Sunday, November 6, 2011
Monday, July 11, 2011
JUNE 2011 SALES UP and REO Inventory LOW
JUNE was an unbelievable month in REAL ESTATE here in AZ... We have been consistently hearing and seeing articles on how the Bank Owned homes are not being released to the market. The JUNE 2011 Cromford REPORT reinstated this fact with this headline:
"Foreclosure activity declining and active REO inventory is at the lowest level for several years". WOW and still 400+ foreclsoures daily... WHERE IS THE INVENTORY... ??
What a true statement!! More and More on a daily basis there are BID WARS, like 2010! My partner, Gabriel Ostrovsky and I were calling on homes last week and a Surprise home (Bank Owned) was on the market for 4 days had 12 Offers, yes I said 12 that is NOT a typo! .....
Maricopa County also had the HIGHEST month of closings in JUNE 2011 as well. Our brokerage, Green Street Realty, alone closed 66 transactions and my partner and I closed 14, ending a spectacular month!
It is still a buyers market, between prices being so low and interest rates so low as well still less than 5%!
Between the Mortgage Debt Relief Act expiring in December 2012 and the low inventory, Sellers should be contacting their area short sale specialist, EZSHORTSALEOPTION.com for a FREE Short Sale Consultation to get their home on the Market before the Protection laws VANISH! This way the buyers can buy and the sellers can work on their credit and TEAM up with us to help them get into a NEW home sooner than the later!
DONT HESITATE TO CALL WITH ANY QUESTIONS!!!
"Foreclosure activity declining and active REO inventory is at the lowest level for several years". WOW and still 400+ foreclsoures daily... WHERE IS THE INVENTORY... ??
What a true statement!! More and More on a daily basis there are BID WARS, like 2010! My partner, Gabriel Ostrovsky and I were calling on homes last week and a Surprise home (Bank Owned) was on the market for 4 days had 12 Offers, yes I said 12 that is NOT a typo! .....
Maricopa County also had the HIGHEST month of closings in JUNE 2011 as well. Our brokerage, Green Street Realty, alone closed 66 transactions and my partner and I closed 14, ending a spectacular month!
It is still a buyers market, between prices being so low and interest rates so low as well still less than 5%!
Between the Mortgage Debt Relief Act expiring in December 2012 and the low inventory, Sellers should be contacting their area short sale specialist, EZSHORTSALEOPTION.com for a FREE Short Sale Consultation to get their home on the Market before the Protection laws VANISH! This way the buyers can buy and the sellers can work on their credit and TEAM up with us to help them get into a NEW home sooner than the later!
DONT HESITATE TO CALL WITH ANY QUESTIONS!!!
Tuesday, March 1, 2011
Great Article from the Wall Street Journal
Great information as to why is a good time to buy!!!
If you have been sitting on the fence trying to decide whether to buy a new house or refinance a mortgage, you should act soon. New loans are starting to get costlier.
The mortgage market is facing pressures from new laws and regulations, still-declining home prices and the ongoing need for government-owned mortgage players to shore up their finances. The Mortgage Bankers Association predicts mortgage originations, which reached $3 trillion in 2005, will be less than $1 trillion this year, the lowest level since 1997.
"The price of mortgage money is going to go up, and the availability of mortgage money may also be impinged," says Keith Gumbinger, vice president at HSH Associates, which tracks mortgage data.
The silver lining is that the rate for a 30-year fixed loan is hovering around 5% for those with good credit. That is up about a percentage point from last year's lows but is still an attractive rate by historical standards, though expected to keep climbing as the economy improves.
Home prices in some areas are still falling, but they are bottoming out or firming up in others. It may not be the perfect time to buy a home—but better mortgage options today may be a worthy trade-off to the possibility of lower prices tomorrow.
Still not convinced? Consider the following:
• New costs.Fannie Mae and Freddie Mac, which provide liquidity to the mortgage market by buying mortgages and selling securities backed by them, are adding new fees to loans to people with the best credit and raising existing loan fees. Freddie's new fees start March 1, while Fannie's kick in April 1.
Neither Fannie nor Freddie have been assessing fees on most loans for borrowers with credit scores above 720, even if the down payment was small. But citing a need to address risk and price their services appropriately, they will assess a fee of 0.25% to 0.5% of the loan value on borrowers with credit scores of 720 or higher who put down less than 25% of the purchase amount. The current fee for those with credit scores of 700 to 719 who put down less than 20% of the purchase price will double to a full percentage point of the loan value from half a point.
Brokers expect the higher fees will translate into slightly higher mortgage rates.
In addition, the Federal Housing Administration, saying it needs to bolster its capital reserves, is raising its required annual mortgage-insurance premium for FHA loans by 0.25% of the loan value. As a result, FHA loans—which are aimed at first-time home buyers and those with moderate incomes—will include an upfront mortgage insurance payment of 1% of the loan amount and an annual premium of 1.1% to 1.15% when the increase goes into effect on April 18.
For regular loans, private mortgage insurance—which is required when you put down less than 20% of the home's value—is tougher to get than it once was. Generally, it is available only for buyers who make a down payment of at least 5% and have a credit score of 700 or higher.
