It’s been a busy old week in online video, what with the news that YouTube hit a billion unique views per month and the launch of potentially the biggest (and most lucrative from the makers point of view) online talent contest ever, but there are also some gems that you may have missed. We take a quick look at the new web series from Reddit, how Twitter users can keep up with March Madness, and YouTube’s foray into the Middle East and possible paid subscription features.
Twitter Gets March Madness Video Highlights In Almost Real Time
I love my sports but as a Brit, I hadn’t even heard of March Madness, NCAA or Brackets until last week. Now, after a bit of research it all makes more sense (go Michigan State!) and I, along with anyone that follows @MarchMadness on Twitter, will be able to see highlights from the games, as quickly as 20 seconds after they air. Hosted by SnappyTV via Turner Broadcasting, the short clips not only create advertising revenue for Twitter (from AT&T and Coke) but provide a powerful second screen experience for users. We can’t wait for the data to come out on this one, the possibilities and potential for future sporting, and other, events is immense.
Read More: Lost Remote
Reddit Launches Web Series To Explain Things Like You Are 5
If you have spent any significant time at all on the interweb’s biggest time suck, Reddit, you’ll have come across one of their most popular subreddits /ExplainLikeI’mFive. As the name suggests, it’s a place to go and ask questions regarding any topic that you need to understand in more detail, the answers being provided by other Redditors who aim to make complicated subjects as simple to understand as possible. It’s a very active and wildly popular forum on the site with over 250,000 subscribers so it makes complete sense that Reddit would take the idea and launch their own web series around it. The YouTube funded venture, which debuted this week with 3 episodes, aims to be a catalyst for the Reddit community to participate in the creation of video content itself, rather than Reddit lead. Erik Martin, Reddit general manager confirms that:
For us, it’s more about encouraging the Reddit community and bigger community of producers, filmmakers and animators out there to create content, video, web series, shows … based on Reddit content.
I for one hope that it does because I don’t think that the videos that Reddit have released work as well as they could have. Watching a group of fidgety 5 five olds listen to grown ups explain the crisis in the Middle East or how the Stock Market works isn’t the most compelling thing I’ve ever seen. I understand the literal interpretation but there is so much scope for creativity within the Reddit community that hasn’t yet been tapped into. If you want a taste of how good the ELI5 subreddit can be take a look at these threads:
Read More Hollywood Reporter
YouTube Extends Partner Program To Egypt, Saudi Arabia and UAE
YouTube announced that they were opening up their Partnership program to the United Arab Emirates (UAE), Saudi Arabia and Egypt in a bid to encourage more activity from those countries, and to reward those who are already active. If their account is in good standing, users in these regions can monetize their videos via their YouTube settings. The decision comes soon after YouTube was temporarily banned in Egypt over politically sensitive content although that was lifted earlier this month. YouTube’s Strategic Partners Development Manager for the Middle East and North Africa, Haisam Yehia states that:
YouTube has seen dramatic increases in Egypt. Opening up the YouTube Partner Program in Egypt is a great step to help content creators develop their skills and provide original local content.
Read More The Next Web
YouTube To Charge For Premium Subscriptions? It’s Looking Likely
It’s been much speculated upon but could YouTube finally be at the point of enabling paid subscriptions on the site? YouTube Vice President Robert Kyncl dropped a heavy hint on Wednesday when he told reporters that
it is incredibly important that subscriptions should be available to create “additional revenue streams” for content creators
Read More WSJ
Harlem Shakes Vs Gangham Style: Twitter Showdown
Harlem Shake + Gangham Style + Twitter = awesome infographic
Worried about predictions of rising mortgage rates, additional increases in home prices and new costs for FHA borrowers, first-time homebuyers are kicking off the spring buying market in years, despite skimpy inventories and late winter weather across much of the nation.
According to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey, first-time buyers accounted for 34.5 percent of home purchase transactions in February based on a three-month moving average, the second monthly increase for first-time homebuyers.
First-time homebuyer traffic surged in February. The HousingPulse Homebuyer Traffic Diffusion Index for first-time homebuyers, an indicator of future home purchases, hit a four-year survey high of 66.4% in February. Any score above 50 percent with the index reflects an increase in home shopping traffic.
