Currently browsing November 2008 monthly archives.
HUD Announces Changes to FHA Loan Program!
Existing Home Sales Are Relatively Unchanged Going On 14 Months Now
In real estate, the term existing home refers to a “used” property; one that can’t be classified as new construction.
The number of existing homes sold each month is tracked by the National Association of REALTORS. The report is often used as a gauge for the health of the real estate market nationwide.
In October, nearly 5 million existing homes sold across the U.S. This figure represents a slight drop from September’s reading, and a equally slight drop from the October 2007 data.
But, October’s Existing Home Sales figures marked the 14th straight month in which Existing Home Sales straddled 5-million units. This is a remarkable statistic because 14 months of anything is a pattern, not a blip. Despite what the news tells us, Americans are buying and selling real estate at a somewhat steady clip.
As we head into the Holiday Season, buyer activity should slow, reducing demand for homes. At the same time, however, widespread foreclosure moratoriums should reduce the number of homes available to buy. These forces should counter-act to help keep the market (and prices) in balance.
(Image courtesy: USA Today)
Planning To Buy A Home In 2009? Expect A Tougher Mortgage Road Ahead.
The Federal Reserve confirmed what most of us already knew — getting qualified for a “prime mortgage” is increasingly more difficult.
In a quarterly survey of 84 banks, 75 percent of respondent banks tightened mortgage guidelines over the last 3 months for the most qualified of home loan applicants.
“Prime” is a vague term when it comes to mortgages, but, historically, a prime borrower is one that can document:
- A well-documented credit history
- Very high credit scores
- Very low debt-to-incomes
Historically, banks bent over backwards to lend money to this class of borrower. Today, they’re thinking twice.
The chart’s steep ascent reinforces that members of all tax brackets face consequences from the current credit market turmoil. And, although some corners of credit looked poised to recover — interbank lending, for one — the mortgage market is yet unaffected and should be among the last to thaw.
All prospective home buyers should prepare for the likelihood that mortgage guidelines continue to toughen before they start to ease. Mortgage applicants on the cusp of being approved today will almost certainly be turned down for a mortgage in 2009.
Owning real estate can require a tremendous amount of advance planning and, sometimes, looking at the past is the best way to prepare for what’s coming ahead.
According to the Federal Reserve’s survey, what’s coming ahead is more mortgage application scrutiny.
To see if you have what it takes, call Tyler Ford and Todd Abelson at Sunstreet Mortgage in Tucson, Arizona or visit our website at www.TucsonMortgages.com
How The Presidential Election May Impact Mortgage Rates
More than a handful of would-be home buyers have stayed on the sidelines this year, waiting for Election Day to pass.
Their prevailing thought was that once the President-Elect was identified, credit markets will systemically unfreeze and housing markets will return to normal.
If history is a guide, this is an unlikely scenario.
Election Day doesn’t figure to alter markets any more in 2008 than it did after the four previous presidential elections.
If anything, post-Election Day market reaction has been muted:
- 1992 : Dow closes down 0.9 percent the day after Election Day
- 1996 : Dow closes up 1.6 percent the day after Election Day
- 2000 : Dow closes down 0.4 percent the day after Election Day
- 2004 : Dow closes up 1.0 percent the day after Election Day
But just because the stock market has a history of idling on the day after the election doesn’t mean that mortgage rates will rest easy this week. The likely outcome is the opposite, actually.
If investors believe the President-elect will successfully stimulate the economy, stock markets would likely rally, causing mortgage bonds to sell off and mortgage rates to rise.
Or, if investors think the winning candidate will fail to revive the economy, money would flock to government bonds as a place of safety. This dollar flow would occur at the expense of the mortgage market, causing rates to rise in this scenario, too.
Of course, it’s as difficult to predict post-Election market conditions as it is to predict the election itself but one thing is for certain — rates may rise and fall before the week is out, but credit guidelines will remain extra-tight. Getting approved for a mortgage won’t be any easier — no matter which party wins the Presidential Election.
For up to the minutes news, and for all your BEST mortgage options in Tucson, Arizona, call Tyler Ford and Todd Abelson at Sunstreet Mortgage, LLC or visit our site at www.TucsonMortgages.com
Source
Will the election drive the Dow?
Eamon Javers
Politico
https://news.yahoo.com/s/politico/20081022/pl_politico/14826
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