Lending, the holidays, and the market

The lender forum this morning at the weekly MLS meeting was insightful. Many condominiums are now being classified as condo hotels (condotels) which makes getting a loan to purchase or refinance one difficult. The buyers who are can easily pay cash are the only buyers qualifying for loans to buy these condos, ironic. This is one issue holding back our recovery. These loans require 30% plus down and have rates about 1% higher than conventional, currently around 6%. One lender this morning compared our market to NV and Florida, where HOA's are going bankrupt. Here is a quote from Diana Olick:

"So here's this cul-de-sac, barely 15 minutes from the Las Vegas strip, with three really enormous, gorgeous occupied homes, one 3/4-finished home with broken windows, a dumpster and a port-o-potty, and one enormous slab of concrete where a house should be.  The lunacy in Las Vegas goes on."

The Steamboat market has slowed the past two weeks and the holiday slow time is in full swing. There are still price drops and more listings going to Short Sale and Foreclosure. Check out listing # 122566 and #125566 in the MLS search above. Coincidence with the numbers ending in 566. They are both very good deals.

Check out the curb appeal tips for selling in winter:

http://www.frontdoor.com/Sell/Tips-for-Winter-Curb-Appeal/2560

And, check out the sell now or wait article:

http://www.frontdoor.com/Sell/Sell-Now-or-Wait/55408

Until next time, Happy Holidays!!!

2010 Predictions

Happy Thanksgiving, here is a some thoughts from one of many real estate experts:

"1. The residential housing market will dip again in mid-2010 before settling into a recovery in the back half of the year.

Photo: Jeff Turner

The end of government programs that have been artificially buoying housing (home buyer tax credit and Fed's Fannie Freddie mortgage purchase program) will result in a slowdown in demand right at the height of the Spring season. Rising foreclosures will also push more inventory onto the market, putting additional downward pressure on home prices.

2. Foreclosure inventory will be a lot higher than some predict.

Shadow inventory should be seen not just as homes the banks are holding on to or that are still in the foreclosure process, but homes where borrowers have stopped making payments and have not heard from the banks.

3.  No more historic lows on the 30-year fixed.

Unless the government decides to extend its Fannie-Freddie purchase program or do something else to juice the credit markets, mortgage rates will rise steadily, probably leveling off somewhere around 6 percent.

4.  Commercial real estate will continue to suffer the ills of low vacancy rates, low rents and high default rates.

The biggest concern is credit, as billions of dollars in commercial debt come up for refinance with little to no takers."

I'm still sticking strong with the Ski Town Realty market predictions available in the seller and buyer tabs of my web site. www.SkiTownRealty.NET. Cheers.

November 16th, 2009

A quote from CNBC Realty Check:

"Home prices are improving, but there is a lot of government stimulus behind that improvement. The extension and expansion of the home buyer tax credit, as well as artificially low mortgage rates backed by the Federal Reserves purchase of GSE loans and securities, will all expire by the middle of 2010, so it remains to be seen whether the very tenuous recovery we are now seeing in housing can endure on its own.

As foreclosures and unemployment continue to rise, the potential for a double dip in home prices is very real, and borrowers underwater now will only sink deeper."

She tends to be a bit dramnastic (fantastically dramatic) but they are valid points, by the time these programs fade out, the year over year declines in prices will be flat or show appreciation, and the unemployment rate will be going down, and foreclosures will be flat. So, it's fine to let these programs go by the wayside in a healthy recovering market. However Steamboats real estate market is in worse shape than the US. Which will make it easier to see the bottom in Steamboat when nationally the bottom will be evidently just past us. The report I just reviewed on the Whistler real estate market makes it look like they had a spike due to the Olympics being announced and are crashing as hard as we are, just like most ski towns. Note below the fed has been scaling back there keeping interest rates low program, it's suppose to end in seven months, rates will only go up from there historic lows of 5% right now.

November 11th, 2009

Howard Glaser:

What I am most worried about is March and April of next year. What happens to a housing market that seems like it is finding its footing at that point? Because several things will happen simultaneously: You've got the option ARM resets beginning to kick in, you have the home buyer tax credit expiring, maybe for real that time, and you have the Federal Reserve maybe running out of money to buy mortgage-backed securities. If we add on top of that, banks beginning to release some of this inventory ,which they have been holding on to for a long time, those three items are potentially very destabilizing to the marketplace. So I'm concerned. I think buckle your seatbelts for Spring of next year.

November 10th, 2009

Hi, If you know anyone interested in rented a great pad: Some friends have a nice one bedroom downtown on butcher knife creek. And some other friends have this great spot, just like me know and I'll forward there numbers to you. Oh, they may consider rent to own leases!

Sunny, bright 2bd/2ba condo. 15 min walk or 5 min bike ride to downtown. Washer/dryer, large kitchen, deck, plenty of storage, plenty of parking. Pets allowed. Furnished or unfurnished. FOR RENT. $1,300 per month including all utilities.

Please contact me via email or cell – 819.7392 OR contact Jon Casson at 846.1599 orboardcoach@comcast.net

November 10th, 2009

Excellent news below, these programs are huge for Steamboat's market recovery.

FHA Loan Limits Increased for another year

On October 30^th, President Obama signed into law a continuing resolution that will extend the present loan limits for FHA, Fannie and Freddie through the 2010 calendar year at 125 percent of local median home sales prices, up to a maximum of $729,750 in high-cost areas. The floor for FHA is $271,050; the floor for Fannie Mae and Freddie Mac conforming loan limits is $417,000.

“Home sales have shown significant movement upwards in the past six months and reduced inventory in some segments of the housing market, but not in all. Home purchases in the middle-income and higher brackets have not moved much, and those markets must improve before we can experience a fully sustained housing recovery. These higher loan limits will help motivate qualified home buyers to purchase in those markets,” McMillan said.

YOU DID IT! $8,000 Tax Credit Extended and Expanded By Congress

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.