While homeowners battle tough economic challenges, the trend of disappearing land lines is increasing in an number of U.S. household, according to a report from the National Center for Health Statistics.
As of June 2010, about 26.6% of households had only a wireless phone, up from 13.6% in 2007. And the number of wireless-only homes is increased in every state throughout the U.S.
Stephen Blumberg, a member of the Centers for Disease Control and Prevention's National Center for Health Statistics states that "the phrase 'home telephone number' is going the way of rotary dial phones."
The trend of more people using their cellphones more often "poses an even greater sense of urgency to conduct studies to try to determine whether there are or there are not ill effects from the use of cellphones to the brain," says Nora Volkow, director of the National Institute on Drug Abuse. "The reality is (phones are) widely utilized, and yet we have minimal information."
Lower economic status households are more likely to be wireless-only, according to the researchers, who used data and trends from tens of thousands of respondents to the National Health Interview Survey and the Census Bureau's annual American Community Survey.
"States such as Arkansas, Mississippi and Kentucky have a higher proportion of households living with low income," Blumberg added, "and giving up a land line is one way to save money."
Even if Raleigh homes have a land line, it is not necessarily used. Many are deciding to cut the cord. "All they get are solicitations, and most calls are done on a wireless phone anyway, so it represents a waste of money," says analyst Charles Golvin of Forrester Research.
The wireless-only trend among Apex homes is not likely to be reversed. "Unless the carriers are able to create some new applications or services such as video calling," Golvin says.
In North Carolina, Cary homes that rely on wireless phones are being advised to check their local emergency preparedness department to see if its "Reverse 911" communication systems can incorporate cellphones.
The trend toward wireless phones presents some difficulties for public safety officials, says Francisco Sanchez of the Harris County Homeland Security office. "But the benefit is that now we have a communications device that people carry all the time. So we need to know how to utilize that if we are going to be able to do our jobs effectively in the future."
Friday, April 22, 2011
Tuesday, March 22, 2011
February Shows Weak Homes Sales
In February Americans purchased less previously occupied homes. The weak sales and rise in foreclosures pushed home prices down to their lowest level in nearly nine years.
The National Association of Realtors said Monday that sales of previously occupied homes fell last month to a seasonally adjusted annual rate of 4.88 million. That's down 9.6 percent from 5.4 million in January. The pace is far below the 6 million homes a year that economists say represents a healthy market.
Nearly 40 percent of the sales last month were either foreclosures or short sales, when the seller accepts less than they owe on the mortgage.
One-third of all sales were purchased in cash -- twice the rate from a year ago. In troubled housing markets such as Las Vegas and Miami, cash deals represent about half of sales.
The median sales price fell 5.2 percent to $156,100, the lowest level since April 2002.
Winter storms also hampered sales in many parts of the country, including five inches of snow in Dallas-Fort Worth area just before this year's Super Bowl. That was nearly twice the metro area's annual average.
Still, housing has been weak for some time. Millions of foreclosures have forced down home prices and more are expected this year. Tight credit has made mortgage loans tough to come by. And some potential buyers who could qualify for loans are hesitant to enter the market, worried that prices will fall further. High unemployment is also deterring buyers. Job growth, while expected to pick up this year, will not likely raise home sales to healthier levels.
The median price of a new home is now 45 percent higher than the median price for a previously occupied home, the Realtors group said. A more normal difference is about 15 percent, an indication that old homes on the market are being sold at comparatively cheap, and affordable, levels.
The number of first-time homebuyers rose to 34 percent of the market, partly because of rising rents. A more healthy level of first-time homebuyers is about 40 percent, according to the trade group.
But home prices and sales are uneven across the country. In Miami, where prices have dropped 18.6 percent since last year, sales have skyrocketed 46.4 percent over the same period. In St. Louis, where prices rose 8.2 percent over the past year, sales have fallen 8.6 percent.
One obstacle to a housing recovery is the glut of unsold homes on the market. Those numbers rose to 3.49 million units in February. It would take 8.6 months to clear them off the market at the February sales pace. Most analysts say a six-month supply represents a healthy supply of homes.
Analysts said the situation is much worse when the "shadow inventory" of homes is taken into account. These are homes that are in the early stages of the foreclosure process but have not been put on the market yet for resale. For February, sales fell in all four regions of the country, by 12.2 percent in the Midwest, 10.2 percent in the South, 8 percent in the West and 7.2 percent in the Northeast.
Sales of single-family homes fell 9.6 percent to an annual rate of 4.25 million units. Sales of condominiums fell 10 percent to a rate of 630,000 units.
Monday, October 25, 2010
What Does the 'Foreclosure Crisis' Mean for You?
The Wall Street Journal
For the vast majority of homeowners, new questions about the state of foreclosures appear to be irrelevant. Few people seem to have been wrongly thrown out of their homes, and those who have been are generally months or years behind on their mortgage payments.
But the fallout from the crisis is beginning to be felt in real-estate markets across the country, particularly in places dominated by vacation homes and investment properties. Some of the worst-hit areas could be Western ski towns, because fall is the busiest time of the year for sales.