“First-time homebuyers are the wildcard in the upcoming spring-summer homebuying season,” said Thomas Popik, research director for Campbell Surveys. “We see strong first-time homebuyer traffic, but it’s still not clear that the traffic will translate into increased purchases, because first-time homebuyers are dependent on low-downpayment financing, such as FHA mortgages, and announced FHA program changes will take effect this spring.”
In the April to June timeframe, FHA will be increasing its Monthly Insurance Premium and require payment of the MIP for the full term of the loan.
While first-time homebuyers represented the fastest growing category of home purchasers between January and February, purchases by current homeowners saw the biggest drop fell from 44.3 percent to 42.5 percent. That was the lowest market share for current homeowners recorded by the HousingPulse survey since last June.
The Campbell/Inside Mortgage Finance findings are similar to data released by Realtor.com last week that suggests buyers are getting an early start this year (See Early Bird Buyers Try to Beat Tight Inventories).
The Federal Reserve’s policy of buying mortgage-backed securities to keep mortgage rates low may be bolstering upper tier home values rather than helping to make homeownership more affordable for entry-level buyers.
For decades home buying demand has directly reflected mortgage interest rates, but no more. One question that has baffled policy makers for six year is: Why haven’t housing markets responded to historically low mortgage rates?
In fact, record low rates have had an impact, according to a new analysis by three contributing editors of Home Value Forecast, just not the impact that the Fed anticipated.
“It is very likely that the top tiers of the owner occupied housing market are the ones benefiting the most from lower mortgage rates as this group has been less affected by credit score downgrades or more restrictive underwriting,” the economists said.
Since the housing crash in 2008, the economists, James R. Follain, Norman Miller, and Michael Sklarz, argue three factors have made lower mortgage rates relatively useless for lower income buyers.
- Credit scores for many households have been impacted by defaults, loan modifications, foreclosures, job losses and the breadth of the impact has been sufficient to affect millions of households who now must become or are already renters. Even though buying may be cheaper than renting, such households have little choice but to sit on the sidelines for a few more years.
- Tight underwriting has increased both the time required to secure a mortgage loan and the challenges for those with less secure income streams. Those paid based on self-reported productivity are being affected more severely since the lenders are now requiring more conservative assumptions on future earnings. Appraisals are also being kicked back if they are not conservative in the selection of appraisal comps, and so the risk tolerance pendulum has swung towards extreme conservatism.
- The investment appeal of housing and presumption that prices can only go up has lost its shine. Many households had stretched in the 2000-2005 run up and some even invested in second homes or investment properties hoping to flip these units at higher prices. Those late to the party got burned.
The economists analyzed the impact of low rates for fixed rate mortgages on sales in two major markets, Chicago and Phoenix,
“Affordability is definitely improved when mortgage rates are lower and yet the beneficiaries of these more attractive mortgage rates are not evenly distributed among households of all incomes and wealth. It is very likely that the top tiers of the owner occupied housing market are the ones benefiting the most from lower mortgage rates as this group has been less affected by credit score downgrades or more restrictive underwriting,” they concluded.
“At the same time we expect that investors have supported the lowest price tiers and are now bidding up the remaining REO sales in an attempt to lap up what is left of distress. Prices in the bottom housing price tiers are still dealing with foreclosure inventory hangovers in some markets with slow and clogged foreclosure systems. Markets where distress has been dispatched more expediently seem to be recovering the fastest,” they said.
Mortgage approval rates have risen nearly 20 percent over the past 12 months yet there is virtually no evidence that lenders are relaxing underwriting standards, according to the February originations report from Ellie Mae.
In February some 56.8 percent of all mortgage applications, both purchase mortgages and refinancings, were approved by lenders using Ellie Mae’s Encompass360 software, which handles about 20 percent of all U.S. mortgage originations. That’s an increase of 18.6 percent from the 47.9 percent approved a year ago. Approval rates have risen quickly in recent months. For 2012, the average closing rate for all mortgages was only 49 percent, 15.9 percent below the February closing rate.
