Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

How To Find Good Deals As The Buyers Market Comes To An End

Posted: 30 Oct 2009 07:45 AM PDT

At some point in their lives, every home buyer in America has wondered "Is now the best time to buy a home?" In this 3-minute video, NBC's The Today Show does a good job of answering the question.

The conclusion? Yes, but not if you're going to overpay.

The Buyers Market is ending, we learn, as home prices rise across most of the country. Pockets of opportunity remain, however, and the focused home buyer can still find a "good deal".

Some of the video's tips include:

  • On what types of homes can you get the best prices
  • What you can learn from looking in a seller's closet
  • How to identify a desperate seller

The piece also goes negative on short sales, noting the amount of time required to buy one. Short sales typically do take longer to close versus a "traditional" purchase, but that doesn't mean they should be avoided.

There's plenty of bargains in the short sale arena, too.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

What The Media About September's New Home Sales Report

Posted: 29 Oct 2009 07:45 AM PDT

New Home Sales supply September 2009Some days, newspaper headlines are a terrible place to get your real estate news.

Today is one of those days.

After the September New Home Sales report showed sales volume down from August, the mainstream media jumped on the story:

But the headlines miss the point, somewhat. Yes, home sales volume is important to housing, but it's not as important as home supply.

A deeper look at the New Home Sales data reveals an interesting comparison point:

  • New home sales volume fell 3.6%
  • The number of new homes available for sale fell 3.8%

In other words, sales outpaced supply -- a running theme this year and a positive signal for housing.

Since peaking in January 2009, the supply of newly-built homes has now dropped by 40 percent. The average sale price is up 15% over the same period.

This is why you can't get your real estate news from the headlines. You have to dig a little bit deeper to get the real story.

September's New Home Sales report was plenty strong. The housing market recovery continues.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

Home Values In 95% Of Case-Shiller Markets Are Improving Year-To-Year

Posted: 28 Oct 2009 07:45 AM PDT

Case-Shiller August 2009

For August, the Case-Shiller Index showed annual home values improving across 19 of 20 U.S. markets. It's the first time in 3-plus years that the benchmark housing index has shown such strength.

According to a Case-Shiller Index spokesperson, "The rate of annual decline in home price values continues to improve."

It's yet another sign that housing may have already bottomed.

However, just because the Case-Shiller Index shows a stabilization in home values, that doesn't necessarily make it true. This is because real estate happens on the local level and the Case-Shiller Index is more "national". It tracks data in just 20 U.S. cities.

Homeowners everywhere else are unaccounted for.

Furthermore, even within the 20 tracked Case-Shiller markets, there's no allowance for the natural sub-markets that exist. Some neighborhoods under-perform and some neighborhoods out-perform.

Case-Shiller treats them all the same.

Despite its imperfections, though, the Case-Shiller Index remains a helpful, broader measurement of U.S. real estate. Economists believe that housing led the U.S. into the recession and they believe housing will lead us out, too.

If that's true, August's Case-Shiller data is another step in the right direction.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

Falling Home Supplies Mean More Multiple-Offer Situations For Buyers

Posted: 27 Oct 2009 07:45 AM PDT

Existing Home Supply September 2009The national housing supply fell to a 2-year low last month, according to the National Association of Realtors®.

At the current sales pace, existing home inventories would sell out in 7.8 months -- 30 percent faster versus November 2008.

For a 10-month window, that's a major housing supply reduction and it helps to explain why multiple-offer situations have been so common lately.

Moreover, the same report from NAR showed sales activity reaching its highest point since July 2007, too.

If you're looking for evidence that the long-standing Buyers Market is ending, this month's Existing Home Sales report might be it.

Even median sales prices -- typically dragged lower by distressed and foreclosed properties -- declined at its slowest pace in a year. The market may have turned a corner.

Home prices are rooted in the basic economics of supply and demand.

  • When supply outweighs demand, home prices fall
  • When supply lags demand, home price rise

Since March 2009, the market has been moving in the right direction. Low mortgage rates, ample housing supply and a first-time home buyer tax credit fueled buy-side demand so that home prices are now rising in many U.S. markets.

