|
|
Navigation Calendar
Days with posts will be linked
Most Recent Posts
Categories
Most Recent Comments
Christopher Garlin
Christopher Garlin, co-founder of The RCG Companies, LLC, is a seasoned and accomplished real estate executive with more than 20 years of diverse industry experience that spans real estate development, investment and finance. More...
Contact Me
Subscribe to this blog |
Regina Mincey-Garlin
Regina Mincey-Garlin is an experienced corporate executive turned entrepreneur. Ms. Garlin co-founded the RCG Companies, LLC, and heads up its mortgage broker affiliate RCG Mortgage Solutions, LLC. She has an in-depth knowledge of the mortgage industry and its myriad of lending products and programs More...
Contact Me
Subscribe to this blog |
Ocean Green: RCG Development Group
|
|
|
Work-Force Housing Law Stirs Demographic Debate
(Category: Affordable Housing)
John Collins
Lowell Sun (Massachusetts)
January 12, 2009
PELHAM -- A new affordable-housing law that takes effect July 1, might entice college grads and young working families to stay in New Hampshire, rather than heading to other states where the cost of living is cheaper, according to Pelham Town Planning Director Gowan.
"There's a bigger story behind the work-force housing law, and it's that the state of New Hampshire is hemorrhaging the most important part of its population -- young people," Gowan says. "Many of them can't afford to live in this state."
But according to Ken Johnson, a senior demographer at the Carsey Institute at the University of New Hampshire in Durham, the notion that there has been an "exodus" of young people from New Hampshire is a figment of someone's legislation.
"I'm not saying that there aren't fewer 25- to 34-year-olds in New Hampshire than there were 15 years ago," Johnson said. "I'm saying it didn't happen because a lot of them left."
In his 2007 report, "The Changing Faces of New Hampshire; Recent Demographic Trends in the Granite State," Johnson offers a population chart that shows a significant drop in births occurring in New Hampshire in the late 1970s. Like a notch in the trunk of a growing tree, the state's lower birth rate during that late-1970s period carried forward in the population charts to today, with those former babies now in their late 20s and early 30s.
Johnson admits that New Hampshire's population dipped in the last two years, with more people leaving the state than coming in for the first since 1990.
"But that's the same trend as you see in all the fast-growing states," he said. "I can see no evidence of a substantial hemorrhage of people through migration from New Hampshire."
Gowan, who lives in Pelham, countered that he has personally seen the anecdotal evidence to convince him that the work-force housing law represents smart planning.
"I'm from the Midwest, where my mom just bought a beautiful house for $130,000 that would have been at least $250,000 here," Gowan said. "Because the cost of living is just totally different. There are a lot of states that are using their lower cost of living to draw people in."
The wording of the new law uses a Greater Nashua median income formula to define work-force housing as "homes worth no more than $262,000, and rental units priced at $1,180 a month."
"There are lots of ways to create a more affordably priced starter home," Gowan said. "Basically, you build a house that's a little smaller, maybe with fewer granite countertops, bay windows or garage-under that would drive the price up."
Whether builders choose to construct affordable housing in town is up to them, Gowan said. But he and the selectmen are writing a zoning ordinance to place before Pelham voters in March that will accommodate the new law without giving developers permission to slap together whatever they want.
"It's clear you'd be shooting your town in the foot if you took no action on this," he said. "We just want to make sure it gets built in such a way that we're all proud of it."
Gowan is modeling Pelham's warrant article, titled "An Amendment to Conservation Subdivisions to Allow Work-Force Housing," on an ordinance that Exeter already uses.
He views the new law positively.
"The baby boomers are starting their retirement path now, and when they're not in the work force anymore, who's going to man the police and fire departments?" Gowan said. "It's got to be the younger people who can afford to work and live in the community."
Unlike Exeter or Pelham, officials in Nashua, Hudson, Merrimack, Manchester and other high-density southern New Hampshire towns that already permit multifamily dwellings on smaller-sized lots, regard work-force housing as business as usual, with no special ordinances needed.
Copyright 2009 MediaNews Group, Inc. All Rights Reserved [Show More]
|
 | 0 Comments | Add Comment | Posted by Christopher Garlin on Tuesday, January 13, 2009 |
|
Mortgage rates are still too high
(Category: Mortgage World)
New York Times
12/27/08
By: Paul Krugman
Mortgage rates have dropped a lot in recent weeks, which is a good thing. But there’s still a huge spread between mortgage rates and rates on federal debt. Here’s the spread between conventional 30-year mortgages and 10-year Treasuries (10-year because most mortgages get paid off early, when houses are sold, and the average duration is about 10 years.) This spread was historically stable at about 150 basis points, but has been nearly double that lately.
The spread isn’t dead
Why is the spread so high? Presumably because investors are still seeking the safety of government bonds. But what’s bizarre is that these days the government is the dominant mortgage lender, in the form of Fannie and Freddie, which have been nationalized for all practical purposes.
The persistence of the spread offers one opportunity for quick economic stimulus: declare that Fannie and Freddie are backed by full faith and credit, and if that doesn’t work, have the Treasury borrow on their behalf. This can bring mortgage rates down by more than 100 basis points. By itself, that’s not nearly enough to turn the economy around, but it could really help the economic recovery package.
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Saturday, December 27, 2008 |
|
Prius: It’s Not Just a Car, It’s an Emergency Generator
(Category: Sustainability)
New York Times
12/23/08
By Kate Galbraith
Which would you rather have in a winter emergency?
The Prius has a new use, and it does not involve driving. The Harvard Press — which serves the Massachusetts town of Harvard as opposed to the university — reported that the car’s battery helped keep the lights on for some locals during the recent ice storms.
The newspaper reports that John Sweeney, a resident who lost power, “ran his refrigerator, freezer, TV, woodstove fan, and several lights through his Prius, for three days, on roughly five gallons of gas.”
Said Mr. Sweeney, in an e-mail message to The Press: “When it looked like we were going to be without power for awhile, I dug out an inverter (which takes 12v DC and creates 120v AC from it) and wired it into our Prius.”
According to the newspaper, “the device allowed the engine to run every half hour, automatically charging the car battery and indirectly supplying the required power.”
In fact, this development, which comes at a tough time for Toyota, which makes the Prius, may not be not as strange as it sounds. Mr. Sweeney’s tinkering is along the lines of the “smart grid” technology that many utility executives and other experts say lies in our future. The idea is that the battery of an electric car — a plug-in, in most smart-grid scenarios — can feed power to the electricity grid when the grid needs it.
Even President-elect Barack Obama has endorsed this idea, as seen toward the end of this YouTube clip in which he said: “We’re going to have to have a smart grid if we want to use plug-in hybrids — then we want to be able to have ordinary consumers sell back the electricity that’s generated.”
Mr. Sweeney, out of necessity, got there first. [Show More]
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Tuesday, December 23, 2008 |
|
Cheers! Now You Can Recycle Your Wine Corks
(Category: Sustainability)
Published by Joe Gillach on December 22, 2008
Used wine bottle corks. Never give them much thought. After the corkscrew does its job, I simply throw corks away or find some arcane use, like guarding the tips of scissors or stabilizing a wobbly table leg. So I’ll confess skepticism when I read about a new environmental organization formed to promote the recycling of wine corks, ReCORK America.
