse video on the spread of foreclosures in Colorado

2010-11-17T11:26:00.002-07:00

Here's a time-lapse map I put together on foreclosures in Colorado. Primarily, I put it together to show the spread of foreclosures from Colorado's Front Range to mountain areas and Western Slope areas.

Video update on 3rd Q foreclosures in Colorado

2010-11-17T11:25:00.003-07:00

In this video, I look at the latest trends in foreclosure events in Colorado.

Latest video: Employment down 5.8% in Colorado, 11% in Grand Junction

2010-11-04T09:24:00.003-06:00

In this video, I look at statewide employment and compare some trends in Grand Junction and Fort Collins. I also look at employment in construction and the service sector.

"Monopolist" Microsoft rapidly losing market share

2010-10-27T11:32:00.000-06:00

Cross posted at Mises Economics Blog.

Microsoft is slowly dying as a consumer brand. As recently as five or six years ago, though, left liberals and other anti-business ideologues were still making comments about how Microsoft was a monopoly that was crushing competition in the market place.

The less sophisticated of these critiques centered on nothing more than the fact that Microsoft enjoyed huge market share ten years ago. The more sophisticated critiques noted that Microsoft had been successful at expanding market share through agreements with PC providers like Dell who pre-packaged their PCs with Microsoft software.

Anti-IP libertarians have made convincing arguments about patents, but the IP-loving competitors of Microsoft (and the Feds who make IP possible) hardly have a problem with IP.

None of this behavior around bundling products is remotely "monopolist" of course, since there were no real barriers to entry into the market beyond the fact that people really liked Microsoft's products and weren't interested in going out of their way to get other products. Linux and Apple's OS have always been available for purchase and use. People simply didn't like them as much.

We should mention, of course, that a lot of this anti-Microsoft hysteria came form the early Apple fanbois who saw (and still see) one's choice of computing products as some kind of moral issue. Thus, the Apple disciples never tired of portraying Microsoft as an evil corporation contrasted with the cute and cuddly people at Apple.

Other competitors of Microsoft resorted to monopolist talk also, and Sun Microsystems, which had been producing far less popular products for many years, sued Microsoft for "anti-competitive behavior."

Eventually, the federal judiciary sided with Microsoft's competitors, and federal judges who could not even turn a computer on, started making sweeping judgments about the software industry and computing and forced a variety of reforms in Microsoft's structure to make it less "monopolistic."

In spite of all of these efforts by competitors to use the power of the state to crush Microsoft, Microsoft continued for several years to dominate the computing market with both businesses and consumers.

Eventually, however, Microsoft ceased to be inventive and its browser, operating system and platforms either failed to impress, or were never adapted at all to deal with the new realities of modern computing.

The decline of Microsoft simply illustrates what many free market economists had predicted all along. Namely, that Microsoft, never having been a actual monopolist (monopoly only being possible within a framework of government privilege) would some day fade from view as other, more inventive organizations took over Microsoft's market share.

This happened to IBM, of course. IBM was once denounced as a monpolist, yet today, who could make such a claim without producing smirks in response?

Microsoft's retreat has little to do with the rent-seeking lawsuits levied against it by Sun and others, but has everything to do with the fact that Microsoft hasn't produced any interesting or inventive products in years.

With losing market share, Microsoft is no longer the bogeyman of the anti-monpolist crowd. Now it's Google that is supposedly forcing us all to bend the knee before its monopolist power.

(Better get the federal courts involved, or we'll all be living in Google-owned company towns within a decade!)

Unless they enjoy government privilege, (as was the case with Pan Am under the Civil Aeronautics Board, for example) these alleged "monpolists" come and go, and these reversals of fortune happen all the more quickly in the fast moving technology world.

The fact that Microsoft now struggles to even keep up with the rapidly-changing computing world illustrates just how unconvincing and short-sighted are the claims or monopoly that are usually little more than an expression of personal opinion and self-interest.

Foreclosure-gate poised to do some major damage

2010-10-21T11:56:00.005-06:00

The Market Oracle has a nice and detailed piece explaining the history of mortgage loan securitization and debt collection, and shows how the current crisis has the potential to inflict massive amounts of damage on the mortgage and banking industries.

Here's my favorite part:

Foreclosures can only be done by the note-holder, who has the legal standing to show up in court and ask the judge to foreclose and evict. In about half the states, they have to bring the ORIGINAL (not a photocopy or electronic version) document with "wet signature", so the judge can see the actual ink on paper. They have to prove the chain of title and that they own the note they intend to foreclose on.

BECAUSE IF THE CHAIN OF TITLE OF THE NOTE IS BROKEN, THEY WON'T BE ABLE TO FORECLOSE.

Once the people going into foreclosure figure this out, they will stop paying and hire lawyers. Some will keep their homes for free.

Once the people who have been paying their mortgages figure out they might not need to pay, they will stop paying.

Once the lawyers figure this out, they are going to be busy for the next five years helping people sue the banks.

Once the shareholders of the bank stocks figure this out, they will sell the shares.

Once the pension funds figure this out, they will also sue the banks and return their now junk MBS.

Once real estate buyers figure this out, they will stop buying anything with the potential for a tainted chain of title. The foreclosures will stop selling (many already have).

Even the sheriff is figuring this out. What happens when the sheriff refuses to do the foreclosure?

The moral of this story is: If you're buying a house, don't cheap out on your title insurance.

How bad the jobs picture really is

2010-10-01T23:41:00.002-06:00

Cross posted at Christian Science Monitor and the Mises Blog:

The people over at the Calculated Risk blog had a helpful post today that links to the BLS's primer on the differences between the "Establishment" employment data and the "Household" employment data.

Economist John Williams has often been referenced on these issues, and his site, Shadowstats.com is indeed helpful. However, if you want something straight from the BLS's mouth, the primer is very useful.

This will help you understand a bit more about the establishment survey's somewhat infamous "birth/death" model that assumes new businesses (and jobs) are created every time an existing business goes out of business. This sort of modeling, of course, makes employment look better than it is in the current environment.

Calculated Risk also credits a recent blog post by Nancy Folbre that looks at the futility of examining the unemployment rate as a measure of real-world job market health.

While one should always view government employment data with a critical eye, one need not debate the sampling models to see immediately that using the unemployment rate to discuss the job markets rather misses the point.

The unemployment rate is a function of both total employment and the labor force. Indeed, in a sense, it's just the delta between the total size of the labor force and the total number of jobs available.

But how big is the labor force? The labor force size depends on whether a person is actively looking for work or not. So, if a discouraged worker, or say, a recent college grad who hasn't even bothered to look for work given the economic conditions, reveals his or her lack of job seeking, that person will not be counted as a member of the labor force.

So, when we subtract all the older "retired" people who'd rather not be retired, the young people who are ecstatic with an unpaid internship or worse, and all the discouraged workers, we end up with a big decline in the labor force, and this is why labor force participation is at historic lows. As long as that's the case, that delta between labor force size and total employment will be smaller than if those people thought they could find actual full time employment, looked for work, and were counted as members of the labor force.

Folbre's point is that we should look to total employment for a real gut check on how the economy is doing, and not to unemployment. Taking Folbre's advice, we see that there aren't new jobs being created, and all the while high schools and colleges are graduating more and more people every December and every May, and as wages fall, spouses and non-wage earners in single-wage households may have to go out and look for work.

All of this in the face of extremely poor job creation.

Personal Income rises slightly in Colorado, remains in lowest quintile

2010-10-01T09:28:00.002-06:00

I've put together this short analysis of personal income totals in Colorado. Income's been increasing, but at a slower pace in Colorado than in most states, and it's not likely that it's driven by jobs and wages.

Book review: The Cult of the Presidency

2010-09-18T06:38:00.002-06:00

My book review for The Cult of the Presidency, published in The Independent Review last year, is now online.

Rental houses popular in Denver

2010-09-17T13:49:00.004-06:00

Here's my look at vacancies and rents in single-family rentals and similar properties in Denver

A love letter from a reader

2010-09-16T21:31:00.010-06:00

J.H. Huebert, a brilliant writer, libertarian, attorney and friend, wrote this column showing that Glenn Beck is not now and never has been a libertarian (even though some people refer to him as such for some unfathomable reason).

A fellow named Leon Haller wrote in calling Huebert a "leftist plant" and a "fool," which is fun in itself, but this part piqued my interest for obvious reasons:

"You are a free market egalitarian, Huebert, and I'm going to show up at any Mises Institute event in which I know you're going to be a speaker (at least someday, when I can arrange matters properly), and I'm going to expose for the world just what leftists you and [Mises Institute founder Llewellyn] Rockwell et al really are. I knew Murray Rothbard, and he would be disheartened and DISGUSTED at the "Modals" like you which turncoat Rockwell has allowed into the formerly paleolibertarian fold. Shame on you, Lew, for selling out, and building the careers of pathetic leftist nobodies like this Huebert, McMaken, Anthony Gregory, that Kramer freak, and similar jackasses."

Wuh oh. I plan to be at the Institute in March. Maybe 'ol Leon will be there to "expose" my crypto-leftism to the world too! Meanwhile, I guess the shade of the late, magnificent Murray Rothbard will weep at our treachery.

Week 2 of the Chart of the Week feature

2010-09-08T16:56:00.002-06:00

This time, I discuss unemployment. I'm trying to make these a little livelier, but so far the comments I've received have been good.

My favorite blog of the day: Marketing Japan

2010-09-04T00:42:00.003-06:00

Today I stumbled across the Marketing Japan blog by Mike Rogers in Tokyo. I've corresponded with Mike a couple of times since we write for the same web site every now and then.

Being an expatriate who has fled these American shores, he's naturally one of the sanest people I know. If you're interested in learning about business from the Japanese, check out his blog.

The new "Chart of the Week" feature

2010-08-27T09:37:00.003-06:00

I've begun putting together short videos on the economy that are two to three minutes long, and will be produced about once a week. Here's the first one. I should have another one posted by Monday:

My prediction actually came true

2010-08-26T11:18:00.005-06:00

It's a red letter day. One of my economic predictions actually came true. Note this snippet from the Denver Business Journal:

Foreclosure filings in Colorado's 12 largest counties fell 29.5 percent in July from a year earlier, although they were up slightly from June 2010, the Colorado Division of Housing reported Thursday.
Completed foreclosures in the state's urban areas, meanwhile, fell 15.4 percent in July from 2009 and were down 10.9 percent from June 2010.
The new figures appear to back up state experts' predictions earlier this year that Colorado foreclosure sales -- the last stage in the foreclosure process if a homeowner can't work out a deal with a lender -- would start to come down after months of year-over-year decline in foreclosure-filing rates.

Huzzah. My batting average is now about .100

Government owns 46 percent of foreclosed inventory

2010-06-29T22:07:00.002-06:00

Cross posted at Mises Economics Blog

The latest data for the S&P/Case-Shiller Home Price Index were released today. The home price index for April is still down considerably from the July 2006 peak:

As of April 2010, average home prices across the United States are at similar levels to where they were in late summer/early autumn of 2003. From their peak in June/July of 2006 through the trough in April 2009, the 10-City Composite is down 33.5% and the 20-City Composite is down 32.6%. The peak-to-date figures through April 2010 are -30.5% and -30.0%, respectively.

To paraphrase Donald Rumsfeld from a different context, it is close to impossible now to deny that the housing markets are in for a long, hard slog. Well, the places that have hit bottom are in for a slog. Some places, such as Las Vegas, are still on their way down. Comparing year over year, Las Vegas home prices actually fell 8.5 percent. April of 2009 was a disastrous month for home prices, but Vegas is now below even that.

This all assumes an owner's perspective, of course. It's a nice buyers' market out there right now for some people.

This is April data, so it doesn't compare directly to the May data I commented on here a few days ago, but the data continues to drive home the fact that home prices simply aren't going to bounce back. Thanks to bad public policy and perennial but unwarranted bullishness about real estate, lenders assumed that prices were going to bounce back. Consequently, mortgage servicers and investors have been dragging their feet on approving short sales and the liquidation of foreclosed properties.

Nevertheless, the holders of REO properties (foreclosed properties returned to the bank) are going to have to do something with them sooner or later. And worse yet, almost half of those REOs are held by the government:

Based on Radar Logic’s analysis, the federal government’s REO inventory — including homes owned by Fannie Mae, Freddie Mac, HUD, and the Department of Veterans Affairs (VA) — has increased steadily for over 24 months and now accounts for approximately 46 percent of the nation’s total REO supply.

Looking at information from the GSEs and HUD, Radar Logic says the government currently owns 209,500 homes as a result of foreclosure, and the company estimates there could be an additional 9,560 homes held by the VA, for a total of 219,060 government-owned foreclosed homes.

This will create additional downward pressure on prices for the foreseeable future.

In a larger context, the protracted growth of non-performing loans will likely continue to have a deflationary effect as lender portfolios contract with the value of residential real estate.

Twilight of the Economists

2010-06-28T22:40:00.001-06:00

by Ryan McMaken

Cross posted at LRC blog.

The economics profession is experiencing a crisis of legitimacy. Well, not the whole profession, just the mainstream neo-Keynesian part that comprises the majority of the professional economist corps. Austrian economics, on the other hand, is in a state of renaissance since the old Keynesian sloganeering obviously isn't working anymore.

So, in response, an economist who works for the Federal Reserve, Kartik Athreya whines that the economics bloggers are mean and are undermining the real economists with PhD's who sit around with their computer models and debate whether the government should tax everything at a rate of 40 percent or 50 percent.