If home supplies stay on this path into 2010, expect home prices to rise even more.


Market updates

10-yr   3.57% (+ 8 bps)
MBS: -10/32 (-31 bps)
Stock Markets:
DOW -104  at 9,867
S&P - 13 at 1,067
NAS  - 13 at 2,142
Economic Calendar:
Tuesday, October 27, 2009
Durable Goods @ 8:30am – Moderate Impact
Case/Shiller Home Price Index @ 9:00am – Moderate Impact
Consumer Confidence @ 10:00am – HIGH Impact
Two-year note auction @ 1:00pm – HIGH Impact
Wednesday, October 28, 2009
New Home Sales @ 10:00am – Moderate Impact
Five-year note auction @ 1:00 – HIGH Impact
Thursday, October 29, 2009
Quarterly GDP @ 8:30am – HIGH Impact
Weekly Jobless Claims @ 8:30am – HIGH Impact
Seven-year Note Auction @ 1:00 – High Impact
Friday, October 30, 2009
Personal Income @ 8:30am – Moderate Impact
Personal Spending @ 8:30am – HIGH Impact
Chicago PM survey @ 9:45 – Moderate Impact
Univ. of Michigan Consumer Sentiment @ 9:55am – Moderate Impact

Market Commentary:
Stock markets remained weak the remainder of the day after starting on the positive side. Treasuries and MBS also remained weak closing on their lows of the day and holding in place the price worsening conditions that we started with. Secondary market mortgage pricing worsened by .250 overall today with 30-year products edging close to .375 price worsening.
What happened? There was no news that drove the markets today and we saw stocks sell-off in response to strengthening in the U.S Dollar today. Stocks had also touched technical highs – once again testing and failing to breakout. 
Treasuries and MBS traded on their own today. You could typically expect to see some movement to bonds on a weak stock market, but the selling that we began the day with held tight as the day unfolded. Additionally last week there were rumors that the Fed may tweak their semantics on the next statement to suggest that the Fed would be ready to nudge rates higher at the first signs of inflation and stable economic growth. By the way, we don’t see much of that yet as unemployment and a weak consumer will continue to weigh on a recovery. But, the Fed could also be testing the markets reaction as they are also set to unwind their treasury purchases that have been helping to support the low mortgage rates.
Bonds broke resistance we have seen hold since August and now sit right on a very small technical resistance level of 3.57% in the 10-year TSY. The next level of support isn’t until 3.70 to 3.80% levels… so as we have been recommending for weeks – stay defensive.
Bonds have tended to weaken like this as bond traders hedge ahead of treasury auctions like we have this week. If those bond auctions go well – as anticipated – we could get some near-term relief. But, all of that will be weighed by traders against the avalanche of economic news this week as well.
The stock markets were lead lower by financials with the large banks- namely Bank of America- selling off early and hard. The compensation control rhetoric along with weak loan portfolios continue to weigh on the banks..
P.S. As we watch the after hours trading, MBS continue to weaken slightly setting up more price worsening in the morning if that trend holds through 9:00am ET.  Stay tuned for our Pre-Market Alerts.
Pricing Conditions/DirectionNegative
Even with a weak stock market, conditions are negative ahead of the treasury auctions and economic news coming this week.
Float/Lock Recommendation: Lock Bias
We have been, and continue to recommend caution and an overall defensive strategy toward float/lock in this environment. With the very low historical mortgage pricing, one should continue to bias toward locking unless we alert you to improving conditions. Given the potential volatility of breaking out of the current range (for the worse), the risk/reward balance still favors a lock bias.
However, the aggressive float/lock strategy we have been describing could still be played on small positions in the pipeline (or new apps today) by those with a strong constitution and appetite for risk, as the technical’s setting it up are still in tact – albeit hanging on by a thread at the moment. With bonds now in a technical oversold area, this play is setting up the opportunity to play this ultra-aggressive float strategy once again.
There has been a trend setting up that has been fairly reliable to play in a range of .250 to .375 rebates over the last 60 days.
Here’s how you would play this opportunity for now… when you see treasuries approach 3.45%, you could bias to float in anticipation of the sell-off with yields dropping to the lower end of the range of 3.32%. 
So, with the 10-year TSY closing outside of  the outer band of this range tonight, one could now float light positions in anticipation of the pullback below 3.48% and toward 3.32%. The current outer bands of the range are 3.30% to 3.48%. 
One thing about ranges and trading within the bands- it works until it doesn’t, so we would recommend staying very close to the markets and our emails/alerts if you decide to take this strategy. It is an aggressive strategy, but if we see stocks stall or weaken additionally here, along with strong treasury auctions this week, this recent trend could hold and you could pick up .125 to .375 in pricing improvement over this evenings pricing by playing for the retracement in bond yields. Any convicted moves in treasuries outside this band could be a break in near-term direction.

