Today: Nearly one-third of homes with mortgages in California are “underwater.” Plus: Warner Bros. puts rentals of “The Dark Knight” on Facebook, and Netflix’s stock slides. And: San Jose’s population is up, but still under 1 million, according to official census data.
Real estate update
Underwater mortgages: If you owe more on your mortgage (or mortgages) than your home is worth, you’re not alone: Nearly one-quarter of homes with a mortgage in the U.S. had negative equity in the fourth quarter, according to a report today from CoreLogic, a Santa Ana real estate information firm. The situation is even worse here in the Golden State.
Nationwide, the number of such “underwater” homes climbed 22.5 percent from the previous three-month period to 11.1 million — or 23.1 percent of properties with mortgages. Falling home prices are in large part to blame for the increase, according to CoreLogic.
In California, nearly 2.2 million homes — or about 32 percent or nearly 1 in 3 of properties with mortgages — were underwater. The average loan-to-value ratio in the state was 71 percent, slightly higher than the national average of 70 percent.
“Negative equity holds millions of borrowers captive in their homes, unable to move or sell their properties,” CoreLogic chief economist Mark Fleming said, according to a news release. “Until the high level of negative equity begins to recede, the housing and mortgage finance markets will remain very sluggish.”
Short sales: The California Association of Realtors today charged that lenders aren’t doing enough to encourage “short sales” — or transactions for less than the value of the mortgage on a property.
“Many underwater homeowners who have been hit by the recent economic crisis can no longer afford to stay in their home and just need to sell their home as expeditiously as possible are unable to largely because of the complex and cumbersome short sale process,” association President Beth L. Peerce said today in a news release.
According to a survey by the group of 2,150 Realtors, 94 percent were involved in a short sale transaction last year. Less than 3 in 5 of short sales transactions were successful, and lenders in more than half of the cases took 60 days or more to approve or reject the deals.
Bank reactions: According to a Merc report, at least one big lender, Bank of America, reports that it has increased its staff and technology to make the short-sale process more efficient.
Bloomberg News is reporting today that BofA is separating its mortgage portfolio to create a “good bank, bad bank structure.” Loans going into the “bad bank” are “delinquent or are expected to go delinquent over the next three years,” Laughlin said. “As borrowers default, we’ll evaluate them for a loan modification.”
Online movies
‘Dark Knight’ on Facebook: Hollywood studio Warner Bros. today started offering online rentals of “The Dark Knight” on Palo Alto social networking powerhouse Facebook. The movie will be available for viewing for 48 hours from the time of rental at a cost of $3 or 30 Facebook credits (the site’s virtual currency).
“Facebook has become a daily destination for hundreds of millions of people,” Thomas Gewecke, president of Warner Bros. Digital Distribution, said in a news release today. “Making our films available through Facebook is a natural extension of our digital distribution efforts.”
Netflix stock falls: According to a Bloomberg News report, Goldman Sachs analyst James Mitchell says movies on Facebook shouldn’t be a direct threat to Netflix, the Los Gatos online movie pioneer. Unlike Facebook, Netflix offers online movies as part a monthly subscription and its content can be viewed on big-screen TVs.
Nonetheless, Warner and other big Hollywood players have been worried that Netflix could be a threat to their business model. Netflix stock finished regular trading today at $194.89, down $11.95, or 5.8 percent, from Monday’s closing price.
‘Dark Knight’ app: Warner also has released apps for “The Dark Knight” and another popular movie, “Inception,” for Apple’s iPad, iPhone and iPod touch.
Fans download the apps, which include the first five minutes of the film, bonus content and social-networking features. They can unlock the full feature with an in-app purchase, with Apple taking a 30 percent cut.
According to an analysis today by IHS Screen Digest, apps could bring studios such as Warner a wider audience for their content.
“The success of the greater apps business being driven by Apple and Google has created an opportunity for companies to experiment with the movie app concept, at a time when digital movie sales continue to struggle,” IHS broadband media analyst Laura Aguilera noted in an e-mail.
U.S. Census
It’s official: San Jose’s population jumped 5.4 percent over a decade to 945,942 — according to 2010 census data just released this afternoon.
But wait a minute. Haven’t we been reporting in the past couple of years that San Jose’s population has topped 1 million? Yes, but that’s according to estimates based on such factors as driver’s license address changes from the California Department of Finance, which put San Jose’s population as of Jan. 1, 2010, as 1,023,083. (The Census Bureau, by contrast, actually tries to count all of us every 10 years.)
According to the Census, only two California cities have a population larger than San Jose’s: Los Angeles at 3,792,621 and San Diego at 1,307,402. Our beautiful neighbor to the north, San Francisco, was fourth at 805,235 — up 3.7 percent over the decade.
Santa Clara County — the hub of Silicon Valley’s tech industry — had an official population of 1,781,642, the sixth-largest in the state, according to the Census Bureau. That was up 5.9 percent since 2010.
Silicon Valley tech stocks
Up: Apple, Google, Oracle, Cisco Systems, Hewlett-Packard, eBay, VMware, Gilead Sciences, Juniper Networks.
Down: Intel.
The tech-heavy Nasdaq composite index: Up 20.14, or 0.7 percent, to 2,765.77.
The blue chip Dow Jones industrial average: Up 124.35, or 1 percent, to 12,214.38.
And the widely watched Standard & Poor’s 500 index: Up 11.69, or 0.9 percent, to 1,321.82.
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Frank Russell at 408-920-5876. Follow him at Twitter.com/mercspike.
