Real Estate Related News

[Asylum]

Big Downpayments Return, Hurting Housing Recovery
As U.S. banks mop up the mess from billions of dollars of bad home loans, buyers are finding the days of cheap money are over and, in many cases, tougher versions of old lending rules now apply.


People of modest means have seen the American dream of home ownership move further out of reach. Even affluent buyers, who took advantage the last decade's low interest rates and looser lending standards to move up to more expensive homes or to buy investment properties, are seeing their options evaporate.
Gone are the days when almost anyone could get a loan with a down payment of less than the traditional 20 percent.
http://www.cnbc.com/id/24770001

easy money is long gone... even HELOC's are had to get...

 

[Silverbird]

Big Downpayments Return, Hurting Housing Recovery
As U.S. banks mop up the mess from billions of dollars of bad home loans, buyers are finding the days of cheap money are over and, in many cases, tougher versions of old lending rules now apply.


People of modest means have seen the American dream of home ownership move further out of reach. Even affluent buyers, who took advantage the last decade's low interest rates and looser lending standards to move up to more expensive homes or to buy investment properties, are seeing their options evaporate.
Gone are the days when almost anyone could get a loan with a down payment of less than the traditional 20 percent.
http://www.cnbc.com/id/24770001

 

[Silverbird]

Sigh, I assume that is what's making F so volitile? If that was a barometer we'd be riding in 50' waves.

 

[luv2read]

:nuts::worried:

 

[Asylum]

...the bank's main asset is debt... bad bad bad

 

[luv2read]

But still, wouldn't the banks be more forthcoming with money if they were actually "RECIEVING" money for the houses that forclosed. It seems to me that there needs to be more incentive for the banks to actually sell their empty properties or turn it over to a mangement company to stop "writing-off" all this debt. Is it me or have the banks forgotten that they NEED customers to operate? Yes the fine line is there but getting some money is better than no money.

They obviously don't think so. They've figured out they can make loans, package and sell them to get their money back instead of holding them and collecting monthly payments. If they default or foreclose on the ones they can't sell, they write them off. With all of them doing this with each other, it will take a while for them to need any new customers to make new loans under the new more restrictive standards. Sound like a giant ponzi scheme?

 

[Frixxxx]

from the original story at the top of the thread:

Yes.. this has come to pass... even buyers with good credit are not assured approval. This makes sell houses even more difficult.

But still, wouldn't the banks be more forthcoming with money if they were actually "RECIEVING" money for the houses that forclosed. It seems to me that there needs to be more incentive for the banks to actually sell their empty properties or turn it over to a mangement company to stop "writing-off" all this debt. Is it me or have the banks forgotten that they NEED customers to operate? Yes the fine line is there but getting some money is better than no money.

 

[Asylum]

from the original story at the top of the thread:

Mar 2007 - Some housing specialists worry that the mortgage industry – with more than 20 companies already in bankruptcy – will raise its lending standards so high that would-be homeowners with less-than-perfect credit will be frozen out. There is even some concern that the pullback in lending will extend the slump in the nation's housing market.

Yes.. this has come to pass... even buyers with good credit are not assured approval. This makes sell houses even more difficult.

 

[Silverbird]

More Subprime, Alt-A Mortgages May Head `Underwater' (Update2)

By Jody Shenn
April 29 (Bloomberg) -- About half of recent subprime and Alt-A borrowers may soon owe more on their mortgages than their houses are worth or hold minimal equity, putting $800 billion of debt at greater risk of default, according to Barclays Capital.

Subprime loans from 2006 and 2007 that exceed the value of the homes jumped 5 percentage points to 19.8 percent in the fourth quarter, and may reach 26 percent by midyear if prices drop at the same pace, Barclays analysts wrote in a report yesterday. Alt-A loans, a grade better than subprime, would grow to 23 percent from 16.3 percent.

Many of the loans are in areas where prices are falling faster than the U.S. average, so the size of the shift is underappreciated, New York-based analysts Ajay Rajadhyaksha and Derek Chen wrote...
http://www.bloomberg.com/apps/news?pid=20601087&sid=a8rYIdIDvfIo&refer=home

 

[Miss_Piggy]

Mar 08 CAL Median Home prices

http://www.car.org/index.php?id=Mzg0MzA=.

 

[Silverbird]

Homeowners Convert to Costlier Fixed-Rate Loans Amid ARM Fears

April 25 (Bloomberg) -- Mortgage refinancing in the U.S. is increasing as record numbers of homeowners dump their adjustable-rate mortgages for the security of a fixed loan.

The amount of refinanced home loans will reach $321 billion by the end of June, the most in a year, according to estimates from Washington-based Fannie Mae, the largest buyer of mortgages. Nine out of 10 of those borrowers will choose a fixed rate, Fannie Mae said.

Property owners are abandoning adjustable-rate mortgages, or ARMs, to ward off the prospect of higher payments.

http://www.bloomberg.com/apps/news?pid=20601213&sid=au53A_G4d.nI&refer=home

 

[Silverbird]

Usually, Fed bringing down rates would improve interest rates, but right now it's not happening because there are so many bad loans out there. Cutting rates drops the dollar, which means commodity prices will go up, and there is less worldwide interest in holding dollars or dollar rated bonds. Raising the rates might bring Fed rates closer to the actual borrowing rates out there, but not good psychologically for the nation. I'd prefer the Fed "hold 'em" for a bit.