What’s next? I wondered. Single-stream recycling for toothpaste caps, shoelaces, or those unnecessary rubber bands around the daily newspaper?
To dig a little deeper, I called up ReCORK’s head of public relations, Roger Archey, who also happens to be the West Coast marketing head for Amorim, the world’s third largest manufacturer of cork stoppers, selling over three billion annually.
Archey piqued my sustainability interests when he mentioned that Amorim was the first natural cork supplier in the world to receive FSC (Forest Stewardship Council) certification in 2007. Because natural cork is a renewable resource—the stripped cork bark regrows in 10 to 12 years while the trees can live 150 years—it has environmental advantages over the plastic stopper and metal screwcap alternatives.
A PricewaterhouseCoopers life cycle analysis published a last week showed that carbon dioxide emissions of screwcaps are 24 times higher than natural cork stoppers, and plastic stoppers produce 10 times more CO2 than natural cork stoppers. The research, commissioned by Amorim, compared the performance of cork stoppers versus aluminum screwcaps and plastic stoppers on seven key environmental indicators. Cork won on six of seven dimensions, placing second to aluminum closures only on water consumption.
Archey was starting to turn me into a believer. And not just me—organic groceries giant Whole Foods recently partnered with ReCORK on a six-month trial in which customers at 25 Northern California Whole Foods stores may drop off their corks for recycling.
“Frankly, the public doesn’t think too much about the world of closures,” Archey confessed, referring to the industry term for wine bottle caps. It turns out that more than 13 billion corks are manufactured worldwide every year, along with stoppers for billions of plastic and aluminum bottles. This all adds up to a whole lot of unnecessary landfill that slips below the public’s radar.
Wine and champagne corks are often the one souvenir that people keep to commemorate benchmark events such as birthdays, anniversaries, promotions, and even funerals. Hang onto these—but know that ReCORK aims to get his hands on as many of the remaining corks as possible.
Despite the arcane nature of ReCORK’s recycling effort, Archey says that people are responding with enthusiasm. He recently received a call from a Florida couple who wanted to recycle their collection of 750 corks that they began amassing back in 1954 to commemorate the milestones in their marriage. (That’s nearly 14 milestones per year—perhaps one secret to a happy marriage.)
The French American International School in San Francisco recently tallied the 100,000th cork in their collection. Archey was invited to the school ceremony, where officials proudly handed over to him the latest batch of 20,000 corks gathered by students—presumably with their parents’ assistance—from local restaurants, hotels and wine bars. Très bien!
ReCORK is also focused on higher volume opportunities, capturing used and surplus corks from winery tasting rooms, bottling lines, and quality assurance laboratories. In addition, they are establishing more collection locations with key retailers and restaurants in larger metropolitan areas.
Today the ReCORK program ships most of its harvest back to Portugal, where they are ground up by Amorim. The resulting material goes to manufacturers of flooring tiles, building insulation, shoe soles, fishing rod handles, bulletin boards, place mats, gaskets, and packaging materials. Ground recycled cork even figures as an ingredient in soil compost. In time, Amorim hopes to develop California-based uses for recycled cork, to reduce the expense and carbon-load of overseas shipping. Looks like solid Cradle to Cradle thinking to me.
Amorim hopes the recycling campaign may grow a way to start a dialogue directly with consumers about cork closures. That would be a big change from the past, when only wine critics cared about wine stoppers.
Having lost 20% market [Show More]
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Tuesday, December 23, 2008 |
|
DC Pursues More Affordable Housing with Four Developers
(Category: Affordable Housing)
Globe St.com
By Erika Morphy
WASHINGTON, DC-The District is supporting a $15-million project to develop 58 units of new housing--that will be primarily affordable--with $3 million in funding from the federal Neighborhood Stabilization Program. The Department of Housing and Community Development awarded 37 vacant properties in the Northeast part of town to four developers for rehabilitation. The developers are Mi Casa, Manna, DC Habitat for Humanity, and MissionFirst. Mayor Adrian Fenty’s office did not return a call to GlobeSt.com in time for publication.
Of the 58 units of housing to be developed in the project--single family, condo and limited equity coops--29 are to be affordable to households at or below 50% of the Area Median Income. An additional 23 units will be affordable to households between 50% and 80% of the Area Median Income. The remaining 6 units will be market rate. The land--stretching over six city blocks--that these properties are on has been valued at $1 million.
In phase one, Mi Casa, will rehabilitate three buildings--1302 Gallaudet, 1304 Gallaudet and 1917 Capitol Ave.--to create eight housing units. In phase two, Mi Casa, will build seven more units located on Capitol Ave., Kendall St., and Corcoran St. Manna will build 20 units in later phases, followed by MissionFirst, which will build 15 units, and then DC Habitat for Humanity, which will build eight units. According to the Mayor’s office, only 12% of residents own their own home in this submarket--Ivy City--but once this initiative is complete that number is expected to double.
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Monday, December 22, 2008 |
|
Obama picks NY official as HUD secretary
(Category: Affordable Housing)
Shaun Donovan, President-Elect Barack Obama's selection for Secretary of Housing and Urban Development is a welcome choice.
Mr. Donovan is a bright and committed housing professional who grasps the complexities of the housing market, while understanding that quality, affordable housing is critical to both the social and economic stability of our Country.
Although the task is challenging, we are confident that he will be successful.
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Monday, December 15, 2008 |
|
Could News of Lower Rates Ice Home Sales?
(Category: Mortgage World)
Wall Street Journal Online 12-08-2008
Nick Timiraos reports:
Builders and Realtors are, of course, applauding the news that Treasury officials are considering a proposal to lower interest rates for new home purchases. Builder stocks rallied yesterday on the news. But some financial analysts and brokers are less sanguine about the proposal. (See “[2] Lower Rates Help Sell Houses, But Market Faces Broader Ills“)
For one, they say that news that interest rates could fall lower has iced potential sales, which already received a big boost last week when the Federal Reserve said it would buy up $500 billion in mortgage-backed securities. Refinancing applications tripled on the news, the Mortgage Bankers Association said.
The news frustrated Jon Eisen, a San Diego mortgage broker, who said three of his clients had been interested in refinancing their mortgages until they heard of the reported proposal. Now, he says, they “want to wait and see if I can get them a lower rate.”
Lawrence Yun, chief economist for the National Association of Realtors, says that reports of subsidized mortgage rates could lure many more potential buyers than the handful of serious buyers who may decide to hold out for lower rates. But he concedes that, in the short term, the news that interest rates may continue to fall “could hold back some consumers” who were serious about buying immediately.
A spokesman for Bank of America says that customers should make decisions based on where mortgage rates currently stand, not on where they might go. “It is as difficult to time rates in the mortgage market as it is to time the stock market. If a borrower determines the current rate makes sense and provides them with an advantage in their situation, that’s a good time to consider taking action,” says Rick Simon, a Bank of America spokesman.
