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A bankruptcy judge has rejected the proposed sale of the Palm House Hotel to a former owner who claimed a $37.3 million secured interest in the unfinished hotel-condominium in tony Palm Beach, Law.com reported. A dispute between the owner and a key creditor KK-PB Financial LLC, which is managed by Wellington developer Glenn Straub, has jammed up the proceedings on a property tainted by civil allegations of EB-5 investment visa fraud. The owner and debtor, 160 Royal Palm LLC, filed for chapter 11 protection last August, putting the Palm House Hotel in line for auction. KK-PB Financial wants to place a credit bid, saying it holds a senior mortgage on the property where a 79-unit development was planned. Straub bought the property at auction for $10 million in 2009 and sold his membership interest in the company in 2013. KK-PB Financial maintains 160 Royal Palm defaulted on the $27.5 million mortgage issued with the 2013 sale and now claims a security interest of $37.3 million. The stalking horse bid for the bankruptcy auction is $32 million. KK-PB asked U.S. Bankruptcy Judge Erik Kimball to estimate its secured claim to get a credit from the auction. 160 Royal Palm’s court-appointed manager Cary Glickstein, a former Delray Beach mayor, responded by asking the court to limit KK-PB’s ability to credit bid.

The U.S. may or may not enter a recession this year, but if it does, housing is unlikely to be the cause, because it never really recovered in the first place, according to a New York Times commentary. The U.S. has had 11 recessions since the end of World War II, and all but two were preceded by a big decline in the housing market. “Housing is not in a position to lead this thing down,” said Edward Leamer, an economics professor at the University of California, Los Angeles. How much it can help prolong the overall recovery is another matter, according to the commentary. Home sales and prices have been sluggish in the face of rising interest rates. Still, the pace of construction, combined with pent-up demand from young adults, suggests that the sector should at least remain stable in the face of uncertainty elsewhere.

*The views expressed in this commentary are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.

The Trump administration’s pick to help overhaul the way many Americans finance their home purchases told Congress on Thursday he would work to preserve the popular 30-year mortgage, a product he has criticized in the past, the Wall Street Journal reported. Mark Calabria, speaking at his confirmation hearing yesterday before the Senate Banking Committee, said, “It is indeed possible for us to have a well capitalized, strong system that preserves the 30-year mortgage.” The nominee also said that he would scrutinize big banks if confirmed, using his seat on a panel of regulators, the Financial Stability Oversight Council, to raise concerns about risks the largest firms pose to the financial system. A critic of big banks, Calabria said he disagreed with the 2008 federal bailout plan known as TARP. The Senate panel is considering the nomination of Calabria to lead the government’s oversight of Fannie Mae and Freddie Mac. The mortgage-finance companies guarantee roughly half of U.S. home loans and have been under government control since the financial crisis.

The Trump administration’s pick to help overhaul the way many Americans finance their home purchases is expected to face questions about the future of the popular 30-year mortgage at his Senate confirmation hearing today, the Wall Street Journal reported. The Senate Banking Committee is considering the nomination of Mark Calabria to head the government’s oversight of Fannie Mae and Freddie Mac. The mortgage-finance companies guarantee roughly half of U.S. home loans and have been under government control since the financial crisis. If confirmed, Calabria would play a pivotal role as head of the Federal Housing Finance Agency in making changes to the companies. Calabria, a libertarian economist and senior aide to Vice President Mike Pence, is expected to face questions from lawmakers over his past calls for modifying the foundations of the U.S. mortgage market. While working at the libertarian think tank the Cato Institute from 2009 to 2017, Calabria advocated for curtailing government support for 30-year fixed-rate mortgages. These account for approximately 90 percent of new home loans, according to Mortgage Bankers Association data. He also called for banks to hold more of the loans they originate rather than selling them to Fannie, Freddie and other financing entities.

Senate Finance Committee Chairman Chuck Grassley (R-Iowa) will not tweak the new state and local tax deduction cap while he leads the panel, CNBC.com reported. U.S. residents are filing taxes for the first time this year under the new GOP-written tax code, which limited the deduction for those taxes to $10,000. "The Senate Finance Committee won't be revisiting the SALT deduction reforms made in the Tax Cuts and Jobs Act under Chairman Grassley's leadership," Grassley spokesman Michael Zona said. The statement comes a day after President Donald Trump said that he would be "open to talking about" revising the deduction limit. Speaking to regional reporters on Wednesday, Trump said that "some people from New York have been speaking to me about doing something about that, about changing" the cap. He did not say what potential tweaks he would consider.