Real-estate salespeople in some of those places are worried. "September and October are usually the height of the selling-season for us," says Rich Armstrong, who owns the brokerage Rare Properties in Jackson Hole, Wyo. "Now we are seeing a number of what we call 'fence sitters,' people who would have leapt in even a month ago, but now are waiting on the sidelines."
The "foreclosure crisis" is a result of the frenzied real-estate boom and bust of the past decade. Banks made foolish loans, and borrowers signed up for them—only to default later, as the economy slumped. Banks rushed to reclaim properties, launching a record number of foreclosure proceedings.
In the past several weeks flaws have emerged in that complex process. Because of the high volume of foreclosures, the documentation supporting legal actions was prepared hastily, and some homes were seized improperly.
Yet the far bigger worry is what happens next. A frenzy of lawsuits and banks' examinations of their own practices could throw more of the millions of foreclosures of the past few years into legal jeopardy. Attorneys general in all 50 states are investigating, and plaintiffs' lawyers are working hard to perfect their legal strategies for suits on behalf of people who have been foreclosed on.
The suits might well fail. But just the threat that past foreclosure rulings might be overturned could result in collateral damage. In some places, banks are rushing foreclosed properties to market. In others, buyers are stepping back, refusing to buy foreclosed properties or "short sales"—homes sold by owners for less than the mortgage balance. In markets already beset with large inventories of foreclosed properties, the result could be a slower recovery.
Coastal markets and ski areas are feeling the most anxiety. Some already are littered with foreclosures—in part because they're dominated by second-home and investment properties. Those owners are more willing to walk away from a house that isn't their primary residence.
Foreclosure tracker RealtyTrac estimates that, nationwide, 30% to 35% of properties in foreclosure are owned by investors or were second homes. In Aspen, Colo., the figure is about 60%, says Kim McKinley, owner of McKinley Sales Real Estate in Basalt and Aspen, Colo. If foreclosure proceedings slow from here, inventory could jump, leading to price weakness later.
"We're concerned that the phantom inventory buildup will cause a more rapid and drastic drop in prices in Aspen, which is just getting started in terms of foreclosures coming to the market," says Ms. McKinley.
The timing of the foreclosure mess is especially inconvenient for ski towns, given the fall selling season.
Property owners are growing nervous. In Park City, Utah, lenders are quickly unloading foreclosed homes ahead of what could be a long, stalled foreclosure process, says Joe Trabaccone, a real-estate agent there.
On Oct. 11, for example, J.P. Morgan Chase put up for sale an 8,000-square-foot home adjacent to a private gated golf course. Mr. Trabaccone initially recommended the property be listed for $1.6 million, but Chase opted for $1.26 million. "They are offering these homes far too low just to hurry up and sell them," Mr. Trabaccone says.
Even so, it hasn't worked. A buyer made an offer and signed a contract, but then backed out.
In South Lake Tahoe, Calif., on Thursday, Freddie Mac, the big government-sponsored guarantor of mortgages, put a foreclosed home that had just been listed for sale on hold, freezing the property until paperwork could be straightened out. The foreclosure mess "seems to be filtering down and it could be an impact," says Doug Rosner, the broker who had listed the home. Three other properties in town were also frozen, another real-estate agent says.
The "sand states" of Arizona, California, Florida and Nevada are being hit as well. These areas, too, have a lot of vacation and investment properties—and a lot of foreclosures.
Robin Speronis, a real-estate broker in Cape Coral, Fla., says business had been picking up recently, with several inquiries a day—until the latest foreclosure scandal broke. Since then, she says, inquiries have shriveled to just one in the past week.
Susan Weeks, 55 years old, and her husband, Eddie, aren't optimistic. The couple had expected to retire and downsize when they bought a condo in Clermont, Fla., near Orlando, in 2007 for $192,000. Their plan was to sell their primary residence 10 minutes away and live in the condo. The trouble: They can't sell their first home.
The Weeks paid $269,000 for their three-bedroom home in 2004. The house next door, a bit larger, is listed at $185,000, Ms. Weeks says.
The couple has decided to move back to their primary home and take a renter for the condo. But while that brings in $850 a month, the Weeks take a $450-a-month hit on the condo —on top of the $2,400 a month they pay every month on their primary home.
"We're just going to wait it out," she says.
The possible foreclosure wars to come loom so largely over Florida markets that Ms. Speronis is urging condo sellers to consider any offer they get, even if it is far below asking price or what is owed on the mortgage.
Dianne Cloutier, a records supervisor in Chelmsford, Mass., had been looking for a retirement property in Cape Coral, but decided to wait because of the foreclosure mess. "It's left us on hold until we are sure the banks have legitimately foreclosed on people and that nobody can come back on us to get their property back," she says.
Foreclosures aren't the only problem. Short sales are getting more difficult to pull off, too.
In Bend, Ore., agents say buyers are avoiding short sales or even backing out of contracts because they don't want to deal with paperwork hassles or the chance of a court challenge later.