As we say with this strategy, stay very close to our emails alerting you of worsening conditions that would take this play off the table.

There are still technical reasons to be cautious while floating:
  • We still have a lot of earnings being reported that could swing the markets
  • The economic calendar is loaded with impactful data this week
  • The 10-year TSY is now testing a technical breakout to much higher levels.
  • Corporations continue to beat Q3 earnings estimates
  • Economic has been and remains to come in relatively positive.
This is still some of the best ever historical pricing and overall we continue to recommend to consumers that they lock these historically great rates now unless we start to see some fundamental turn in the economic news that would spur a flight to bonds and better mortgage pricing on the horizon.
Bond traders appear to be setting up their positions ahead of new treasury auctions next week and have a bias to hedge higher yields and mortgage pricing at the moment. We do tend to get some bond selling (higher yields) as we approach these auctions.
The Technical’s:
The overall trend still remains constructive and bullish for these very low historical mortgage prices, and the very positive historical mortgage pricing environment remains in tact. We still see mortgage pricing staying within a tight range of 5.00% to 5.50% for the 30-year fixed in the near-term.
The macro-range for the 10-year TSY is about 3.30% to 3.80% and we are sitting in the middle of that range with a bias drifting upward to the highs – while we spent late summer and early fall in the lower end of the range. We don’t see anything on the tape yet that would suggest a breakout above 3.80% soon. Within this range, mortgage pricing would stall at 5.50% for a 30-year fixed if we started to test the highs on this macro-range.
The 10-year ran up to 3.57% to test a breakout of the 100 day moving average. As we have said for a few weeks now, we could get near-term bullish on mortgage pricing if stocks weaken here and we see the 10-year trade back and through 3.48% with conviction. If this scenario played out we could see the 10-year drift to 3.32% relatively quickly.
However, we don’t see that trend setting up at the moment just yet. Rather, we are seeing the 10-year testing a breakout of the recent range of 3.32% to 3.48% and bond traders will take their queue from the stock markets and economic news to find the next direction and range. If stocks and corporate earnings remain positive, we would likely jump out of this range on bonds and mortgage pricing.
Stock investors are still consolidating some of the recent gains over the last few weeks. If the economic news and corporate earnings continue to come in positive, we could see the S&P run up to the 1,125 to 1,179 range and push mortgage pricing significantly higher from here. It would take continued good news and a weakening US Dollar, though, as stocks look ready to take a breather after making the big recent gains. However, if the S&P closes lower than 1,076 again tomorrow (after closing at 1,067tonight), that could be a signal of at least a near-term pullback in stocks and setting up positive moves in mortgage pricing.
We are near-term and technically bearish on mortgage pricing conditions as corporate earnings continue to look good and the economic news continues to look better. Although, it will take a lot of momentum for stocks and bonds to break the current range.
Trends:  Last Ten Closing Prices
10-yr TSY          3.57% 3.49% 3.42%  3.38% 3.34% 3.38% 3.41% 3.46% 3.42% 3.32%      
MBS                 100.06 100.15 100.27 100.28 100.30 100.28 100.23 100.12 100.26 101.07

HVCC is on the ropes

We have HVCC on the ropes so we need your help more than ever!