Others worry about the unintended consequences and bottlenecks that could stem from a new surge in lending. “When you combine the Fed plan with the prospects of this new Treasury plan, that’s a lot in a very short period of time,” says Greg McBride, senior financial analyst at [3] Bankrate.com. “Anytime you get that much action in a short period of time, you have to worry… are we inflating the next bubble?”
Builders are pushing their own proposal to lower rates to 3% next year, but some say that 4.5% is too generous. Interest rates, at 5.5%, are near a nearly 50-year low of 5.375% set in June 2003. “Does the good-credit quality-home-buying market need more incentive than nearly 50 year low interest rates?” says Keith Gumbinger of HSH Associates, a financial publisher.
Builders say the proposal could help stop a slide in home prices, clear existing inventory and create more jobs. (New employment data released Friday showed that [4] November’s job losses were the steepest since 1974. Employers cut 533,000 jobs last month, pushing the unemployment rate to 6.7%.)
Lowering interest rates, currently to 4.5% would substantially increase consumers’ buying power. Someone looking at a $200,000 mortgage would be able to consider a $230,000 loan without paying more in interest rates. But as today’s piece in the WSJ notes, any stimulus faces several challenges, including tightening credit, buyers who may not have much savings for a down payment, and weak consumer confidence.
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Monday, December 08, 2008 |
|
Treasury mulls plan to lower mortgage rates to 4.5%
(Category: Mortgage World)
By Tami Luhby, CNNMoney.com senior writer
Last Updated: December 4, 2008: 7:52 AM ET
NEW YORK (CNNMoney.com) -- Lobbyists are pushing the Treasury Department to consider a plan to purchase mortgage-backed securities in the hopes of driving mortgage rates to as low as 4.5%, an industry source said.
Similar to an effort unveiled last week by the Federal Reserve, the proposal calls for Treasury to buy securities backed by 30-year fixed-rate mortgages from Fannie Mae and Freddie Mac. Details on the plan remain sketchy, but an announcement could come as early as next week, the source said.
The increased demand for mortgage-backed securities would prompt mortgage rates to drop. That, in turn, would enable homeowners to refinance into lower-cost loans and make it cheaper for potential homebuyers to get into the market.
Spokeswomen from Treasury and the Federal Housing Finance Agency, which oversees Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500), declined to comment.
Last week's Fed move drove mortgage rates down to 5.5%, from 6.06% a week earlier. The Fed said on Nov. 26 that it would purchase up to $500 billion in mortgage-backed securities from Fannie, Freddie and Ginnie Mae, and that it would buy another $100 billion in direct debt issued by those firms.
Mortgage applications more than doubled as a result, the Mortgage Bankers Association said Wednesday. Much of the activity stemmed from homeowners looking to refinance.
Industry groups have been pressuring President-elect Barack Obama and lawmakers to lend a helping hand to the housing market. The National Association of Realtors, for instance, has called for Treasury to buy mortgage-backed securities.
Meanwhile, a coalition of industry groups have banded together under the "Fix Housing First" banner to call for measures including tax credits of up to $22,000 and the creation of a 30-year mortgage, carrying rates as low as 2.99%.
Experts see both pros and cons
Experts, however, had mixed views on how much a new Treasury initiative would help homeowners and the economy. Some felt lower rates would help stabilize the housing market by bringing in new buyers and would give those who refinance more money to spend.
"If it gets people buying homes and spending, it will help reverse the economy and get us out of this recession," said Scott Talbot, senior vice president of the Financial Services Roundtable, which is pushing the measure.
While it takes time to entice new buyers into the market, low rates accelerate that process, said Greg McBride, senior financial analyst at Bankrate.com.
"It is clearly designed to bring buyers into the marketplace and soak the inventory of unsold homes," he said.
But others questioned whether rates would remain low and, even if they did, only a narrow slice of credit-worthy borrowers would benefit.
Rates are already inching up, hitting 5.75% on Wednesday, said Keith Gumbinger, vice president of HSH Associates. Several government attempts to lower mortgage rates this year have failed to have a lasting effect.
Also, the proposal would do little to help troubled borrowers who have fallen behind on their payments, have no equity in their homes or have lost their jobs. With credit standards still high, these homeowners would not be able to refinance and take advantage of the lower rates, he said.
Finally, super-low rates could keep private investors out of the mortgage-backed securities market, forcing the government to remain the primary buyer of such investments, Gumbinger said. Rates have not fallen below 5.37% in more than 45 years.
"I can't imagine there will be a significantly active marketplace of people who want to buy at these low rates," he said. [Show More]
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Thursday, December 04, 2008 |
|
Housing projects benefit more than just tenants
(Category: Affordable Housing)
Housing projects benefit more than just tenants
John King, Chronicle Staff Writer
Housing built for lower-income residents often is seen as doing only one thing: giving shelter to people who can't afford what the market demands.
Three new projects in San Francisco show how narrow that view can be. Not only does each serve a different segment of the population, they connect with the larger city in ways that will benefit many more people than the residents inside.
Two buildings are in the Tenderloin, bringing a recreational center and architectural flair to that long-beleaguered neighborhood. The third is in the Mission District, where housing and work spaces overlap with an ease that offers a model for the city's changing industrial landscape.
The literal standout is a 14-story tower that rises one block west of Hallidie Plaza and premieres Oct. 26 with a block party hosted by Glide Memorial Church, one of the developers.
The housing is straightforward, with 81 apartments ranging from one to four bedrooms, but the design is playful and rich. Along Mason the eight-story base is deep red with a woodsy grain, while irregularly stacked bays are accented by panels of blue, yellow and orange. A comparatively demure tower then pulls back and climbs six stories, making room for a ninth-floor outdoor lounge and tenant garden.
Poetic tiles
The bold look is unusual for the Tenderloin, where many blocks are lined with weary residential hotels that saw their best days decades ago (though, in a heartening trend, several have been restored by nonprofit developers in recent years). Also unusual are such materials as the resin panels that form the red wall, or the silver porcelain tiles at ground level that are cast with poetry conceived by artist Mildred Howard and poet Janice Mirikitani.
Designer Rod Henmi of Michael Willis Architects says he drew on two sources for inspiration: Glide's jubilant worship services and the textured patterns of the Gee's Bend Quilters Collective, whose work was exhibited in 2006 at the M.H. de Young Memorial Museum.
Uplift in daily life
It's a welcome splash and a symbolic one. In a neighborhood where many residents struggle to climb the economic ladder and others are down on their luck, the new housing affirms that uplift can be part of daily life.
There's also a spark to another new Tenderloin project, a unique combination of supportive housing and recreational space on Turk Street.
The name is almost as substantial as the building: The Ray & Joan Kroc Corps Community Center and Railton Place. The latter refers to 110 units of housing for a population that includes youth leaving foster care, adults recovering from substance abuse and formerly homeless veterans; the former is a Salvation Army facility complete with a full-court gymnasium, an indoor pool, computer labs and a dance studio.
Staccato shots of color
The nine-story building designed by Herman & Coliver: Architecture fills the middle of a block, and from the east it matches the monochromatic older buildings in the district. Up close? It shimmers with staccato notes of color - window frames in foam green, sky blue and pure yellow snap out from the shallow bays that zigzag above the street.
