2010 hasn't been a great year for the real estate market, and September proved no different. Several new surveys and reports emerged with grim statistics about the state of economy and people's personal finances. Although the new ultra-low in mortgage rates was a high point, it hasn't done as much to boost the market as many had hoped: without the income to buy a house, even a good deal just isn't good enough. (A home is an asset, but it can also be an expense. Learn more in The Hidden Costs of Home Ownership.)

IN PICTURES: 10 Habits Of Successful Real Estate Investors

That said, if you look away from the statistics, there was some lighter news on real estate, celebrity home sales and the sale of one of America's most famous (or perhaps infamous) homes. Read on to find out what happened in real estate this month.

Mortgage Rates Hit Rock-Bottom

According to a survey released on September 30 by Freddie Mac, U.S. 30-year and 15-year mortgage rates met or exceeded record lows in the final week of September. Although ultra-low rates, which average 4.32% for a 30-year, fixed-rate mortgage, can be good news for homebuyers, consumers' lack of confidence in the economy means only a few are making the leap to home ownership. Existing home sales rose 7.6% in August compared to July, according to the National Association of Realtors, but the NAR's chief economist still referred to home sales as subpar. (For more insight on the importance of interest rates, see Understanding Your Mortgage.)

No Wonder No One's Buying!
Despite the good deals out there, it's no wonder few are buying: according to the Census Bureau's American Community Survey, released September 28, more than 20% of Americans can barely afford rent. The study indicated that two-fifths of respondents reported spending more than 35% of their incomes on housing. Typically, the government considers affordable housing costs (including utilities) to be less than one-third of total income. This could be partly explained by an overall reduction in income in the U.S., with 31 states showing increases in poverty rates in 2009 over 2008.

In addition, commercial real estate prices are also plummeting; according to the Moody's/REAL All Property Type Aggregate Index, prices are only 0.9% above their October 2009 recession low. The Census report suggests that while there is plenty of fuel help start a real estate recovery, improved income and job security will have to be the first step. (For related reading, check out Too Much Debt For A Mortgage?)

Faulty Foreclosures?
While it isn't news that many homeowners are falling behind on their payments and landing themselves in foreclosure, some interesting news that emerged this month suggests that lenders aren't exactly on top of things either - and that some homeowners may have lost their homes without good reason.

It all began with GMAC Mortgage, a unit of Ally Financial, which has been under investigation by attorneys general in Iowa, Illinois and Texas, and since December 2009 after one of its employees disclosed that the company had signed off on thousands of foreclosures without checking borrowers' loan records or verifying their accuracy. According to RealtyTrac, lenders took possession of a record number of homes in August, and suspicions are mounting that many lenders may have been pressed to take shortcuts in their usual processes in order to deal with the volume.

Attorneys general in California, Colorado, Illinois and Ohio have also picked up the trail and started looking into GMAC's foreclosures in their respective states, while lawyers in Florida began questioning JPMorgan Chase & Co. after discovering that one of the company's executives failed to check the details of a claim against a homeowner. (If you're at risk of foreclosure, there are steps you can take to save your home. Find out what you can do in Saving Your Home From Foreclosure.)

Celebrity Slam-dunks
As is always the case, not everyone feels the slump, as evidenced by some great celebrity real estate that went up for sale in September. NBA stars Chris Bosh and LeBron James both scored real estate slam-dunks in September. According to Zillow.com, Bosh signed on a slick $12.5 million, seven-bedroom house in Miami Beach, while James opted for a four-bedroom pad in Coconut Grove.

Another celebrity duo, the "Olsen Twins", finally unloaded a 6,000-square-foot condo in New York this month, which the pair had reportedly owned since 2004, but never occupied. Although they had to settle for considerably less than the initial $11.995 million asking price, the $7.7 million final offer still came in $300,000 over what the Olsen's paid for the place, according to Curbed NY.