"I have some people saying 'I don't want to mess with bank-owned properties or short sales,'" says Dianne Willis, principal broker with RE/MAX Sunset Realty in Sunriver, Ore. "They're reluctant because it can be a frustrating process, especially for those who are looking to make a big move."
The short sales "can be very frustrating," adds Becky Ozrelic, of with Steve Scott Realtors in Bend. "You just have buyers waiting and waiting."
For sellers, lining up a short sale was tough even before the latest foreclosure crisis. Banks and mortgage "servicers," the outfits that process payments, already had been scrambling to handle surging workloads.
Mike and Kim Schwarz of San Jose, Calif., are coming up on the one-year mark on their short-sale saga.
The couple had acquired several investment properties over the past few years, including one in Thousand Oaks, Calif., for $751,000. After the tenants stopped paying rent, the Schwarzes couldn't cover the payments and decided to sell, Mr. Schwarz says.
They lined up a buyer in November 2009, and started working with their loan servicer on the short sale. For lenders, short sales are ugly because they guarantee a loss, but they often are preferable to a foreclosure, in which the lender is saddled with a tough-to-sell house.
The servicer, Residential Credit Solutions, took six months to process the paperwork, the Schwarzes say. Faxes and emails were sent, but nothing happened, Mr. Schwarz says.
"We typically don't hear from borrowers about long delays," says Dennis Stowe, president of Residential Credit.
The buyer walked away from the deal in June. The couple found another buyer in August, and resubmitted the short-sale paperwork. Mr. Schwarz says he has sent paperwork to Residential Credit four times since.
On Friday, Mr. Schwarz says, Residential called to tell him the short-sale paperwork looked good and the sale should close in mid-November.
Says Mr. Schwarz: "They didn't make it easy."
But the fallout from the crisis is beginning to be felt in real-estate markets across the country, particularly in places dominated by vacation homes and investment properties. Some of the worst-hit areas could be Western ski towns, because fall is the busiest time of the year for sales.
Real-estate salespeople in some of those places are worried. "September and October are usually the height of the selling-season for us," says Rich Armstrong, who owns the brokerage Rare Properties in Jackson Hole, Wyo. "Now we are seeing a number of what we call 'fence sitters,' people who would have leapt in even a month ago, but now are waiting on the sidelines."
The "foreclosure crisis" is a result of the frenzied real-estate boom and bust of the past decade. Banks made foolish loans, and borrowers signed up for them—only to default later, as the economy slumped. Banks rushed to reclaim properties, launching a record number of foreclosure proceedings.
In the past several weeks flaws have emerged in that complex process. Because of the high volume of foreclosures, the documentation supporting legal actions was prepared hastily, and some homes were seized improperly.
Yet the far bigger worry is what happens next. A frenzy of lawsuits and banks' examinations of their own practices could throw more of the millions of foreclosures of the past few years into legal jeopardy. Attorneys general in all 50 states are investigating, and plaintiffs' lawyers are working hard to perfect their legal strategies for suits on behalf of people who have been foreclosed on.
The suits might well fail. But just the threat that past foreclosure rulings might be overturned could result in collateral damage. In some places, banks are rushing foreclosed properties to market. In others, buyers are stepping back, refusing to buy foreclosed properties or "short sales"—homes sold by owners for less than the mortgage balance. In markets already beset with large inventories of foreclosed properties, the result could be a slower recovery.
Coastal markets and ski areas are feeling the most anxiety. Some already are littered with foreclosures—in part because they're dominated by second-home and investment properties. Those owners are more willing to walk away from a house that isn't their primary residence.
Foreclosure tracker RealtyTrac estimates that, nationwide, 30% to 35% of properties in foreclosure are owned by investors or were second homes. In Aspen, Colo., the figure is about 60%, says Kim McKinley, owner of McKinley Sales Real Estate in Basalt and Aspen, Colo. If foreclosure proceedings slow from here, inventory could jump, leading to price weakness later.
"We're concerned that the phantom inventory buildup will cause a more rapid and drastic drop in prices in Aspen, which is just getting started in terms of foreclosures coming to the market," says Ms. McKinley.
The timing of the foreclosure mess is especially inconvenient for ski towns, given the fall selling season.
Property owners are growing nervous. In Park City, Utah, lenders are quickly unloading foreclosed homes ahead of what could be a long, stalled foreclosure process, says Joe Trabaccone, a real-estate agent there.
On Oct. 11, for example, J.P. Morgan Chase put up for sale an 8,000-square-foot home adjacent to a private gated golf course. Mr. Trabaccone initially recommended the property be listed for $1.6 million, but Chase opted for $1.26 million. "They are offering these homes far too low just to hurry up and sell them," Mr. Trabaccone says.
Even so, it hasn't worked. A buyer made an offer and signed a contract, but then backed out.
In South Lake Tahoe, Calif., on Thursday, Freddie Mac, the big government-sponsored guarantor of mortgages, put a foreclosed home that had just been listed for sale on hold, freezing the property until paperwork could be straightened out. The foreclosure mess "seems to be filtering down and it could be an impact," says Doug Rosner, the broker who had listed the home. Three other properties in town were also frozen, another real-estate agent says.