"The fact the sun comes blazing down the street in the afternoon is marvelous - I wanted to take advantage of it," said Bob Herman. The social function is equally important: "The colors re-emphasize the individuality of each resident."
Regardless of what's inside, Railton Place would be a case study in contextual modernism. But the recreational extras are like nothing else in the neighborhood - especially for Tenderloin youth who gain a fun, safe haven.
The most experimental newcomer is 2 miles to the south in a transitional corner of the Mission District.
It fills the block bounded by Alabama, Florida, 18th and 19th streets. And though residents won't move in until January, it's already clear the four-story structure designed by WRT/Solomon E.T.C. is ambitious urbanism as well as architecture with a streamlined yet monumental air.
The residential mix at what will be called Mosaica is complex enough: 93 family apartments, 24 studios for formerly homeless elders and 34 condominiums - 21 for first-time buyers, 13 priced at what the market will bear.
The extra twist involves 12 ground-floor spaces reserved for light industry or design production - most along a cobblestone alleyway that slices through the block and passes beneath portals that are 18 feet wide and 25 feet high, with two floors of apartments above.
Upstairs, downstairs
"It's a big, simple building, but it puts together an extremely interesting mix of uses," said architect Daniel Solomon. "They'll thrive off each other and reflect what this neighborhood is about."
Indeed, the work spaces with their glass garage doors are an outgrowth of the city's slow-moving Eastern Neighborhoods planning effort.
For much of the seven-year saga, planners proposed that new housing on former industrial land include blue-collar space at street level. That stipulation isn't as absolute now that the plan is before the Board of Supervisors, but Solomon and developer Citizens Housing Corp. crafted Mosaica with that duality in mind.
Whatever the back story, Mosaica's languid flow of different people doing different things has the potential to become a neighborhood centerpiece.
So does each Tenderloin project: Glide's housing for its vibrant presence, the Salvation Army complex for its array of offerings.
As different as these projects might be, they send the same message: Affordable housing needn't offer shelter alone. It can make everything around it better. [Show More]
|
| 0 Comments | Add Comment | Posted by Christopher Garlin on Friday, October 24, 2008 |
|
Mortgage Applications Rise Last Week As Rates Drop
(Category: Mortgage World)
(RTTNews) - Industry data released on Wednesday showed that mortgage application volume jumped nearly 10 percent last week, as low 30-year mortgage rates sent investors rushing to refinance. The Mortgage Bankers Association revealed that its market index of mortgage application volume climbed 9.5 percent on a seasonally adjusted basis for the week of September 5th. The Market Composite Index was 496.2 compared to 453.1 last week, with an adjustment for the Labor Day holiday. On an unadjusted basis, the index declined 13.6 percent from last week, while it was down 24.4 percent compared with Labor Day week last year. The Refinance Index jumped 15.4 percent to 1222.9. Without the Labor Day holiday adjustments, refinancing slipped 7.7 percent on the week. Accordingly, 36.3 percent of mortgage activity took place through refinancing last week, up from 34.0 percent in the previous week. The conventional and government purchase indices saw mixed results, with the conventional purchase index jumping 14.4 percent and the government purchase index, largely made up of FHA loans, decreasing 8.7 percent. The adjustable-rate mortgage (ARM) share of activity ticked down to 6.4 percent of total applications from 6.6 percent in the previous week. Interest rates for 30-year fixed-rate mortgages decreased to 6.39 percent from 6.06 percent last week. Interest rates for 15-year fixed-rate mortgages also decreased to 5.73 percent from 5.96 percent. One-year ARMs also slipped, with their contrast interest rates hitting 7.00 percent compared to 7.11 percent in the previous week.
|
| 0 Comments | Add Comment | Wednesday, September 10, 2008 |
|
V.A.-Backed Loans on the Rise
(Category: Mortgage World)
V.A.-Backed Loans on the Rise
By BOB TEDESCHI New York Times June 29, 2008
IN recent years, military veterans followed the masses who migrated toward subprime loans, rather than avail themselves of government programs meant to provide them safer, if slightly more costly, alternatives.
Now the mortgage market is flowing back to normal, and veterans are making use of more traditional help. Demand for mortgages from the federal Department of Veterans Affairs is rising sharply, the V.A. said, and more growth is expected as conventional loan programs become more restrictive and home values fall back to earth.
“I think we’ll continue to see increasing volume,” said Judith Caden, who is director of the agency’s loan-guarantee service. “We’re getting the word out about the program more.”
In recent months, Ms. Caden said, the V.A. has been publicizing improvements to the program in military publications and elsewhere. But the rise in demand started before that. In 2007, the V.A. guaranteed 133,000 loans. It is on track to guarantee 150,000 to 180,000 mortgages in 2008.
The V.A. does not actually finance the loans — but leaves that to more than 42,000 lenders nationwide. It can, however, guarantee a loan on the borrower’s behalf, thereby diminishing the lenders’ risk and paving the way for interest rates that are much lower than the borrower would otherwise obtain.
Still, those interest rates are about one-quarter of a percentage point higher than prevailing market rates, because they often require no down payment. Borrowers who put less of their own money into a mortgage are riskier for lenders.
Active service members and veterans — who must have at least six years of military service or an honorable discharge to qualify — must also pay a financing fee of 0.5 percent to 3.3 percent of the loan; this fee is typically factored into the monthly payment. Surviving spouses of veterans may sometimes qualify, too. More details are available at www.homeloans.va.gov/.
The higher costs are balanced by the fact that a veteran may qualify for no down payment. That had become almost a hallmark of subprime mortgages during the recent mortgage bubble, which is why so many veterans shunned V.A. loans, Ms. Caden said. “With the subprime meltdown, we’re one of the only — if not the only — loan programs that’s a true no-down-payment loan,” she said.
A borrower makes payments to the lender, but many lenders have instituted a new system that quickly notifies the V.A. of late payments, Ms. Caden said. In those cases, the agency often works on the borrower’s behalf to renegotiate the loan and avoid foreclosure.
Demand for V.A. loans in New York, New Jersey and Connecticut has traditionally been hampered by high real estate prices, since the program covers only loans of $417,000 or lower. But with real estate prices in the New York region softening, demand has surged here, too.
In the first five months of this year, New York veterans have been obtaining these loans at a pace that is 28 percent greater than in the corresponding period last year. Demand in Connecticut is up 15 percent; in New Jersey, demand has jumped 42 percent.
Regina Garlin, an owner of RCG Mortgage in Montclair, N.J., said that V.A. loans are ideal for those who cannot get down-payment help from friends, family or other sources.
For veterans who can find such help, she said, loans guaranteed by the Federal Housing Administration are an even better alternative, since they often carry lower mortgage insurance premiums than V.A. loans.