On Wednesday, October 21st, the National Association of Mortgage Brokers used this petition
hvccpetition.com to help convince the House Financial Services Committee to pass an amendment that will finally put an end the mess that HVCC has been making of the real estate and lending industries.  More than the 102,000 signatures on the petition, it was the pace at which the petition is growing and the HVCC horror stories signers included with their electronic signatures.  Now more than ever we need everyone to rally behind this cause to make absolutely certain it continues to gain the momentum necessary to make it through the House and Senate votes that are forthcoming.  Please, please, Please, sign this petition if you haven't done so already and more importantly, send it to everyone you know in any sector of the real estate and lending industry as well as to all the current, past and future clients in your database.  The new petition website makes it abundantly clear how all homeowners are losing equity and being harmed directly by HVCC as well as how it is blocking any chance at the real estate recovery our economy needs so desperately.  Everyone you send to hvccpetition.com will be indebted to you for looking out for their best interest.  We won the first of three battles which is more than anybody thought could happen and if we get serious and rally together now for one last massive push we should be able to put HVCC behind us forever.  Thank you for your time, effort and support.

Click here to see our interview with the president of NAMB 


Mortgage Rates this week and you

Last Week:
Rates were up just slightly for the week by .125 to .250 depending on the lender. Pricing has steadily backed up through October and taken us back to rates last seen briefly Mid-September and Late August.
The 10-year TSY ended the week testing the high end of the range that has not been broken for over 60 days, while stocks were flat for the week after running up the previous two weeks. With stocks flat last week, but bond yields up - most of this can be attributed to bond trader hedging against the treasury auctions coming up this week. This has been the trend each week prior to these record bond auctions held by the Treasury. If the trend we have witnessed holds, we could see some relief in bond yields later this week as long as the auctions go well - as expected.
We had mostly good news from housing market data last week that suggested that housing appears to be finding stabilization.
First, last week, the Fed Beige book listed residential real estate as leading the more positive sectors across the Fed Districts - along with Manufacturing, which were the two hardest hit sectors in the early part of the recession.
Later in the week, the Existing Home Sales report surprised the street by leaping 9.4% in September (to 5.57 million annualized units) - the highest sales rate in over two years. Prices seem to be firming and the report showed inventory dropping to 7.8 months - the lowest inventory number in almost 3 years (not including short sale and foreclosure dispositions).
The rest of the economic news last week was mostly positive and suggest the economy is slowly healing, while new unemployment claims last week was slightly higher than expected and will continue to drag on the recovery. Inflationary pressures still remain subdued as well.
Rate Forecast:

With rates at multi-year or near historic and all-time lows, it's tough to expect that they have considerable space to decline much from here , especially in the face of a modestly improving economic climate and improving corporate earnings picture.
Rates that were lower earlier this year were fueled by an apocalyptic economic state and near-term view forward. While this has improved, investors lack of appetite to take risks, weak economic growth, and the low near-term prospects for inflation should serve to keep a lid on any serious increases, too. The bleakness of Spring drove rates down; the euphoria of Summer (and inflation worries) drove them back up. The Autumn seems to have a sense of reality about it, and an improving sense of optimism about tomorrow's economic prospects. And, as we showed you going into the fall - there is a well established trend of mortgage rates "falling in the fall".
Somewhere between those two extremes of Spring and Summer is where we'll probably find ourselves for the remainder of the fall. That being the case, we expect mortgage rates to likely wander in a range from about 5.00% to 5.50% on the Conv. 30-year fixed, but to be choppy in that range as the stock and bond markets search for new trend line.
The Week Ahead:
This week brings us the release of seven relevant economic reports and two important Treasury auctions for the bond market to digest. There is relevant data or events scheduled every day except Monday, so there is a pretty good chance of seeing noticeable movement in mortgage rates several days this week.
Overall, it will likely be an active week for the markets and mortgage rates. We believe that the single most important day will probably end up being Thursday with the extremely important GDP release in the morning and the Treasury auction results during afternoon hours. Monday should be the calmest day of the week, but Tuesday, Wednesday and Friday should also be active. Accordingly, I strongly recommend staying close to our emails/alerts.
This week also has Treasury auctions scheduled each day except Friday. However, the two that are most likely to influence mortgage rates are Wednesday's 5-year and Thursday's 7-year Note sales. If those sales are met with a strong demand, particularly Thursday's auction, bond prices may rise during afternoon trading. This could lead to improvements to mortgage rates shortly after the results of the sales are posted at 1:00 PM ET each day. But a lackluster investor demand may create bond selling and upward revisions to mortgage rates.


