US laws allow real estate corruption says report
The United States is one of four countries where loopholes in the law make it easy for corruption in the real estate markets according to a new report.
Transparency International analyzed the US, along with Canada, the UK, and Australia; and found several weaknesses in regulations and laws which allow money laundering and other issues related to luxury property.
The study says that none of the four jurisdictions are meeting international monitoring obligations for anti-money laundering while only the UK requires professionals including real estate agents and lawyers to identify the beneficial owners of real estate as part of due diligence procedures.
That means that trusts and other legal entities can purchase real estate without an actual person being identified. Furthermore, foreign companies can purchase real estate without providing details of their real owners, except in Australia but even then, not in relation to money laundering.
There is also an over-reliance on financial institutions carrying out money laundering checks for real estate transactions. This varies across the four jurisdictions but can mean that cash purchases do not have the same level of monitoring.
Even where there are requirements on real estate professionals to conduct anti-money laundering checks, compliance and enforcement is often weak and Transparency International also found that none of the four jurisdictions has a “fit and proper” test for professionals working in real estate.
The report highlights that the US has “severe deficiencies” in nine of the ten identified areas of weakness and notes that the temporary exemption from anti-money laundering requirements of the USA PATRIOT Act 2001 for real estate agents, was never lifted.
New York state, metro lead house price gains
New York State and the New York City metro led gains in house prices in January, Black Knight Financial’s data shows.
The mortgage tech firm’s analysis shows that the national gain was 0.1 per cent for the month and 5.4 per cent for the year to $233,000. In New York (state and metro) the monthly gain was 1.3 per cent.
The gap between New York State’s gains and equal-second placed Hawaii, New Jersey and Washington was large with runners-up gaining a relatively moderate 0.6 per cent.
The gap between the New York metro rise and that of equal-second placed Seattle and San Jose was less with the runners-up gaining 0.8 per cent.
Refinance mortgage apps share near 9-year low
There was a fall in the number of mortgage applications in the week ending 24 March the Mortgage Bankers’ Association reports.
Its index of home loan originations reveals that there was a 0.8 per cent drop from a week earlier on a seasonally adjusted basis; 0.4 per cent unadjusted. The refinance index was down 3 per cent while the adjusted purchase index was up 1 per cent and the unadjusted purchase index was up 4 per cent from the same week of 2016.
The share of refinance applications was down to 44.0 per cent, the lowest since October 2008.