• Dodd-Frank fallout. The Consumer Financial Protection Bureau, established by the Dodd-Frank financial overhaul, opens its doors for business in July and is expected to take a close look at how interest rates and closing costs are disclosed to borrowers. That could create new costs that lenders are likely to pass along to consumers. In addition, a Federal Reserve rule that takes effect April 18 will change how mortgage brokers are paid, a move intended to curb practices such as steering home buyers to higher-cost loans.
The new rules, which limit the kinds of compensation brokers can receive, have brokers in a tizzy. The brokers claim the changes will raise mortgage costs and put some of them out of business, shrinking the market. How it will play out isn't clear, but given both the changes and the Fannie and Freddie pricing, mortgage prices may vary more than usual, say those in the industry—making it wise for borrowers to shop for rates even more aggressively.
• More restrictions. Earlier this month, the Obama administration proposed a wide-ranging overhaul of the mortgage market, including phasing out Fannie Mae and Freddie Mac, requiring a down payment of at least 10% and reducing the share of FHA loans, which are almost 30% of the market now, up from a historical market share of 10% to 15%.
In addition, the administration recommended letting Fannie and Freddie loan limits for high-cost areas fall back to $625,500. The limits were temporarily increased to $729,750 in 2008 when the market for "jumbo" loans—those above the loan limits—all but disappeared, and that increase is now scheduled to expire Sept. 30. (The $417,000 loan limit for homes in most other markets would remain the same.)
What those proposals will mean depends on where you live. In Manhattan, where the average home price is still around $1 million, a drop in the loan limit means more buyers will need jumbo mortgages, says Melissa Cohn, CEO of Manhattan Mortgage Co. Those currently have rates that are about half a percentage point higher than conventional loans.
Richard Peek, president of the Florida Association of Mortgage Professionals, says much of his business right now is in FHA loans, which allow down payments of as little as 3.5%. Requiring a 10% down payment, he says, would put homes out of reach for many Florida customers.
—karen.blumenthal@wsj.com
If you have been sitting on the fence trying to decide whether to buy a new house or refinance a mortgage, you should act soon. New loans are starting to get costlier.
The mortgage market is facing pressures from new laws and regulations, still-declining home prices and the ongoing need for government-owned mortgage players to shore up their finances. The Mortgage Bankers Association predicts mortgage originations, which reached $3 trillion in 2005, will be less than $1 trillion this year, the lowest level since 1997.
"The price of mortgage money is going to go up, and the availability of mortgage money may also be impinged," says Keith Gumbinger, vice president at HSH Associates, which tracks mortgage data.
The silver lining is that the rate for a 30-year fixed loan is hovering around 5% for those with good credit. That is up about a percentage point from last year's lows but is still an attractive rate by historical standards, though expected to keep climbing as the economy improves.
Home prices in some areas are still falling, but they are bottoming out or firming up in others. It may not be the perfect time to buy a home—but better mortgage options today may be a worthy trade-off to the possibility of lower prices tomorrow.
Still not convinced? Consider the following:
• New costs.Fannie Mae and Freddie Mac, which provide liquidity to the mortgage market by buying mortgages and selling securities backed by them, are adding new fees to loans to people with the best credit and raising existing loan fees. Freddie's new fees start March 1, while Fannie's kick in April 1.
Neither Fannie nor Freddie have been assessing fees on most loans for borrowers with credit scores above 720, even if the down payment was small. But citing a need to address risk and price their services appropriately, they will assess a fee of 0.25% to 0.5% of the loan value on borrowers with credit scores of 720 or higher who put down less than 25% of the purchase amount. The current fee for those with credit scores of 700 to 719 who put down less than 20% of the purchase price will double to a full percentage point of the loan value from half a point.
Brokers expect the higher fees will translate into slightly higher mortgage rates.
In addition, the Federal Housing Administration, saying it needs to bolster its capital reserves, is raising its required annual mortgage-insurance premium for FHA loans by 0.25% of the loan value. As a result, FHA loans—which are aimed at first-time home buyers and those with moderate incomes—will include an upfront mortgage insurance payment of 1% of the loan amount and an annual premium of 1.1% to 1.15% when the increase goes into effect on April 18.
For regular loans, private mortgage insurance—which is required when you put down less than 20% of the home's value—is tougher to get than it once was. Generally, it is available only for buyers who make a down payment of at least 5% and have a credit score of 700 or higher.
• Dodd-Frank fallout. The Consumer Financial Protection Bureau, established by the Dodd-Frank financial overhaul, opens its doors for business in July and is expected to take a close look at how interest rates and closing costs are disclosed to borrowers. That could create new costs that lenders are likely to pass along to consumers. In addition, a Federal Reserve rule that takes effect April 18 will change how mortgage brokers are paid, a move intended to curb practices such as steering home buyers to higher-cost loans.
The new rules, which limit the kinds of compensation brokers can receive, have brokers in a tizzy. The brokers claim the changes will raise mortgage costs and put some of them out of business, shrinking the market. How it will play out isn't clear, but given both the changes and the Fannie and Freddie pricing, mortgage prices may vary more than usual, say those in the industry—making it wise for borrowers to shop for rates even more aggressively.
• More restrictions. Earlier this month, the Obama administration proposed a wide-ranging overhaul of the mortgage market, including phasing out Fannie Mae and Freddie Mac, requiring a down payment of at least 10% and reducing the share of FHA loans, which are almost 30% of the market now, up from a historical market share of 10% to 15%.