In reality, this isn't a matter of PhD's, since many brilliant economists from Ludwig von Mises to Joseph Salerno have had PhD's or an equivalent degree. So what Athreya really means is that non-PhD'ed economists -who point out the Olympus-like heights to which the non-Austrians have reached in being wrong about almost everything- should just shut up.

The Screed Against The Bloggers should be recognized as its very own genre of non-fiction now. It is a genre first developed by professional journalists who couldn't stand the fact that they were being upstaged by more informative, balanced and interesting bloggers who were gaining readership at the expense of the "official" organs of public information. Now the economists have joined in the game, and it's just as unseemly.

It is also worth noting, that there is no true real distinction between an economist with a PhD and one without. The National Association of Business Economists is filled with professional economists who lack PhD's but who are paid, professional economists. Yes, the economists with PhD's perhaps make up the majority of the NABE rolls, but Athreya's claim that real economists have PhD's is an arbritary novelty invented by Athreya in an effort to perhaps make himself feel better about all those years spent writing for obscure scholarly journals that no one ever reads.

Tax Credit Pumps Up Latest Home-Buying Bubble

2010-06-28T22:38:00.001-06:00

by Ryan McMaken
Cross posted at Mises Economics Blog

Existing home sales did not do as well as expected in May, while new home sales fared even worse.

Last week's new home sales data released by HUD and the Census Bureau revealed yet again the underlying weakness in the housing markets in the United States. New home sales, not to be confused with existing home sales, fell 32.7 percent from April to May. The negative month-over-month change was expected by many in the real estate industry, although most major media outlets called the drop "surprising." The drop surprised no one who was watching to see the response to the expiration of the home buyer tax credit in April.

So, while the April to May drop was expected, the year-over-year drop signaled a significant lack of demand for new housing. From May 2009 to May 2010, new home sales dropped 18.3 percent. This is especially noteworthy since May 2009 was near the bottom of the market following the financial panic of late 2008.

One would be tempted to think that there was no where to go but up when comparing real estate trends to the first half of 2009, but the 18 percent drop put an end to that hope.

Existing home sales fared better. According to data released last week by the National Association of Realtors, existing home sales were up 2.2 percent from April to May and increased 19.2 percent from May 2009 to May 2010. The year-over-year increase from the doldrums of May 2009 was correctly anticipated.

Now, the lackluster performance of home sales in the absence of the homebuyer tax credit has spurred talk of extending the tax credit yet again. Staff at Moody's Economy.com admits that the proponents of the tax credit had miscalculated how the tax credit would stimulate home buying.

Some supporters had "expected the tax credit to pique buyer interest in a manner that would carry over for months following the credit's expiration." How exactly this was supposed to happen remains a mystery. Real estate agents who work daily with buyers knew that the tax credit was merely cannibalizing buyers from later in the year. In other words, people who were planning to buy in, say, August, moved up their plans to take advantage of the tax credit. There has been very little evidence that the tax credit created any significant number of buyers who hadn't otherwise been considering a home purchase.

Now, with many of the summer's buyers electing to purchase before the end of April instead, the summer is looking to be particularly grim for home purchasing.

The latest real estate bubble isn't much of an argument in favor of a tax credit with the sole purpose of increasing spending on residential real estate. All things being equal, tax credits are good because they mean more control can be exercised by the taxpayer over his or her wealth. However, a tax credit that exists only to convince people to spend more money faster is problematic.

The answer is not to end tax credits, but to make them far more broad. Why do renters not deserve tax credits? And why must one buy a house to get a tax credit? If the Keynesians in government want to really increase spending, shouldn't they just give everyone an $8,000 tax credit? Or they could cut tax rates.

Policymakers won't do this, however, because they fear that people would use such an open-ended tax credit or reduction to save money or pay off debt, which is totally unacceptable for the Paul Krugmans of the world.

Politics explains a lot in this case also since renters simply don't enjoy a powerful lobby as do the real estate agents, mortgage brokers and home builders. Thus, tax "breaks" are written to subsidize a single industry rather than provide relief for the taxpaying population overall.

Even if the tax credit were extended again, it would not produce any income growth or job growth any more than did the last extension of the credit. Without job creation and income growth, there will not be any sustainable increases in demand for home buying. Despite many claims to the contrary, demand for real estate will improve when the economy produces jobs and income growth, and not the other way around.

The need for actual job growth will especially be seen among younger home buyers, or lack thereof. One of the ways that the home buying bubble was sustained during the last decade was to make home purchasing available to younger and younger segments of the population. Job creation during the bubble allowed for wildly optimistic estimates of future job prospects and earning power for twenty-something who then looked to homebuying as the next logical step. Combined with incredibly low requirements for down payments and credit histories, 25-year-olds were buying up houses.

Today, with unemployment among twenty-somethings at 25 percent, and with income growth near zero, there is nowhere from where to draw new households looking to buy houses. The tax credit can be extended, but like so many of the "stimulus" efforts that have been used in the last two years, this one may have run out of steam.

Personal Income Rises With Government Spending

2010-06-28T21:09:00.001-06:00

by Ryan McMaken

Cross posted at Mises Economics Blog.

Personal income information released this week by the Bureau of Economic Analysis shows total personal income increasing 0.4 percent, or $54 billion, from April to May 2010. Year over year, personal income is up 1.6 percent, or $191 billion. In spite of recent growth, total personal income is still down $24.4 billion, or 0.2 percent, from the peak reached during May of 2008.

In short, personal income has gone nowhere over the last two years as it plummeted $479 billion, or 3.9 percent, from May 2008's peak to March 2009's nadir. It has generally increased each month since.

Now that personal income has nearly recovered to where it was during the peak time, it is important to look at where the income has come from.

Job creation has been extremely weak since 2008. More than 7 million jobs have been lost, and as new high school and college grads have entered the work force, there simply haven't been enough jobs to provide for growth in the work force. Hence, unemployment hovers near 10 percent, and job creation in the private sector is essentially zero.

So, how is it that income growth has recovered? The answer lies in what is included in the income numbers. Total personal income statistics include wages earned, whether from public-sector or private-sector jobs, and will also include wages from government-funded stimulus jobs such as highway construction and other similar projects.

But more important for our analysis here is the fact that personal income totals also include "personal current transfer receipts" which include "benefits received by persons for which no current services are performed." Such benefits show up as personal income in the form of Medicare, food stamps, unemployment compensation, public assistance and a variety of other forms of income.

While personal income peaked in 2008, then crashed and slowly recovered, income in the form of transfer receipts have only increased. At the same time that personal income fell 0.2 percent from May 2008 to May 2010, personal current transfer receipts increased 12.2 percent. During those two years, as personal income saw a net decrease of 24.4 billion, transfer receipts increased 244.3 billion.

Indeed, a look at the last ten years shows that transfer receipts increased far more, both in absolute terms and in percentage increases, during the last two years than during any previous economic downturn dating back at least to 1959. (Although, there are almost certainly would have been very large increases in transfer receipts had they been measured during the New Deal.)

Today, the Dow rallied on news that personal income had grown faster than spending and that households were beginning to save more. This would be excellent news if this income had been produced by increases in wealth and income in the private sector, but unfortunately, increased personal income, while not totally due to public sector spending, has been largely buoyed by public sector spending, and has been a very significant portion of the growth in income that is now being trumpeted as proof that the recovery is taking hold.

However, as long as income growth is largely dependent on public-sector spending, growth is just a matter of income being redistributed from net tax payers to tax receivers, which is largely why personal income continues to improve in spite of only very small gains in private-sector employment. Ultimately, however, economic "growth" that is driven by mere transfer payments, cannot be growth founded any any true creation of wealth.

Wilma Zeimmer, RIP

2010-06-25T08:32:00.004-06:00

My grandfather's sister, Wilma Zeimmer, recently died back in Indiana. Requiescat in pace.

Here is the funeral home's obituary:

Born: January 14, 1912
Died: May 23, 2010

J. WILMA ZEIMMER, 98, of Fort Wayne, passed away on Sunday, May 23, 2010, at Coventry Meadow Nursing Home. Born Jan. 14, 1912, in Fort Wayne, she was a daughter of the late Henry W. McMaken and Jessie (Freck). She was a homemaker and member of Arcola United Methodist Church. Surviving are three daughters, Mary Grepke and Norma (Terry) Closson, both of Fort Wayne, and Janice (Bob) Bell of Geneva; stepdaughter, Roxanna Baker of Tucson, Ariz.; stepson, Ronald Zeimmer of Ashville, N.C.; brother-in-law, Kenneth Becktol of Roanoke; 15 grandchildren; 30 great-grandchildren; and eight great-great-grandchildren. She was also preceded in death by her first husband, Joseph Carroll; second husband, George H. Zeimmer; daughter Lorraine Schorey; sons-in-law, Stan Fink, Harry Beatty and Tom Grepke; brother, Herbert McMaken; sister, Margaret Van Hoozen; and grandchildren, Joey Grepke, David Fink and Mick Blockson.

Wilma was actually the last of 6 brothers and sisters to die. Not mentioned here are her other siblings: Ruth, Henry and Edith. The siblings were all born between 1902 and 1914 and they grew up on a prosperous farm in Aboite Township, Indiana.

Free Sholom Rubashkin!

2010-06-23T00:08:00.002-06:00

Bill Anderson has an excellent piece on this case today:

This week, Sholom Rubashkin, who was the vice-president of what was once the largest kosher meat processing supplier in the world, was sentenced to 27 years federal prison for "financial fraud." Prosecutors had asked for 25 years, and this is essentially a life sentence for Rubashkin, who is 51. However, a lot of other people, including a number of former U.S. attorneys general, called for leniency and are outraged by this sentence that was motivated more by politics and not by the law.

I will go against all of them. Sholom Rubashkin, in my view, does not need "leniency." He needs to be freed, period, for the man is not a criminal, which is more than I can say for the people who hounded and prosecuted him and destroyed his business, Glatt kosher Agriprocessors of Postville, Iowa. Let me begin.

Rubashkin is a Hasidic Jew, his family having fled the U.S.S.R. after the Nazi invasion. They came to the United States and set up a butcher shop in New York City. After marriage in 1989, he and his new bride moved to Atlanta on shlihut to do kiruv (Jewish outreach). That same year, Rubashkin’s father started a kosher meat processing business in Postville to better enable Jews living outside of main Jewish centers to be able to obtain kosher meat.

Before Glatt kosher Agriprocessors began to expand its business, Jewish families could only purchase kosher meat from small butchers and specialty stores that catered to Jews. This made things more difficult for Jewish families who did not leave near these kinds of stores, but by expanding the amount of kosher meat for sale, the firm was able to bring kosher meat to regular grocery stores, which was not a small development for jewish families.

The market for news

2010-06-22T20:16:00.001-06:00

Cross-posted at the Mises Economics Blog: http://blog.mises.org/13055/the-market-for-news/

Historically, newspapers have made money in two ways. They make money from readers, and they make money from advertisers. Originally, most of the money that newspapers made came from readers. In the late 19th century and early 20th century the old newsboy sales model was based on incentives to move as many newspapers as possible at the highest possible price. Advertising was a source of revenue, to be sure, but not the primary source.

Over time, the emphasis would shift away from revenue provided by readers and toward advertiser revenue. Eventually, advertiser revenue would make up at least 70-80 percent of all revenue. Essentially, newspapers gave up on getting the readers to cover the full cost of the news a long time ago. The daily cost of a newspaper subscription is, more often than not, well below the cost of producing a paper copy of a newspaper. Until the last few years, the real money was to be made in advertiser dollars.

But with the significant decline in circulation (see here) advertisers know that they get less bang for their buck every month that circulation drops.

So, one day, after years of plummeting circulation and revenue, the newspapers suddenly realized they'd better get the readers to start paying for the news. Their most brilliant ideas revolved around erecting pay walls around content. In other words, the newspapers, to solve their revenue problem, returned to a revenue model that hadn't been used in decades. It hasn't been working out.

Mashable today carried a nice piece on some newspapers that are finally starting to look at innovative ways to make money. Primarily, they're finding ways new ways to make money off of advertisers.

The new innovation that some papers are showing results from the fact that some papers are finally starting to come to grips with reality. The new reality is that news can and will be produced without traditional newspapers.

For the last several years, the entire business model of the newspapers seemed to be "you'll miss us when we're gone, so give us money," which wasn't a rock-solid strategy to say the least.

But other organizations have already moved in to displace them. As the Mashable article notes, laid off journalists from closed and downsized papers have started to produce their own news. Here in Denver, at least one online newspaper aggregates news from a variety of blogs written by former newspaper writers and other bloggers. The blogs are sometimes funded by private firms, such as in the case of this real estate blog.

It has become clear that journalism will be funded, but that the new reality is far more decentralized, complex, and competitive.

The days are gone when one could ask "did you read the paper today" and everyone could discuss the same few news stories selected by even fewer news editors. Today, people can get the news they want, and different people are interested in different things. The market loves this kind of diversity and will move in to serve it in even more diverse ways.

The market is currently in transition, and transitions in the market produce winners and losers, but we're not sure yet who the big winners are in this. The losers are already pretty obvious. Capital needs to be moved to where it is demanded. That is to say, it will be moved away from physical printing presses and old-timey newspapers and toward new innovative leaders in delivering news. Some newspaper organizations will get learn to make money from this, and many will not.