The first report of the week is one of the more important ones. October's Consumer Confidence Index (CCI) will be posted late Tuesday morning. This Conference Board index gives us a measurement of consumer willingness to spend. It is expected to show a small increase in confidence from last month's 53.1 reading, indicating that consumers are a little more likely to make large purchases in the near fut ure than last month. As long as the reading doesn't exceed the forecasted 53.5, we will likely see the bond market react favorably to this report. This data is watched closely because consumer spending makes up two-thirds of the U.S. economy.

Wednesday morning the Commerce Department will post Durable Goods Orders for September. This report gives us a measurement of manufacturing sector strength by tracking orders at U.S. factories for big-ticket items. Analysts are currently calling for an increase in new orders of approximately 1.0%. If we see a larger than expected increase in orders, mortgage rates will probably rise as bond prices fall. A weaker than expected reading should be good news for the bond market and mortgage rates, but this data can be quite volatile from month to month and is difficult to forecast.

Also Wednesday is the release of September's New Home Sales. This data covers the remaining 15% of home sales that last week's Existing Home Sales report tracked and is this week's least important data. It is expected to show an increase in sales, but regardless of its results I am not expecting it to have a significant impact on mortgage rates Wednesday.< /p>
The next relevant data is the preliminary reading of the 3rd Quarter Gross Domestic Product (GDP) early Thursday morning. The GDP is considered to be the benchmark measurement of economic growth because it is the sum of all goods and services produced in the U.S. and therefore is likely to have a major impact on the financial markets and mortgage pricing. There are three versions of this report, each a month apart. Thursday's release is the first and usually has the biggest impact on the markets. Current forecasts call for an increase of approximately 3.2% in the GDP. If this report shows a much smaller increase, we would expect to see the bond markets rally and mortgage rates to fall. However, a larger than expected rise could lead to bond selling and a sizable increase in mortgage pricing.

There are three reports scheduled for release Friday. The first is the 3rd Quarter Employment Cost Index (ECI), which tracks employer costs for salaries and benefits. Rapidly rising costs raises wage inflation concerns and may hurt bond prices. It is expected to show an increase in costs of 0.5%. A smaller than expected increase would be good news for bonds and mortgage rates.

September's Personal Income and Outlays report will also be posted early Friday. This data gives us an indication of consumer ability to spend and current spending habits. It is important to the markets because consumer spending makes up two-thirds of the U.S. economy. Rising income generally indicates that consumers have more money to spend, making economic growth more of a possibility. This is bad news for the bond market and mortgage rates because it raises inflation concerns, making long-term securities such as mortgage related bonds less attractive to i nvestors. Analysts are expecting to see no change in income and decline in outlays of 0.5%.

The week's last report comes at 10:00 AM ET Friday w hen the University of Michigan updates their Index of Consumer Sentiment for this month. Current forecasts show this index rising slightly this month's preliminary reading of 69.4. This index is moderately important because it helps us measure consumer confidence, which is believed to indicate consumers' willingness to spend. Since consumer spending makes up two-thirds of the U.S. economy, any related data is considered to be relevant.

Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

What's Ahead For Mortgage Rates This Week : October 26, 2009

Posted: 26 Oct 2009 07:45 AM PDT

1-Month PPI September 2009Mortgage markets were volatile last week, making it very difficult to shop for mortgage rates.

On most days, lenders issued multiple rate sheets with the trend putting rates higher in the morning, and lower in the afternoon.

Overall, mortgage rates were unchanged on the week. It broke a three-week streak through which mortgage rates rose.

Rates remain roughly one-half percent higher than the lows of early-October.

The biggest positive for rate shoppers last week was tame economic data -- specifically concerning the Producer Price Index and the housing sector.