Home buyers taking out a purchase mortgage to buy a home have been more successful than homeowners seeking to refinance. Some 61.7 percent of home buyers were approved for a mortgage in February compared to 54.7 percent of refinancing homeowners.
The data show almost only a slight decline in only one of the three key factors lenders use for mortgage approvals: FICO scores, loan to value ratios and debt to income ratios. Loan to value ratios have risen to 80 today compared to 76 a year ago, an increase of 5.2 percent but median FICO scores for all approved loans are less than one percent lower than they were a year ago, down from 750 to 745. Debt to income ratios are exactly the same as a year ago: 23 percent and 35 percent when mortgage payments are included.
Despite the improved percentage of approvals, mortgages are taking a little longer to process than a year ago. Purchase loans took 47 days to close in February, slightly longer than the 45 days it took a year ago. Refinancings are taking significantly longer today than a year ago, 50 days compared to 44 days.
While the rest of the nation’s housing markets experience various levels of recovery, most markets in Florida seem to be relapsing to the heyday of the Foreclosure Era after a brief period of improvement.
With delinquencies and defaults ranking among the worst in the nation, Florida is also burdened with extraordinary backlogged inventories in this judicial state which is a nexus for foreclosure legal battles that have slowed processing down more than elsewhere. The result is that Florida’s beach resorts and vacation spots are easy pickings for hedge fund investors.
Jack McCabe, a pre-eminent Florida real estate economist, begins a conversation with some frightening numbers:
- Florida is once again leading the nation in new foreclosures. In February RealtyTrac reported that Florida posted the nation’s highest state foreclosure rate for the sixth consecutive month in February, reporting one in every 282 housing units with a foreclosure filing during the month. Florida cities accounted for seven of the nation’s 10 highest metro foreclosure rates in February, led by the Miami, Orlando, Ocala, Tampa and Palm Bay metro areas in the top five spots.
- More than 1.1 million of Florida’s 9 million residences, or roughly 11 percent, are in some stage of distress that most likely will result in sales in the next two to three years. To put that into perspective, the entire national visible inventory of foreclosures today is 1.1 million, according to CoreLogic.
- About 550,000 mortgage holders in Florida have not made a mortgage payment in more than 90 days but have not received a notice of foreclosure. Banks shelved new foreclosure filings for much of 2012 while several lawsuits were pending and previous fraudulent foreclosure filings were adjudicated. As a result, the state’s shadow inventory has ballooned. At the end of 2012, 371,119 foreclosure cases were open in Florida.
- The current backlog of unsold inventory is nearly half as large as all the foreclosures completed in the state over the past six years. Since 2006, 450,000 foreclosures have been completed in Florida. Banks still own 200,000 real estate owned properties, or REOs.
Florida’s foreclosure problems have blunted the positive rate of price increases achieved the so-called Florida Phenomenon two years ago and only one of the state’s markets, Tallahassee registered a negative media list price compared to last year in Realtor.com’s February report.
One of the most important outcomes of Florida’s chronic foreclosure crisis is the arrival of massively financed hedge funds ready to spend billions to buy foreclosures as cheaply as 50 cents on the dollar in some of the world’s finest resort destinations. Investors played the central role the renaissance in 2011 and now McCabe reports they are very active.
Large investors, including Waypoint Homes of California and Blackstone Group are very active in the state. Blackstone has focused on the Tampa market and erroneous report circulated earlier this year that Blackstone planned to spend a billion dollars in the Tampa market. Now it is reportedly spending a reported $100 million per week to buy single-family homes and has purchased 250 single-family homes in the Sarasota area.
One measure of the impact of hedge funds investors is bulk sales of foreclosures sold before they are marketed as REOs and listed through Realtors on multiple listing services.
“It used to be that Realtors handled 75 to 77 percent of the transactions in a normal marketplace,” said McCabe. “But now I think it’s closer to 60 percent.”