In addition, the administration recommended letting Fannie and Freddie loan limits for high-cost areas fall back to $625,500. The limits were temporarily increased to $729,750 in 2008 when the market for "jumbo" loans—those above the loan limits—all but disappeared, and that increase is now scheduled to expire Sept. 30. (The $417,000 loan limit for homes in most other markets would remain the same.)
What those proposals will mean depends on where you live. In Manhattan, where the average home price is still around $1 million, a drop in the loan limit means more buyers will need jumbo mortgages, says Melissa Cohn, CEO of Manhattan Mortgage Co. Those currently have rates that are about half a percentage point higher than conventional loans.
Richard Peek, president of the Florida Association of Mortgage Professionals, says much of his business right now is in FHA loans, which allow down payments of as little as 3.5%. Requiring a 10% down payment, he says, would put homes out of reach for many Florida customers.
—karen.blumenthal@wsj.com
Saturday, February 19, 2011
What Caliber of agent do you have working for you?
HI All-
Its been awhile since my last Blog... but what can I say it has been a crazy last quarter of 2010 and first month of 2011. I am proud to present that I was congratulated with the TOP PRODUCER award from my Brokerage Green Street Realty for 2010. This also carried into being TOP PRODUCER January 2011. I am so excited about Real Estate and sharing the opportunities with buyers and seller alike.
I wanted to share with everyone the excitement that I am participating in this week. I am getting my CIAS (Certified Investor Agent Specialist) designation. In 2009 I was able to complete the CDPE (Certified Distressed Property Expert) Designation. This designation has set myself and my TEAM apart from the rest. We have a 98% success rate when completing short sales. You may wonder what a CIAS it is simply the following:
A Certified Investor Agent Specialist™ (CIAS) finds, creates, and closes with residential real estate investors with the knowledge and tools earned through comprehensive education and experience. CIAS-designated agents can streamline the process of real estate investment to increase returns for investor clients.
CIAS-designated agents help real estate investors navigate:
Investment Strategies
Self-directed IRAs
1031 Exchange
Leverage Options
Key Calculations
Return-on-Investment
Capitalization Rate
Average Returns
Cash Flow
And much more!
Adding this designation is very EXCITING and I am looking forward to bringing a new element into our TEAM.
My partner, Gabriel Ostrovsky and I have specialized in the Distressed Market in Arizona since 2008. We have excelled in not only Bank Owned Properties and Short Sales.. we have also helped many buyers and investor find some AWESOME OPPORTUNITIES in this market!
Feel free to contact me for any of your Real Estate needs! Have a prosperous 2011!!!
Its been awhile since my last Blog... but what can I say it has been a crazy last quarter of 2010 and first month of 2011. I am proud to present that I was congratulated with the TOP PRODUCER award from my Brokerage Green Street Realty for 2010. This also carried into being TOP PRODUCER January 2011. I am so excited about Real Estate and sharing the opportunities with buyers and seller alike.
I wanted to share with everyone the excitement that I am participating in this week. I am getting my CIAS (Certified Investor Agent Specialist) designation. In 2009 I was able to complete the CDPE (Certified Distressed Property Expert) Designation. This designation has set myself and my TEAM apart from the rest. We have a 98% success rate when completing short sales. You may wonder what a CIAS it is simply the following:
A Certified Investor Agent Specialist™ (CIAS) finds, creates, and closes with residential real estate investors with the knowledge and tools earned through comprehensive education and experience. CIAS-designated agents can streamline the process of real estate investment to increase returns for investor clients.
CIAS-designated agents help real estate investors navigate:
Investment Strategies
Self-directed IRAs
1031 Exchange
Leverage Options
Key Calculations
Return-on-Investment
Capitalization Rate
Average Returns
Cash Flow
And much more!
Adding this designation is very EXCITING and I am looking forward to bringing a new element into our TEAM.
My partner, Gabriel Ostrovsky and I have specialized in the Distressed Market in Arizona since 2008. We have excelled in not only Bank Owned Properties and Short Sales.. we have also helped many buyers and investor find some AWESOME OPPORTUNITIES in this market!
Feel free to contact me for any of your Real Estate needs! Have a prosperous 2011!!!
Thursday, November 4, 2010
FULLY APPROVED SHORT SALE IN TERRAMAR
FULLY APPROVED SHORT SALE IN TERRAMAR
Have you heard of a FULLY APPROVED short sale that the home owner was current!!! Well I have! Matter of fact one just closed October 30, 2010 right in the pristine neighborhood of Terramar.
This particular home owner DID have a hard ship and MY TEAM was able to negotiate this short sale with Chase and receive a FULL LEIN RELEASE with a small contribution from the seller. Amazing! there is hope out there for bank to start working with their home owners!
This home was FULLY approved at 370k. the home had many features and the property was in MINT CONDITION… this was not like your ordinary short sale or REO you stumble across!
The home featured the following: 6 bed 4.5 baths and 2100+ Square feet. Property included an RV gate/parking and a 1/2 basketball court that backed to the common area. The backyard was truely an oasis perfect for entertaining. It was equipped with a 50 ft patio, built in BBQ, Huge Diving pebbletec pool with spa and waterfall feature. The Master Suite of the home had his and her built in closets, a master bath with dual side fireplace overlooking large garden tub. Additionally in the fourth bedroom upstairs was FULLY equipped to be a media room and lastly, the family room downstairs was complete with a dry bar built in and fireplace.