Uh-oh, bigots don't like me

2010-06-21T22:24:00.009-06:00

There's a web site called VDARE which many corporate web-surfing programs block for "racist content." They're a site that spins a variety of bizarre theories about the inferiority of non-Anglo Saxons and so on. Articles criticizing me for my moderately pro-immigration views have appeared more than once. On this site, a writer seems to (or at least did at one time) attribute to me the famous "Go back to Boston" tirade by Augustin Cebada of the Brown Berets. Comments that are a bit fiery for my tastes, and somewhat violent and in poor taste. And, I never wrote them. [Here is the original piece, although I don't want to link directly to such a site: http://www.vdare.com/misc/080514_pendleton.htm]

This is simply an occupational hazard of writing a lot, I suppose, since sooner or later, someone would attribute something to me that I never wrote. In my original posting in which I quote (without endorsement) Cebada's views, I did point out the hypocrisy of those who claim to be so horrified by such a statement, while supporting similar sentiments in favor of Anglos. My piece is basically a historical analysis, which is why I compare modern sentiments to those of John C. Calhoun, although for some people, everything is a cause for histrionics. [Here's the archived link, since my old blog posts prior to 2007 have been deleted.]

Which brings me to why I ever brought this up. The "racialists" (as they call themselves) who support these hyper-nationalistic views have twice now hurled insults at me in the comments section of the Mises Economics blog. Personally, I find it rather bizarre that some people have so much free time as to sit around starting fights over articles that were published 4 years ago. But there's a lot of variety out there I suppose.

Flat is the new 'up'

2010-06-11T16:32:00.002-06:00

With the next several years looking quite grim, it seems that just neutral economic news will be good news.

From the Aurora Sentinel today:

Higher earners far from immune on foreclosure

AURORA | Not a single economic class or neighborhood in Aurora is immune to foreclosures.

Although foreclosures are more saturated in low-income neighborhoods, they are also dispersed throughout middle- and high-income neighborhoods, according to 2009 data from Arapahoe County.

Until recently, foreclosures were most prevalent in lower-income neighborhoods, among homeowners who were living paycheck to paycheck, afflicted with job losses and unable to pay their mortgages.

But as high unemployment persists and the aftermath of the recession continues to ripple across the state, wealthier neighborhoods with higher-income homeowners are becoming vulnerable to foreclosures as well.

Although the Arapahoe County Assessor’s office doesn’t track the incomes of people who have been affected by foreclosures, they do track the prices of homes that have been foreclosed upon.

Judging by those statistics, it’s evident that the rate of foreclosures has jumped from 2009 to 2010 in all levels of home prices — and, presumably in all economic classes.

*
“Every category did increase,” said Corbin Sakdol, Arapahoe County Assessor. “However, the heavy foreclosures are still in the $250,000 and below range.”

Since January, there were about 1,300 foreclosed homes in Arapahoe County in the price range of $250,000 and below, up from about 1,000 from January to June of 2009, Sakdol said.

In the price range of $250,000 to $500,000, there have been about 160 foreclosed homes since January, up from about 110 foreclosures in the same period of 2009.

The trend continues all the way up to the homes in the price range of $1 million and above. In that range, there have been 16 foreclosed homes since January, up from 11 in the same period of 2009.

Aurora still has the highest number of foreclosures out of any area in Arapahoe County, Sakdol said.

But data from the state of Colorado’s Division of Housing show that foreclosures are trending away from Aurora and into counties such as Jefferson, Douglas and Boulder.

“The fact that foreclosures have become more numerous in places like Douglas and Jefferson indicates that foreclosures are moving up the income scale,” said Ryan McMaken, community relations director for the state of Colorado’s Division of Housing. “We’re seeing movement in foreclosures toward areas that have more expensive homes, whereas they used to be centered in Denver, Adams, Arapahoe, and especially in Aurora.”

Foreclosures are quick to impact those people without college degrees, who most likely haven’t built coffers of savings to sustain them through a lull of unemployment, he said. That explains why the number of foreclosures were originally most concentrated in places like Adams County and Arapahoe County.

But since late 2008, as homeowners in high-income neighborhoods have slowly run out of money because of unemployment, they are now in the same position as those lower-income homeowners.

“The length of time that unemployment has been high is now starting to affect people with higher incomes because they are running out of savings,” McMaken said. “But people toward the lower end of the income scale are most impacted by the recession.”

Recent data suggests that the rate of people going into foreclosure statewide, including in Aurora, has reached a plateau.

McMaken said last month’s figures show the lowest foreclosure filings for counties since May 2009.

“Flat is the new ‘up’ in terms of good economic news,” he said. “Flat is what you like to see. Rather than foreclosures going up, if they can just stay flat for a while then you’re happy about that, and that seems to be what we’re looking at right now.”

#2 of ten things to not Tweet about

2010-06-04T23:19:00.004-06:00

I especially enjoyed this one:

Translation: I don't have any actual knowledge about any actual industries. I just like to communicate about communications.

From The Oatmeal

More economic pain ahead

2010-06-04T22:45:00.000-06:00

From my post at Libertarianstandard.com:

In the chart below, provided by chartoftheday.com, one can see how grim the job situation has become. The long term-trend experienced since 1961 has been abandoned for what can only be described as stagnation in job creation. As jobs remain flat, of course, the size of the job force will continue to grow as more young people graduate from college and secondary school. This is partly why unemployment among teens and twentysomethings is now about 25 percent.

According to chartoftheday.com:

Today, the Labor Department reported that nonfarm payrolls increased by 431,000 in May. It is worth noting that a large majority of last month's gain in payrolls was due to the hiring of temporary workers for the 2010 census. Today's chart provides some perspective on the US job market. Note how the number of jobs steadily increased from 1961 to 2001 (top chart). During the last economic recovery, however, job growth was unable to get back up to its long-term trend (first time since 1961). More recently, nonfarm payrolls have pulled away from its 40-year trend (1961-2001) by a record percentage (bottom chart). In fact, the number of US jobs is currently at level first reached in early 2000.

So far, the current "recovery" has produced a net loss of 133,000 jobs. During the same point in the last recovery (2003), the economy was adding 200,000 to 300,000 jobs per month. Calling the current situation a recovery is risible to anyone who is out looking for a job right now, especially since workers are now experiencing the longest periods of joblessness experienced in decades.

We can add to this the fact that the debt crisis in Europe has now spread to Hungary. So now, Greece, Portugal, Ireland, Italy, Spain and Hungary are all now facing serious debt crises and even risk of default. The European economy is in disarray, and investors were not pleased as the Dow plunged more than 300 points to below 10,000.

The homebuyer tax credits are gone, the stimulus is beginning to wear off, and there is nothing left that the feds can do to stave off another crisis since interest rates are already effectively zero and the federal government is more more broke than ever. State and local governments are in even worse shape.

Needless to say, this does not bode well for the "recovery."

New economics haikus

2010-05-18T08:26:00.004-06:00

Here are a couple of haikus by economists I know. I didn't credit them because I'm too lazy to ask them, and it's easier to just cut and paste. Note: If you want me to credit you, just shoot me an email.

Helicopters fueled
Bernanke begins his flight
Paper-rain cuts me

also

Too much bank credit
Plans cannot be completed
Recession follows

I'll post any good new ones...

Good analysis on GDP growth.

2010-03-30T11:45:00.004-06:00

All those big growth numbers above 5 percent come from manufacturing to replace burned off inventory. There's little actual growth. Oh, and there's zero employment growth.

This piece is helpful except for this statement: "As this remains a jobless recovery, it must therefore become a consumer spending recovery." That doesn't follow at all. This attitude only results in consumers going more deeply into debt. Just because the American economy is currently driven by consumer spending doesn't mean that has to be true. The economy could just as easily be based on saving and investment rather than on purchasing shiny trinkets.

But, as long as the Fed continues to ram down interest rates, consumers will prefer spending to saving.

My talk in Aspen

2010-03-17T17:35:00.001-06:00

I was recently on an economics panel at the Aspen Board of Realtors' Economic Summit. The Aspen Daily news did a write-up.

Foreclosure filings up dramatically
by Catherine Lutz, Aspen Daily News Staff Writer
Monday, March 15, 2010

Expert: Locals in resort areas getting hit hard

Foreclosure filings in Pitkin County are more than triple what they were in early March last year, mirroring a disturbing trend in which experts are seeing rural resort regions getting hit harder later in the economic downturn.

There have been 22 foreclosure filings so far in Pitkin County in 2010, compared to six at the same time last year, according to treasurer’s office records.

Delinquent amounts range from under $100,000 to $1.5 million, and there doesn’t seem to be any rhyme or reason to the types of foreclosures being filed, said Tiffany Wancura, chief deputy public trustee for Pitkin County.

“They’re all over the place,” said Wancura. “They just keep coming in.”

A scan of the foreclosures list shows that mostly individuals and couples are affected, as opposed to LLCs, which tend to own commercial properties and oftentimes more expensive, second homes.

Pitkin County saw a total of 105 foreclosure filings in 2009, out of which 20 properties went all the way through to the foreclosure sale. It was the third highest number of foreclosures since 1973. (Records are unavailable before that.) By comparison, 2008 saw 35 foreclosure filings and five completed foreclosures in Pitkin County.

An economist who works for the state government addressed the issue of rising foreclosures recently at the Aspen Board of Realtors’ real estate summit.

Some resort regions saw 40-60 percent foreclosure rates two years ago, said Ryan McMaken, director of community relations for the Colorado Division of Housing. That’s when vacation home owners, initially hit by the economist crisis, were choosing to jettison their timeshares or other investment properties as values plummeted by simply not paying the mortgage. Owner occupants, meanwhile, qualified for a federal foreclosure deferment program, which saved many people from foreclosure sales.

But now, “local owners are losing their jobs or otherwise seeing a decline in income, so over time locals are impacted more and more,” said McMaken, an economist.

In the rural resort regions of Colorado, McMaken said, both new foreclosure filings and completed foreclosures are going up, and in some places are doubling and tripling since last year.

“It’s because places like this got hit later,” he said. “And it adds to the pain lasting.”

Statewide, data is not yet available for 2010. But trends from 2009 show that while foreclosure filings increased — there were 18 percent more in 2009 than in 2008 — foreclosure sales decreased by 4 percent.

These trends indicate that “lenders, borrowers and housing counselors are meeting success in implementing a variety of loss mitigation strategies,” according to a report from the state Department of Local Affairs. “However, the increase in new foreclosure filings indicates that foreclosure activity will continue in Colorado at least through the first half of 2010.”

The DOLA report also notes that “most of the new growth in foreclosure activity is taking place outside of the Denver Metro area.”

Foreclosure filings have risen across Colorado nearly every year since 2003, according to state data, with a big spike in 2007. Filings rose to 39,900 that year, from 28,400 in 2006. They went down just slightly in 2008, to 39,300, but rose again, to 46,400, in 2009.

Foreclosure sales have been decreasing since 2007, when there was a high of 25,000 completed foreclosures.

Both foreclosure filings and sales are roughly triple what they were in 2003.

The largest amount of foreclosure activity last year was taking place on the Front Range, even though some metro counties are seeing the biggest drops in foreclosure sales totals.

Mesa County (home to Grand Junction), on the other hand, saw about 300 percent more foreclosure filings and sales in the fourth quarter of 2009, compared to the same period in 2008 — likely due to the decrease in oil and gas activity. Otherwise, foreclosure rates (number of homes per completed foreclosure) have generally been lower in the mountains and on the Western Slope, according to DOLA.

Pitkin County’s foreclosure rate in 2009 was .3 percent, which translates to 393 households per completed foreclosure, among the lowest in the state. Garfield County had 408 foreclosure filings in 2009, and 82 foreclosure sales. That’s compared to 108 filings and 10 sales in 2008. Still, its 2009 foreclosure rate was .4 percent, compared to the state average of 1.1 percent.

Locally, it’s unknown how many of the foreclosure filings will translate into sales at auction. The first scheduled foreclosure sale of the 2010 filings in Pitkin County is May 12.

Meanwhile, banks that have been acquiring more and more property due to foreclosures are doing everything they can to avoid future foreclosure sales.

If a foreclosure sale goes through, there are additional costs to the bank, including legal fees, property taxes and the time spent by staff, said Scott Gordon, president of Alpine Bank Aspen.

“The bills add up pretty quick,” said Gordon.

Gordon also pointed out that property values have been low recently, and while the bank may prefer to hold the property for a couple years in hopes of better recouping costs when the market goes up, federal regulators want them to sell it sooner rather than later.

“We’re not in the business of buying and selling real estate; that’s not apart of our core business model,” he said.

Gordon said that it’s to everyone’s advantage to try to negotiate avoiding a foreclosure sale.

“Strategically the best thing you can do is to find what the borrower and the bank can work out,” he said. “If you have some level of income coming in, the last thing you want to do is not have a conversation with your bank.”

CBS4 Promotions

2010-03-09T17:44:00.002-07:00

The Foreclosure Hotline communications guru (Sarah Noel) and I helped put together a nice little partnership between the Colorado Association of Realtors and the Foreclosure Hotline that has led to a series of spots on CBS4 featuring foreclosure issues and homeownership. They can be viewed here.

February 2010 Housing Snapshot

2010-03-02T09:32:00.003-07:00

Housing Snapshot is a very brief summary of the housing economy in Colorado. It's 4 pages of short articles and graphs covering mostly job growth and housing demand, and the housing markets in general.