Funds planning to buy, rehab and rent foreclosures have an improving market. The loss in homeownership, damaged credit and job losses have driven rental demand to the highest level on record. In 2005, Florida had a 71 percent-29 percent split between homeowners and renters. That ratio has rapidly changed to 63 percent buyers and 37 percent renters.
Though hedge fund purchases on a national level have had minimal impact, in the nation’s hottest foreclosure markets hedge funds, or institutional investors, are contributing to double digit foreclosure price increases and dramatic declines in REO inventories.
A new analysis of 16 of the leading foreclosure markets by CoreLogic economist Sam Khater suggests that institutional investors are driving up prices in six hot foreclosure markets where institutional investors’ purchases increased last year.
“The media has focused attention on institutional investors using cash to invest in single-family residential properties to rent, but relative to the overall market, the scale of their purchases is still very small,” Khater said. He noted that Blackstone, reportedly the largest hedge fund investor, has committed to buy 125,000 properties in 2013. By contrast, small investors purchased sone 600,000 homes using first-lien financing last year.
However, hedge funds are increasing their investments and in a few selected markets their impact was very large last year.
Phoenix saw prices rise 37 percent over 2011, Las Vegas rose 30 percent and in the balance of the six markets foreclosure prices increased by double digit amounts.
“More importantly, the ripple effects are greatly impacting the broader market,” Khater wrote. “Lower end home prices in markets with rising shares of institutional investors are up 15 percent from a year ago, compared to only 6 percent for the remaining markets.”
Khater said the large volume declines of foreclosures in Las Vegas, Atlanta and Phoenix are to do hedge fund activity, where declines in California markers are primarily to do individual investors.
Khater said institutional investors are clearly concentrated in five states: Florida, Georgia, Arizona, Nevada and North Carolina. In Miami last year, hedge funds accounted for 30 percent of REO sales; 23 percent in Phoenix; 21 percent in Charlotte; 19 percent in Las Vegas; and 18 percent in Orlando.
Hedge funds were much less active in California and the Midwest. In the Midwest, REOs remained elevated compared to Florida and Southwestern markets.
“Minneapolis and Chicago are drawing less interest from both types of investors generally, relative to these other markets. Only Detroit is garnering interest from institutional investors,” Khater said.
A nationwide panel of 118 economists, real estate experts and investment and market professionals expects home values to end 2013 up an average of 4.6 percent and rise cumulatively by 22 percent, on average, over the next five years, according to the first quarter Zillow Home Price Expectations Survey.
Survey respondents predicted home values will rise another 4.2 percent on average in 2014, before moderating somewhat to annual appreciation rates between 3.6 percent and 3.8 percent for 2015, 2016 and 2017. On average, panelists predicted home values to rise 4.1 percent annually from 2013 through 2017, exceeding the pre-housing bubble (1987-1999) average annual appreciation rate of 3.6 percent.
This is the first time the predicted average annual growth rate for the next five years has surpassed pre-bubble levels since the survey’s inception three years ago. “The panel is quite bullish on home prices near-term, considering a pre-bubble average appreciation rate of 3.6 percent per year,” said Zillow Chief Economist Dr. Stan Humphries. “That said, their expectations are a bit shy of the home value gains of 5.5 percent that we saw in 2012, implying some moderation in the pace of gains. The panel expectations are consistent with continued strong home value growth this year fueled by tighter-than-normal inventory of for-sale homes and robust demand attributable to high affordability and a stronger general economy.”
The most optimistic quartile of panelists predicted a 6.1 percent increase in home values in 2013, on average, while the most pessimistic predicted an average increase of 3 percent. Through 2017, panelists predicted cumulative home value changes of 22 percent, on average. Expectations for cumulative home value change projections ranged from 34.2 percent among the most optimistic quartile to 11.7 percent among the most pessimistic, on average.
The first quarter 2013 Zillow Home Price Expectations Survey asked the panel to indicate their view of a reasonable timeframe for “winding-down” government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. The majority of panelists (59 percent) indicated that a reasonable and appropriate timeframe for winding-down the GSEs is within the next five years. On the opposite ends of the spectrum, 13 percent suggested a timeframe within the next two years, and 10 percent said they believe a period of more than 10 years is sensible.