A growing number of economists have fresh concerns about the future of the mortgage industry, and the availability of home loans for future home buyers. Many question how many buyers will be left in the market when the $8000 tax credit expires.
A New York Times article supports the notion that banks will continue to tightly monitor all lending practices, and that it will continue to be difficult for Americans to borrow money. FHA Mortgages that have provided the financing for many home buyers in 2009 may see some changes in 2010.
There is legislation being drafted to increase the required down payment from 3.5% to 5%, and would potentially take away the option for seller concessions for closing costs. The mere fact that such a proposal even exists, is cause for concern for many. This report from Fox News has more information.
The most glaring misconception this past week is the loan modification reports of success from the Making Homes Affordable Program. While many homeowners are being given a temporary life line from this program, the root of the trouble is not being fully addressed.
Most modifications involve a lowering of interest rates for a given time which helps homeowners now. Unfortunately, the interest that is unpaid is often put on top of the loan, very similar to the negative amortization loans that were so popular a few years ago. Does it truly help a homeowner if their loan balance goes up each month?
An article on RealtyCheck details that only 5 homes in the program received principal reductions in the mortgage balance. What is worse? Unemployed homeowners that need help the most, are not eligible for the program. The Florida Realtors article on re-defaults has some very sobering statistics. An article from Yahoo Finance discusses current anti- foreclosure initiatives and feels that they do not fully address the problems ahead. While the program is helping, improved solutions are needed.
Daytona Beach Florida Listings
During the last week we have witnessed many claims of market stabilization, improvement in the housing industry, and the reaching of certain benchmarks in loan modifications. I am certainly a champion of positive news and would welcome a warm feeling of a strong economy as the holidays approach.
That being said, I am concerned as to the legitimacy of some recent claims, and more importantly, their sustainability. What appears to be very clear to me is that anyone interested in buying or selling a home today has a great opportunity for a limited time. Interest rates are low, prices are low, and while many homes have sold recently, there is still a large selection.
What is even more clear to me, is that a seller in this market should become very aggressive while these conditions exist. To any seller, I would ask the question, "Do you feel that there will be more or less home buyers when the tax credit ends, and interest rates go up?" For buyers and sellers alike, now is the time to make a deal happen. Click here to see the video I have created.
My buyers offer was just accepted in the Plantation Bay subdivision in Ormond Beach Florida. She got a great deal on a beautiful 3 bedroom / 2 bath pool home. The home is immaculate and the owners were great when we toured the home. It is so nice to see the buyer and seller come to terms on a deal that was good for both parties. The listing agent did a great job as well.
My business continues to increase each week, and it is looking like the last quarter of 2009 is going to be a very good one. It is hard to say that whether or not we have hit the bottom, but the buyers are writing better offers. The low ball offers are not so low any more. Multiple offers, on multiple homes by a buyer that only wants to buy one home on short sales are less common. It is definitely a good sign.
The Daytona Beach market has seen increase activity!
The $8000 tax credit, low interest rates, and REO Sales have all played a role in the increase. Less obvious is the fact that many people that are not eligible for tax credits are buying into a very low point in the market. There are those that feel we have stabilized to some extent, and buyers are less hesitant to purchase. More importantly, sellers have come to realize that they will need to compete with distressed property if they want to sell.
Some interesting reads that I wanted to share: Diana Olick at CNBC has some very interesting views on the Housing recovery in her Realty Check Column. Click here to see why she feels that the housing recovery is at a crossroad. Many of my customers considering a short sale of their home have concerns about their credit once it is completed. For many, the effect of doing nothing at all is far worse than the short sale.
I found 2 articles on Bankrate.com that relate to Walking Away From A Mortgage and Making Payments on an Underwater Mortgage .
Click here to read an article from Reuters details why some believe that The Fed will need to raise rates sooner than many believe it should take place. I will stand by my opinion that a short sale now may pave the road to a brighter future. If you are in this dilemma, call me for a free in home consultation.
Keeping an eye on the markets for you is my business. Please keep those much appreciated referrals coming in.
If you know anyone purchasing a home, selling a home, or refinancing a current mortgage, I am a home pricing specialist.
I am your one stop shopping choice. Sell your home with me today. Find out how your home can qualify to be featured on realtor.com.
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Real Estate Agent and Loan Officer in Daytona Beach Florida. A trusted full service professional for all of your your real estate consultant and mortgage specialist needs. One Stop Shopping.
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