The Producer Price Index is an inflationary, Cost of Living-like measurement for businesses and it went negative in September. Analysts weren't expecting that and the surprise pulled rates down an eighth.

Similarly, in housing, both the Home Price Index and Housing Starts figures were softer than expectations. These, too, tugged mortgage rates down.

At least temporarily.

We say "temporarily" because -- all week long -- a steadily-weakening U.S. dollar was leading mortgage rates higher.

All things equal, mortgage rates rise as the dollar loses value and, last week, the dollar touched a 14-month low versus the Euro. The greenback's weakness countered most of the "positive" news for rate shoppers and is a major reason why rates were so volatile.

The volatility should continue into this week, too. With little data and no Fed speakers, look for mortgage rates to move with the market's momentum.

Lately, momentum has been pulling rates higher so if you're floating a rate and trying to time a bottom, the chances are good that we already passed it. Consider locking your rate before rates rise much further.

Once rates break 6 percent, they may not come back down.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

Government : Home Prices Edged Lower In August

Posted: 23 Oct 2009 07:45 AM PDT

Home Price Index month-to-month since the April 2007 peak

According to the government, home values edged lower last month.

The Federal Housing Finance Agency's Home Price Index report shows values down by 0.3 percent from the month prior -- the index's first down month since April.

The Home Price Index is based on the value of homes financed via Fannie Mae or Freddie Mac and, in this sense, the FHFA Home Price Index is more of a "national" real estate index that its private-sector cousin, the Case-Shiller Index.

But like the Case-Shiller, the HPI is as notable for what it specifically excludes as for what it includes. Most notably, the Home Price Index doesn't account for homes meeting any of the following descriptions:

  1. Is considered new construction
  2. Is a multi-unit property
  3. Is financed by an entity other than Fannie Mae or Freddie Mac

Given the resurgence of FHA financing this year, this last exclusion is especially glaring. FHA represents about one-third of all mortgage loans in 2009.

Because of these exceptions, some analysts label the Home Price Index incomplete. The same could be said of every method of home valuation, however. Case-Shiller only collects data from 20 markets, for example.

In light of these shortcomings, therefore, what's most important to today's home buyers and sellers is to know that each of the "popular" home valuation reports show similar patterns -- home prices have leveled and may be starting to recover in earnest.

For a region-by-region breakdown of the Home Price Index, visit the FHFA website.


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Latest From : Atlanta RE 5 by 5

As Gas Prices Rise, Mortgage Rates Are Rising, Too

Posted: 22 Oct 2009 07:45 AM PDT

Gas price breakdown from DOE.govWith crude oil at its highest levels since October 2008, retail gas is up 8 cents per gallon this week.

It's bad news for home buyers and mortgage rate shoppers. The same force that's driving oil higher is linked to rising mortgage rates.

We're talking about the weakening U.S. Dollar which is now at its worst levels versus the Euro in 15 months.

Crude oil is priced in U.S. dollars, by the barrel. When the dollar loses value, more of them are needed to buy the same barrel of oil. As a result, predictably, the price of crude oil goes up.

Now, there are other reasons why crude oil is rising, but the fading U.S. dollar is one of the major ones and it's why we're addressing it.

The dollar has a similar impact on mortgage rates.

Mortgage rates are based on the price of mortgage bonds that -- like crude oil -- are also denominated in dollars. As the dollar loses value, so do mortgage bonds. This causes demand for bonds to drop and prices on bonds to fall.

Because bond prices and bond rates move in opposite directions, mortgage rates rise and thisis precisely what's happening on Wall Street today.

Since touching a 5-month low in early-October, mortgage rates have tacked on as much as 1/2 percent, depending on the product. Moreover, with the dollar showing no signs of a rebound, the upward pressure on rates should continue.

If you're trying to time the market bottom, you may have already missed it. Consider locking your mortgage rate before rates increase even more.

And your everyday signal that rates are rising? Just check your price at the pump. If gas prices are up, it's likely that mortgage rates are, too.

Housing Starts Rise In 8 Months Out Of 9 This Year

Posted: 21 Oct 2009 07:45 AM PDT

Housing Starts September 2009Housing Starts on single-family homes gained last month, marking the 8th time that's happened this year.