[Show More]
|
| 0 Comments | Add Comment | Monday, June 30, 2008 |
|
The New Federal Government's Legislation on Foreclosure: "The Bailout in Layman's Terms"
(Category: Mortgage World)
After reading and re-reading the many news paper articles and web-blasts on Congresses bailout plan for the more than 2.6 million distressed Homeowners, I still find myself pondering the same question: Shouldn't this have already been enacted? The newest prediction as to when this new legislation, which aims to help restructure mortgages for roughly 400,000 at-risk families, will be signed into law, is sometime after the July 4th barbeque. What can these hopeful borrowers expect? Here is what I predict:
1. Lenders and loan servicers will identify borrowers who are in pre-foreclosure and foreclosure status and potentially meet the parameters of bill # H.R. 3221.
2. A mass mailing informing borrowers that because of H.R. 3221 they may qualify to have: 1) A portion of their debt removed and a new more affordable loan amount and or interest rate and loan term will be established as a new replacement loan.
3. Millions of borrowers who fit prediction number one will respond to these lenders and servicers.
4. After collecting various forms of financial information from the home-owners, Lenders and servicers will quickly realize that a huge portion of their sample population does not meet the parameters of H.R. 3221 due to one or all of the following:
a. Debt proportionally exceeds income when measured against maximum debt ratios or using the current Federal Housing Administration (F.H.A.) guidelines.
b. The borrower's home is not a primary or an owner-occupied residence, a requirement of the F.H.A..
c. Employment for the primary wage earner is unstable (meaning 1. Borrower is self-employed for less than the required minimum time or, 2. Borrower has changed job paths since the current mortgage was originated and has held new employment for a limited amount of time).
So, why enact a law with so many obvious holes? Well, because we desperately need it. But, here is what this legislation ought to allow:
A temporary allowance of a higher debt ratio which is more in line with current United States Households
A 12 month moratorium on the new up-front mortgage insurance, which will be elevated to 2.25% for certain borrows having lower fico scores. Currently the percentage stands at 1.5%. This will help to mitigate the higher debt ratios
A new minimum on self-employment or career path changes provided the borrower can show consistent income for the past 3 years, versus the standard 2 years currently enacted by F.H.A.
In order to enact any real change, we first need the current pending legislation signed into law. The hold-up appears to be President Bush's apprehension on disbursing a significant amount of funds into the hands of the States. These funds are earmarked in the current legislation as a funding tool to purchase abandoned and foreclosed properties, and prepare them for re-sale. This is reminiscent of our Government's bailout of the savings and loan and thrifts back in the early 1980's, a very expensive undertaking, which the American taxpayer is still burdened with.
Nevertheless, if Bear Stearns can benefit from our governments helping hand, then why can't the average American homeowner? [Show More]
|
| 0 Comments | Add Comment | Posted by Regina Mincey-Garlin on Sunday, June 29, 2008 |
|
Let’s talk about short sales!
(Category: Mortgage World)
When you are in default or at risk of default on your mortgage, your mortgage lender may agree to accept a mortgage payoff amount less than what is actually due to them. They do this to avoid being left “holding the house” as will be the case with a foreclosure.
When a property owner is financially overwrought with debt and can document this to a lender as proof that they can no longer pay their monthly mortgage, a lender may agree to what is called a Short Sale. If you are a seller, a short sale is likely to impair your credit; ironically, the damage is as bad as in the case of a foreclosure. You will very likely leave the final transaction with just your name in tact, no favorable profit to be found here. This often makes it a little harder to secure another place to live, so be sure to have this plan already in place.
The buyer of course gets the property at a reduced price- a reduced price which normally means, “as-is”. What happens to the bank? Well, the bank takes a loss, but the good news for them is that this loss may pale in comparison to a loss due to foreclosure.
A couple of questions to ask yourself before considering a short sale as a viable option? Have I completely exhausted all of my financial resources; will my request for a short sale be looked upon as a last resort? (The very last resort being a foreclosure of course) Have I filed for bankruptcy? If you have, a lender by law cannot pursue the collection of your mortgage debt as you have protected yourself with this bankruptcy filing.
When considering a short sale, consider this:
1. Identify all liens on the property
2. Calculate what’s due including any late payments of unpaid interest
3. Contact the lender
4. Complete the lenders short sale application
5. Speak to a market professional regarding the value of your property
6. Make your lender an offer-and negotiate
7. Close the transaction
8. Start over and re-build your credit
This entire process can get a little complicated, you may want to speak with an attorney or real estate professional familiar with the process, someone who can assist you in the execution of this transaction.
Regina Mincey-Garlin [Show More]
|
| 0 Comments | Add Comment | Posted by Regina Mincey-Garlin on Monday, June 09, 2008 |
|
I, Too
(Category: Political Fix)
“Besides,
They’ll see how beautiful I am
And be ashamed—
I, too, am America.”
-Langston Hughes
As Barack Obama becomes the first African-American to have a real chance to become the President of the United States, these words of the great American poet Langston Hughes have struck me with particular resonance and begs the question. Has America, founded on the soaring rhythmic torrent of a flawed notion of freedom and equality, moved one-step closer to fulfilling her moral promise? I think the answer will emerge over the next few months as we mine the depths of emotions hidden deeply within our Nation’s soul.
As a man, Senator Obama is a talented politician skillfully navigating unrelenting storm swept political seas. As an ideal, his candidacy forces us to examine our beliefs, loves, hatreds, strengths and weaknesses; and the electability question is not our own but one formed centuries ago, made manifest through our unwillingness to wash away the ignorance that stains our democracy. The shadows that follow us on this journey are not our own but the souls of our ancestors, black and white, bound together, moving in step with our consciousness; waiting to be released from their common pain.
We as a Country need Barack Obama the ideal more than the man because once we are able to release the hate-forged chains that bind the fulfillment of our greater selves; the beauty of our common humanity will be unveiled. Many centuries ago, we as a Country, a nation built on the noblest of expectations, embarked on a great exodus from the canopied wilderness of our sin to fulfill a great covenant. Obama’s political quest represents a significant mile marker along the way.
Christopher Garlin
|
| 0 Comments | Add Comment | Friday, June 06, 2008 |
|
$20M Metro Green Apartments Breaks Ground
(Category: Affordable Housing)
STAMFORD, CT-A partnership of Jonathan Rose Cos. LLC and W&M Properties have broke ground on the first phase of the Metro Green Apartments project here, which will consist of 50 “green” affordable units to be built on property along Henry Street between Atlantic Street and Washington Boulevard near the Stamford Transportation Center.
Fully built out, the Metro Green project will eventual consist of 238 mixed income rental and for-sale residences called Metro Green Residential and a 17-story 350,000-sf office building coined Metro Green. The first phase of the project will cost approximately $20 million to develop. Jonathan Rose officials say that the Metro Green Residential component is a candidate for LEED New Construction and Neighborhood Development certification by the US Green Building Council.
“Metro Green will provide a green, environmentally-sensitive transition from the Stamford Transportation Center to the emerging, formerly industrial neighborhood in Stamford’s South End while preserving housing opportunities for existing residents in one of the few remaining affordable neighborhoods in Fairfield County,” said Stamford Mayor Dannel Malloy at the groundbreaking ceremony held on Wednesday.