Here's February's issue.

The latest Case-Shiller index data

2010-03-01T11:59:00.002-07:00

In case you're looking for it, here's the link to the latest Case-Shiller home price index data.

Why didn't reporters attend your press conference?

2010-02-18T22:36:00.007-07:00

Because it was a waste of time.

I'm generally against press conferences and other made-up events that are supposed to create news out of nothing. Press conferences are rickety, wizened old antiques from the 20th century. It is all well explained by Daniel Boostin in his classic book The Image: A Guide to Pseudo-Events in America. Press conferences are non-events dressed up as events.

That may have worked ten or twenty years ago when reporters were looking for things to do, but in the modern era when no reporter has the time to travel to a press conference, listen to a bunch of self-congratulatory chit chat, and then drive back to the office, something else must be done.

Conference calls tailored to specific reporters work well. But only if there is actual news worth reporting. That latter part is the tough part. But even if it's only sort of news, if you get a 100-word brief out of it, you've done well since you didn't waste a bunch of time planning an enormously inefficient press conference.

Not all events are necessarily bad, though, if they serve a purpose other than simply restating what's in a press release. The Bianchi Biz Blog has a nice piece here on how to get reporters to those events that are actually worth attending.

Apartment vacancies fell in fourth quarter

2010-02-01T17:18:00.001-07:00

Apartment vacancies fell in fourth quarter
February 01, 2010 11:50 AM
THE GAZETTE

Local apartments filled up late last year at a pace not seen in eight years.

The vacancy rate for Colorado Springs-area apartments was 8.7 percent during the final three months of 2009, down from 10.4 percent in the fourth quarter of 2008 and the lowest for any fourth quarter since the rate was 8.9 percent in 2001, according to a report released today by the Colorado Division of Housing.

More troops at Fort Carson and a lack of new apartments being built in the area contributed to the falling vacancy rate, said Gordon Von Stroh, a University of Denver business professor and who authored the report.

Even though the demand for apartments is on the upswing, rents averaged $711.66 in the fourth quarter, which was about $1.60 less than the same period a year earlier.

Rents likely remained stable because of poor economic conditions, particularly shrinking payrolls and rising unemployment, said Housing Division spokesman Ryan McMaken. If the apartment vacancy rate continues to fall, however, expect rents to begin to rise significantly, he said.

The Housing Division's report is somewhat similar to a report by Apartment Insights, an online research company, which showed the apartment vacancy rate fell to 7.4 percent in the fourth quarter. While different in their numbers, both reports showed the apartment vacancy rate trending downward from the same period a year earlier.

Examiner article: Unemployment up

2010-01-25T08:47:00.004-07:00

Unemployment rises in Colorado to 7.3 percent
January 22, 2:57 PM Denver Economy Examiner Ryan McMaken

Colorado's unemployment rate (not seasonally adjusted) increased six-tenths of one percentage point from 6.7 to 7.3 percent in December, according to new data released today by the Colorado Department of Labor and Employment. Nationally, the unemployment rate remained at 10 percent for the second month, according to the Department of Labor's Bureau of Labor Statistics (BLS). December's seasonally adjusted unemployment rate in Colorado was 7.5 percent.

Year over year, the December rate increased in Colorado from 6.0 to 7.3, and the national rate increased from 7.4 percent to 10.0 percent.

Consumer prices down 0.2% in West, nationwide

2010-01-21T11:13:00.007-07:00

Here's my latest piece as the Economy Examiner for Examiner.com:

Consumer prices fell 0.2 percent in Western states, including Colorado, from November to December. Prices in the region have risen 2.2 percent since December 2008 according to the report released Friday by the Department of Labor's Bureau of Labor Statistics.

Nationwide, consumer prices in December increased 2.7 percent over December 2008 and fell 0.2 percent since November 2009. Numbers are not seasonally adjusted.

...

Generalizing regional data to Colorado can be problematic. The West, as defined by the BLS, includes a large number of states with economic conditions that differ from Colorado's. Nevada and California, for example, are both included in the region yet differ significantly from Colorado in employment figures and in real estate prices. States with high unemployment and depressed real estate and more likely to see falling overall prices than states with more moderate unemployment and with more stable real estate prices.

Read the full article.

An old clipping

2009-12-09T21:18:00.002-07:00

I recently found this old front page clipping. I never read a physical paper, so I have no idea on what page articles appear. Nevertheless, I like to get a featured story every now and then:

2009-10-19T13:40:00.002-06:00

Below is some recent newspaper coverage of my most recent foreclosure report found here: http://dola.colorado.gov/app_uploads/docs/Monthly%20Foreclosure%20Reportseptember2009.pdf

Colorado foreclosure filings up sharply in September
Bizjournals.com - Mark Harden - ‎Oct 7, 2009‎
Foreclosure filings in Colorado's cities rose 71.9 percent in September from the same month a year earlier, but state officials said the big increase was ...

County foreclosure filings up
The Coloradoan - ‎Oct 9, 2009‎
By Coloradoan staff • October 9, 2009 Foreclosure filings in Larimer County and across the state increased in September, in part because of statutory ...

Mesa County foreclosure activity soars in September
Grand Junction Free Press - Wyatt Haupt Jr - ‎Oct 9, 2009‎
A distressed Mesa County housing market continues to suffer, as the number of completed foreclosures surged more than 216 percent last ...

Foreclosure sales drop
Denver Daily News - Gene Davis - ‎Oct 8, 2009‎
Foreclosure sales at auction in Denver last month dropped 29.3 percent compared to the same time period last year, a statistic that some experts believe is ...

Foreclosure rate more than triples in Mesa County
Grand Junction Sentinel - ‎Oct 8, 2009‎
By LE ROY STANDISH/The Grand Junction Daily Sentinel The number of completed foreclosures in Mesa County more than tripled in September of this year ...

Foreclosure filings, sales increase in Larimer, Weld in September
Northern Colorado Business Report - ‎Oct 8, 2009‎
By Staff DENVER - A report issued by the Colorado Division of Housing shows foreclosure activity in Larimer and Weld counties rising sharply in September. ...

Weld foreclosure filings, sales rise in September
Greeley Tribune - ‎Oct 8, 2009‎
Weld County foreclosure filings and sales continue a gradual rise through September, but have not completely returned to top of the state. ...

October 8 9News Interview

2009-10-10T19:53:00.001-06:00

Here's the story that accompanied my Thursday morning interview on 9News:

Foreclosures still on the increase, but trend is slowing

KUSA - The Colorado Division of Housing has released local foreclosure statistics for September, and while the numbers continue to rise, the Division says they are improved over a year ago.
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The office said "completed foreclosures" rose by 21 percent in the state from last month, but the September numbers are down 5 percent from 2008.

According to the Office of the Comptroller of the Currency (OCC), which regulates all national banks, foreclosures are "completed" when the ownership of the properties is transferred to the servicers or investors and the debts are extinguished.

The OCC website says the process varies by state and can take up to 15 months to finish.

The numbers show Mesa County led the state in foreclosures with a rise of 217 percent over 2008, with Denver County reporting a decrease of 29 percent since this time last year. Arapahoe County totals fell 13 percent.

Housing spokesman Ryan McMaken was on 9NEWS 7 a.m.

McMaken explained completed foreclosures were lower because borrowers are becoming more sophisticated in exploring alternatives to foreclosure.

"This is helpful in keeping down the number of foreclosures that proceed to the end of the process," McMaken said. "Also, the reach of the foreclosure hotline continues to expand and this has helped keep totals down."

As to why completed foreclosures increased since August, McMaken says the division has noticed a slow but growing trend of lenders processing foreclosures more quickly.

Overall, McMaken says there's little in the report to suggest that foreclosures are about to take off again in Colorado, but the problem will persist for a while as the economy continues a gradual recovery.

"I'd expect to see a little bit of growth from September to October in totals," according to McMaken, "but I still expect 2009's numbers to be either flat or lower than the numbers from last year."

The full foreclosure report is available on the Division of Housing blog: www.divisionofhousing.blogspot.com

New report on Colo. Metro areas from Bureau of Economic Analysis

2009-09-25T09:11:00.003-06:00

Here are selections form the release:

ECONOMIC SLOWDOWN WIDESPREAD IN 2008

New statistics released today by the U.S. Bureau of Economic Analysis show that the slowdown in U.S. economic growth was widespread: 60 percent of metropolitan areas saw economic growth slow down or reverse. Real GDP growth slowed in 220 of the nation's 366 metropolitan statistical areas (MSAs) in 2008 with downturns in construction, manufacturing, and finance and insurance restraining growth in many metropolitan areas. Growth in real U.S. GDP

In contrast, growth accelerated in 146 metropolitan areas, most notably in areas where natural resources and mining industries are concentrated such as Casper, WY and Grand Junction, CO. Grand Junction had the fastest real GDP growth (12.3 percent) of any metropolitan area in 2008 due largely to growth in natural resources and mining. The professional and business services industry group also showed strong growth in 2008, contributing the most to real GDP growth in 112 metropolitan areas.

The statistics of GDP by metropolitan area in current and real (chained) dollars are available from the Regional Economic Accounts page of the BEA Web site at http://www.bea.gov/regional/index.htm.

FDIC out of money

2009-09-18T12:14:00.001-06:00

FDIC May Tap Treasury Line to Bolster Fund, Bair Says

Sept. 18 (Bloomberg) -- The Federal Deposit Insurance Corp. is considering tapping a Treasury Department line of credit as the agency examines ways to replenish a reserve fund depleted by 92 bank failures this year, Chairman Sheila Bair said.

Unemployment rates for states

2009-09-18T10:28:00.002-06:00

Five states are now over 12%: Michigan, Nevada, Rhode Island, Oregon, and California. Of course, these are also the "official" numbers that exclude discouraged workers and the underemployed such as former financial sector workers who now work waiting tables.

See here for all states.

Double-Dip Recession Looms

2009-09-15T00:20:00.006-06:00

Nothing fundamental has changed in the economy since a year ago when Lehman Brothers went under. Savings rates have increased, but Americans are so deeply in debt, they are still nowhere near the level of savings necessary for actual capital accumulation to take place. Unemployment is increasing, the government is engaged in massive inflation of the money supply, and there are simply no resources that can be pulled from a hat that will get Americans investing in production or spending on consumption. So, we are left with an economy that is essentially the same as it was when the financial panic hit and when the recession started way back during the fourth quarter of 2007.

The recent uptick is only a result of inflationary money flooding the economy through the stimulus plans.

Economist William White agrees.

Freedom Communications may declare bankruptcy

2009-08-31T08:56:00.004-06:00

CNN Money today repeated reports that Freedom Communications may declare bankruptcy. Freedom most famously owns the Orange County register, but Freedom also owns The Colorado Springs Gazette, by far the most important daily in the Colorado Springs metro area.

Here's my commentary on the Mises Institute blog.

Viva Colorado column

2009-08-12T22:37:00.004-06:00

Viva Colorado is a Spanish-Language rack-and-stack newspaper published by the Denver Newspaper Agency. It has the highest circulation of any Spanish-language paper in Colorado. This is a piece I wrote for the paper last month. I admit that I wrote the piece in English and the Viva Colorado editors translated it for me.

The piece covers a new change in law affecting the foreclosure process.

Column in the Colorado Real Estate Journal

2009-08-12T22:06:00.002-06:00

Here's a piece I wrote for the Colorado Real Estate Journal. The CREJ is a bi-weekly publication that serves the commercial real estate industry.

CBS4 piece on new foreclosure laws

2009-08-03T11:18:00.002-06:00

This is based on a TV piece:

Jul 31, 2009 5:06 pm US/Mountain
New Foreclosure Law Offers Homeowners Relief
Written for the Web by CBS4 Special Projects Producer Libby Smith
Reporting
Michelle Griego
DENVER (CBS4) ―

...Starting on August 1st, homeowners facing foreclosure will get letters in the mail informing them of a new law that could give them an extra 90-days to save their homes.

"Provides potentially a 90-day deferment, that is an additional 90-days for someone during which they can do some negotiation and some workout for their loan," said Ryan McMaken, spokesperson for the Colorado Division of Housing.

The law is designed to help those homeowners who can still make some payment on their mortgage even if it's not the full amount.

"This probably isn't going to be a program for people who have no income at all or they have such greatly diminished income that they can't make that two-thirds payment," McMaken added.

Those who get the notice that they're eligible will then be instructed to call the Colorado Foreclosure Hotline. Call agents will hook them up with housing counselors and the counselors will decide if they're qualified. The law spells out very specific qualifications to get the extra 90-days. Those include:

There are some other stipulations as well.

"What they're really looking to do is work towards a loan modification of sorts with the mortgage company so they can reduce their payments to a reasonable amount compared to their income now," said Shannon Peer, Director of Housing Counseling at Brothers Redevelopment, Inc.

Brothers Redevelopment, Inc. is one of the 27 housing agencies partnered for the Colorado Foreclosure Hotline. As calls come into the hotline, Peer has seen the foreclosure crisis change in Colorado.

"Back in November - December, early December, we started to see a lot more unemployment or under employment clients reaching out for help," Peer explained.

Call agents used to field calls from people struggling under bad mortgages, now they're taking about 2,000 calls a month from people who can no longer pay their mortgage because of the economy. This new law is another tool the housing counselors can use to help homeowners hold on to their homes...

