Us lenders too strict?

US mortgage lenders need to relax their high credit standards to get the market moving again, says the NAR...

For the housing market to recover, lenders need to lend:  That was the message from an official at the National Association of Realtors (NAR) during a recent Urban Land Institute conference in Hollywood.

Addressing about 300 people attending the event at the Seminole Hard Rock Hotel & Casino, Jed Smith, head of quantitative research for the Realtors' group, said: "Lower interest rates have had only a modest effect. Relaxing high credit standards would have a greater effect".

Bailout effect

Smith said banks have been too slow to lend money for mortgages even after receiving government bailout money, a fact that suggests the financial institutions are hurting worse than they've let on.

Alex Sanchez, president of the Florida Bankers Association in Tallahassee, said Smith's comments are typical of many non-bankers. Only about 300 of 9,000 banks nationwide have received bailout money so far, and fewer than 10 are based in Florida, Sanchez said in an interview.

What's more, lending money now without strict standards in place would worsen the country's housing and mortgage problems, said Sanchez, who did not attend Friday's conference.

"We need to lend money more carefully," he said. "If not, we'd be raked over the coals by the regulators. Banks want to finance that home for you, but they want it to be a home you can stay in."

South Florida lagging behind

Panelists at Friday's seminar said the U.S. housing market is likely to hit bottom in the third quarter of 2009. But they caution that South Florida could lag behind in a recovery because the region was among the areas hardest hit.

Also discussed Friday was the precarious state of many home builders. In a preliminary earnings statement issued Friday, Dallas-based Centex Corp. said net sales fell 80 percent from a year earlier, and closings at the second-biggest U.S. home builder declined 49 percent.

"For those of us in home building, we are in a depression and hope we can get to a recession," said Harry Posin, president of Label & Co. Developments Inc. and former head of Minto Communities in Coconut Creek. "The industry feels like it's in free fall."

But not everyone was downcast. Peter Zalewski, principal of Condo Vultures, said his Bal Harbour-based real estate consulting business is booming as cash buyers search for deeply discounted properties in Palm Beach, Broward and Miami-Dade counties.

"There are a bunch of gunslingers, and there are deals to be had," Zalewski told the crowd. "For me, it's all sunny, and I've never felt better."