MAY 2011
HOW LOW CAN THEY GO
Home prices (national average) fell another 3.3% in February. This was the eight month in a row that home prices have dropped. (cnnfn.com)
Home prices in Maricopa County (Arizona) fell slightly, but home sales are up nearly eight percent in the first quarter of 2011. 16,535 homes sold in the first quarter of 2011 in Maricopa County. The median home price for existing home sales is $125,175. (azcentral.com)
INVEST IN PHOENIX
So it is a bit self-serving; but when talking to people that do not live in the Phoenix Metropolitan market, they are astounded when I discus the types and prices of homes we are selling here. You would be amazed at what you can buy for under $100K; for that matter, under $50K.
There are over 2,100 properties (excluding manufactured) actively listed on the MLS in the Phoenix Metropolitan market (Maricopa & Pinal Counties) under $50,000. There are over 6,000 properties listed between $50,001 and $100,000. There are another 4,600 listed between $100,001 and $150,000.
People are purchasing these homes as primary residences, second homes, and investment properties. Phoenix is a great market, if you are in the market for a home. Low prices, low rates, and good loan products. And by the way, it will be in the high 80s all week.
Please contact me if you are interested in some of the great values currently being offered in the Phoenix Metropolitan market.
NEW HOME SALES BEGIN TO SHOW STRENGTH
Although new home sales remain near all-time lows, February new home sales were up 11%. (cnnfn.com) That number is going the right direction, but new home sales were down nearly 28% from February of last year.
QUALIFED RESIDENTIAL MORTGAGE (QRM) – CONGRESS IS AT IT AGAIN
Congress is in the process of improving the quality and lowering the risk of mortgage lending. “To discourage excessive risk taking, Congress required securitizers to retain five percent of the credit risk on loans packaged and sold as mortgage securities. However, because across-the-board risk retention would impose significant costs on responsible, credit worthy borrowers, legislators also created an exemption for “Qualified Residential Mortgages,” defined to include mortgages with product features and sound underwriting standards that have been proven to reduce default.” – Proposed QRM Harms Creditworthy Borrowers and Housing Recovery
Borrowers that could not qualify for a QRM would fall into the high cost, and potentially higher risk, non QRM market; regardless of credit worthiness.
Consumer Impact
Increased Down Payment Requirement
20% down payment would be required on purchase transactions.
Research from the Center for Responsible Lending estimated that it would take the average family 14 years to save up 20% for a down payment on a home.
Increased Equity Requirement
20% equity requirement on refinance transactions.
25% equity requirement on cash-out refinance transactions
Increased Interest Rates
Estimates have shown up to a 3% rise in interest rates. – Report by JP Morgan Securities Inc. (Securitization Outlook 12/11/09)
Less Market Competition
· Most mortgage lenders do not have the capital to maintain the 5% proposed risk retention. Reducing the number of lenders will drive up costs and rates while reducing lending turn times and program choices.
Under the current proposal, loans insured or guaranteed by Fannie Mae, Freddie Mac, FHA, VA, and USDA would be “exempt.” What loans would have the “exempt” status is still an ongoing debate. If the Republican Party is successful with “unwinding” Fannie and Freddie, a large segment of the population would be eliminated from being able to purchase a home with less than 20% down at low interest rates, or force homebuyers to government loans (i.e. FHA and VA). The QRM may prove to be counterproductive for the Republicans that are pushing for the government to diminish its involvement in mortgage industry.
WALL STREET SPENDS MILLIONS TO STOP DODD-FRANK
“Wall Street and the financial industry spent more to lobby Washington in the first quarter of this year than a year ago when Congress was writing sweeping financial-overhaul legislation, according to a Wall Street Journal review of lobbying reports released Thursday. The disclosures show that 26 of the financial firms and trade associations that spent the most in 2010 collectively spent $27 million in the three months ending March 31, a 2.7% increase from the $26.3 million spent in the comparable period in 2010. Wells Fargo & Co. shelled out more on lobbying than any other financial firm, surpassing J.P. Morgan Chase, which had the top spot in 2010. Wells Fargo's lobbying expenditures nearly doubled to $1.9 million during the first quarter from $1 million in the same period a year ago.” (housingwire.com)
BROUGHT TO YOU BY:
Chris Tiller
via: The Brett Tanner Team
Keller Williams
Phone: 602-561-1346
Fax:602-595-5450
Email: tiller34@hotmail.com
HOW LOW CAN THEY GO
Home prices (national average) fell another 3.3% in February. This was the eight month in a row that home prices have dropped. (cnnfn.com)
Home prices in Maricopa County (Arizona) fell slightly, but home sales are up nearly eight percent in the first quarter of 2011. 16,535 homes sold in the first quarter of 2011 in Maricopa County. The median home price for existing home sales is $125,175. (azcentral.com)
INVEST IN PHOENIX
So it is a bit self-serving; but when talking to people that do not live in the Phoenix Metropolitan market, they are astounded when I discus the types and prices of homes we are selling here. You would be amazed at what you can buy for under $100K; for that matter, under $50K.