The new partnership with Rocky Mountain PBS

2009-07-13T10:42:00.004-06:00

The hotline is now partnering with Rocky Mountain PBS to promote the Hotline. Check out their site "Facing the Mortgage Crisis"

Latest Colorado State of Mind appearance

2009-06-27T21:47:00.001-06:00

I was on Colorado State of Mind on Friday night. The topic was foreclosures.

Interview on Channel 8 in Denver

2009-06-17T20:46:00.005-06:00

Last April, I was part of a panel discussion on the housing market in the Denver area. It featured Zach Urban of the Division of Real Estate, Terry Ware of the City of Denver, and Tony Ormsby of the City of Aurora.

Here are some screen shots:

"No one really knows what anything is worth anymore"

2009-06-16T00:53:00.002-06:00

[from my latest at the Mises Economics Blog]

"No one really knows what anything is worth anymore. Some sellers appear to be kidding themselves..."

So says David Whitford in this nicely detailed piece about real estate in Phoenix. Overall prices in Phoenix, by the way, are off 53 percent from the peak, and have seen the biggest decline in the nation.

There are some interesting contrasts in the piece. Notable is how at least some of the over-70 crowd wasn't caught up in the speculation and the bust. Those who are too old to be Baby Boomers weren't taken in by the profligacy of that generation. Says one 73-year-old: "If you're going to retire early, you can't have a lot of wives you're paying, you sure as hell can't have kids in college, and you can't have a lot of debt. You gotta get your debt down, get your bills paid, pay for your car. And then when hard times come, you don't participate."

I once had a Baby Boomer try to explain to me his theory of how it was smart to maximize mortgage debt for some reason or other. He probably won't be retiring any time soon.

But what struck me here was the section on how prices are all over the map in Phoenix. "Some sellers appear to be kidding themselves..." says Whitford, and this is hardly peculiar to Phoenix.

It's pretty clear that a great many sellers are still in denial about the current economic situation. And this includes banks who own foreclosed properties. Often, the banks are asking for the most ridiculous prices.

One real estate agent remarked to me recently that she has never experienced a time when people were so clueless about the true value of their homes. Banks will price foreclosed homes at 500K only to have them sell for 350K many, many months later. And this is in the relatively healthy market in Denver. Individual sellers aren't much better.

But can we be surprised when we have economists like those at Wells Fargo who recently declared that there will be economic growth in the second half of 2009, and that the recession will be history by 2010? Many have already convinced themselves that the next boom is already in place.

cross posted at the Mises Economics Blog

No sign of a housing recovery

2009-06-14T06:52:00.000-06:00

[From the Mises Economics Blog]

The new Case-Shiller housing price data was recently released, and cities like Los Angeles are still reporting housing price declines of 22 percent. Miami is down almost 29 percent.

S & P's spokesman declared that "we see no evidence that a recovery in home prices has begun."

These are March numbers, and I'm pretty sure that "popular" economists have been declaring the economy at bottom since at least March. We'll see what April numbers say, but the enthusiasm over the imminent recovery is perhaps misplaced.

With so few people qualifying for mortgage loans, and with so many people with terrible credit and massive consumer debt, it's difficult to imagine the scenario that will lead to all the excess housing inventory being mopped up any time soon.

UPDATE: The mortgage bankers association released new data today showing that mortgage defaults are in no danger of going down. As noted in the comments, it is of course a good thing that home prices are going down because that indicates that some of the malinvestment due to the bubble is being repaired. However, the malinvestment has been so incredibly bad, that the continuing decline in prices indicates that we still have a long way to go. As long as prices are moving down, it's a pretty good indicator that the bubble has still not been repaired and recovery is not on the horizon. What we need is a fast and steep fall in prices, but the bailouts ensure that we're in for a long, prolonged ordeal instead

The Fort Collins Coloradoan on the the latest vacancy rates

2009-05-22T12:53:00.009-06:00

Fort Collins apartment vacancies decrease
BY HALLIE WOODS • May 22, 2009

Fort Collins was one of four areas across the state to see decreasing multifamily vacancy rates at the beginning of 2009, a new report says.
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The city's apartment vacancy rate fell to 4 percent in the first quarter of 2009 from 4.8 percent in the first quarter of 2008, according to a report released Thursday by the Colorado Division of Housing.

Loveland, however, saw an increase of vacancy rates to 6.1 percent from 5.6 percent in the first quarter of 2008 in the first quarter of 2009, according to the report.

Experts attribute Fort Collins' decreasing vacancy rates to a tightening up of the home mortgage market and a robust economy due to the university and a growing number of renewable energy startups.

"The whole Northern Colorado region still has some stable job opportunities: renewable energy, health care. And, if you are going to live in Northern Colorado, what better place to live than in Fort Collins?" said Terrance Hunt, principal at Apartment Realty Advisors in Denver. Hunt specializes in the Northern Colorado market.

Homeowners falling into foreclosure are typically not turning to multifamily rental housing, such as apartments, but are turning to single-family home rentals, said Ryan McMaken, spokesman for CDH.

Families who might have looked to purchase a home during the housing market boom, however, are either searching for or staying put in multifamily rental housing.

"In 2003, the rhetoric is why are you throwing your money on rent? That is no longer the dominant way of thinking," McMaken said. "People need very good if not excellent credit on a home. For these reasons, people are staying in rental housing longer."

In Fort Collins, the largest drop in multifamily rental housing vacancies occurred on the northwest side of town, where the rate dropped from 7.1 percent in the first quarter of 2008 to 3.8 in the first quarter of 2009.

Candace Capitelli, property manager of Stone Creek Apartment Homes, 1225 W. Prospect Road, said her 167-unit apartment complex has been easy to fill.

The Durango Herald on foreclosures

2009-05-18T09:15:00.002-06:00

County's foreclosure rates go up
But Durango area looks good when compared with Front Range
by Dale Rodebaugh
Herald Staff Writer
Article Last Updated; Monday, May 18, 2009
Foreclosure filings and real estate auction sales rose sharply in La Plata County from first quarter 2008 to the same period this year, a [CDH] report shows. But by another standard, La Plata County is not doing too badly.

"Your foreclosure rate is low," Ryan McMaken, a researcher and director of communications at the state agency, said Friday. "You're not close to the problems they have on the Front Range."
custom residential construction

The agency's report shows that in the first three months of 2009, there were 10,745 foreclosure filings and 4,354 sales (completed foreclosures) statewide, compared to 11,634 filings and 5,899 sales in first-quarter 2008 - decreases of 8 percent and 26 percent, respectively.

In La Plata County, on the other hand, filings increased from 23 in the first quarter of 2008 to 64 in the same time frame this year - an increase of 180 percent. Auction sales tripled - from seven to 21 - in the same corresponding period.

The second, third and fourth quarters of 2008 saw 44, 30 and 51 foreclosure filings, respectively, in La Plata County. The number of auction sales in the same three quarters - five, eight and six - were almost identical to the seven registered in the first quarter of 2008.

But a snapshot of first quarter 2009 reveals that there was one auction sale for every 944 households in La Plata County. Excluding seven counties that had no foreclosure activity, 35 counties had one foreclosure sale per fewer number of households; 21 counties recorded one sale per greater number of households.

An example: Denver County had one sale for every 352 households while Moffat County had one sale for every 2,629 households.

"Look at Denver County. The rate was almost three times that of La Plata County," McMaken said. "The percentage of households recording a foreclosure sale shows the same trend - .00283 percent in Denver County and .00108 in La Plata County."

McMaken said higher rates of foreclosure sales don't tell the entire story. Eagle, Grand, Summit and Pitkin counties have high percentages of households in foreclosure, but many are second homes, he said.

"The owners still have a place to live," he said.

La Plata County Treasurer Ed Murray added an observation.

"The numbers for the first quarter of 2009 are correct," Murray said in an e-mail. "But first-quarter sales are foreclosures started in a prior year. The soonest a foreclosure sale can occur is 110 days for residential property and 215 days for an agricultural property."

The Department of Local Affairs report said that the 12 most populous counties register 95 percent of foreclosure activity. They tend to be along the Front Range.

"The effects of the recession that began in December of 2007 are not necessarily evident in the number of completed foreclosures," the report said. "However, the fact that the new foreclosure filing totals have not fallen off may indicate that many homeowners are still missing payments.

"We know from data released by the national Mortgage Bankers Association that the number of home loans in Colorado that are least 90 days delinquent continues to rise."

The report said that foreclosure filings are on a pace to equal 2007 and 2008 numbers. Sales, however, aren't expected to reach 2008 totals and foreclosures would have to increase significantly to reach 2007 peak levels, the report said.

The Greeley Tribune on Foreclosures

2009-05-12T09:51:00.003-06:00

Fewer people lose homes to foreclosure, but ...

by Sharon Dunn

House Bill 1276, the Foreclosure Delay act, gives homeowners and their lenders 90 days to avoid foreclosure by working with certified mortgage counselors to regain their financial footing.

Gov. Bill Ritter is due to sign the bill by June 5, and it will be effective July 1.
According to the bill, within 20 days of notice of foreclosure, the borrower must contact a HUD-certified counselor such as those at the Foreclosure Hotline at (877) 601-HOPE. The counselor will assess the person’s debt and financial situation. If the homeowner is deemed a good candidate, he/she gets an extra 90 days to work with the bank to figure out how, if at all possible, to stay in the home, according to a Colorado legislative staff review of the bill.

If a loan holder receives notice that a borrower is eligible for a loan deferment, the loan holder must defer the foreclosure for 90 days, during which time the borrower must make payments equal to two-thirds of the monthly payment due prior to delinquency, plus one-12th of the annual amount due for taxes and insurance.
The bill states the 90-day delay would only be available through July 2011.
The bill was sponsored by Rep. Mark Ferrandino, D-Denver.
The number of people losing their homes to foreclosures in Weld County has gradually dropped since last spring, but that trend may soon come to an abrupt end.

The first quarter of the year saw a 21 percent decrease in foreclosure sales in Weld County and a 26 percent drop statewide, compared to the first quarter in 2008. But it also was the time when Fannie Mae and Freddie Mac put a moratorium on foreclosures. That ended March 31, and in April, Weld saw its biggest single-month bump of foreclosure filings in history at 300.

There are still some adjustable rate mortgages “adjusting,” but many people are now losing their homes because of newfound unemployment, officials say.

“You have an interesting situation where people are unemployed or underemployed, and oftentimes the payment is going up, and they have negative equity,” said Matt Revitte, a broker with ProRealty, 806 8th St. in Greeley, who markets foreclosed properties. “There are just not a whole lot of options out there. It’s an interesting set of circumstances we’re dealing with now.”

More foreclosures may be coming now that the Legislature has passed House Bill 1276, which would delay foreclosures for 90 days to allow borrowers time to work out their financial hardships. Gov. Bill Ritter plans to sign the bill before June 5, according to his spokesman, Evan Dreyer.

Consequently, second-quarter foreclosures may go through the roof.

“When lenders see we passed 1276, they’re going to try to jam as many foreclosures through before that bill goes into effect,” said Ron Woodcock, of Remax Southeast in Denver, who participated in a conference call Monday to discuss first-quarter foreclosures. “My list has jumped up to 900-1,000 per week, just last week.”

Initially, foreclosures numbers look promising for Weld County and the rest of the state. The first quarter, or the first three months of the year, show Weld foreclosure sales dipped 21 percent from the same time last year and filings dropped 5 percent. In Larimer County, foreclosure sales dropped 24 percent but filings grew by 10 percent.

The first quarter’s declines mark the largest year-over-year decreases in completed foreclosures since [CDH] began collecting data in 2006, according to a prepared release.

“The trend you’ll find is that over the last three quarters, completed foreclosures have been declining, but it is the third quarter of increases in new foreclosure filings,” said Ryan McMaken of the [CDH] in the conference call.

There are more filings than actual sales because borrowers have up to four months to cure their bad loans. Housing officials say the Colorado Foreclosure Hotline also shares some responsibility for driving down actual foreclosure sales.

The Colorado Foreclosure Hotline — (877) 601-HOPE — has been in place for more than two years, and according to Hotline records, almost 10,000 households have been able to avoid foreclosure.

A big portion of homeowners avoiding foreclosures is unloading their homes on the market through short sales, or selling the home for less than it’s worth.

Billie Jo Downing, with Remax Action Brokers in Loveland and a founding member of the Foreclosure Prevention Task Force in northern Colorado, said 40 percent to 60 percent of the market now is from either bank-owned properties or short sales.

Weld’s foreclosure rate is one foreclosure sale for every 245 households.

Channel 7 on Foreclosures

2009-05-06T09:28:00.003-06:00

More Coloradan's Mortgages Falling Behind
Officials Fear Growth Of Foreclosures

POSTED: 5:55 pm MDT April 29, 2009
UPDATED: 7:04 pm MDT April 29, 2009

DENVER -- State housing officials fear another boom in home foreclosures. The number of homeowners falling behind in their mortgage is growing.

According to the state, the current delinquency rate in Colorado is 4 percent. That is more than double what it was two years ago.

“The current situation is very flexible,” said Ryan McMaken, a representative with [CDH].

State housing officials said a number of Coloradans who haven’t made their mortgage payment in some time could soon face foreclosure since many lending institutions have ended a self-imposed moratorium.

“There are a decent number of borrowers who haven’t made payments in a while but they don’t register as foreclosures yet,” said McMaken.

