Bills Aim to Stem Home Losses
February 7, 2011
By The Record, Stockton, Calif.
Feb. 03—STOCKTON—Legislation intended to stem the continuing tide of home foreclosures was brought to both houses of Congress in January.
Rep. Dennis Cardoza, D-Atwater, re-introduced a bill that would make it easier for home owners to refinance existing mortgages to net more manageable monthly payments. He proposed this bill, called the HOME Act, in 2009.
Last week, U.S. Sen. Barbara Boxer, D-Calif., introduced a similar bill in the Senate.
“Like the HOME Act, Sen. Boxer’s bill would lower interest rates for millions of struggling home owners, lowering their monthly mortgage payments and giving them a fair shot at keeping their homes,” Cardoza said.
Both bills would allow home owners with mortgages backed by Fannie Mae or Freddie Mac to take advantage of low interest rates, Cardoza said.
There are about 30 million mortgages backed through Fannie or Freddie, and the potential savings from such a program could amount to a $50 billion reduction in annual payments, according to an estimate from Morgan Stanley and JP Morgan Chase cited in a news release from Cardoza’s office.
The economy is directly related to the housing crisis, and recovery requires action to stop the “domino effect of foreclosures,” Cardoza said.
The program outlined in the HOME Act would be funded through new mortgage-backed securities and would have littleto- no cost to taxpayers, according to the release.
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Copyright (c) 2011, The Record, Stockton, Calif.
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This is the type of bill we need to help troubled homeowners and spur the economy further.
Conne Terova
Tuesday, February 8, 2011
Tuesday, February 1, 2011
DECEMBER MICHIGAN MARKET REPORT 2010
December Pending Sales were at a relatively strong pace, giving us more market momentum going into 2011 than we had into 2010!
Overall, we are seeing what appears to be a trend towards a stable market in terms of inventory levels and sales pace. It is also a window into what we can expect in 2011, an active buyer market with sales near 2010 levels (possibly slightly lower without the tax credit help of 2010).
The months supply of inventory (MSI) is still running over 6 months, putting the market on the Buyers side, however it dips closer to 5 months in the under $100,000 range, but still over 24 months in the over $500,000 range. Which means price appreciation is still a year away for the lower priced areas and more for the higher priced markets.
Should buyers wait? As we have said many times, it is pretty clear that we have hit the market bottom, and although appreciation won't be taking off soon, interest rates will certainly rise, as they have already. A 1% rise in rates wipes any savings from a 10% price drop and it is far more likely that interest rates will rise by 1% than values will fall by 10%. Also, with an FHA loan, buyers will lock in a low interest rate that is assumable when they sell their home. In five years, a 4.75% rate will make your home more saleable when the rates are at 6.5%.
Also, keep in mind that there are thousands of former homeowners, who were forced to sell and now lease and whose credit is now repaired and ready to take the homeownership plunge. In the most recent National Association of Realtor surveys, the vast majority of people who lost their homes due to financial hardship are still looking to own another home first chance they get.
2010 was the fifth year of our “new normal”, where most sales required 2-3 negotiations (to the buyer, the appraiser, the lender) and considerably more time. We worked extra hard, but there has not been a time when we have been needed more by our clients. Through it all, we closed more transactions than ever before in our 81 year history!! We are one of only five brokers among the Real Trends 500 to show an increase in productivity!
We worked hard for our clients and it showed…my best year in nearly 22 years!
Thank you for a great 2010 and an even stronger 2011~
Conne
Overall, we are seeing what appears to be a trend towards a stable market in terms of inventory levels and sales pace. It is also a window into what we can expect in 2011, an active buyer market with sales near 2010 levels (possibly slightly lower without the tax credit help of 2010).
The months supply of inventory (MSI) is still running over 6 months, putting the market on the Buyers side, however it dips closer to 5 months in the under $100,000 range, but still over 24 months in the over $500,000 range. Which means price appreciation is still a year away for the lower priced areas and more for the higher priced markets.
Should buyers wait? As we have said many times, it is pretty clear that we have hit the market bottom, and although appreciation won't be taking off soon, interest rates will certainly rise, as they have already. A 1% rise in rates wipes any savings from a 10% price drop and it is far more likely that interest rates will rise by 1% than values will fall by 10%. Also, with an FHA loan, buyers will lock in a low interest rate that is assumable when they sell their home. In five years, a 4.75% rate will make your home more saleable when the rates are at 6.5%.
Also, keep in mind that there are thousands of former homeowners, who were forced to sell and now lease and whose credit is now repaired and ready to take the homeownership plunge. In the most recent National Association of Realtor surveys, the vast majority of people who lost their homes due to financial hardship are still looking to own another home first chance they get.
2010 was the fifth year of our “new normal”, where most sales required 2-3 negotiations (to the buyer, the appraiser, the lender) and considerably more time. We worked extra hard, but there has not been a time when we have been needed more by our clients. Through it all, we closed more transactions than ever before in our 81 year history!! We are one of only five brokers among the Real Trends 500 to show an increase in productivity!
We worked hard for our clients and it showed…my best year in nearly 22 years!
Thank you for a great 2010 and an even stronger 2011~
Conne
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