There are over 2,100 properties (excluding manufactured) actively listed on the MLS in the Phoenix Metropolitan market (Maricopa & Pinal Counties) under $50,000. There are over 6,000 properties listed between $50,001 and $100,000. There are another 4,600 listed between $100,001 and $150,000.
People are purchasing these homes as primary residences, second homes, and investment properties. Phoenix is a great market, if you are in the market for a home. Low prices, low rates, and good loan products. And by the way, it will be in the high 80s all week.
Please contact me if you are interested in some of the great values currently being offered in the Phoenix Metropolitan market.
NEW HOME SALES BEGIN TO SHOW STRENGTH
Although new home sales remain near all-time lows, February new home sales were up 11%. (cnnfn.com) That number is going the right direction, but new home sales were down nearly 28% from February of last year.
QUALIFED RESIDENTIAL MORTGAGE (QRM) – CONGRESS IS AT IT AGAIN
Congress is in the process of improving the quality and lowering the risk of mortgage lending. “To discourage excessive risk taking, Congress required securitizers to retain five percent of the credit risk on loans packaged and sold as mortgage securities. However, because across-the-board risk retention would impose significant costs on responsible, credit worthy borrowers, legislators also created an exemption for “Qualified Residential Mortgages,” defined to include mortgages with product features and sound underwriting standards that have been proven to reduce default.” – Proposed QRM Harms Creditworthy Borrowers and Housing Recovery
Borrowers that could not qualify for a QRM would fall into the high cost, and potentially higher risk, non QRM market; regardless of credit worthiness.
Consumer Impact
Increased Down Payment Requirement
20% down payment would be required on purchase transactions.
Research from the Center for Responsible Lending estimated that it would take the average family 14 years to save up 20% for a down payment on a home.
Increased Equity Requirement
20% equity requirement on refinance transactions.
25% equity requirement on cash-out refinance transactions
Increased Interest Rates
Estimates have shown up to a 3% rise in interest rates. – Report by JP Morgan Securities Inc. (Securitization Outlook 12/11/09)
Less Market Competition
· Most mortgage lenders do not have the capital to maintain the 5% proposed risk retention. Reducing the number of lenders will drive up costs and rates while reducing lending turn times and program choices.
Under the current proposal, loans insured or guaranteed by Fannie Mae, Freddie Mac, FHA, VA, and USDA would be “exempt.” What loans would have the “exempt” status is still an ongoing debate. If the Republican Party is successful with “unwinding” Fannie and Freddie, a large segment of the population would be eliminated from being able to purchase a home with less than 20% down at low interest rates, or force homebuyers to government loans (i.e. FHA and VA). The QRM may prove to be counterproductive for the Republicans that are pushing for the government to diminish its involvement in mortgage industry.
WALL STREET SPENDS MILLIONS TO STOP DODD-FRANK
“Wall Street and the financial industry spent more to lobby Washington in the first quarter of this year than a year ago when Congress was writing sweeping financial-overhaul legislation, according to a Wall Street Journal review of lobbying reports released Thursday. The disclosures show that 26 of the financial firms and trade associations that spent the most in 2010 collectively spent $27 million in the three months ending March 31, a 2.7% increase from the $26.3 million spent in the comparable period in 2010. Wells Fargo & Co. shelled out more on lobbying than any other financial firm, surpassing J.P. Morgan Chase, which had the top spot in 2010. Wells Fargo's lobbying expenditures nearly doubled to $1.9 million during the first quarter from $1 million in the same period a year ago.” (housingwire.com)
BROUGHT TO YOU BY:
Chris Tiller
via: The Brett Tanner Team
Keller Williams
Phone: 602-561-1346
Fax:602-595-5450
Email: tiller34@hotmail.com
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