Attention "Deadheads": the home of Jerry Garcia, lead guitarist and singer of the Grateful Dead, also hit the market this month. The Mediterranean-style home is located 30 miles from San Francisco and the Haight-Ashbury area, where the 1960s hippie movement took root. Garcia died in 1995, but any Deadheads with a $4 million housing budget could get the chance to see the world through is eyes.

New Owners to Haunt Infamous House
Just in time for Halloween, another very famous home got a new owner in September: the Amityville Horror House. The large, Dutch Colonial house in Long Island, New York, was the site of a brutal murder in 1974, in which Ronald DeFeo Jr. Shot and killed his mother, father and four siblings. But the home's real fame arose from the book by Jay Anson about the Lutz family's experiences in the home, which they claimed to be haunted, along with several movies and spinoffs.

According to Zillow.com, Caroline and David D'Antonio finalized the deal on the Amityville house this month for $950,000, calling it their "dream house". Whether the gruesome haunting recounted in The Amityville Horror really happened is still hotly debated, but the new owners claim they're not worried about ghosts - although with all the attention the home still gets from the book's fans and other curious onlookers, they are a little scared about Halloween night.

The Bottom Line
While the real estate market appears to be picking up a little, it's clear that the economic conditions required for a more sustainable turnaround are not in place. The market continues to be haunted by the ghosts of the real estate crash. Let's hope these ghosts are scared off in October, giving way to more positive news reports.

For the latest financial news, check out Water Cooler Finance: The End Of The Recession.

Related Articles
  1. Insurance

    The 5 Biggest Russian Insurance Companies

    Discover the five companies that dominate the Russian insurance market, and learn a little more about their business operations and ownership.
  2. Insurance

    Biggest Life Insurance Companies in the US

    Read about the top life insurance companies in the United States as measured by written premiums and learn a little more about their business operations.
  3. Stock Analysis

    The 7 Biggest Chinese Mining Companies

    Read about the seven largest Chinese mining companies as measured by revenues, and learn more about the types of mineral resources they mine.
  4. Stock Analysis

    The 6 Biggest Life Insurance Companies in Canada

    Read about the biggest life insurance companies in Canada, and learn about their business operations and the types of products they offer.
  5. Stock Analysis

    The 7 Biggest Canadian Natural Gas Companies

    Read about the seven biggest Canadian natural gas companies as measured by production volume and learn a little more about their recent performance.
  6. Stock Analysis

    The 6 Biggest Chinese Energy Companies

    Read about the six companies atop the Chinese energy industry as measured by consolidated revenue, and learn more about their energy operations.
  7. Stock Analysis

    The 5 Biggest Chinese Oil Companies

    Read about the top five Chinese oil companies as measured by crude oil production volume, and learn a little more about their business operations.
  8. Stock Analysis

    The 7 Biggest Canadian Energy Companies

    Read about the largest seven Canadian energy companies as measured by market capitalization, and learn more about their energy operations.
  9. Insurance

    Top 6 Car Insurance Companies in New York

    Read about the top private auto insurers licensed to operate in New York, and learn about recent trends in market share among these companies.
  10. Markets

    The 5 Biggest Chinese Natural Gas Companies

    Read about the top five Chinese natural gas companies as measured by gas production volume and learn a little more about their business operations.
  1. What is the long-term outlook of the metals and mining sector?

    An industry agency council was established by the World Economic Forum in 2014 to serve as an advisory board on the future ... Read Full Answer >>
  2. What is the railroads sector?

    The railroads sector is comprised of publicly traded stocks for companies that operate railroad tracks and/or trains. Railroad ... Read Full Answer >>
  3. Who are Amgen Inc.'s (AMGN) main competitors?

    Biotech giant Amgen Inc (AMGN) bills itself as one of the first biotechnology firms. It was founded in 1980 and has grown ... Read Full Answer >>
  4. What's the most expensive stock of all time?

    Back in late August 2012, Apple’s (AAPL) stock price reached nearly $700 per share. The stock has since split but has yet ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!