Many banks and lending institutions instituted a moratorium on foreclosures as they waited to see what the Obama administration would do troubled homeowners. The best advice for anyone behind in their mortgage is to contact their bank immediately.

Don Childears with the Colorado Bankers Association said often times the banks are willing to work with their delinquent customers.

“A lot of borrowers are embarrassed often because they’re behind or delinquent and that will only make the situation worse,” said Childears.

Childears admitted it is in a bank or lenders best interest to work with their delinquent customers rather than go through with a foreclosure. A typical foreclosure costs a lending institution about $50,000. That accounts for a number of things including the home’s depreciation and the cost to sell it.

“That is an expense you’d like to avoid if you can,” said Childears. “Often the bank will work out a plan with that borrower.”

Front Page - Denver Daily News

2009-03-26T16:58:00.004-06:00

I like the Denver Daily News, and I know that among Downtown Denver professionals, it's the preferred reading material of choice over that morning bagel or that sandwich at lunch.

So I was happy about Monday's front page story based on my press release:

9News, March 10

2009-03-10T21:11:00.006-06:00

Gregg Moss, who is one of my favorite humans, has done a lot for the Foreclosure Hotline lately. On Tuesday, we discussed the heavy volume of calls we're dealing with these days.

Here is the link to the video.

Update: I put out a release on Hotline call volume that was picked up by the AP on March 11th. 9News then re-used the Tuesday morning video with this newly written web story:

DENVER - Even though foreclosures are on the decline here in Colorado, the Foreclosure Prevention Task Force Hotline received a record number of calls last month.

In February alone, the Foreclosure Hotline received more than 4,500 calls, in part due to new programs being offered by the government to help with this problem.

President Obama passed the Homeowner Affordability and Stability Plan (HASP) last month, which will encourage mortgage servicers to offer lower interest rates, extend loans to 40 years and even forgive principle. In January, Congress passed The American Revitalization and Recovery Act (ARRA), which provides money for people who can't avoid foreclosure or who has already lost their home.

Ryan McMaken, with the Foreclosure Prevention Taskforce says, with so many people seeking assistance and wanting to know if these programs can help them, lenders are becoming overwhelmed.

"Notice in this case, it's the squeaky wheel that gets the oil," said McMaken. "You want to first make sure you have all of your paperwork in order to show that you are ready to go and then make sure that you're the type of person that can get through the system and get noticed."

The Colorado Foreclosure Prevention Task Force is a non-profit organization that provides housing counselors who can help answer questions and find the best solution for you. This free hotline service can help homeowners in a variety of situations, from those who think they may miss a mortgage payment in the future to those who have already received a notice of foreclosure.

"(When people call our hotline) they're going to figure out all of those things that they need to find out before they really start to work with their lender."

If you have questions foreclosure, you can call the hotline at 1-877-601-HOPE or go to the Colorado Foreclosure Prevention Task Force at http://www.dola.state.co.us/cdh/foreclosure.htm.

9News, February 23

2009-03-10T21:10:00.001-06:00

Here's a story that features the Div. of Housing.

Colorado State of Mind

2009-03-09T19:59:00.001-06:00

I was a guest on Colorado State of Mind on channel 6 last Friday. We talked about housing prices, foreclosures, and unemployment:

Here's the full program.

I want my Rebchook

2009-03-02T21:43:00.005-07:00

John Rebchook, the now former Real Estate Editor of the Rocky Mountain News is one of the greatest reporters I've ever known. He'd been covering real estate in Colorado since 1983, and I have the old clippings to prove it.

We discussed a lot of foreclosure data in recent years, and when your'e dealing with a reporter who reported on the high foreclosures of the mid-eighties, the discussion is a lot more learned than it might be otherwise.

I got used to reading Rebchook's real estate stories pretty much every day. Many of them were about things we were doing at the Division of Housing, but I probably always enjoyed the articles about new development the most.

Today is the third day in a row without a Rebchook story to read, and it's quite maddening to say the least.

test video

2009-02-18T22:28:00.000-07:00

Twitter: the best thing about Facebook

2009-02-10T21:50:00.006-07:00

Said Nick O'Neill of the All Facebook blog:
"My guess is that we'll see a large number of status feed applications build and while other apps will be built, any Twitter-like applications will receive the most amount of buzz."

That which makes Facebook more like Twitter can only be a good thing. What made the status updates finally interesting was the new ability to comment on them and have miniature conversations with other members. Of course, this is exactly what Twitter is good for, and with Twitter, you avoid all the obnoxious miscellaneous applications.

Naturally, I have set it up so my Facebook status changes whenever I update my Twitter status.

Facebook leads Myspace

2009-02-10T21:35:00.005-07:00

Well, according to Compete.com:

This may be the first survey we've seen that puts Facebook ahead of the News Corp.-owned MySpace in U.S. traffic. It also puts Twitter as the third-biggest social-media site in the country by total page views, with only about six million unique visitors but a whopping 54 million views.

I could never get into Myspace with its cartoonish aesthetic. More importantly, some studies have shown that Facebook features a membership that has more education and higher incomes. If you're going to blow an evening posting photos of yourself and discussing the minutiae of your life (as I have done), you might as well do it with people who have money.

Blame the media!

2009-01-28T20:50:00.003-07:00

The Society of Saint Pius X, a fringe Catholic organization in a state of suspension (I won't bore you with the technical details), has as one of its bishops a nut named Richard Williamson. Recently, Williamson sat for an interview with Swedish television, and during the interview, made it clear that he is essentially a Holocaust denier. Obviously, these views are very unpopular for good reason, but the Society's response was to blame the media:

It is shameful to use an interview on religious matters to introduce secular and controversial issues with the obvious intention of misrepresenting and maligning the activity of our religious society.

Yes, clearly the fact that Williamson was exposed as a fool was all the media's fault. The TV station could have asked Williamson about his thoughts on anything under the sun and Williamson, who is not a child, could have simply refused to answer questions on matters not related to religion. Yet Williamson, who obviously wanted to talk about the Holocaust, did not refuse, and forged ahead with his anti-Semitism. The fact that Williamson is both anti-
Semitic and stupid is not the TV station's fault, but the fact that Williamson is allowed to remain a member of the Society is the Society's fault.

Have you seen my plane and my sweet wheels?

2009-01-28T20:40:00.003-07:00

Marcus Schrencker, the Indiana investor who jumped out of a plane and faked his own death, once apparently thought that posing for this photo was a good idea:

This is the file photo used by MSNBC for some of its articles about Schrenker. It probably doesn't do much to win him sympathy among the public, or more importantly, among the members of the jury that will decide his fate in the future.

His clients who lost millions due to Schrencker's mismanagement also probably don't appreciate the high level of class necessary to take a photo with one's high-priced possessions.

Greatest. Spokesman. Ever.

2009-01-28T20:22:00.003-07:00

Today's Rocky carries an article penned by David Milstead that says that the Post is surreptitiously borrowing funds from the Denver Newspaper Agency to cover payroll. Whatever the merits of the story (which the excellent Michael Roberts covers here), the Denver News Corp. executive, Joseph Lodovic, who acted as spokesman, provided some excellent examples for how not to respond to media inquiries.

"Who cares who owes what? Money goes back and forth all the time. All the balances will get wiped out altogether in the end."

Brilliant! Just don't tell the Justice Department, since anti-trust laws governing the DNA stipulate that the Feds do in fact care who owes what.

And my favorite:

"The issue is too complicated. It's irrelevant. Who cares?"

Beautiful.

The Post likes the give the impression that it's doing spectacularly well, but in reality, it is deeply in debt and it just had its bond rating downgraded about six weeks ago.

A few seconds of the Mortgage Line9

2009-01-23T12:16:00.002-07:00

Here is a short video of what the Mortgage Line9 at Channel 9 looks like. It's not of terribly great import, but somewhat interesting (to me).

Lame comment by me

2009-01-12T21:23:00.005-07:00

In a recent article in the Grand Junction Daily Sentinel about foreclosures, I said: "It’s a totally different situation for Mesa County," said Ryan McMaken, spokesman for the division. "You guys are nowhere near in the same boat as some of the metro areas."

"You guys"?! How horrific.

We should all be categorically opposed to the use of the word "guy" to refer to anyone other than a male chum, although it turns out the word itself is quite interesting.

The word was originally used as a term to describe someone who was grotesque or very odd in some way. It comes to us by way of Guy Fawkes, the hero of the Catholic restorationists who was captured while attempting to blow up Parliament with gunpowder.

So the term, originally used to describe an effigy of Guy Fawkes that was traditionally burned by Protestants to commemorate Fawkes's execution, has its roots in anti-Catholicism and British nationalism.

Whatever its origins, my folksy use of "you guys" is no good.

Here's the article (edited down):

Mesa County foreclosures not near Front Range levels

By ANNA MARIA BASQUEZ
Saturday, December 20, 2008

A recent [CDH] foreclosure report paints Mesa County in a better light than the rest of the state.

The report tallied completed foreclosures, or foreclosures that went to sale, rather than the number of filings.

As of the end of September, there had been one completed foreclosure for every 749 houses in Mesa County. The ratio in Adams County is one in 58 houses, in Denver County one in 78 and in Pueblo County one in 102 houses.

“It’s a totally different situation for Mesa County,” said Ryan McMaken, spokesman for the division. “You guys are nowhere near in the same boat as some of the metro areas.”

McMaken said he used the number of completed foreclosures because it does not duplicate households that may have filed for foreclosure on two different mortgages, and because many foreclosure filings are stopped before going through the entire process. Sales figures were not available to use before, McMaken said.

“That number is telling me that we had a lot more lenders that withdrew the foreclosures,” Brown said. “They did not want us to take the homes to sale. They cured or withdrew and renegotiated the sale.

Year-to-date, the number of foreclosures filed in Mesa County is 445, which is more than the total for 2007, Brown said. He predicted it will reach between 450 and 460. The number of completed foreclosures will be about 101, he added.

Counties nearby are in a similar situation in terms of the number of completed foreclosures, McMaken said.

“Housing’s so tight in Garfield County that if you can’t make payments, you just sell your house, and it goes in a month,” he said. “Moffat County is the other lowest place. Where mining activity is happening, there’s just nobody foreclosing.”

When you think of foreclosures, think of the Hotline

2008-12-19T14:56:00.003-07:00

This is nice. The Hotline is now routinely mentioned as a resource every time a news outlet does a story on a topic related to foreclosures. In this story about evictions from December 17 on Channel 4, the news team discusses the Colorado Foreclosure Hotline at the end of the story. This has happily become a trend.

The more popular McMaken

2008-12-11T21:05:00.003-07:00

My uncle Herb is a Real Santa. Real Santas are men with bona fide long white beards who get paid premiums to be "Santa's Helpers" at stores and events. There is a listing of them at RealSantas.com. The good malls all have Real Santas.

Herb was Santa recently at the Orange County Market Place. According to the Newport Beach Daily Pilot:

The beginning of the Holiday shopping season at the Orange County Market Place is heralded each year with the arrival of Santa Claus.

This year Santa was helped by Anaheim resident Herb McMaken, who arrived in a red 1929 Model A roadster Saturday morning at the swap meet, waving to holiday shoppers and children.

The kids lined up to sit on Santa’s lap this year are still asking for the same stuff they always have, despite a less-than-cheery economic climate — they want toys, video games and ponies, McMaken said.

“Santa’s not worried about the economy,” McMaken said. “He still has plenty of toys.”

If Santa isn’t worried about the economy, the vendors at the swap meet are. This holiday shopping season has been slower than in past years for sellers at the Orange County Market Place, who come each week to sell everything from flip flops and T-shirts to handmade quilts.

I'm a man on the street...

2008-12-11T06:22:00.002-07:00

...since I'm not a political or business leader.

See me at the bottom of this list from the Rocky (December 4)

Reaction from local political and business leaders and people on the street Thursday to the announcement that the Rocky Mountain News is for sale:

* Gov. Bill Ritter: "I spoke earlier today with Scripps President and CEO Rich Boehne about the sale and told him I hope Colorado's oldest newspaper and longest continually operating business can survive the worst economic crisis this country has seen in decades.

Newspapers around the nation have been particularly hard hit for years, and this downturn is impacting newspapers as badly as any industry, but nobody should be writing the Rocky's obituary just yet. I have the highest regard for the Rocky's Pulitzer-prize winning journalists and for Editor/Publisher/President John Temple's involvement and leadership in the community, and I'm hopeful the community will continue to benefit from the Rocky for years to come."

* Mayor John Hickenlooper: "We have great respect for the reporters, staff and management of the Rocky Mountain News and appreciate that these are difficult economic times for many. It's hard to imagine Colorado without the Rocky. We sincerely hope there is a solution to its financial challenges."

* Sharon Linhart, managing partner of Linhart Public Relations: "It is a tough time in the newspaper business, but I hope the new owner will find a way to keep the newspaper operating. The Rocky is an outstanding newspaper with a legendary history. We are blessed in Denver to have two daily newspapers, and I hope that will be the case long into the future."

* Wendy Aiello, president of Aiello Public Relations and Marketing: "I'm devastated. We knew something was going to give, but to actually see it happen . . . it's like your foundation is crumbling. The newspaper is the soul of our city. As a public relations professional, it's certainly not good news on a very selfish basis. We've all worked in this community together for so long. We've watched this happen all over the country and have it finally hit so close to home, and in such a vibrant media market. It's such a tragic thing to see.