“Metro Green is a model solution to high energy and transportation costs currently plaguing low income residents,” added Jonathan F.P. Rose, president of Jonathan Rose Cos. “By locating affordable housing within walking distance to a regional train line and a vibrant downtown, our residents will be spared the high price of gasoline, and by making the building green, they will benefit from lower energy costs for years to come.
Among the “green” features at the Metro Green Residential development will be: a “rainwater harvesting system” that company officials explain will funnel water from the roof into storage tanks to be used for drip irrigation and filtered for use in washing machines located in the shared laundry room; a building envelope that includes a roof that reduces heat-island effect, high efficiency, operable double hung windows; individual heating and cooling units and gas-fired domestic water heaters in each apartment and a number of other energy reduction related amenities.
Financing for Metro Green apartments was arranged through JPMorgan Chase, GE Capital, the Connecticut Housing Finance Authority and the City of Stamford. The balance of Metro Green’s residential and office developments are now in the final approval and planning stages. Connecticut Governor M. Jodi Rell reported on Tuesday that Metro Green Apartments is eligible for up to $2 million from the state’s Housing Trust Fund.
$20M Metro Green Apartments Breaks Ground
By John Jordan [Show More]
|
| 0 Comments | Add Comment | Friday, June 06, 2008 |
|
A Real Estate Deal Seen from Both Sides
(Category: Real Estate Finance)
The New York Times
Their plaintive scribblings painted a picture of first-time buyers chasing the American dream or growing families hungry for more space. The letters dripped with compliments for the property and ended with a plea for mercy (and a signed contract).
Today’s real estate market, however, calls for a different kind of letter, less a fuzzy valentine and more like a cold splash of water. It’s what you write to accompany a bid that is so far below the listing price that it cries out for explanation.
Dear Seller:
I’m writing to let you know that I would like to make a bid on your property. I love the area and am committed to buying a house nearby. And your home fits my needs.
But given that my offer is well below your asking price, I also feel I owe you an explanation.
First, consider the big picture. Nationwide, home prices in the first quarter of 2008 fell 14.1 percent compared with the same period a year earlier, according to the Standard & Poor’s/Case-Shiller U.S. National Home Price Index.
That’s the biggest decline in the 20-year history of the data. And just in case you’re wondering, during the housing downturn of the early 1990s, the decline was never worse than 2.8 percent.
Not only that, earlier this month, the National Association of Realtors pointed to the huge number of existing homes on the market. As of the end of April, the total number was 4.55 million. At the rate people are buying right now, that represents an 11.2 month supply.
So buyers have options right now. A lot of them. I’m no different. Your home is great, but it isn’t unique. Few homes are. I know this may be hard to hear, since you’ve spent years creating memories here. But you may be waiting a long time if you hope to find a buyer with the same emotional connection that you have.
My mindset is hardly unique. We’ve all been reading the headlines. The accompanying stories appear prominently in major newspapers and sit on the Web pages where people check their e-mail every day. Everyone sees them, and the psychic impact is real.
It will be tempting to view my low bid as an insult. Please don’t make that mistake. Your home is genuinely appealing, and I wouldn’t have written this note unless I was serious about buying it. Getting a firm offer in this market is an accomplishment. So congratulations!
Oh, and one more thing. You presumably need someplace to move. My guess is that you’ll find these same points compelling when it’s your turn to buy. You just might succeed in buying for a better price, too.
I look forward to hearing from you soon.
Yours Truly,
The Realist
Dear Buyer:
Thanks so much for your note. I’m truly glad that you like our home as much as we do. You’re right that my family and I have many great memories of this place, and we hope someday you will, too.
And I just want you to know that I’m not insulted in any way by your offer. The fact is, none of us are very good at buying and selling homes. We don’t do it often, and as much as we know we’re not supposed to let emotions get in the way, it’s hard not to. After all, few people buy or sell anything else as expensive as a home in their lifetimes.
That said, your offer disappointed me. You seem to believe that I’m not aware of how bad things are out there or that I’m in denial. But I do read the headlines, and I priced the house accordingly. I knew I might have to wait awhile to sell it.
I should point out that your data draws on what has already happened in the housing market. Instead, I’d ask you to consider what’s about to happen.
One big reason for the falling prices is that it’s harder to get mortgages. Lenders went from giving money to anyone with a pulse to demanding higher credit scores and larger down payments. All sorts of buyers simply couldn’t make the numbers work anymore.
I know you talked about having choices, but presumably we wouldn’t be engaging in this correspondence unless you liked my home best. Given that, I’d ask you to think about something: How often do you find a place that you can actually imagine living in? Sure, there’s a lot of other properties out there. But an increasing number are in foreclosure and probably have problems lurking within the walls. So don’t let fear of a falling market keep you out of a home that you truly want.
Please take another look at whatever mortgage calculator you’re using and see how your monthly payment will change if you brought your price up a bit. It almost certainly is not going to be enough to break you. But it may be enough to get us to a deal.
I look forward to your reply.
Yours,
The Undaunted [Show More]
|
| 0 Comments | Add Comment | Friday, May 30, 2008 |
|
Single-family home prices tumble
(Category: Market Report)
By Joanne Morrison WASHINGTON (Reuters) - Prices of single-family homes plunged a record 14.1 percent in the first quarter from a year earlier, marking a pace five times faster than the last housing recession, data showed on Tuesday.The Standard & Poor's/Case Shiller composite index of 20 metropolitan areas fell 2.2 percent in March from February and plummeted a record 14.4 percent from a year ago."There are very few silver linings that one can see in the data," David Blitzer, chairman of S&P's index committee, said in a statement. Consumer confidence slumped to its lowest in 16 years in May as rising gasoline costs and falling home prices made Americans nervous about the future, the Conference Board said. But in April, sales of newly constructed single-family homes rose for the first time since October, Commerce Department data showed, and the inventory of new homes declined for the 12th straight month. U.S. stocks rose but then turned mixed after the data. The dollar extended gains versus the euro and the yen. Economists expected prices for the 20-city S&P/Case Shiller index to fall 2.0 percent on month and 14.0 percent from a year earlier, according to the median forecast in a Reuters survey. Falling home prices have become the scourge of the housing market that is seeing its worst downturn since the 1930s. Home values since last year have been dropping below balances owed on many mortgages, leaving borrowers with no equity and more likely to succumb to foreclosure. The crisis in foreclosures, which pressure prices even lower, has spurred numerous plans by regulators and lawmakers that aim to keep borrowers in their homes by forgiving a portion of their loan's principle. Housing markets that grew the most during the housing boom, such as Las Vegas, Nevada and Miami, Florida, are leading the decline, S&P said.S&P said its composite index of 10 metropolitan areas declined 2.4 percent in March, for a record 15.3 percent year-over-year drop. NEW HOME SALES RISE U.S. sales of newly constructed single-family homes rose 3.3 percent in April to a 526,000 annual rate but they were down 42 percent from a year ago, which was the largest year-over-year drop in nearly 27 years, Commerce Department data on Tuesday showed. The Commerce Department estimate showed the first increase in new home sales since October, but the increase came after a big downward revision to the prior month. Economists polled by Reuters were expecting new home sales to slip to a rate of 520,000. The department revised down its March estimate to a rate of 509,000 from 526,000, or a 11.0 percent decrease from a first-reported 8.5 percent decline. The inventory of homes available for sale in April fell 2.4 percent to 456,000, which was the 12th straight monthly decline. The April sales pace put the supply of homes available for sale at 10.6 month's worth. CONFIDENCE SINKS The Conference Board, an industry group, said its monthly measure of consumers' mood fell to 57.2 this month from 62.8 in April, well below Wall Street's median estimate of 60.0. The index has dropped by almost half since last July, when housing market troubles triggered the most severe credit crisis in at least a decade. Inflation expectations rose to an all-time high 7.7 percent, well above April's 6.8 percent. The pain was felt across the board, with consumers worried about both what is happening now and what might be to come. The present situation index dropped to 74.4 from 81.9, while the expectations barometer fell to 45.7 from 50.0. (Additional reporting by Pedro Nicolaci da Costa and Al Yoon in New York; Editing by Andrea Ricci) [Show More]
|
| 0 Comments | Add Comment | Tuesday, May 27, 2008 |
|
Wall Street Journal -Florida for Sale!