Here is a little about where Terramar is located in Peoria, Arizona This area has long been one of the most desirable locations in the Valley. Peoria’s attractive nature and mountainess views along with its limitless amount of recreational opportunities and exceptional school systems One of the most desirable characteristics of this community is the high quality housing..
What a truly breathtaking area to raise a family!!!
Have you heard of a FULLY APPROVED short sale that the home owner was current!!! Well I have! Matter of fact one just closed October 30, 2010 right in the pristine neighborhood of Terramar.
This particular home owner DID have a hard ship and MY TEAM was able to negotiate this short sale with Chase and receive a FULL LEIN RELEASE with a small contribution from the seller. Amazing! there is hope out there for bank to start working with their home owners!
This home was FULLY approved at 370k. the home had many features and the property was in MINT CONDITION… this was not like your ordinary short sale or REO you stumble across!
The home featured the following: 6 bed 4.5 baths and 2100+ Square feet. Property included an RV gate/parking and a 1/2 basketball court that backed to the common area. The backyard was truely an oasis perfect for entertaining. It was equipped with a 50 ft patio, built in BBQ, Huge Diving pebbletec pool with spa and waterfall feature. The Master Suite of the home had his and her built in closets, a master bath with dual side fireplace overlooking large garden tub. Additionally in the fourth bedroom upstairs was FULLY equipped to be a media room and lastly, the family room downstairs was complete with a dry bar built in and fireplace.
Here is a little about where Terramar is located in Peoria, Arizona This area has long been one of the most desirable locations in the Valley. Peoria’s attractive nature and mountainess views along with its limitless amount of recreational opportunities and exceptional school systems One of the most desirable characteristics of this community is the high quality housing..
What a truly breathtaking area to raise a family!!!
Monday, September 6, 2010
HAFA NEWS YOU CAN USE
HAFA News You Can Use
With the standard HAFA program getting introduced a few months ago and now Freddie Mac and Fannie Mae introducing their own versions at the start of August, it can be confusing to keep up with all the changes and updates.
From “The Government Goes Media on Foreclosure Alternatives,” this excerpt talks about the possibility of HAFA being more successful than the HAMP program:
The HAMP program has not been a raging success. In fact, nearly 521,000 trial modifications have been cancelled and over 60% of those have been trials for six months or more. Only 398,000 borrowers have been converted from trial loan-mods to permanent workouts. Over 45% of cancelled trials are now in a an alternate modification program offered by the servicers. But, of those, at least 6% are still falling back into a 60+ day delinquency status. There are no official HAFA stats to report, but it should be more successful overall then HAMP.
Or check out this video which detailed the still-evolving HAFA policies in May 2010:
How are Freddie HAFA sales different from the standard program?
Freddie’s program is the allowances to subordinate liens. Each junior lien, in order of priority, may receive no more than 6% of their unpaid principal balance up to an aggregate cap of $6000, in exchange for release of the subordinate liens and satisfaction of the underlying debts. That means that if a home has 2 liens in subordinate position, one is a $210,000 HELOC recorded before a $2700 HOA lien, the HELOC will only get $6000 and the HOA nothing.
Freddie Mac will accept the short-sale minimum acceptable net proceeds in satisfaction of the amount owed under the note and release of its lien
Freddie Mac will not require promissory notes or cash contributions from the borrower by Subordinate lienholders must also agree to release all liens without promissory notes or contributions from the borrower in order for the borrower to close under the program.
Fannie Mae HAFA sales include greater incentives for the servicers, taking the max under the Treasury program at $1500 to $2,200.
With the standard HAFA program getting introduced a few months ago and now Freddie Mac and Fannie Mae introducing their own versions at the start of August, it can be confusing to keep up with all the changes and updates.
From “The Government Goes Media on Foreclosure Alternatives,” this excerpt talks about the possibility of HAFA being more successful than the HAMP program:
The HAMP program has not been a raging success. In fact, nearly 521,000 trial modifications have been cancelled and over 60% of those have been trials for six months or more. Only 398,000 borrowers have been converted from trial loan-mods to permanent workouts. Over 45% of cancelled trials are now in a an alternate modification program offered by the servicers. But, of those, at least 6% are still falling back into a 60+ day delinquency status. There are no official HAFA stats to report, but it should be more successful overall then HAMP.
Or check out this video which detailed the still-evolving HAFA policies in May 2010:
How are Freddie HAFA sales different from the standard program?
Freddie’s program is the allowances to subordinate liens. Each junior lien, in order of priority, may receive no more than 6% of their unpaid principal balance up to an aggregate cap of $6000, in exchange for release of the subordinate liens and satisfaction of the underlying debts. That means that if a home has 2 liens in subordinate position, one is a $210,000 HELOC recorded before a $2700 HOA lien, the HELOC will only get $6000 and the HOA nothing.
Freddie Mac will accept the short-sale minimum acceptable net proceeds in satisfaction of the amount owed under the note and release of its lien
Freddie Mac will not require promissory notes or cash contributions from the borrower by Subordinate lienholders must also agree to release all liens without promissory notes or contributions from the borrower in order for the borrower to close under the program.
