Some housing bubble news from Wall Street and Washington. Bloomberg, "Toll Brothers Inc., the largest U.S. luxury-home builder, reported its third straight quarterly loss as tumbling demand forced the company to write down land values. The five largest U.S. builders have reported a combined $3.4 billion in losses in their most recent quarters, hurt by what CEO Robert Toll described today as a 'downward spiral' of home prices."

"The average price of net contracts signed in the second quarter was $534,000, down 26 percent from a year earlier and 7.9 percent lower than the previous three months. The lower sales prices were partly due to fewer sales in expensive markets such as California and Manhattan."

"The net value of contracts fell 58 percent to $496.5 million from a year earlier. The order backlog, or homes under contract that have yet to be sold, declined 50 percent to $2.08 billion."

The Associated Press. "Toll said the company will continue to offer incentives to get people to buy homes - a concession uncharacteristic of Toll Brothers that speaks to the severity of the housing market."

"But Deutsche Bank analyst Nishu Sood said the builder should more aggressively discount because 'by holding prices the company is just delaying the inevitable as prices are unlikely to revisit boom time levels for a prolonged period.'"

"The quarter included a pretax write-down of $288.1 million, which included $85 million from joint ventures with other builders on land development. Net contracts, an indication of future business, fell by 58 percent to $496.5 million in the quarter from a year ago. Cancellations totaled $234.1 million."

"The average home price on net contracts fell to $534,000 from $710,000 in 2007's second quarter."

"Residential Capital LLC, the mortgage lending unit of GMAC LLC, said Tuesday it needs more than three times more cash to stay in business than it estimated just weeks ago."

"ResCap estimates it now needs about $2 billion in cash by the end of June to meet liquidity demands, according to a regulatory filing with the Securities and Exchange Commission. It previously estimated it needed just $600 million by the end of the month."

The Wall Street Journal. "Delinquencies on loans originated by GMAC-RFC (U.K.) Ltd. rose sharply this year, according to data from Moody's Investors Service, potentially putting a host of U.S. and European banks at risk of losses on GMAC-RFC loans that they have purchased."

"Bradford & Bingley PLC Monday said that 5% of acquired loans it holds, which include those from GMAC-RFC, are three months or more in arrears, leading it to take a £36 million ($70.7 million) impairment charge in the four months to April 30."

The Independent. "The first signs of a collapse in Britain's buy-to-let property market emerged yesterday as Bradford & Bingley, the UK's largest lender to private landlords, revealed a 50 per cent jump in arrears on its mortgage book over the first four months of the year."

"The picture was much worse within one of its books of business - which it acquired from the US lender GMAC-RFC in 2005 - where buy-to-let arrears were up almost 80 per cent to 3.5 per cent of the total."

"B&B represents 20 per cent of lending across the British buy-to-let sector. The number of buy-to-let mortgages has more than doubled over the past four years, as thousands of new amateur landlords looked to cash in on the meteoric rise in residential property prices."

"However, rents failed to keep up with the rise in prices, leaving many landlords committed to monthly mortgage payments which were greater than their regular rental income."

"John Postlethwaite, of Punter Southall Financial Management, the financial consultants, said: 'In the past three to four years we have experienced a buy-to-let boom, mainly fuelled by private landlords purchasing a second or third property, putting down a minimum deposit and borrowing the maximum available. At the time this was not a problem, as money was plentiful and cheap. Unfortunately, that happy scenario does not exist any more.'"

"Mr Postlethwaite added that many landlords could now see their mortgage rates jump by as much as 2 percentage points as they come to the end of their current deals, putting them under further pressure."

"'The worry is, if we get a situation where large numbers of private landlords are trying to offload properties at the same time and needing to do it quickly because they cannot afford the new mortgage payments, property prices will fall even further and faster than they are now,' he said."

"Ratings cuts at three of the biggest U.S. securities firms coupled with management shakeups at Wachovia Corp. and Washington Mutual Inc. yesterday triggered concern that the mortgage slump has yet to reach a bottom."

"While Wall Street's top executives have insisted the housing crisis is waning, mounting evidence suggests otherwise, said Robert Eisenbeis, head of research at the Federal Reserve Bank of Atlanta from 1996 to 2006. He expects losses to be higher than banks' forecasts as the worst real-estate decline since the Great Depression continues and foreclosures rise."

"'There may be another shoe to fall,' said Eisenbeis. 'The real puzzle to me is why these firms didn't jump on the opportunity to really come to grips with the financial situation they were facing.'"