* Pasquale "Pocky" Maranzino, president of advertising agency Karsh & Hagan: Maranzino's connections to the paper go way back. He worked as a paperboy for the Rocky, and his father was a columnist for 33 years. Karsh & Hagan did the advertising for the Rocky from 1995 to 2000 and later for the Denver Newspaper Agency: "The Rocky Mountain News is 150 years old and is part of our society in Denver. As a Denver native, I'm saddened at the thought. I'm hoping it will continue to exist and that there will be a buyer for it.

On the other hand, I understand the economic concerns for Scripps and what's happening with the evolution in our information society. The Rocky has a great personality and, because it's a tabloid, fits into people's lifestyles better than the competition - no offense to the Post. I think there's a niche of readers, people who are segregated by their age, who really can't function without reading their daily newspapers."

* Doug Jones, owner of Jones Realty Group: "The Rocky has been synonymous with the news, growth and the voice of Denver since its birth. Hopefully, it will continue. It does suggest the magnitude of the downturn."

* Denver native Gerry Armstrong, 67, said he first started reading the Rocky Mountain News and Denver Post in the sixth or seventh grade, especially enjoying the general news, commentary and business.

"I got to read it after Dad," said Armstrong, a real estate investor and shareholder rights advocate. He especially remembers examining the 1952 election results with his grandfather.

Armstrong said he would miss the Rocky Mountain News if it folds - "competition drives better quality" - but he also said he believes the newspapers aren't what they used to be.

"I read both newspapers regularly. Both are getting so light on the number of pages, more condensed than I like."

* Curtis Kennedy, attorney for the Association of U S West Retirees, said he has read both local newspapers since moving to Denver in the early 1980s. He often proudly tells friends from other states that Denver is fortunate to have two newspapers.

He said he believes two newspapers provide a more balanced view of a community, with readers often getting two sides or different dimensions to the same story.

"I can tell you from my experience living in big cities with two newspapers that every time they'd go down to one, it was the worst thing that could happen for an informed public. It's a death knell for the informed reader."

* Gary Bauer, independent real estate broker: "I'm not surprised Scripps is selling something, but I'm surprised it is the News. I would think they would be selling other assets first. It will be interesting to see if Phil Anschutz wants to buy it. He would seem to be one logical purchaser."

* Marty Jones, a devout newspaper reader and publicist for craft brewer Oskar Blues Brewery, was stunned when told of the Rocky's sale: "Oh my gosh! That's terrible news," he said on the phone.

"I feel awful for all of the staffers there who got this news, especially right before the holidays," Jones wrote in a follow-up e-mail.

"When I moved here 13 years ago, one of the biggest attractions of Denver was its rare status as a two-newspaper town," Jones said.

"That makes for a great and well-informed city. I hate to see it end, big loss for the town and our culture."

* Ryan McMaken, spokesman for [CDH]: "If the PR industry here knew what was good for it, we'd all just put together some kind of joint stock company and buy the News. I'm just going to pray that at the VERY least, the News continues as some kind of sleek online news source."

Old-school clipping: higher education vouchers

2008-12-10T18:40:00.000-07:00

Once upon a time, the organization I headed became embroiled in a massive overhaul of higher education which eventually produced the "College Opportunity Fund." The fund is not without its critics although it seemed like a fairly decent idea at the time. Here is a report on the event from the days of yore. I hadn't looked at this in a while, and I'm quite surprised at how candid I am in my comments.

Twitter's role controversial

2008-11-29T23:17:00.004-07:00

Alexander Wolfe of Information Week notes that the police were concerned that the Tweeters might be giving away strategic information. Wolfe doubts that any info of use was given away.

The most important piece of information to come out of all of the Tweeting is that "official" journalism is no longer the best source for breaking news of this kind:

I'd add that Mumbai is likely to be viewed in hindsight as the first instance of the paradigmatic shift in crisis coverage: namely, journalists will henceforth no longer be the first to bring us information. Rather, they will be a conduit for the stream of images and video shot by a mix of amateurs and professionals on scene.

Mumbai Attack Aftermath Detailed, Tweet by Tweet

2008-11-29T11:47:00.004-07:00

The Wired blog has a great post on how social media is providing some of the best current coverage coming out of the Mumbai massacres.

I'm often asked even by technophiles what purpose Twitter serves. This is just one example if its use in crises. I recently read that the American Red Cross also uses Twitter to provide updates to its network of volunteers.

I'm reminded of how in 1991 when Gorbachev was deposed in a temporary coup d'état, Internet Relay Chat, aka "IRC", was used to relay information on the crisis since all television and radio in Russia had been shut down.

I love Bloomberg

2008-11-26T07:01:00.001-07:00

Not the man, but his news empire. With Bloomberg's streaming video and detailed reporting, I really don't see the need for the Wall Street Journal at all. The Journal has become obnoxiously politicized in recent years, while Bloomberg has flowered into the place for financial news. And, Bloomberg actually offers unusual viewpoints such as those of investor Jim Rogers. Most business news sources ignored the financial panic in its early days, while Bloomberg was way out front.

Managing expectations

2008-11-26T07:00:00.001-07:00

Managing expectations with the Foreclosure Hotline is a big deal for us. Since it's administered by non-profits, capacity and response time are a constant challenge:

"For many homeowners, getting help can be frustrating"
November 23, 2008
THE (Colorado Springs) GAZETTE

At a time when record numbers of people have fallen into foreclosure in the Colorado Springs area, Brooks believes he's exactly the type of troubled homeowner that lawmakers, housing advocacy groups and consumer counseling agencies want to help. So, he's called his lender to see if he can work out a deal, contacted financial counseling services and pursued assistance through a new federal program.

"People like this fellow (Brooks) are trying to think ahead and be pro-active before they reach the panic zone, but they're at a disadvantage because they're trying to access the same resources as other people ... who already are in foreclosure and who have a more urgent situation," said Ryan McMaken, a CDH spokesman.

Student Association Activities and Photos

2008-11-22T05:19:00.004-07:00

Lobbying doesn't interest me much anymore, but I found an old page of the CSA web site I created a few years back, so I saved a few of the pages, since I realized I had forgotten most of the information here.

I'm especially proud of the fact that I was able to do so much with such a tiny budget.

From the old web site:

Legislation and Lobbying

Legislation and Public Policy - The Colorado Student Association works with the Colorado General Assembly and the Colorado Commission on Higher Education to ensure that student interests are considered when decisions are made regarding financial aid, transfer credits, curriculum, program selection, governance, tuition rates, and higher education funding. Three times a year, our representative assembly assigns the Board of Directors a legislative agenda.

The Colorado Student Association holds a seat on the advisory committee of the Colorado Commission of Higher Education, and CCHE ad hoc committees such as the Governor's Blue Ribbon Committee on Higher Education Finance and Governance and the General Education Coordinatting Committee. CSA provides full time lobbying services.

Many organizations settle for a lobbyist that merely "monitors legislation," but the Colorado Student Association actively promotes legislation, secures sponsors for new legislation, and meets with all higher education lobbyists on a regular basis during the legislative session from January to May. Guests at our events in recent years have included House Majority Leader Keith King, CCHE Executive Director Tim Foster, and a variety of Commission members and CCHE staff.

Since legislators generally make up their minds about legislation long before bills are heard in committee, the idea that one can properly influence legislation by testifying before committees is a myth. Publicity shots and sound bytes cannot substitute for personal, full-time lobbying services provided by our staff.

Our office one block south of the State Capitol Building allows us to easily attend all relevant hearings, committee meetings, and floor debates related to state higher education statutes.

History of Recent Legislative Action

As the budget process is a year-round process, CSA is always working to ensure affordable tuition rates for Colorado's students. Much of this work is done through our seat on the Colorado Commission of Higher Education, but is also accomplished through regular interaction with the Joint Budget Committee during their fall hearings on the Dept. of Higher Education. This is a constant concern of ours from the time the Dept. submits its budget to the JBC in late summer to the time that budget bill is introduced the following April. As with the Commission, financial aid is also a top priority for us.

We also work on non-budgetary legislation as outlined below. The below list only includes major legislative changes, however. Please contact our office more more information:

2004 Session - This upcoming year, CSA has secured Rep. Nancy Spence (Chair, House Education Committee) as sponsor of new legislation creating optional programs for students seeking tuition stability over a four or five year period. This legislation would enable students to enter into agreements with public higher education institutions that would guarantee students a fixed tuition rate for the duration of the degree program. Students who choose to enter into these agreements could then enter school knowing that they would not be looking at any unexpected tuition increases a few years down the line.

In addition to other pending issues, CSA also plans to make sure that the amendments we were able to add to last years "College Opportunity Fund" legislation remains in the new COF bill. Please contact us for more information.

2003 Session - CSA worked on primarily two issues this session: student privacy legislation and the higher education voucher legislation. With identify theft as the largest property crime in America, CSA wrote and secured sponsorship (Rep. Nancy Spence) for a bill (HB 1175) prohibiting the use of a student's social security number in class rosters, identification cards, and library accounts. This legislation was designed to compel the CU, CSU, and Community College systems to end the practice of using student SSN's as primary identification numbers. This legislation passed and was signed into law in April 2003.

CSA also authored numerous amendments to the higher education voucher bill (also known as the College Opportunity Fund, HB 1336) during the legislative session. We were successful in having eight of these added to the legislation. Perhaps most important was our increase to the "credit hour cap". The bill failed during the 2003 session but will be introduced again in 2004. Please contact us for more information on the credit cap and the text of these Amendments.

CSA was the only lobbying group other than CCHE itself opposed to defunding CCHE through the budget long bill. The legislature, encouraged by individual colleges, initially supported reducing CCHE's budget to under 100,000 dollars effectively destroying all transfer-credit, distance education, and quality indicator systems that benefit students. CSA was able to make it clear that students depend greatly on the statewide coordination offered by the Commission, and the amendment was killed.

2002 Session - CSA was perhaps most notable during this session for amending out the misdemeanor portions of the higher education "riot bill." Originally, this bill contained language stipulating that a student would be expelled from all state higher education institutions in the event that he or she was convicted of one of four "riot related offenses." Three of these were felonies, but the fourth offense was a minor misdemeanor offense which CSA did not feel was appropriate in a list of mandatory expulsion offenses. Our amendment was successfully passed on Senate Education committee removing this lesser offense.

2001 Session - The 2001 session was a good one for students with the passage of HB1263, the "Student Bill of Rights" creating a statewide system of "guaranteed transfers" assuring students credit for specific core courses regardless of where a student might transfer within the state. This bill was also supplemented by HB 01-1298, the common course numbering system, making it easy for students to determine which courses are equivalent to those at other campuses where one might wish to transfer later. In response to this legislation, CCHE also created a statewide appeals process for students who believe they have no received full credit for transferred courses. CSA staff wrote key provisions of this bill, and we sit on the GE coordinating committee. Please contact us for more information.

After the session, the Governor Appointed his Blue Ribbon Committee on Higher Education Governance. CSA was invited to the table as member of the advisory committee, and was present at all meetings. This was especially important for us, as the genesis of the "credit hour cap" that was to show up in the "College Opportunity Fund" was in this committee.

These photos are not great, but keep in mind that we certainly didn't have funds for a digital camera in 2003:

This is a break-out session at one of our conferences.

Here is a panel discussion during one of our board meetings.

This is a presentation at one of our meetings by the president of the state Student Loan Program.

Identity theft and student ID numbers

2008-11-19T18:56:00.000-07:00

Probably the best thing I did as director of the Colorado Student Association was successfully lobby for legislation (which I wrote) prohibiting the use of Social Security numbers as student ID numbers. Here's a clip from the University of Colorado faculty newspaper, The Silver and Gold Record:

Bill would ban use of SSNs as student numbers

January 30, 2003

By Marianne Goodland

HB 1175, sponsored by Rep. Nancy Spence (R-Centennial), would require all institutions of higher education in Colorado to set up randomly-generated identification numbers and end the practice of using SSNs as student ID numbers. Currently, institutions must use SSNs to interface with the federal government on financial aid, student employment and selective service registration. Barbara Todd, CU-Boulder registrar, said this week that it is legal for an institution to use the SSN as a student identifier, and that SSNs routinely appear on class rosters and in the Student Information System (SIS). Faculty use SSNs to look up student records in the SIS and to verify student identities in classes.

It is illegal for anyone to display a student's SSN without his/her consent, which might occur through posting grade lists on a faculty office door. Those lists often identify the student with all or part of the SSN. It is also illegal to pass a roster around in a class to ask students to check-off their names if that roster includes the SSN. "Anytime an instructor passes a roster around or posts it on his/her door, it is displaying student information without the student's consent," Todd said.

Ryan McMaken of the Colorado Student Association testified Monday that the Family Educational Rights and Privacy Act (FERPA) has for almost 30 years prohibited the release of student Social Security numbers to anyone other than those with a "legitimate educational interest." Most institutions have taken steps to ensure that they do not use a student's SSN to identify the student, McMaken said, but many of the violations still occur at the classroom level. "It often depends on the preference or policy of the individual faculty member," McMaken told the committee.

Violations occur even when only a partial SSN is used, such as on class exams or papers. Three years ago, the U.S. Department of Education ruled that the release of even a partial Social Security number violated FERPA, and McMaken told the committee that in Colorado faculty often use the last four digits in a SSN to identify students on exams or papers. However, he said, many Colorado residents have the same first five digits, and as a result it would be easy for someone to identify the entire SSN once the last four digits are known, he said.