Fannie Mae HAFA sales include greater incentives for the servicers, taking the max under the Treasury program at $1500 to $2,200.
Thursday, September 2, 2010
Market Update 2010
MARKET UPDATE
September 2010
HOW LOW CAN THEY GO
Mortgage Type Interest Rate APR
30 Year Fixed 3.875% 4.005%
15 Year Fixed 3.500% 3.729%
5/1 ARM 3.000% 3.018%
Interest rates as of 09/01/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES CONTINUE TO SURGE
If you currently have an FHA mortgage with a rate of 5.000% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option. Call today if you have an FHA mortgage at 5.000% or higher. 480-368-2000.
FHA NEEDS CASH
In an effort to increase cash reserves, FHA is modifying the upfront mortgage insurance premium and monthly mortgage insurance charge. Currently the upfront mortgage insurance premium is 2.25% of the loan amount, which is rolled into the base loan amount. The current monthly mortgage insurance fee is .55%, which is part of the monthly mortgage payment.
Effective October 4th, 2010, the upfront mortgage insurance premium will be reduced from 2.25% to 1.0%. The monthly mortgage insurance fee will be raised from .55% to .85% - .95%; which will vary based on certain risk factors of the file.
NATIONAL HOME PRICES UP FOR THE YEAR
“National home prices jumped a substantial 3.6% in the past year, according to the S&P/Case-Shiller Home Price Index released on Tuesday. Prices also climbed 4.4% in the second quarter compared with a 2.8% plunge in the first quarter.” – cnnfn.com
The tax credit is the largest contributing factor for the increase in home prices. Industry insiders predict that home prices will level off, and potentially see a decline in the coming months, now that the tax credit has expired, and employment is not dramatically improving. Without another stimulus from the Federal Government, the housing market will remain shaky for the foreseeable future.
HOME SALES TAKE A BEATING
Home sales hit a 15 year low.
“Existing home sales sank 27.2% in July, twice as much as analysts expected, to a seasonally adjusted annual rate of 3.83 million units. Much of that drop is attributed to the end of the $8,000 homebuyer tax credit.” – cnnfn.com
TAX CREDIT 2010 & DOWNPAYMENT ASSISTANCE
The housing market is on the slide, and there is no hope in the foreseeable future; but there are rumors of help on the way.
A new buzz is stirring about the possibility of a new Government tax credit for home buyers to once again kick start the housing market. Numbers are now surfacing, and it is apparent that the tax credit had a much bigger impact on housing than many critics of the tax credit claimed.
Did someone say “Downpayment Assistance?” H.R. 600 FHA Seller-Financed Downpayment Reform Act of 2009 is not dead; not yet. Downpayment assistance allowed the seller to contribute the buyer’s minimum downpayment on FHA mortgages and was eliminated a couple of years ago when there was a push for everyone to have “skin in the game.” Downpayment assistance allows borrowers to essentially purchase a home with no money down. With the current housing market sputtering to a standstill, downpayment assistance may be making a come back.
If either the tax credit or downpayment assistance resurfaces, the housing market will once again erupt with new buyers coming off the fence and out of the woodwork. Yes, it may just be a short term Band-Aid, but the Government will want to stop the bleeding before there is hemorrhaging.
September 2010
HOW LOW CAN THEY GO
Mortgage Type Interest Rate APR
30 Year Fixed 3.875% 4.005%
15 Year Fixed 3.500% 3.729%
5/1 ARM 3.000% 3.018%
Interest rates as of 09/01/10. Conforming interest rates. Interest rates and APR based on loan amounts not to exceed $417,000. Loan to values not to exceed 80%. 720+ credit score. Owner occupied only. Purchase and rate in term refinances. Not all applicants will qualify. Call today for your individual scenario rate quote.
FHA STREAMLINES CONTINUE TO SURGE
If you currently have an FHA mortgage with a rate of 5.000% or higher, you may be able to refinance with no appraisal, and little or no closing costs. The recent drop in interest rates have caused an influx of borrowers refinancing to take advantage of the FHA Streamline refinance option. Call today if you have an FHA mortgage at 5.000% or higher. 480-368-2000.
FHA NEEDS CASH
In an effort to increase cash reserves, FHA is modifying the upfront mortgage insurance premium and monthly mortgage insurance charge. Currently the upfront mortgage insurance premium is 2.25% of the loan amount, which is rolled into the base loan amount. The current monthly mortgage insurance fee is .55%, which is part of the monthly mortgage payment.
Effective October 4th, 2010, the upfront mortgage insurance premium will be reduced from 2.25% to 1.0%. The monthly mortgage insurance fee will be raised from .55% to .85% - .95%; which will vary based on certain risk factors of the file.
NATIONAL HOME PRICES UP FOR THE YEAR
“National home prices jumped a substantial 3.6% in the past year, according to the S&P/Case-Shiller Home Price Index released on Tuesday. Prices also climbed 4.4% in the second quarter compared with a 2.8% plunge in the first quarter.” – cnnfn.com
The tax credit is the largest contributing factor for the increase in home prices. Industry insiders predict that home prices will level off, and potentially see a decline in the coming months, now that the tax credit has expired, and employment is not dramatically improving. Without another stimulus from the Federal Government, the housing market will remain shaky for the foreseeable future.
HOME SALES TAKE A BEATING
Home sales hit a 15 year low.