"Lenders' losses have accompanied declines in home prices in 20 U.S. metropolitan areas where they have dropped 17 percent from July 2006 through March, according to the S&P/Case-Shiller home-price index. Bank of America Corp. CEO Kenneth Lewis expects that number to reach 25 percent in the next two years."

"'It's going to be bigger than that,' said David Olson, president of Wholesale Access Mortgage Research in Columbia, Maryland, and a former economist at Freddie Mac. 'People are walking away from homes. This is a new mentality.'"

From Newsday. "Paul Brennan never handled a short sale - and barely ever used the phrase - until about six months ago."

"But since then, Prudential Douglas Elliman, where Brennan is The Hamptons regional manager, has handled about 10 short sales across the South Fork, he said. 'It is a new phrase for me,' said Brennan, who has worked in real estate in The Hamptons for nearly 30 years."

"Over the past year across the East End there's been a noticeable increase in 'lis pendens' - the first legal foreclosure notice - and even foreclosure auctions, which take place in courtrooms or on town hall steps. Among the houses in the initial stage of foreclosure is one now on the market for $19 million in very upscale Bridgehampton."

"'It's more expensive out here, especially for the local people who are living out here every day,' said East Hampton police dispatcher Steve Blanchard, who is about four months behind on his $650,000 mortgage and is now in contract for a short sale. 'And with the economy going down, it's going to get worse.'"

"Indeed, his real estate agent, John Brady now specializes in short sales, currently handling 14 in The Hamptons."

"Homeowners have been getting their home equity lines of credit frozen or pared down by lenders trying to cut risks."

"It happened to Bay Shore dentist Michael Sherman, who can't touch his $100,000 line for bath renovations because he's got little equity in his home, and to Lido Beach homeowner Suzanne Dzolan, whose $200,000 limit was halved soon after she paid back what she borrowed to redo the house."

"'It's almost hurt me to be someone who was a good borrower,' said Dzolan, who works for a mortgage broker. 'They just felt they could take the luxury and cut it.'"

"Retired firefighter Paul Porcello said he was going to buy an Amityville house until a $5,000 check, drawn on a HELOC on a rental property, bounced. 'The next day, I get a letter saying they lowered my line from $144,500 to $10,000,' said Porcello, who lives in Rockaway Park."

"Sherman expected his lender's move because the value of his home, along with others, has dropped: 'It's hard to admit that it's not worth $530,000 today.'"

The Star Telegram. "This weekend, 100 new North Texas homes will be auctioned -- with starting bids as much as 60 percent off the original listing price. The homes up for auction were all built by Arlington-based Classic Century Homes. Original asking prices range from $112,000 for a home in Fort Worth to $469,950 for a home in Mansfield."

"'Our starting bid is $49,000, and previous values go up to almost half a million dollars,' said Ted Embry, VP of Real Estate Disposition Corp., which is conducting the auction."

"The auctioned homes could affect the values of neighboring homes, said Cheryl Hunt with Ebby Halliday Realtors. She has a listing in the Emerald Park development of far north Fort Worth, where 10 homes will be auctioned Saturday."

"'If everything were to sell under market value, it hurts every home,' she said."

"The three Elk Ridge homes up for auction have starting bids of $59,000 and were originally listed at more than $144,000, according to auction materials."

"'Even if you got the homes for $90,000 of $100,000, you'd be getting a bargain,' said Nancy D'Angelo, a Burleson homeowner who often goes walking through nearby Elk Ridge. 'I can't even imagine them building them for that much.'"

The Rocky Mountain News. "Experts in the real estate community are divided over whether a Canadian developer's decision to pull the plug on its $165 million, 51-story luxury condominium project at 1401 Lawrence is a harbinger of things to come or an isolated incident."

"When the project was announced in January 2006, it was heralded as the tallest residential development in Denver's history. It promised to change Denver's skyline."

"But that all came to a halt on Friday, when Great Gulf closed its $1.5 million sales center and released this statement: 'As you are aware, the downturn in the U.S. real estate market continues, and unfortunately Denver is no exception. Due to these conditions, Great Gulf Colorado, LLC has not achieved the requisite pre-sales to go forward with the 1401 Lawrence project and, regrettably, is canceling the project.'"

"There are currently 1,787 condos and 1,339 rental units under construction in the Denver area, so the loss of 1401 Lawrence accounts for less than 5 percent of the 3,126 total units going forward, said John Desmond, of the Downtown Denver Partnerhip."

"Jeff Selby, co-developer of the Four Seasons under construction across from 1401, said he is not surprised the tower isn't going forward, because Gulf had not yet lined up its financing, which is extremely difficult since the subprime collapse last August."