A "Housing Start" is a home for which the foundation has been excavated and, considered alongside other key market metrics, September data suggests that the housing market stabilization is complete.

Momentum in housing is overwhelmingly positive:

Despite the positive news, the press is calling September's Housing Starts data a "bummer". Citing a drop in monthly building permits, the media purports that housing will slow in the months ahead.

The conclusion may be right, but the rationale may be wrong.

The probable cause for fewer permits isn't that the housing market is overdone. It's that home builders are choosing to exercise caution given the pending expiration of the First-Time Home Buyer Tax Credit and a still-growing number of foreclosed homes.

It's unclear what housing demand will be beginning in December and the last present a builder wants for the holidays is an excess of inventory.

It makes sense that building permits are down, in other words.

Looking back at February of this year, there's a host of signs that housing is on the path to recovery. Now, that path won't be a straight line and there's bound to be setbacks, but September's Housing Starts is not one of them.

Housing Starts are up 40 percent on the year.


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Latest From : Atlanta RE 5 by 5

Previewing The New Good Faith Estimate

Posted: 20 Oct 2009 07:45 AM PDT

The new Good Faith Estimate

The new Good Faith Estimate makes its debut January 1, 2010.

Expanded from 1page to 3, the legislators responsible for the new Good Faith Estimate want it to be simpler for homeowners and home buyers to understand than the former version.

By most accounts, Congress will meet this goal.

The new Good Faith Estimate includes plain-English explanations of every fee, charge, and interest payment involved in a purchase or refinance. It also includes a section called "The Shopping Cart" in which applicants can compare lenders.

The new Good Faith Estimate is concise, too. Using a series of "Yes/No" checkboxes on Page 1, mortgage lenders specifically note:

  • The interest rate on the mortgage
  • Whether the interest rate can change over time
  • Whether the loan carries a prepayment penalty
  • The length of the rate lock

Currently, this information is spread across 3 separate forms.

Furthermore, the new Good Faith Estimate simplifies rate-and-fee comparisons, showing applicants how a lower rate can be available for a higher set of fees, and vice versa.

For all of its clarity, though, the new Good Faith Estimate still fails to address the issue of "suitability". As in, is this the right loan for the right borrower? That's something only a loan officer can do.

For suitable advice, talk with a loan officer who both listens to your needs and helps you plan for them. Great terms on an unsuitable loan are often worse than "good" terms on the right one.


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Latest From : Atlanta RE 5 by 5

What's Ahead For Mortgage Rates This Week : October 19, 2009

Posted: 19 Oct 2009 07:45 AM PDT

University of Michigan Consumer SentimentMortgage markets worsened last week on better than expected economic data, causing mortgage rates to rise.

Last week was the third consecutive week that mortgage rates moved higher and, since touching a multi-month low in early-October, conforming mortgage rates are up by about a half-percent.

It's likely rates will continue to rise, too. That's because the same force that held rates down for so long is now the force pulling them up -- expectations for the U.S. economy.

Over the last 6 months, it wasn't clear in what direction the country was headed. The housing sector has been gaining in strength, but the rest of the economy has been a question mark.

Last week put an end to some of those questions:

Expectations for the U.S. economy are changing on the fly. As a result, stock markets gained last week and mortgage markets lost.

This week, rates could move higher still. There are an unusually large number of key economic reports including on housing and inflation, plus a handful of speeches from key Federal Reserve members.

With each positive announcement, mortgage rates should rise.


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The Fed Thinks The Economy Is Improving And What It Means For Home Affordability

Posted: 16 Oct 2009 07:45 AM PDT

FOMC Minutes September 23-23 2009Mortgage rates are higher after the Federal Reserve released the internal notes of its September 22-23, 2009 meeting.

Known as the "Fed Minutes", the report details the conversation and cross-currents that led to the Federal Reserve's decision to vote "unchanged" on the Fed Funds Rate after its last meeting.

The Fed Minutes are the lengthy companion to the more famous, succinct post-meeting press release.

As a comparison:

The extra level of details is a big deal because Wall Street is perpetually in search of clues about what the Federal Reserve is going to do next.

