Countdown to June 30th

As the Tax Credit Expiration Date comes barreling towards us, we in the mortgage business are facing some challenges we haven’t seen since December 1986 (when the tax law changes that were becoming effective in January 1987 required an flood of closings onto the docket).  Today, I want you to understand the challenges and provide […]

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The Appraisal: A True Evaluation of a Home’s Worth?

Every house for sale in today’s real estate market must be sold twice. First, you must find a buyer ready, willing and able to purchase the home. Second, you must sell the value of that house to a bank so they will agree to lend money based on the negotiated price. The second sale may […]

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News Alert! The Luxury Market Has Returned

There is no longer any question that luxury homes are beginning to sell.  The high-net-worth client has marked 2010 as the year to again start purchasing real estate and their desire is turning into sales. Financing is beginning to open up in the ‘jumbo’ market and prices are starting to reflect true values as upper […]

Is FHA Trying To Become LESS Popular?

There is a buzz in the real estate and mortgage world that says that FHA is moving towards changing how they charge insurance premiums – again!  And the proposal I am hearing is going to reduce the number of people who are eligible for the FHA Program, as well as make the program less attractive. […]

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Supply and Demand: How it applies to Real Estate

Supply and Demand. It is a relatively easy concept to understand. Most of us learn it in high school. The price of any item is determined by two variables: the demand for that item and the current supply of that item. If I had one of only seven Spanish gold coins known to exist, the […]

Why Are Interest Rates Going Down?

For months the alleged experts (including me) espoused the logic that after the Fed exited the Mortgage Backed Securities Purchase Program on March 31, interest rates would move up.  But here we sit, 60 days later, and rates are at their lowest point of the year.  What’s up with that? Let’s start with some general […]

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It’s Not About Foreclosures. It’s About Pricing!

Many of our readers question why I spend as much time as I do on the foreclosure situation in the country. I want everyone to know that it is NOT an obsession with depressing news. I strongly believe that the wave of distressed properties (foreclosures and short sales) coming to market will dramatically impact house […]

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Where Will Home Prices Be in 2012?

This week we have discussed how difficult it is to establish the value of a home in today’s market, what factors will impact prices in 2010, the effect distressed properties will have on values, and the challenges faced by appraisers in establishing value. Today, I want to tackle future values… specifically where prices will be […]

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Who Cares What The Purchase Price Is… WILL IT APPRAISE?

The classic definition of what a home was worth has always been “what a reasonable buyer will pay a reasonable seller.”  That’s because MOST real estate transactions have historically involved reasonable people– people not under duress.  But today, with the enormous number of foreclosures, bank-owned property, strategic defaults, and short sales, all the reasonableness has […]

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Why is Pricing a Home So Difficult?

We looked at the significance of a house as a home this past Friday. I hope everyone enjoyed the weekend and had the chance to personally feel the intrinsic value of a home. However, it would be unprofessional of us not to acknowledge that each house also has a market value, which is the price […]

To Pay Points Or Not To Pay Points?

That is a question I have heard for all my years in the mortgage business.  There is no black-and-white answer to this question; hence, the reason for the discussion today. Let’s begin with a definition of “points.”  First the expression “points” is a shortened version of the more technical name “Discount Points.”  Discount Points will […]

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And The Survey Says!

Every day on our blog we try to give you insights from industry experts on issues that matter the most in real estate. Today we want to give you the thoughts of some non-professionals. People like us. Friends and neighbors who have personally experienced the ups-and-downs of the housing market over the last few years. […]

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If Supply Goes Up, Prices Will Go Down

HOUSING SUPPLY Today I want to cover the impact the expired tax credit and the Fed’s exit of the mortgage market will have on home prices as we move forward. Whenever we talk about pricing, we must look at two variables: supply and demand. We covered buyer demand in yesterday’s blog, No Tax Credit.  How […]

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No Tax Credit. How Will You Wind Up?

BUYER DEMAND The big question in the real estate industry today is what happens now that the Homebuyer Tax Credit has expired. There are many theories around this issue. Some believe that the tax credit (along with other government programs) has created a stabilization in the housing market both in the number of sales and […]

Tax Credit Still Available for Troops!

Thank God For Those Who Have Served! We all owe a debt of gratitude to the men and women who have served this country in times of peace and times of conflict.  They preserve the freedoms the rest of us too often take for granted.  As a nation, there are too few times we properly […]

Less Players, More Competence Among Lenders

There has been a dramatic decrease in the number of loan officers in this country.  I have seen estimates that show that in 2005 (the peak of mortgage activity) there were 450,000 loan officers, and that by 2009, the number had shrunk to 150,000.  Nearly 70% of individuals feeding their families by originating mortgages have […]

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The Upper End: Win, Place, or Show?

In this horserace to a more normalized housing market, there seemed to be only one constant. The luxury market has been the horse bringing up the rear. We have been experiencing some stability in the lower price points in almost every geographic market. However, the upper tier price points have had an overabundance of inventory […]

The Price Is the Same, It Just Costs Less

The papers will be full of articles urging homebuyers to purchase a home this week before the Homebuyer Tax Credit expires. The articles will be correct. Getting a home into contract by this Friday, April 30 will enable you to collect on the tax credit. However, it is not just the tax credit that makes […]

Is the New York Times Suggesting You Buy a Home?

We do a tremendous amount of research each week. Occasionally we see a news source stressing a certain point. It was interesting to see the articles on housing published at the New York Times over the last several days. It seems they might be of the belief that now is the time to buy a […]

Interest Rates – Two Weeks after the Fed’s Exit

Everyone in both the real estate and mortgage industries waited to see what reaction the mortgage market would have to the Fed exiting its purchase of mortgage-backed-securities last month. Would there be ample demand from the private sector? At what price? The predictions of where 30 year mortgage rates would settle were all over the […]

Who Cares If I Miss Out On The Tax Credit?

Many people who are looking to buy a home now NEED the Tax Credit to close a gap in their finances.  But not everyone feels that way. As the days tick away, I have started to hear some buyers already begin rationalizing why they have not yet gone to contract.  They say things like, “$8,000 […]

Damn the Data! I’m Buying a House

This blog tries to share the best real estate information we can find. We don’t like opinion pieces with just anecdotal confirmation of points. We like hard facts, packaged in a compelling matter that enables the reader to make sense of a very confusing market. The goal is to not be subjective, but instead, TOTALLY […]

Interest Rates a Week after the Fed’s Exit

As the Fed was planning to exit the mortgage market at the end of last month, more and more experts were calling for the exit to be uneventful. Their belief was that there was ample demand sitting on the sideline ready to replace the Fed’s role. Well it is now a week later and let’s […]

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How Do Rising Interest Rates Affect Affordability?

I have long been irked by mortgage “pre-approvals” that say a borrower is qualified to purchase a non-specific home for a specific loan amount.  Why?  Because, lenders don’t qualify borrowers based on the Purchase Price of a home, we qualify them for a particular Mortgage Payment (and payments vary based on a number of factors […]

Interest Rate Forecasting in a Volatile Time

This past weekend, I saw a decent movie… Hot Tub Time Machine and one of the running themes in the movie reminded me of the shift in the bond market last week (and what our immediate future looks like). Without giving away the whole movie, I want to explain…. In the movie Crispin Glover plays […]