“Existing home sales sank 27.2% in July, twice as much as analysts expected, to a seasonally adjusted annual rate of 3.83 million units. Much of that drop is attributed to the end of the $8,000 homebuyer tax credit.” – cnnfn.com
TAX CREDIT 2010 & DOWNPAYMENT ASSISTANCE
The housing market is on the slide, and there is no hope in the foreseeable future; but there are rumors of help on the way.
A new buzz is stirring about the possibility of a new Government tax credit for home buyers to once again kick start the housing market. Numbers are now surfacing, and it is apparent that the tax credit had a much bigger impact on housing than many critics of the tax credit claimed.
Did someone say “Downpayment Assistance?” H.R. 600 FHA Seller-Financed Downpayment Reform Act of 2009 is not dead; not yet. Downpayment assistance allowed the seller to contribute the buyer’s minimum downpayment on FHA mortgages and was eliminated a couple of years ago when there was a push for everyone to have “skin in the game.” Downpayment assistance allows borrowers to essentially purchase a home with no money down. With the current housing market sputtering to a standstill, downpayment assistance may be making a come back.
If either the tax credit or downpayment assistance resurfaces, the housing market will once again erupt with new buyers coming off the fence and out of the woodwork. Yes, it may just be a short term Band-Aid, but the Government will want to stop the bleeding before there is hemorrhaging.
Friday, August 27, 2010
July Existing-Home Sales Fall, But Prices Rise
Existing-home sales were sharply lower in July following expiration of the home buyer tax credit but home prices continued to gain, according to the National Association of REALTORS®.
Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums, and co-ops, dropped 27.2 percent to a seasonally adjusted annual rate of 3.83 million units in July from a downwardly revised 5.26 million in June, and are 25.5 percent below the 5.14 million-unit level in July 2009. Sales are at the lowest level since the total existing-home sales series launched in 1999, and single family sales – accounting for the bulk of transactions – are at the lowest level since May of 1995.
Lawrence Yun, NAR chief economist, said a soft sales pace likely will continue for a few additional months. “Consumers rationally jumped into the market before the deadline for the home buyer tax credit expired. Since May, after the deadline, contract signings have been notably lower and a pause period for home sales is likely to last through September,” he said. “However, given the rock-bottom mortgage interest rates and historically high housing affordability conditions, the pace of a sales recovery could pick up quickly, provided the economy consistently adds jobs.
“Even with sales pausing for a few months, annual sales are expected to reach 5 million in 2010 because of healthy activity in the first half of the year. To place in perspective, annual sales averaged 4.9 million in the past 20 years, and 4.4 million over the past 30 years,” Yun added.
Mortgage Rates Dip
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.56 percent in July from 4.74 percent in June; the rate was 5.22 percent in July 2009. Last week, Freddie Mac reported the 30-year fixed was down to 4.42 percent.
The national median existing-home price for all housing types was $182,600 in July, up 0.7 percent from a year ago. Distressed home sales are unchanged from June, accounting for 32 percent of transactions in July; they were 31 percent in July 2009.
“Thanks to the home buyer tax credit, home values have been stable for the past 18 months despite heavy job losses,” Yun said. “Over the short term, high supply in relation to demand clearly favors buyers. However, given that home values are back in line relative to income, and from very low new-home construction, there is not likely to be any measurable change in home prices going forward.”
Inventory Rises
Total housing inventory at the end of July increased 2.5 percent to 3.98 million existing homes available for sale, which represents a 12.5-month supply at the current sales pace, up from an 8.9-month supply in June. Raw unsold inventory is still 12.9 percent below the record of 4.58 million in July 2008.
NAR President Vicki Cox Golder said there are great opportunities now for buyers who weren’t able to take advantage of the tax credit. “Mortgage interest rates are at record lows, home prices have firmed and there is good selection of property in most areas, so buyers with good jobs and favorable credit ratings find themselves in a fortunate position,” she said.
A parallel NAR practitioner survey shows first-time buyers purchased 38 percent of homes in July, down from 43 percent in June. Investors accounted for 19 percent of sales in July, up from 13 percent in June; the balance were to repeat buyers. All-cash sales rose to 30 percent in July from 24 percent in June.
Breakdown of the Numbers
• Single-family home sales dropped 27.1 percent to a seasonally adjusted annual rate of 3.37 million in July from a pace of 4.62 million in June, and are 25.6 percent below the 4.53 million level in July 2009; they were the lowest since May 1995 when the sales rate was 3.34 million.
• The median existing single-family home price was $183,400 in July, which is 0.9 percent above a year ago.
• Single-family median existing-home prices were higher in 11 out of 19 metropolitan statistical areas reported in July in comparison with July 2009 (the price in one of 20 tracked markets was not available). However, existing single-family home sales fell in all 20 areas from a year ago.
• Existing condominium and co-op sales fell 28.1 percent to a seasonally adjusted annual rate of 460,000 in July from 640,000 in June, and are 24.0 percent below the 605,000-unit level in July 2009. The median existing condo price was $176,800 in July, down 1.7 percent from a year ago.
By Region
• Existing-home sales in the Northeast dropped 29.5 percent to an annual pace of 620,000 in July and are 30.3 percent lower than a year ago. The median price in the Northeast was $263,800, up 4.8 percent from July 2009.