(Category: Market Report)
A reporter journeys to the Sunshine State and finds that high-end homes are now selling for bargain prices. His conclusion: the real estate market is even worse than you hear.
NAPLES, Fla.-- You can hardly escape the real estate crash down here. Even the young woman who checked me into my hotel just lost her home.
So if you are looking to buy a place, someone is going to make you a deal.
The surprising twist: It isn't just at the bottom end of the market. As my colleague June Fletcher noted in March, there have been huge price drops in areas where foreclosures are at record highs. But you also see deep discounting in the snazzier parts of town. For three years, Americans have been using Web sites like Zillow to rubberneck the biggest real estate crash since the Great Depression and, maybe, to scout for values. But there's only so much the Web, or the statistics, can tell you. So I decided to come down here to see it up close. I'll be writing a series of columns over the next few days to tell you what I've learned.
And who knows? I'm not really in the market for a winter home here. But you never know...
What I'm finding so far?
The market's even worse than you hear. Which means, if you're a buyer, it's even better.
![[floridasale]](http://s.wsj.net/public/resources/images/OB-BM581_roi_it_20080522111319.jpg)
The biggest price drops haven't fully shown up in the official data because that stuff isn't selling at all.
Some condo developments out in alligator swampland -- excuse me, on 'pre development golf courses' -- have gone dark.
Meanwhile, hard though it is to believe, plenty of others in the market are still in denial.
Brokers will tell you about homes still being offered vainly at $899,000 long after identical units in the same building have sold for $500,000.
This extends to some brokers too. When I called around before flying down, a remarkable number told me, "Gosh, I'm just the busiest I've ever been! The market's really picking up."
I guess they were gambling I hadn't read a newspaper in, oh, about three years.
But the good news is that there are deals around in the kinds of places you might actually want to buy.
Realtor Craig Jones of John R. Wood in Naples showed me a two-bedroom, sixth-floor co-op near the beach that probably would fetched more than $600,000 at the peak. Today it's on the market for $498,000. And Ms Jones whispers you can probably get it for $425,000.
That' a big price cut. The apartment has spectacular Gulf views and is a five-minute walk to the beach.
According to official data, this unit sold for $480,000 back in July 2002. So in some cases we are back to those prices, maybe even earlier. That's pretty much pre-bubble.
Zillow, for its part, says this co-op was last worth about $425,000 in 2000 --2001.
Incidentally, Zillow now thinks this property is worth $740,000. And the Web site says the value has risen by $200,000 in the past year.
So much for relying on the Web. What's actually happening in these markets isn't always showing up right away.
Meanwhile, a one-bedroom condo near the beach just sold for $237,000. At the end of 2004 the owners bought it for $370,000.
It's the same elsewhere along the west coast. On Siesta Key, near Sarasota, a corner condo right on the water is on the market for $500,000, and you could probably get it for $450,000. Realtor Raul Elizalde, at Michael Saunders and Associates, says that at the peak it sold for more than $700,000.
There are other deals on the island. It looks more interesting than snooty neighbor Longboat Key, where the lawns have been trimmed with toenail scissors, and former Florida Congresswoman Katherine Harris has a home.
Along the coast there are gorgeous, brand new homes on the water down from $3.1 million to $2.1 million; and the broker whispers you can get them for $1.8 million.
Bill Earls in Naples is showing a waterfront mansion with a boat dock for $9.9 million that "would have sold for $12 million, maybe $ 14 million, a few years ago." Sure, he's a broker; he would say that. But it's not implausible.
I was tempted to buy it and put it on my expense account. But the place was a little ornate for my taste.
Mr Earls largely deals with the high end and the very high end of the market. But he says the rich are as reluctant to buy as anyone.
Write to Brett Arends at brett.arends@wsj.com
[Show More]
|
| 0 Comments | Add Comment | Thursday, May 22, 2008 |
|
Seniors to Start Exploring Reverse Mortgage Options
(Category: Mortgage World)
40% of Wealthy Seniors Cutting BackOur slowing economy is having an impact on seniors. “One in four affluent 60-year-olds are changing their retirement plans and 40 percent “downsizing” their lifestyles,” according to an April national survey from Bell Investment Advisors.
The major findings included: Financial Stress Increases for One in Three Affluent Boomers Survey findings revealed that almost 30 percent of affluent boomers have more financial stress now than they did six months ago. Affluent female boomers report considerably more stress than men (35% vs. 24%), while affluent boomers on both coasts–in the Northeast (36%) and West (34%)—report more stress than those in the Midwest (27%) and South (25%). One in Four Affluent Boomers Affected by Job Loss Over a fourth (28 percent) of affluent boomers have either lost their job in the last 12 months or know someone who is age 60 or over who has. The job losses have been more acutely felt by affluent boomers in the Northeast or Midwest (both 38 percent) and have had the least effect on those in the South (19 percent). More than one third (35%) of the most affluent boomers surveyed—those with more than $3 million earmarked for retirement—were affected by job loss, compared with just 24 percent of those with $1-3 million saved, and 30 percent of those with under a million saved for retirement. Changes in Retirement Plans and Spending Of the one in four boomers who are changing their retirement plans due to the economy, more women (31%) than men (19%) say they are making changes. Regionally, those in the Midwest are most likely to make changes to their retirement plans (31% vs. 25%). Male respondents are more likely than women to have decided to push their retirement plans further into the future, with those in the Northeast and West more likely to postpone retirement than affluent boomers in the Midwest and South. Of the 40 percent of boomers who are reducing spending in response to the economy, the highest proportions are in the Northeast (50%) and the West (46%), compared with 38 percent in the Midwest and 33 percent in the South. Based on the survey, 47 percent of affluent boomer women are making lifestyle changes, compared with just one-third of men. Only four percent of the affluent boomers surveyed report having downsized housing in response to changes in the economy. Affluent Boomers’ Seeking Higher Returns Based on the survey, more than half (54 percent) of affluent boomers cited higher returns on investments as a primary goal for the next five years. “This finding underscores the fundamental lack of understanding many investors have about risk and return. Boomers will not achieve higher returns if they shift to more conservative investments as the survey findings suggest,” said Bell. He recommends that boomers retain a healthy portion of their assets in growth-oriented equities, so that their nest egg continues to grow.