"For example, developer Randy Nichols lost his initial financing for the Spire condo project, a couple of blocks from 1401 Lawrence, before he found a new lender."

"'I do not think this is a sign of things to come, but a sign of things that already have happened' in the financial markets, Selby said."

The Review Journal. "It offered such a tidy solution for a land-constrained city: Go vertical, with luxury high-rises to draw in upscale buyers from around the world."

"When it began three to four years ago, the push toward towering condominium skyscrapers quickly became one of the hottest real estate trends in Las Vegas, with high-profile names including Ivana Trump, George Clooney and New York's Related Group jumping into the market to invest in, build or brand major projects."

"But the same market realities restraining residential construction in Las Vegas have at least temporarily put a ceiling on the city's reach for the skies."

"Numbers from the Greater Las Vegas Association of Realtors and research firm SalesTraq show about 820 resale units in high-rise condo towers on the local market the first week in May, with closings in the month between March and April coming in at around 20 units. At that sales rate, it'll take roughly 3 1/2 years to churn through the high-rise resales on the market."

"Buyers who locked in sales agreements three years ago when the high-rise trend took flight and the broader local market peaked in sales and median prices are walking away at closing today, said Larry Murphy, president of SalesTraq."

"'People who bought units on contract in 2005 are aware the market in 2008 is nothing like the market they bought in,' Murphy said. 'But appraisals are coming in at whatever they agreed to pay on their contract three years ago. People are saying, 'We don't think that appraisal is right, and we don't want to close at that price.' A lot of people have been unwilling or unable to come to the closing table.'"

"Buyers who do close on their units often put them on the market immediately, compounding already-big supplies, said Renee Burrows, a Realtor with Nevada Realty Solutions. Speculators looking to flip condos populate the resale markets."

"Even buyers with excellent credit, cash in the bank and 20 percent down payments aren't having much luck -- banks are quoting them the double-digit interest rates often associated with riskier hard-money loans, said Bruce Hiatt, co-owner of Luxury Realty Group in Las Vegas."

"It could be years before supplies and prices stabilize, experts said. That's because homeowners hungry to flip units aren't the only contributors to rising condo supplies."

"The 3 1/2-year stockpile of high-rise resales on the market doesn't include new condos set to come online in the next few months and years."

"Las Vegas contains 9,168 completed high-rise units, with an additional 794 condos in presale stages and another 12,497 condos under construction. Yet, the market moved just 4,202 units in the three-plus years between January 2005 and April 2008."

"Burrows, in the meantime, is counseling her clients -- just one of whom has purchased a resale high-rise unit -- to purchase inside luxury towers only if they plan to hold the property for a while, either as a primary home or a vacation spot."

"'Short-term speculative flips have pretty much gotten our market where it is,' she said. 'To stabilize the market, we need a reversal of everything that's happening now. We need buyers who actually want to live in these products, and we need mortgage-underwriting guidelines to loosen up.'"

"'It's all coming to a pretty sad ending right now,' said Murphy of the housing oversupply and the loan shortage."

The LA Times. "The opening of Plams Place was as celebrity-packed and media-saturated as you would expect from a George Maloof event associated with the Palms. This was vintage Maloof milking press out of each stage of his project's development. And the plan worked with US, People, ABC radio and many others crowded for space on the valet side of the entrance behind a rope."

"Maloof is opening his condominium/hotel tower (in which the rooms can be converted into hotel rooms if the owner is out of town) amid the worst real estate meltdown in Vegas history."

"'Sometimes you can't help when you open. You just have to work hard and live through it. There are always challenges,' Maloof says of the unfortunate timing of his two openings."

"The final stage of Palms Place is proving 'challenging' (one of Maloof's favorite words) as well. Palms place sold out its 599 units, including 21 penthouses, three years ago. But even that hasn't proven total protection from the current economy."

"Maloof notes: 'People put 20% down. Now we just have to collect the rest for closing in very challenging financial times.'"

"Still, Palms Place has had it easier than most competitors, including Trump International, which still has available units in that recently opened hotel/condo."

"Owner Jessica Simpson sounded as excited to own a condo as if she had completed a marathon: 'Owning a condo in Vegas is surreal. I never thought I would own a condo in Vegas. But I went for it and did it, and I am proud that I did it, and I am impressed actually.'"

"As for how often the singer intends to be in residence at her Palms Place unit, Simpson offered one of her trademark headscratchers by way of an answer: 'I hope that I stay here more than I ever thought that I would.'"