• Existing-home sales in the Midwest fell 35.0 percent in July to a level of 800,000 and are 33.3 percent below July 2009. The median price in the Midwest was $151,600, down 2.8 percent from a year ago.
• In the South, existing-home sales dropped 22.6 percent to an annual pace of 1.54 million in July and are 19.8 percent below a year ago. The median price in the South was $156,300, down 3.3 percent from July 2009.
• Existing-home sales in the West fell 25.0 percent to an annual level of 870,000 in July and are 23.0 percent below a year ago. The median price in the West was $224,800, up 3.3 percent from July 2009.
Source: NAR
Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums, and co-ops, dropped 27.2 percent to a seasonally adjusted annual rate of 3.83 million units in July from a downwardly revised 5.26 million in June, and are 25.5 percent below the 5.14 million-unit level in July 2009. Sales are at the lowest level since the total existing-home sales series launched in 1999, and single family sales – accounting for the bulk of transactions – are at the lowest level since May of 1995.
Lawrence Yun, NAR chief economist, said a soft sales pace likely will continue for a few additional months. “Consumers rationally jumped into the market before the deadline for the home buyer tax credit expired. Since May, after the deadline, contract signings have been notably lower and a pause period for home sales is likely to last through September,” he said. “However, given the rock-bottom mortgage interest rates and historically high housing affordability conditions, the pace of a sales recovery could pick up quickly, provided the economy consistently adds jobs.
“Even with sales pausing for a few months, annual sales are expected to reach 5 million in 2010 because of healthy activity in the first half of the year. To place in perspective, annual sales averaged 4.9 million in the past 20 years, and 4.4 million over the past 30 years,” Yun added.
Mortgage Rates Dip
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.56 percent in July from 4.74 percent in June; the rate was 5.22 percent in July 2009. Last week, Freddie Mac reported the 30-year fixed was down to 4.42 percent.
The national median existing-home price for all housing types was $182,600 in July, up 0.7 percent from a year ago. Distressed home sales are unchanged from June, accounting for 32 percent of transactions in July; they were 31 percent in July 2009.
“Thanks to the home buyer tax credit, home values have been stable for the past 18 months despite heavy job losses,” Yun said. “Over the short term, high supply in relation to demand clearly favors buyers. However, given that home values are back in line relative to income, and from very low new-home construction, there is not likely to be any measurable change in home prices going forward.”
Inventory Rises
Total housing inventory at the end of July increased 2.5 percent to 3.98 million existing homes available for sale, which represents a 12.5-month supply at the current sales pace, up from an 8.9-month supply in June. Raw unsold inventory is still 12.9 percent below the record of 4.58 million in July 2008.
NAR President Vicki Cox Golder said there are great opportunities now for buyers who weren’t able to take advantage of the tax credit. “Mortgage interest rates are at record lows, home prices have firmed and there is good selection of property in most areas, so buyers with good jobs and favorable credit ratings find themselves in a fortunate position,” she said.
A parallel NAR practitioner survey shows first-time buyers purchased 38 percent of homes in July, down from 43 percent in June. Investors accounted for 19 percent of sales in July, up from 13 percent in June; the balance were to repeat buyers. All-cash sales rose to 30 percent in July from 24 percent in June.
Breakdown of the Numbers
• Single-family home sales dropped 27.1 percent to a seasonally adjusted annual rate of 3.37 million in July from a pace of 4.62 million in June, and are 25.6 percent below the 4.53 million level in July 2009; they were the lowest since May 1995 when the sales rate was 3.34 million.
• The median existing single-family home price was $183,400 in July, which is 0.9 percent above a year ago.
• Single-family median existing-home prices were higher in 11 out of 19 metropolitan statistical areas reported in July in comparison with July 2009 (the price in one of 20 tracked markets was not available). However, existing single-family home sales fell in all 20 areas from a year ago.
• Existing condominium and co-op sales fell 28.1 percent to a seasonally adjusted annual rate of 460,000 in July from 640,000 in June, and are 24.0 percent below the 605,000-unit level in July 2009. The median existing condo price was $176,800 in July, down 1.7 percent from a year ago.
By Region
• Existing-home sales in the Northeast dropped 29.5 percent to an annual pace of 620,000 in July and are 30.3 percent lower than a year ago. The median price in the Northeast was $263,800, up 4.8 percent from July 2009.
• Existing-home sales in the Midwest fell 35.0 percent in July to a level of 800,000 and are 33.3 percent below July 2009. The median price in the Midwest was $151,600, down 2.8 percent from a year ago.
• In the South, existing-home sales dropped 22.6 percent to an annual pace of 1.54 million in July and are 19.8 percent below a year ago. The median price in the South was $156,300, down 3.3 percent from July 2009.
• Existing-home sales in the West fell 25.0 percent to an annual level of 870,000 in July and are 23.0 percent below a year ago. The median price in the West was $224,800, up 3.3 percent from July 2009.
Source: NAR
Foreclosures Down, But Late Payments Up
Foreclosures Down, But Late Payments Up
The wave of foreclosures appears to be subsiding slightly. According to data from Mortgage Bankers Association’s National Delinquency Survey:
• The percentage of loans on which foreclosure action were started during the second quarter was 1.11 percent, down 12 basis points from last quarter and down 25 basis points from one year ago.