In the past week, multiple Federal Reserve members hinted that the Fed Funds Rate may rise as early as April 2010. Fed Chairman Ben Bernanke even alluded to it, too.

The minutes revealed that the economy may improve even faster than was previously expected, too.

These acknowledgements are part of the reason why mortgage rates are up. Because the Fed Funds Rate rises to accommodate a growing economy, the prospect of economic recovery is drawing money into the stock market and away from mortgage-backed bonds.

Less demand for bonds means a lower prices which, in turn, leads to higher rates.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

Foreclosure Activity Remains Concentrated In Just 4 States

Posted: 15 Oct 2009 07:45 AM PDT

Foreclosures September 2009For the seventh consecutive month, foreclosure activity in the U.S. was dominated by a tiny subset of states.

As reported by RealtyTrac.com, more than half of September's foreclosure-related activity occurred in just 4 states:

  1. California
  2. Florida
  3. Nevada
  4. Michigan

These states represent just 22.05 percent of the total U.S. population.

Overall, foreclosures are up 29 percent from September 2008 and, while, the data seems negative, defaults are creating some interesting buying opportunities.

Foreclosed homes often sell at a discount as compared to non-foreclosed homes. Cheap prices, low mortgage rates and willing buyers have helped to spur home sales in many U.S. markets. In August, "distressed homes" accounted for one-third of all existing home sales.

That said, buying foreclosures isn't for everyone.

First off, foreclosed homes are often sold "as-is" and may be in perfect condition, or may be inhabitable. If the property falls into the latter category, it's important to get estimates for the work needed to make the home livable. Suddenly, the home may not seem like such a "steal".

And, secondly, buying a home in foreclosure can be a 3-month process or more. For some people, this is just too long.

Buying a home in foreclosure is fundamentally the same as buying a "regular" home -- there's a contract and a closing. But most of the steps in between are different.

Read the complete foreclosure report, plus take a peek at foreclosure heat maps on the RealtyTrac website. If you like what you see, talk to your real estate agent about what to do next.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

Should Joint Homeowners Have Separate Bank Accounts?

Posted: 14 Oct 2009 07:30 AM PDT

When you own a home with a spouse or partner, the issue of what's mine, what's yours, and what's ours can be a divisive one.

Each household has its own money management methodology and, according to financial talk-show host Suze Orman, most leave significant room for improvement.

In this 4-minute piece aired on NBC's The Today Show, Orman talks about co-managing finances with topics including:

  • How to determine how much money goes into a "personal" spending account versus a "family" spending account
  • The importance of both parties taking an active role in bill-paying
  • How to manage the money when one partner doesn't earn an income

Being aware of money is the first step towards protecting it.


Latest From : Atlanta RE 5 by 5

Latest From : Atlanta RE 5 by 5

What's Ahead For Mortgage Rates This Week : October 13, 2009

Posted: 13 Oct 2009 07:09 AM PDT

Mortgage rates have spiked in each of the last two weeksMortgage markets worsened last week as investors responded to a recovering global economy.

Despite briefly touching their lowest levels since May, mortgage rates ended the week dramatically higher.

It's the second straight week that rates soared on a Friday.

For several months, Wall Street has been in limbo; undecided whether the economy is truly showing signs of improvement. Negative news has tended to sink rates while positive news has tended to do the opposite.

Lately, investors have been in search of signals anywhere signals can be found. Last week -- sans hard-hitting economic data -- those signals came from the worlds' Central Banks.

Shortly after Australia raised its interest rates by one-quarter percent, Fed Chairman Ben Bernanke suggested that the Fed may raise rates sooner than expected. Stock markets rallied on the news and mortgage bond markets tanked.

When bond prices fall, rates go up.

This week, data returns. Expect more volatility.

Mortgage rates have been very low lately, but they remain jumpy. Rates change fast and if you're not ready for them when they fall, you'll likely miss your chance to catch the bottom.

Rate shoppers in need of a lock should remain in ready-position. As we've seen over the last 2 weeks, when rates start to rise, they tend to rise in a hurry.