The "sand states" of Arizona, California, Florida and Nevada are being hit as well. These areas, too, have a lot of vacation and investment properties—and a lot of foreclosures.
Robin Speronis, a real-estate broker in Cape Coral, Fla., says business had been picking up recently, with several inquiries a day—until the latest foreclosure scandal broke. Since then, she says, inquiries have shriveled to just one in the past week.
Susan Weeks, 55 years old, and her husband, Eddie, aren't optimistic. The couple had expected to retire and downsize when they bought a condo in Clermont, Fla., near Orlando, in 2007 for $192,000. Their plan was to sell their primary residence 10 minutes away and live in the condo. The trouble: They can't sell their first home.
The Weeks paid $269,000 for their three-bedroom home in 2004. The house next door, a bit larger, is listed at $185,000, Ms. Weeks says.
The couple has decided to move back to their primary home and take a renter for the condo. But while that brings in $850 a month, the Weeks take a $450-a-month hit on the condo —on top of the $2,400 a month they pay every month on their primary home.
"We're just going to wait it out," she says.
The possible foreclosure wars to come loom so largely over Florida markets that Ms. Speronis is urging condo sellers to consider any offer they get, even if it is far below asking price or what is owed on the mortgage.
Dianne Cloutier, a records supervisor in Chelmsford, Mass., had been looking for a retirement property in Cape Coral, but decided to wait because of the foreclosure mess. "It's left us on hold until we are sure the banks have legitimately foreclosed on people and that nobody can come back on us to get their property back," she says.
Foreclosures aren't the only problem. Short sales are getting more difficult to pull off, too.
In Bend, Ore., agents say buyers are avoiding short sales or even backing out of contracts because they don't want to deal with paperwork hassles or the chance of a court challenge later.
"I have some people saying 'I don't want to mess with bank-owned properties or short sales,'" says Dianne Willis, principal broker with RE/MAX Sunset Realty in Sunriver, Ore. "They're reluctant because it can be a frustrating process, especially for those who are looking to make a big move."
The short sales "can be very frustrating," adds Becky Ozrelic, of with Steve Scott Realtors in Bend. "You just have buyers waiting and waiting."
For sellers, lining up a short sale was tough even before the latest foreclosure crisis. Banks and mortgage "servicers," the outfits that process payments, already had been scrambling to handle surging workloads.
Mike and Kim Schwarz of San Jose, Calif., are coming up on the one-year mark on their short-sale saga.
The couple had acquired several investment properties over the past few years, including one in Thousand Oaks, Calif., for $751,000. After the tenants stopped paying rent, the Schwarzes couldn't cover the payments and decided to sell, Mr. Schwarz says.
They lined up a buyer in November 2009, and started working with their loan servicer on the short sale. For lenders, short sales are ugly because they guarantee a loss, but they often are preferable to a foreclosure, in which the lender is saddled with a tough-to-sell house.
The servicer, Residential Credit Solutions, took six months to process the paperwork, the Schwarzes say. Faxes and emails were sent, but nothing happened, Mr. Schwarz says.
"We typically don't hear from borrowers about long delays," says Dennis Stowe, president of Residential Credit.
The buyer walked away from the deal in June. The couple found another buyer in August, and resubmitted the short-sale paperwork. Mr. Schwarz says he has sent paperwork to Residential Credit four times since.
On Friday, Mr. Schwarz says, Residential called to tell him the short-sale paperwork looked good and the sale should close in mid-November.
Says Mr. Schwarz: "They didn't make it easy."
Other Ways the 'Foreclosure Crisis' Could Sting Homeowners
The foreclosure mess could hurt homeowners in another way: The costs of buying a home and paying off the mortgage are likely to go up, say housing experts.
The rising costs will come both during the closing and throughout the life of the loan.
At the closing, the cost of title insurance, which protects a property buyer from claims of ownership made by other people, is likely to rise, industry officials say. Title insurance is one of those annoying costs that can sneak up on a buyer during a close; premiums average around $2,000 across states, says Tim Dwyer, CEO of insurer Entitle Direct Group.
The foreclosure mess has sent insurers scrambling. One of the largest, Old Republic Title Insurance, told its agents on Oct. 1 not to issue policies on homes that have been foreclosed by GMAC Mortgage or J.P. Morgan Chase. And on Wednesday, the nation's largest title insurer, Fidelity National Financial, said lenders must vouch for the accuracy of their paperwork before it will insure properties.
Just like homeowners-insurance rates rise after a hurricane, the rates for title insurance are expected to rise, to compensate for the added risk.
The turmoil will likely lead to pricey premiums for new homeowners, says McLean, Va.-based housing economist Tom Lawler. Adds Cameron Finlay, chief economist at mortgage lender Lending-Tree.com: "Any time there is uncertainty in the market or risk implied, it follows that costs go up."