Many seniors, homeowners who are age 62 and older, are looking toward reverse mortgages as a resource for income and a way to lessen monthly housing expenses.
|
| 0 Comments | Add Comment | Monday, May 19, 2008 |
|
Shifting Sands?
(Category: Political Fix)
Whether you believe John Edwards endorsement of Barack Obama to be politically expedient or borne out of genuine inspiration, it certainly represents a tonal shift in the Democratic presidential nominating process. Hillary Clinton’s quixotic quest notwithstanding, the fall election campaign is in full tilt and the words of key players on both sides on the aisle take on critical importance. Therefore, we pose this question. What is John Edwards really saying?
|
| 0 Comments | Add Comment | Thursday, May 15, 2008 |
|
Interest Rate Cuts: What’s in it for me?
(Category: Mortgage World)
Ding, ding, ding, sound the alarm! It’s been one week and a day since the Feds last interest rate reduction and things haven’t really changed all that much. The Federal Reserve cut it’s key interest rate the federal funds rate to 2% and the only true healer so far is the stock market.
When we see lower interest rates induced by the Federal Reserve we should expect two things: 1) Banks will charge each other a lower rate when lending one another funds 2)The reduction will not affect you the consumer as much as you might like it to.
Sure, most folks get a little jolly when the Federal Reserve cuts rates, and why not, it is believed to find relief in credit cards, auto loans, home equity lines, student loans, and finally the home mortgage. However, after seven consecutive rate cuts, I think we can all agree that this is simply not the case! Here is what you should know and how to benefit:
Use this opportunity to save any “savings” from lower interest only credit lines or loans:
· While the rates are low, pocket any additional savings from what is expected to be an increase later on. This will help to cushion the blow when rates go back up.
If you’re in a higher than market interest rate (fixed or adjustable) mortgage or loan and prepare to refinance by:
· Establishing a relationship with a broker or banker and give them a desired rate, once the market reaches your desired interest rate instruct them to lock in the rate and move quickly to close the loan.
If you’re in a position to buy:
· Then assess your total financial situation with the help of a financial planner or other finance professional and invest in real estate while the getting’s good!
Be cautious and know what’s ahead: [Show More]
|
| 0 Comments | Add Comment | Thursday, May 08, 2008 |
|
What is Patient Equity?
(Category: Real Estate Finance)
In a January 2007 paper entitled "Back to the Future: The Need for Patient Equity in Real Estate Development Finance" Christopher B. Leinberger, visiting fellow with the Brookings Institution Metropolitan Policy Program, explores the concept that the use of "Patient Equity" would faciliate the development of "walkable, mixed use neighborhoods" across the United States, producing quality projects yielding superior financial returns.
As the industry seeks to develop more sustainable, mixed-use, transit-oriented, mixed-income projects, the re-application of "Patient Equity" may prove to be a useful tool.
|
| 1 Comment - Comment | Add Comment | Wednesday, May 07, 2008 |
|
| 0 Comments | Add Comment | Wednesday, May 07, 2008 |
|
Fed Says `Historical Highs' of Banks Tighten Lending Standards
(Category: Mortgage World)
May 5 (Bloomberg) -- The Federal Reserve said the proportion of U.S. banks making it tougher for companies and consumers to borrow approached a record in the past three months as the credit crunch deepened.
A net 70 percent of banks increased loan rates over their cost of funds for commercial and industrial borrowing, according to the central bank's quarterly survey of senior loan officers released today in Washington. That compares with 45 percent in the January survey, the Fed said.
The survey, conducted last month, was available to Fed policy makers last week when they cut interest rates by a quarter percentage point. Banks are restricting access to credit after financial firms posted more than $318 billion of losses and writedowns in the aftermath of the crisis sparked by subprime mortgages.
``The net fractions of domestic banks reporting tighter lending standards were close to, or above, historical highs for nearly all loan categories in the survey,'' today's Fed report said.
The survey covered 56 domestic banks and 21 foreign institutions. The American banks together have $6.1 trillion in assets, representing about 64 percent of the country's $9.5 trillion total for all domestically chartered, federally insured commercial banks.
Policy makers last week signaled that they are ready to hold off on further rate cuts as they assess the impact of the 3.25 percentage points of reductions since September. They dropped a reference to ``downside'' risks to growth from their previous statement.
Impact on Growth
At the same time, officials acknowledged in their April 30 statement that ``tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters.''
Traders anticipate that the Fed will leave its main interest rate unchanged at 2 percent through October, based on futures prices on the Chicago Board of Trade.
In commercial real estate, a net 80 percent of U.S. banks said they tightened lending standards, about the same as the January survey, both about the highest since the central bank began seeking information on the subject in 1990. A net 35 percent of U.S. banks reported slower demand, less than January's 47 percent.
For home loans, the proportion of U.S. banks making it tougher for prime borrowers, those with the best credit, rose to about 60 percent from 53 percent. About one-fourth of U.S. banks reported slower borrowing for prime mortgages and 30 percent said nontraditional loans were weaker, both ``significantly smaller'' numbers of banks than in the January survey.
Mortgage Costs
The Fed's cumulative 3.25 percentage points of reductions in the benchmark short-term rate since September have failed to put much of a dent in the cost of a mortgage. The average rate on a 30-year fixed mortgage was 6.06 percent last week, down from 6.46 percent at the start of September though up from 5.45 percent in January, according to Freddie Mac.
In response to special survey questions on home-equity lines of credit, about half of U.S. banks said they tightened terms on existing loans, mainly because of declines in home values below appraised values, as well as increased defaults and changes in borrowers' finances.
Today's report comes amid signs the U.S. economy is weathering the housing and credit contractions. A report today showed service industries unexpectedly grew for the first time since December, while the economy as a whole expanded at a 0.6 percent annual pace in the first quarter, matching the pace of the last three months of 2007.
Fed Chairman Ben S. Bernanke is scheduled later today to speak in New York on mortgage foreclosures, his first public comments since last week's Federal Open Market Committee meeting.
Bernanke's speech coincides with the advance of legislation backed by Democrats that would create a program at the Federal Housing Administration insuring as much as $300 billion in refinanced mortgages. The House is scheduled to consider the bill on Wednesday.
Foreclosure filings rose 57 percent in March from a year earlier, according to Irvine, California-based RealtyTrac Inc. [Show More]
|
| 0 Comments | Add Comment | Monday, May 05, 2008 |
|
Venture JVs to Acquire $1B in Urban Retail, MXD
(Category: Urban Investment News)
NEW YORK CITY-Cushman & Wakefield Sonnenblick has arranged the joint venture between locally based Madison Capital and affiliates of Prudential Real Estate Investors. The venture may acquire $1 billion in urban retail and mixed-use properties in New York City and other major urban markets. Click here for full story.
|
|
|
|
