[CITY] Mortgage News

Median home price rises in Marin County for the first time since 2007 - In statistics complied at the end of the year, the median value of a Marin County home rose from $750,000 in 2009, to $775,000 last year.  Leading the way were the communities of Mill Valley, Novato, San Anselmo and Sausalito - each of which experienced an increase in the median values of their homes. Mill Valley fared best, with the median value increasing by just under 10%.  Hardest hit were Fairfax and Tiburon , each off by more than 10% from year to year. I have this data going back 10 years, courtesy of my associate Bruce Raful, a Novato appraiser.  Send me a note if you would like all the data.
 

Half of families can afford most homes on the market - According to data from Movato.com, a real estate site based in California, more than half of American families can afford to buy a new home based on income and listing prices. Unfortunately, these numbers do not add up to more home sales.  "according to the numbers, buyer interest, affordability, and home price inventory have aligned, " said Henry Shao, CEO of Movato.  Median income levels can support mortgages at the most readily available housing prices, but we have yet to see a corresponding jump in sales. Clearly, buyer caution and difficult underwriting are the dominant reasons that so few sales are occurring.

  
Homeownership levels lowest since 1998, more declines predicted - Home-ownership levels posted Monday by the U.S. Department of Commerce are at 66.5% for the fourth quarter, the lowest they have been since Q4 of 1998.  An analysis by research firm Capital Economics says the declining homeownership rate and rising vacancy rate support their view that home prices will continue to decline this year.

Bernanke's biggest blunders - Monday marked the fifth year that Ben Bernanke has been in charge of the Fed.  According to CNNMoney - here are some of his biggest blunders (and they are doozies). In March of 2007 Bernanke said to congress "the impact on the broader economy and financial markets of the problems in the sub-prime market seems likely to be contained."  He just failed to indicate in which decade. In July of 2008 he told the house Financial Services Committee that "The GSE's (Fannie and Freddie) are adequately capitalized." Whoops. In March of 2009 he pledged to run a more transparent central bank, and then backpedaled like crazy when the cries rang out about the special treatment AIG (and Goldman by extension) received from the Fed. If you want to understand this one you have to see the movie "Inside Job".  In March of 2010 he flooded the financial markets with "printed money", and then loudly proclaimed success when there was a glimmer of improvement on the unemployment front.  He then prematurely ended QE1 when it was working, then started QE2 against massive global criticism (which sent interest rates rocketing upwards as literally everyone knows now that inflation is likely).

 

And those are just his big mistakes.  Now, don't you feel better knowing who is in charge?

 

New call for another tax credit -  Oregon Senator Jeff Merkley (d) has written a letter to President Obama urging a great focus on helping families stay in their homes and avoid foreclosure. Merkley proposed a six point plan to boost the housing market and stem the flow of foreclosures:

1. Bolster the market by proving a permanent tax credit to first time buyers.
2. Assist families facing foreclosure through a national "short refinance" program.
3. Halt foreclosure efforts by banks for homeowners seeking to modify their mortgages
4. Require greater accountability from mortgage servicers during modification efforts
5. Provide homeowners an independent third party  review prior to foreclosure to protect their rights, and
6. Provide bankruptcy judges with the power to modify home loan terms.

Could this help?  Probably.  Will it happen?  Based on the manner that the administration has dealt with the crisis so far I'd have to say, sadly, no.

 

Barbara Boxer introduces bill to attempt to aid high LTV GSE market - Senator Barbara Boxer from California has introduced a bill that requires Fannie and Freddie to entertain more high LTV refinances without charging extra fees - Under HARP the GSE's have refinanced nearly 480,000 borrowers, but only 19,000 or so of them have LTV's of 105 to 125%.  Boxer thinks that it is the extra fees that the GSE's charge on these high LTV refinances that discourages most borrowers from getting on, likely due to their lack of funds to pay the extra fees as they cannot be added to the loan amount in some cases. She also wants them to drop the 125% LTV restriction in it's entirety.  This actually could help, but for now it's too soon to tell.

Grand Wailea owner files for bankruptcy after seizure - The owners of the Grand Wailea Resort Hotel and Spa in Maui sought bankruptcy protection after lenders including Paulson and Company seized control of them from Morgan Stanley's real estate fund - after Morgan defaulted on their loans.

 
Pictured at the right is the adult pool at the Grand, one of the nicest spots to hang out in all of Maui.  

 

Have a good week everyone! Mahalo for reading.