Other costs could be felt during the life of the loan. Until the current mess, servicing loans was a low-margin, high-volume business. Servicers collect mortgage payments from borrowers and send them off to mortgage holders, and if the loan gets into trouble, they manage the foreclosure. Few doubt this process will get costlier now that it is under scrutiny from regulators and the courts. That higher cost likely will show up in higher interest rates for borrowers.
Both of these higher costs also would hit homeowners who refinance their loans.
How much the costs of buying a home will rise is unknown. Mortgage industry officials say it is too soon to tell. And no one believes the costs will significantly change the price of a home. But with the housing market still weak, the uncertainty is making the prospect of buying—or selling—a home that much dicier.
The foreclosure mess could hurt homeowners in another way: The costs of buying a home and paying off the mortgage are likely to go up, say housing experts.
The rising costs will come both during the closing and throughout the life of the loan.
At the closing, the cost of title insurance, which protects a property buyer from claims of ownership made by other people, is likely to rise, industry officials say. Title insurance is one of those annoying costs that can sneak up on a buyer during a close; premiums average around $2,000 across states, says Tim Dwyer, CEO of insurer Entitle Direct Group.
The foreclosure mess has sent insurers scrambling. One of the largest, Old Republic Title Insurance, told its agents on Oct. 1 not to issue policies on homes that have been foreclosed by GMAC Mortgage or J.P. Morgan Chase. And on Wednesday, the nation's largest title insurer, Fidelity National Financial, said lenders must vouch for the accuracy of their paperwork before it will insure properties.
Just like homeowners-insurance rates rise after a hurricane, the rates for title insurance are expected to rise, to compensate for the added risk.
The turmoil will likely lead to pricey premiums for new homeowners, says McLean, Va.-based housing economist Tom Lawler. Adds Cameron Finlay, chief economist at mortgage lender Lending-Tree.com: "Any time there is uncertainty in the market or risk implied, it follows that costs go up."
Other costs could be felt during the life of the loan. Until the current mess, servicing loans was a low-margin, high-volume business. Servicers collect mortgage payments from borrowers and send them off to mortgage holders, and if the loan gets into trouble, they manage the foreclosure. Few doubt this process will get costlier now that it is under scrutiny from regulators and the courts. That higher cost likely will show up in higher interest rates for borrowers.
Both of these higher costs also would hit homeowners who refinance their loans.
How much the costs of buying a home will rise is unknown. Mortgage industry officials say it is too soon to tell. And no one believes the costs will significantly change the price of a home. But with the housing market still weak, the uncertainty is making the prospect of buying—or selling—a home that much dicier.
Tuesday, September 28, 2010
Raleigh, NC Refinance Mortgage Rates Around 4.25% for 30 Year Fixed Interest Loans
Examiner
While Raleigh, NC has held up well when it comes to the mortgage market collapse there are still areas that have seen home prices drop in the last several months. With three major universities in the area and many government jobs available there are many reasons to believe the housing market will improve in Raleigh, NC.
For those looking to stay in the area and invest in their homes it is good to know that Raleigh, NC refinance mortgage rates are around 4.25% for a 30 year fixed interest loan at the end of September 2010. Be aware that it takes a great financial history to lock in to these low loan rates in October 2010.
Many analysts continue to make mortgage rate predictions that state that 30 year fixed home loans will stay very low as long as Ben Bernanke and the Federal Reserve Bank feel that the economy is still struggling. Just last week Bernanke came out and stated that interest rates were going to be held quite low for an extended period of time. This is very good news to those who have made very good financial decisions in the past.
For those who did not make good financial decisions there are many options when it comes to lower a home loan monthly payment. The Making Home Affordable government program has helped many to reduce payments as millions of Americans continue to search for Wells Fargo home loan modification. With Wells Fargo gobbling up Wachovia during the credit crisis it is the case that this major financial institution has many loans that mean the modification requirements.
In a time when mortgage interest rates are very close to all time lows it might be smart to consider refinancing. Residents of Raleigh, NC can be rest assured that jobs will remain in this area as the capital will not move and the major universities of NC State, UNC and Duke will always be within 25 miles of the state capital.
Many analysts continue to make mortgage rate predictions that state that 30 year fixed home loans will stay very low as long as Ben Bernanke and the Federal Reserve Bank feel that the economy is still struggling. Just last week Bernanke came out and stated that interest rates were going to be held quite low for an extended period of time. This is very good news to those who have made very good financial decisions in the past.
For those who did not make good financial decisions there are many options when it comes to lower a home loan monthly payment. The Making Home Affordable government program has helped many to reduce payments as millions of Americans continue to search for Wells Fargo home loan modification. With Wells Fargo gobbling up Wachovia during the credit crisis it is the case that this major financial institution has many loans that mean the modification requirements.
In a time when mortgage interest rates are very close to all time lows it might be smart to consider refinancing. Residents of Raleigh, NC can be rest assured that jobs will remain in this area as the capital will not move and the major universities of NC State, UNC and Duke will always be within 25 miles of the state capital.