• The percentage of loans in the foreclosure process at the end of the second quarter was 4.57 percent, a decrease of six basis points from the first quarter of 2010, but an increase of 27 basis points from one year ago.
• Loans that were 90 days or more past due or in the process of foreclosure was 9.11 percent, a decrease of 43 basis points from first quarter, but an increase of 114 basis points compared to the second quarter of last year.
“The good news is that foreclosure starts are down, and the inventory of homes anywhere in the process of foreclosure fell for the first time since 2006 and had the largest drop since 2005,” says Jay Brinkmann, MBA’s chief economist.
The bad news is that the percent of loans one payment behind had peaked in the first quarter of 2009 at 3.77 percent and fell to 3.31 percent by the end of 2009. Now that rate has risen to 3.51 percent.
“Only when we see a consistent increase in employment will we see an increase in sales and starts, and a sustained improvement in the delinquency numbers,” Brinkmann adds.
Source: Mortgage Bankers Association (08/26/2010)
The wave of foreclosures appears to be subsiding slightly. According to data from Mortgage Bankers Association’s National Delinquency Survey:
• The percentage of loans on which foreclosure action were started during the second quarter was 1.11 percent, down 12 basis points from last quarter and down 25 basis points from one year ago.
• The percentage of loans in the foreclosure process at the end of the second quarter was 4.57 percent, a decrease of six basis points from the first quarter of 2010, but an increase of 27 basis points from one year ago.
• Loans that were 90 days or more past due or in the process of foreclosure was 9.11 percent, a decrease of 43 basis points from first quarter, but an increase of 114 basis points compared to the second quarter of last year.
“The good news is that foreclosure starts are down, and the inventory of homes anywhere in the process of foreclosure fell for the first time since 2006 and had the largest drop since 2005,” says Jay Brinkmann, MBA’s chief economist.
The bad news is that the percent of loans one payment behind had peaked in the first quarter of 2009 at 3.77 percent and fell to 3.31 percent by the end of 2009. Now that rate has risen to 3.51 percent.
“Only when we see a consistent increase in employment will we see an increase in sales and starts, and a sustained improvement in the delinquency numbers,” Brinkmann adds.
Source: Mortgage Bankers Association (08/26/2010)
Monday, August 9, 2010
Housing Tax Credit was like a Painkiller
Housing Tax Credit was like a Painkiller…Posted on 29 Jul, 2010 by admin According to a CNN Money article, “The tax credit was like a painkiller for the housing market, but we’ll have to go into surgery to deal with the underlying problems…”
I certainly can’t speak for the rest of you, but surgery isn’t exactly a fun experience. The housing market has taken it’s bumps and bruises, broken bones, etc., but the bandages have to be addressed properly, not just put on tighter. With any injury, if you’re following the proper treatment procedures, you should follow the RICE method. Rest, Ice, Compression, Elevation…
What does this mean as translation for the housing market? How about TIRE – (T) Tax Credits for Buyers to stimulate offers, (I) Inventory Reduction, (R) Regulation of the banks to accept reasonable offers on properties, (E) Expedition of these submitted offers.
There are many problems within the system, each having a different solution. Buyers are backing out of deals because of the lengthy timeline, and because there is so much inventory on the market, they can find a new property that may not need to be approved. Offering continued tax credits to buyers will offer incentives for them to continue purchasing, it’s proven that this solution worked. Temporary regulation of the lenders to approve reasonable offers, and expediting the process will correct the tumbling housing market.
Until the time where this TIRE method comes to light, the market shifts, and property values continue to rise, we will see a very slow recovery to this housing market crisis. If property values continue to dip as they have, and homeowners owe more than their house is worth, anytime they want or need to sell within the next 10-15 years, depending on the market, it will be a Short Sale.
It would be a shame if the real estate market was still in a cycle 15 years from now, where the term “Short Sale” was as popular as it’s become today. That would simply mean, that bandage was just put on way too tight!
I certainly can’t speak for the rest of you, but surgery isn’t exactly a fun experience. The housing market has taken it’s bumps and bruises, broken bones, etc., but the bandages have to be addressed properly, not just put on tighter. With any injury, if you’re following the proper treatment procedures, you should follow the RICE method. Rest, Ice, Compression, Elevation…
What does this mean as translation for the housing market? How about TIRE – (T) Tax Credits for Buyers to stimulate offers, (I) Inventory Reduction, (R) Regulation of the banks to accept reasonable offers on properties, (E) Expedition of these submitted offers.
There are many problems within the system, each having a different solution. Buyers are backing out of deals because of the lengthy timeline, and because there is so much inventory on the market, they can find a new property that may not need to be approved. Offering continued tax credits to buyers will offer incentives for them to continue purchasing, it’s proven that this solution worked. Temporary regulation of the lenders to approve reasonable offers, and expediting the process will correct the tumbling housing market.
Until the time where this TIRE method comes to light, the market shifts, and property values continue to rise, we will see a very slow recovery to this housing market crisis. If property values continue to dip as they have, and homeowners owe more than their house is worth, anytime they want or need to sell within the next 10-15 years, depending on the market, it will be a Short Sale.
It would be a shame if the real estate market was still in a cycle 15 years from now, where the term “Short Sale” was as popular as it’s become today. That would simply mean, that bandage was just put on way too tight!
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