In addition, according to CSA, students have complained that SSNs are often required to renew library books over the phone or online and the numbers are printed on ID cards required for access to dorms, cafeterias and other facilities. McMaken said such violations "are blatantly illegal."

More on higher ed vouchers

2008-11-19T18:11:00.000-07:00

Colorado Governor Signs College Voucher Law
State will become first in nation to offer program
By Steven K. Paulson
Associated Press
Community College Times
May 25, 2004

DENVER - Colorado became the first state with a college voucher program this month as Gov. Bill Owens signed a law that will give high school graduates hundreds of dollars to attend state schools, public and private.

The Republican governor said vouchers send a message to high school students that college is not out of reach and that taxpayer money is available to help. He also said the program will spur competition for scholars.

“The more students you attract, the better your institution can do,” Owens said at the May 10 signing. “Today Colorado becomes the first state in the nation to transform the way it funds higher education by empowering individual students.”

The National Conference of State Legislatures said no other state has attempted a voucher program on such a scale: Stipends will be available to all Colorado undergraduate students who qualify for in-state tuition. They can use the money for up to 145 hours of credit, with some allowance for unusual circumstances.

The students do not get a check. Instead, they apply for the stipend when they register and the state sends the money to the school. The amount is set each year by the Legislature, depending on the state budget.

When the program begins in the fall of 2005, the amount will be $2,400 for students attending a public school and $1,200 for low-income students attending three private institutions: Regis University, a Jesuit institution, the University of Denver and Colorado College.

The law says the money can go to religious schools as long as they are not “pervasively sectarian.”

Jacob Garcia, a 23-year-old community college student who wants to major in journalism, said vouchers will force schools to improve.

“I like it when colleges compete for students,” Garcia said.

Ryan McMaken, director of the Colorado Student Association that represents about 60,000 college students, said the program does not put more money into higher education. But he said attaching a dollar figure to each student will make it harder for lawmakers to make cuts.

“This does put us on a better footing. This is half of the solution, making people aware the money is there,” he said.

There is concern among lawmakers that vouchers may have to be cut next year unless voters ease fiscal limits in the state Constitution or agree to use millions of dollars Colorado gets from the national settlement with the tobacco industry.

Without one of those steps, lawmakers warn, higher education and Medicaid will be on the chopping block when they cut an estimated $254 million next year.
Owens is considering whether to call a special legislative session to address the fiscal restraints after the Legislature failed to come up with a plan to present to voters in November.

The vouchers give schools some breathing room: They do not have to count voucher tuition toward revenue limits imposed by the Taxpayer’s Bill of Rights (TABOR).

University of Colorado President Betsy Hoffman said vouchers are a first step until taxpayers agree to loosen the constitutional restrictions of TABOR and Amendment 23, which requires increased annual spending on K-12 public education.

Tuition and sticker shock

2008-11-19T18:10:00.000-07:00

AUGUST 28, 2003
Tuition jumps amid sagging economy

By ZACH AHMAD
Colorado Springs Independent

As college students flood into classrooms, in Colorado they may be finding themselves with a little less cash to spare.

In June, Colorado Gov. Bill Owens approved a controversial tuition rate hike plan recommended by the Colorado Commission on Higher Education for all state-funded colleges and universities, sending some institutions' costs of attendance to their highest levels ever. With the state's budget feeling the pressure from a dragging Colorado economy, increasing tuitions became the testy compromise between state officials, universities and student groups.

Locally, the typical student attending the University of Colorado at Colorado Springs -- where $8 million in state funding was slashed -- saw his or her tuition jump from $2,750 annually to $3,025, not taking into account housing, meals or mandatory student fees. At Pikes Peak Community College, resident students taking a full schedule will pay between $1,580 and $1,980 -- an approximate 5 percent increase over last year.

Despite a nearly 10 percent tuition hike, UCCS spokesman Tom Hutton says the university did its best to first cut nonessential spending. No faculty or staff vacancies were filled, no computer upgrades were made on campus, and university travel budgets were curtailed.

"Raising tuition was a last resort," said Hutton. "We tried to cut expenses wherever possible. No one got a salary increase this year, from our custodians to the university chancellor. I think students understood that this wasn't something we wanted to do; it's something we had to do."

Other state schools saw an even more significant boost. Yearly tuition at the University of Colorado at Boulder rose a stinging 15 percent from $2,695 to $3,190, the second largest percentage increase in the university's history. Colorado State University hiked up comparable 9.6 percent to $2,908, and the price tag on attendance at University of Northern Colorado in Greeley leveled at $3,207 after shooting 8.6 percent.

The real world

The increases did not come out of the blue. Tuition hikes are a current trend at public universities everywhere, but they are becoming even more substantial with growing state budget cuts during bad economic weather. With education costs at their highest and financial security at a low, the effect on low-income students is more painful than ever, causing some to rethink the value of a college education.

"There's probably going to be some sticker shock this year," said Ryan McMaken, executive director of the Colorado Student Association, a nonprofit legislative lobby for students in higher education. "For the poorest students this will definitely have an impact. If you're in that category, an increase of more than $100 a month is a major difference. There will no doubt be some who won't be willing to pay for higher education when they don't feel financially secure."

With their own savings and parental assistance not going as far as they once did, cash-strapped students are getting schooled in the real world of economics. Ramen noodles and canned spaghetti no longer provide the answer. Many students are moving back in with their parents or taking on long commutes to live in cheaper housing markets. They are also tallying substantial debts.

Christie Leighton, associate director of Student Financial Services at Colorado State University in Fort Collins, said that while students must approach loans cautiously, they should ponder the option.

"Sometimes students are reluctant to take out loans, but it's something to consider," said Leighton. "If a loan allows them to graduate, over time they're going to get a better-paying job because they have a college education."

Storm to stay

Whatever the benefits of a college education, the rising cost is not a trend likely to die anytime soon. This year's hikes followed only somewhat smaller increases the year before, and Colorado schools have been actively seeking more leeway to raise rates even higher.

Last May, the governor vetoed a bill -- strongly lobbied for by university administrators -- that would have allowed the University of Colorado system to bypass the state's ability to overrule any tuition adjustments. With the struggling economy, the financial storm hanging over higher education could stay a while longer.

"There will certainly be some form of tuition hikes coming next year, as there have been in the past," said McMaken. "When income is going up that's not a problem, but that's not what's happening right now."

The fixed-tuition bill

2008-11-19T18:09:00.000-07:00

This is some legislation I wrote and successfully pushed in 2004. It became law, although I don't know if it was ever implemented as I left CSA shortly after this article appeared.

Fixed-tuition bill offers students same rate for all college years
Chris Kampfe and Kyle Endres
The CSU Collegian
Issue date: 5/4/04

Four-year college students could pay an unchanging tuition amount every year under a bill passed by the state legislature on Monday.

House Bill 1207, barring Gov. Bill Owens' veto, will allow students to sign a contract upon admission to state higher-education institutions that would grant them a fixed-tuition rate if they promise to graduate in a certain amount of time.

"It's to try to even out price increases and tuition increases so a family can plan their budget and say we know that for the next four years, 'We've got to come up with this amount of money,'" said Rick O'Donnell, executive director of the Colorado Commission on Higher Education.

The fixed rate would be strictly optional for students.

"In my own opinion, in the way I've seen the bill most recently, though it hasn't passed yet, it makes it optional to offer these fixed-tuition contracts to students, and it makes it optional for students to participate," said Gerard Bomotti, vice president for Administrative Services.

The bill was proposed by Rep. Nancy Spence, R-Centennial, and co-drafted with Ryan McMaken, executive director of the Colorado Student Association.

McMaken said he believes state universities support the idea.

"It isn't a mandate," McMaken said. "It's something they wanted to do in the past."

Bomotti is wary of implementing such contracts in unpredictable economic times.

"An institution can best offer a fixed-tuition program over a four-year period if the environment is more stable," Bomotti said. "Now, the financial environment in Colorado is not stable."

The bill's implementation is contingent on the passage of the College Opportunity Fund, which is also awaiting Owens' approval. This bill would grant stipends, or vouchers, to in-state students for use at state universities, rather than universities receiving funding directly from the state.

Some stipend supporters say the College Opportunity Fund provides the opportunity for universities to attain enterprise status, which would give them more financial flexibility.

Owens will approve the bill this month, O'Donnell said.

He said the fixed-tuition rate would offer students and families more choices in paying for college.

"Not every student or family's going to want it, but it was an option that the institutions saw they could offer that some students would maybe find (is) an easier way to be able manage the cost of college," he said.

But Sen. Peggy Reeves, D-Larimer County, agrees with Bomotti that the fixed-tuition contract bill's timing is questionable.

"I think that we're in a great state of flux within higher education right now," she said. "I think we need to implement the college-opportunity vouchers and understand how that mechanism works and how that shakedown works before we implement this proposal."

Student Debt

2008-11-19T18:07:00.000-07:00

Here's a partial clipping on student debt. The issue of credit-card debt was big at the time. I also chaired a panel on the topic at the annual conference of the Colorado Student Loan Program (now College Invest).

CONSOLIDATE STUDENT DEBT, EXPERTS SAY LOW INTEREST RATES CAN ADD UP TO BIG SAVINGS

Rocky Mountain News
July 8, 2002
Julie Poppen News Staff Writer

...Record low interest rates have Colorado college graduates who are knee-deep in debt angling to consolidate their loans.

There's never been a better time to do it, financial aid officials say. The historic low interest rates on Federal Stafford loans of 3.46 percent for a student in school and 4.06 percent for many graduates kicked in a week ago.

"A lot of students are fairly careless about how they calculate what they're going to be paying back in the future," said Ryan McMaken, president of the Colorado Student Association...

USA Today on voucher plan

2008-11-19T17:12:00.000-07:00

USAToday
Posted 5/10/2004 9:20 PM Updated 5/11/2004 1:31 PM

Colorado to create college voucher plan
DENVER (AP) — Gov. Bill Owens signed Colorado's first-in-the-nation college voucher plan into law Monday, calling it a landmark step that will empower thousands of students.

Owens said the vouchers send a message to high schoolers that college is not out of reach and that state money — up to $2,400 per voucher — is available to help.

"Quality education isn't about institutions, it's about the future of our students," he said. "It's a new day for higher-education funding in America, and I'm proud to say that it's dawning in Colorado."

Stipends will be available to all Colorado undergraduate students who qualify for in-state tuition.

Every year, the Legislature would set the value of the stipend based on the state budget. For next fall, the amount is set at $2,400 for students attending a public institution in Colorado, and $1,200 for low-income students attending three private institutions: Regis University, which is a Catholic institution, the University of Denver and Colorado College.

The National Conference of State Legislatures says no other state has attempted a voucher program on such a scale.

But students might not get the full $2,400 this year because of budget problems, state lawmakers have said. They said the amount will have to be cut to $1,600 unless voters ease fiscal restraints embedded in the state constitution or agree to use millions of dollars Colorado gets from the national settlement with the tobacco industry.

Opponents of the voucher program complained that giving state funds to private colleges would draw money away from state institutions and could be challenged in court. Owens and others, however, say vouchers would encourage more students to go to college.

Ryan McMaken, director of the Colorado Student Association, which represents about 60,000 college students, said the plan does not put more money into higher education. But he said it could make it harder to cut funding.

This article also appeared on CNN.com:

Nation's first college voucher program OK'd

Monday, May 10, 2004 Posted: 2:28 PM EDT (1828 GMT)

DENVER, Colorado (AP) -- Gov. Bill Owens signed Colorado's first-in-the-nation college voucher plan into law Monday, calling it a landmark step that will empower thousands of students...

A recent meat-and-potatoes placement

2008-11-16T14:04:00.003-07:00

Tuesday, October 28, 2008
Apartment vacancies hit 6.5 percent
Denver Business Journal

Apartment vacancies in metro Denver increased in the third quarter because of the soft national economy, but remained relatively low by recent standards, according to a report issued Tuesday by the Division of Housing...

“The rental market is being affected by the financial markets,” said Ryan McMaken, community relations director for the Division of Housing.

9News piece on foreclosures

2008-11-10T22:11:00.006-07:00

It is apparently unspeakably difficult to produce a screenshot of video of myself in which I look decent. However, this was a pretty good story.

While I prefer to put the division director in front of the camera, sometimes I have to be the spokesman:

A partial transcript:

"From 2006 to 2007 we had this huge jump, 40 percent. The number jumped from about 28,000 filings in 2006 to 39,000 filings in '07. I'm estimating we'll probably see about 45,000 to 50,000 filings in 2008," said Ryan McMaken with the Division of Housing.

McMaken says a recent report from the Pew Charitable Trust that forecasted one out every 25 homeowners in Colorado would likely go into default in the next two years wasn't necessarily offering any new information. McMaken pointed out that such a statistic doesn't necessarily indicate that there will be a correlating increase in foreclosure.

"One in 25 does seem very high, but you want to keep in mind that this is only dealing with defaults, so we're talking about those homeowners that have become 90 days overdue in their payments. It doesn't necessarily mean that default will end up in foreclosure," said McMaken.

Many have been wondering if the crisis on Wall Street has "bottomed out." The same could be asked of the housing/foreclosure crisis. Much like the nebulous stock market, the answer for the housing sector is fluid.

"That's very difficult to say, certainly for 2008 I don't think it's the case that we've bottomed out," said McMaken.