Friday, August 20, 2010
Local-Food Entrepreneurs bring Produce directly to Eaters
Lexington Herald-Leader
RALEIGH, N.C. - "From farm to fork" has long been the rallying cry of the eat-local movement.
But getting the food from the farm has been a barrier for some consumers who don't have time to shop at farmers markets or who find community-supported agriculture programs, better known as CSAs, inconvenient.
Enter a new breed of business - a middleman between consumers and farmers - that tweaks the old model.
Traditionally, a consumer who joins a farmer's CSA pays up to $600 in the winter for a weekly share of produce from spring to fall. Though the programs are popular - there are more than 100 in North Carolina, up from 35 in 2002 - many people cannot pay for a whole season of produce in advance, volunteer on a farm or pick up the food at designated times as many programs require. Other people simply don't know what to do with an abundance of beets or kale.
That has created an opportunity for businesses such as Papa Spuds and The Produce Box, which allow customers to pay for their produce as they go - generally $20 to $30 per box. They offer customers more choice and generally stock products from several farms rather than just one. In addition, the boxes are delivered to customers' homes.
These new businesses are bringing hundreds of new customers to the table, helping to make farming financially viable for more small farmers.
In two years, The Produce Box has grown from 25 customers to nearly 3,000. At the end of last season, the Raleigh company was filling 900 boxes a week, and owner Courtney Tellefsen said demand is growing steadily this year. Some areas have a waiting list to become a Produce Box customer.
This type of system has been feasible only for a few years, said Rob Meyer, co-founder of Papa Spuds, a similar operation in Cary, N.C. He credits his partnership with Eastern Carolina Organics, a Pittsboro, N.C., group that acts as a distributor for local organic products.
Meyer's company, which offers meat and produce, also contracts directly with dozens of farms throughout the state to get the volume and variety customers demand.
"If you were going to do local organic in our size in this area, there aren't enough farms," he said.
Sandi Kronick, CEO of Eastern Carolina Organics, said the new businesses complement farmers' other efforts to reach consumers. Eastern Carolina Organics is farmer-owned and distributes organic products from farmers to restaurants, retailers and companies such as Papa Spuds.
"CSAs are overbooked by February, and there's always going to be customers who choose to go pick up off the farm," Kronick said. "The point is that the money is flowing throughout the local community, and hopefully it's resulting in more acres turning into organic in the state."
The Produce Box partners with Lee Farms in Dunn, N.C., where the sorting and packing is done on site, often within hours of the items' being picked. The company then relies on a network of women who do not work outside the home to distribute the boxes throughout the Triangle.
Papa Spuds gets bulk shipments from Eastern Carolina Organics at its Cary warehouse, where everything is packed and then distributed.
"It took us a year to turn a profit," Meyer said. "We bootstrapped the hell out of it at first. We got our feet and hands really dirty."
For customers like Jessica McRackan the new businesses make eating local feasible.
McRackan, 29, of Cary gave birth to a daughter at the end of March, an event that put an end to her regular trips to the farmers market.
"I like it better," she said of the deliveries. "I love the environment of the farmers market; it's a lot of fun. But it's often hot and it's crowded."
McRackan has become such a fan of The Produce Box service that she writes a blog dedicated to sharing what she does with the contents of each box she receives. She posts meal plans and recipes to help others figure out what to do with less familiar produce.
But getting the food from the farm has been a barrier for some consumers who don't have time to shop at farmers markets or who find community-supported agriculture programs, better known as CSAs, inconvenient.
Enter a new breed of business - a middleman between consumers and farmers - that tweaks the old model.
Traditionally, a consumer who joins a farmer's CSA pays up to $600 in the winter for a weekly share of produce from spring to fall. Though the programs are popular - there are more than 100 in North Carolina, up from 35 in 2002 - many people cannot pay for a whole season of produce in advance, volunteer on a farm or pick up the food at designated times as many programs require. Other people simply don't know what to do with an abundance of beets or kale.
That has created an opportunity for businesses such as Papa Spuds and The Produce Box, which allow customers to pay for their produce as they go - generally $20 to $30 per box. They offer customers more choice and generally stock products from several farms rather than just one. In addition, the boxes are delivered to customers' homes.
These new businesses are bringing hundreds of new customers to the table, helping to make farming financially viable for more small farmers.
In two years, The Produce Box has grown from 25 customers to nearly 3,000. At the end of last season, the Raleigh company was filling 900 boxes a week, and owner Courtney Tellefsen said demand is growing steadily this year. Some areas have a waiting list to become a Produce Box customer.
This type of system has been feasible only for a few years, said Rob Meyer, co-founder of Papa Spuds, a similar operation in Cary, N.C. He credits his partnership with Eastern Carolina Organics, a Pittsboro, N.C., group that acts as a distributor for local organic products.
Meyer's company, which offers meat and produce, also contracts directly with dozens of farms throughout the state to get the volume and variety customers demand.
"If you were going to do local organic in our size in this area, there aren't enough farms," he said.