 

[pyriel]

Remember when everyone is doing the same thing, it is the time to do the opposite. That is what happened with Oil and Gold. Back in the late 1990s people were laughing at them. Look today. When everyone was buying stocks in 2000, look what happened. Same with Real Estate, everyone was buying and flipping properties. There were and still are shows on TV about flipping real estate. The bottom-line is that this was a huge ponzi scheme based on our greed. It all started shortly after 9-11 when the Fed was cutting rates to the bone. Greenspan cut too deep and caused this reaction from banks and the real estate market. Banks wanted to give away money. Appraisers were overpricing the worth of property to keep this scheme going. Homeowners felt house rich and borrowed. They took vacations, bought SUVs,and other wasteful things. Now what happened???? It all backfired on us. The US Dollar is worth crap causing oil to go even higher. Inflation is here and strong. Food prices are skyrocketing. We are at war on a credit card. We are fixing roads in Iraq but not in our towns. There are no silver lining this time around. This will take time to solve and work itself out. People are afraid to buy and banks are tight with the buck. They will be very careful this time. The answer is that we need to get the US DOLLAR back up and fight inflation now!!! The Fed should be increasing rates because this will make the US DOLLAR stronger and allow property value to become more stable.

Hello all... I have some downtime so I decided to swing by my favorite site. The old timers know that I am currently in Afghanistan helping the government win the hearts and mind of the the Afghan people. I am currently the Battalion Team Chief for 3rd Battalion 3rd BDE 203rd Corps. Spring offensive is about to start so we will be doing missions with my Afghanistan counterparts sometime soon.

I've always regarded 12% input on matters dealing with investment. I just want to counter that bringing up rates will not help the economy at this time. The Fed is bringing down rates to stimulate the economy. When rates go down, more people borrow more money and thus more money will be circulating within the economy. Bringing the rates up will hinder people from borrowing so this means that we have less money circulating and stimulating the economy. Increasing rates will not increase the buying power of our dollar in my opinion. As long as we continue to print paper money without anything to back it up except more debts, we will continue to see dollar's value to go down.

Another problem that we are seeing now is that there were many speculators who jumped into RE and people who are living beyond their means that tries to get more of what they can afford. However, for those who have studied RE a little closer, they understand that just like stocks market, RE also has its cyclical trends. This is an opportunity for those who saved their pennies to buy some good RE in the market. It is a buyer's market right now and there are so many good investments RE that are moving under everyone's noses. here is a good example, some houses that used to sell for 900k in San Diego is now down to 500k. Just look at the RE trend in CA and you will see that your property there will grow within the next 3-5 years. I'm not saying that you should buy anything that comes your way. Do your homework, collaborate from those who have done it before, try not to speculate and live within your means.

Good luck all and I hope that everyone is safe at home.

Pyriel

 

[12%ayear]

Remember when everyone is doing the same thing, it is the time to do the opposite. That is what happened with Oil and Gold. Back in the late 1990s people were laughing at them. Look today. When everyone was buying stocks in 2000, look what happened. Same with Real Estate, everyone was buying and flipping properties. There were and still are shows on TV about flipping real estate. The bottom-line is that this was a huge ponzi scheme based on our greed. It all started shortly after 9-11 when the Fed was cutting rates to the bone. Greenspan cut too deep and caused this reaction from banks and the real estate market. Banks wanted to give away money. Appraisers were overpricing the worth of property to keep this scheme going. Homeowners felt house rich and borrowed. They took vacations, bought SUVs,and other wasteful things. Now what happened???? It all backfired on us. The US Dollar is worth crap causing oil to go even higher. Inflation is here and strong. Food prices are skyrocketing. We are at war on a credit card. We are fixing roads in Iraq but not in our towns. There are no silver lining this time around. This will take time to solve and work itself out. People are afraid to buy and banks are tight with the buck. They will be very careful this time. The answer is that we need to get the US DOLLAR back up and fight inflation now!!! The Fed should be increasing rates because this will make the US DOLLAR stronger and allow property value to become more stable.

 

[GUCHI]

gill
thanks for the info. i forwarded the site to my real. est. agent to see if it is a viable option for me. i don't understand all the aspects of the ( 6 % gift).

guchi

 

[Gilligan]

show
i have noticed houses for sale in my neighborhood have been listed forever, they just won't sell !!!! mine included !!! please someone help us. i have heard that even qualified buyers can't get a loan, whats up with that ??????

Guchi,
instead of reducing your asking price, consider gifting the down payment. You can gift 6% of the price, that should allow the seller to buy your house with no down payment. You will increase the amount of buyers by advertising, "Home for sale, $0 down".
http://www.getdownpayment.com/sellers/

 

[GUCHI]

show
i have noticed houses for sale in my neighborhood have been listed forever, they just won't sell !!!! mine included !!! please someone help us. i have heard that even qualified buyers can't get a loan, whats up with that ??????

 

[Show-me]

Someone reported that the bank are not foreclosing on delinquent homes anymore because of the flood on the market and it is cheaper for them to do nothing than foreclose. Also, it keeps the foreclosure off the books. Sneaky crooks. Point of the piece was to show that the banks are cooking the books again and the public is not getting the real story of how bad it really is.

 

[GUCHI]

lucky you !!!! i have to sell to get my money back out of the flip. fortunately we have a renter at the time. expect a tough sell !! we also listed our present home which we thought would sel quickly due to location and price. it did not and thats when i realized how suppressed the market was !!!! good luck and hang in there.

 

[weatherweenie]

Sbird
i have a house on the market (realtor listed) and just had a open house(joke) sunday that noone showed for. i know the market is bad, but come on !!! we felt that Spring would bring out some buyers, i tend to have my doubts now.nothing to do ,but wait!!

guchi

I also have my house on the market. It has been listed for 3-4 weeks. I have had ZERO showings.

I knew it was going to be tough to sell, but wasn't prepared for it to be this tough.

Thankfully I'm not in a position where I have to sell.