Sandi Kronick, CEO of Eastern Carolina Organics, said the new businesses complement farmers' other efforts to reach consumers. Eastern Carolina Organics is farmer-owned and distributes organic products from farmers to restaurants, retailers and companies such as Papa Spuds.
"CSAs are overbooked by February, and there's always going to be customers who choose to go pick up off the farm," Kronick said. "The point is that the money is flowing throughout the local community, and hopefully it's resulting in more acres turning into organic in the state."
The Produce Box partners with Lee Farms in Dunn, N.C., where the sorting and packing is done on site, often within hours of the items' being picked. The company then relies on a network of women who do not work outside the home to distribute the boxes throughout the Triangle.
Papa Spuds gets bulk shipments from Eastern Carolina Organics at its Cary warehouse, where everything is packed and then distributed.
"It took us a year to turn a profit," Meyer said. "We bootstrapped the hell out of it at first. We got our feet and hands really dirty."
For customers like Jessica McRackan the new businesses make eating local feasible.
McRackan, 29, of Cary gave birth to a daughter at the end of March, an event that put an end to her regular trips to the farmers market.
"I like it better," she said of the deliveries. "I love the environment of the farmers market; it's a lot of fun. But it's often hot and it's crowded."
McRackan has become such a fan of The Produce Box service that she writes a blog dedicated to sharing what she does with the contents of each box she receives. She posts meal plans and recipes to help others figure out what to do with less familiar produce.
Tuesday, August 17, 2010
Government Starts Talks about New Mortgage System
Associated Press
Talk of shrinking the government's involvement in the mortgage market is growing. Just don't expect action any time soon.A conference Tuesday at the Treasury Department is the first of many steps toward restructuring the nearly $11 trillion mortgage market. So far, rescuing mortgage giants Fannie Mae and Freddie Mac has cost the government more than $148 billion. That number is expected to grow.
Treasury Secretary Timothy Geithner pledged "fundamental change" to the structure of Fannie and Freddie, which profited tremendously during good times but burdened taxpayers with losses when the housing market went bust. He said the two companies weren't the only cause of the financial crisis, but made it worse.
Geithner, however, did not offer a specific exit strategy for Fannie and Freddie. He said only that, "it is our responsibility to make sure that we create a system that is not vulnerable to these same failures happening again."
With Republicans likely to pick up seats in Congress in November, however, the Obama administration will need support from both political parties for the changes it proposes.
Reflecting this reality, Geithner said that "the failures that produced the system we have today were bipartisan. The solution must be as well."
Executives and mortgage experts are prepared to tell Obama officials that the government must stay in the business of backing U.S. mortgages even if Fannie and Freddie disappear someday.
"At the end of the day, the government will still have a very large role to play," said Mark Zandi, chief economist at Moody's Analytics and a panelist at the event. Others include mortgage executives from Bank of America Corp. and Wells Fargo & Co, plus Bill Gross, managing director of bond giant Pimco and Lewis Ranieri, one of the creators of mortgage bonds.
The Obama administration's management of Fannie and Freddie has been under fire for months from Republicans on Capitol Hill. In December, the Treasury Department eliminated a $400 billion cap on how much money it would give the mortgage giants to keep them from failing. Sen. John McCain, R.-Ariz., has called that a "taxpayer-backed slush fund" and called for the support to be wound down.
Many in the mortgage industry say that's not realistic.
"There has to be a game plan," said Paul Leonard, vice president of government affairs at the Housing Policy Council, a mortgage industry group. "You can't just pull the plug on them."
Fannie and Freddie buy mortgages and package them into securities with a guarantee against default. They have ensured that millions of Americans can get home loans - even after the housing market collapsed.
The two mortgage giants, the Federal Housing Administration and the Veterans Administration together backed about 90 percent of loans made in the first half of the year, according to trade publication Inside Mortgage Finance.
At some point the government will have to scale back the level of support it provided the housing and mortgage markets during the recession and financial crisis.
"The government's footprint in the housing market needs to be smaller than it is today," said Shaun Donovan, President Barack Obama's housing secretary.
Most of the plans being circulated to reshape the mortgage market call for the government to guarantee that investors who buy mortgage-backed securities receive their money even if borrowers default.
Under this system, Fannie and Freddie could either be returned to private ownership or phased out completely. Fannie and Freddie, or their replacements, would pay the government to insure the loans. That money could be tapped if the housing market collapses.
"A government guarantee is both a desirable and necessary component of the country's housing finance system," wrote John Gibbons, a Wells Fargo & Co. executive vice president, in a letter last month to the Treasury Department.
Geithner said that there is a "strong case to be made" for such a government guarantee, but said the government needs to charge enough money to make sure the taxpayer does not get hit with losses in the future.
Thursday, August 5, 2010
Caterpillar Picks NC for Second Plant in Two Weeks
WRAL
SANFORD, N.C. — Heavy equipment manufacturer Caterpillar Inc. announced an expansion at its Sanford plant on Thursday afternoon, bringing more than 300 jobs back to a facility that has seen cutbacks in recent years.
Gov. Beverly Perdue and other state and local officials were at the plant to herald the $28.3 million expansion, which is expected to add 325 jobs over the next four years. An unidentified Caterpillar supplier is also expected to bring 160 jobs to North Carolina to work with the plant, officials said.
“For the second time in less than a week, Caterpillar is making a major investment in North Carolina and strengthening its ties as a corporate citizen of our state,” Perdue said in a statement. “By expanding its stake in North Carolina, Caterpillar has demonstrated that our own investments in education, worker training, transportation and infrastructure have paid off.”
Last Friday, the company said it would build a $426 million factory in Winston-Salem to produce axle units for large mining equipment. It could employ about 500 full-time and contract workers in five years.
Caterpillar will build a 270,000-square-foot addition to the Sanford plant that will house logistics and robotic welding lines to produce skid steer loaders and other equipment, officials said. About half of the new production is slated for export, they said.
Construction is expected to start in September, with production beginning by next July, officials said. The average annual wage for the new jobs will be $35,602, plus benefits, they said.
The Sanford plant and another Caterpillar facility in Clayton have experienced several rounds of layoffs since late 2008, as the company adjusted to the global economic slowdown.
Lee County's unemployment rate is more than 12 percent, and Sanford Mayor Cornelia Olive said it was difficult for her to stop smiling on Thursday with hundreds of new jobs on the horizon.
"This has been a hard couple years for Lee County," Olive said.
Charles Childress, who lost his job as a machinist five months ago, already lined up an interview for Monday for a job at Caterpillar.
"It's hard to find a job. It really is," Childress said. "I know a lot of people out there need work, and there's a lot of people out there qualified (for the Caterpillar jobs)."
Caterpillar employs 1,026 full-time workers in seven North Carolina counties, and with the economy stabilizing, the Peoria, Ill.-based company appears to be gearing up for growth again.
Lee County commissioners in June offered Caterpillar up to $900,000 in incentives to land the plant expansion.
Caterpillar also was awarded a $600,000 grant from the One North Carolina Fund, which provides cash grants to attract business projects to the state. No money is paid up front, and companies must meet job creation and investment targets to obtain the funding.
Also, the state Economic Investment Committee voted Thursday to award a Job Development Investment Grant to Caterpillar. Under the terms of the JDIG, the company is eligible to receive a grant equal to 75 percent of the state withholding taxes on the new jobs for each year in which it meets annual performance targets.
If Caterpillar meets the all of the targets during an 11-year period, it could garner $3.46 million from the JDIG.
Gov. Beverly Perdue and other state and local officials were at the plant to herald the $28.3 million expansion, which is expected to add 325 jobs over the next four years. An unidentified Caterpillar supplier is also expected to bring 160 jobs to North Carolina to work with the plant, officials said.
“For the second time in less than a week, Caterpillar is making a major investment in North Carolina and strengthening its ties as a corporate citizen of our state,” Perdue said in a statement. “By expanding its stake in North Carolina, Caterpillar has demonstrated that our own investments in education, worker training, transportation and infrastructure have paid off.”
Last Friday, the company said it would build a $426 million factory in Winston-Salem to produce axle units for large mining equipment. It could employ about 500 full-time and contract workers in five years.
Caterpillar will build a 270,000-square-foot addition to the Sanford plant that will house logistics and robotic welding lines to produce skid steer loaders and other equipment, officials said. About half of the new production is slated for export, they said.
Construction is expected to start in September, with production beginning by next July, officials said. The average annual wage for the new jobs will be $35,602, plus benefits, they said.
The Sanford plant and another Caterpillar facility in Clayton have experienced several rounds of layoffs since late 2008, as the company adjusted to the global economic slowdown.
Lee County's unemployment rate is more than 12 percent, and Sanford Mayor Cornelia Olive said it was difficult for her to stop smiling on Thursday with hundreds of new jobs on the horizon.
"This has been a hard couple years for Lee County," Olive said.
Charles Childress, who lost his job as a machinist five months ago, already lined up an interview for Monday for a job at Caterpillar.
"It's hard to find a job. It really is," Childress said. "I know a lot of people out there need work, and there's a lot of people out there qualified (for the Caterpillar jobs)."
Caterpillar employs 1,026 full-time workers in seven North Carolina counties, and with the economy stabilizing, the Peoria, Ill.-based company appears to be gearing up for growth again.
Lee County commissioners in June offered Caterpillar up to $900,000 in incentives to land the plant expansion.
Caterpillar also was awarded a $600,000 grant from the One North Carolina Fund, which provides cash grants to attract business projects to the state. No money is paid up front, and companies must meet job creation and investment targets to obtain the funding.
Also, the state Economic Investment Committee voted Thursday to award a Job Development Investment Grant to Caterpillar. Under the terms of the JDIG, the company is eligible to receive a grant equal to 75 percent of the state withholding taxes on the new jobs for each year in which it meets annual performance targets.
If Caterpillar meets the all of the targets during an 11-year period, it could garner $3.46 million from the JDIG.
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