State of foreclosures in NH

This is the 5th consecutive month that foreclosures deeds in New Hampshire have been lower than those recorded in the same month of the prior year, according to the NH Housing Authority. However, the numbers for both deeds and notices reported for February 2011 are the highest since September of 2010, which suggests that the state's foreclosure problem may not be behind us. There were 286 foreclosure deeds recorded in February a 12% decrease for those recorded in February 2010, but a 55% increase from those recorded in January of this year. This is the second highest number of foreclosure filings recorded in over a decade, surpassed by only February of last year. Question is how will the rest of the year round out, with the slow economic recovery will foreclosures increase or decrease, only time will tell. But for one until the foreclosures come to real slow down the economic recovery will be quite slow to potentially stagnant. The fact is that when a home is sold or built it generates $60,000 into the economy, so hence the reason we need more homes to be moved. I will touch more on the aforementioned in my next blog.

Buying in a Short Sale Real Estate Market

Today's real estate market is filled with what is termed short- sales. Due to the tough economy property prices have plummeted and what this means is that certain owners of a particular piece of property owe more to the note holder of the property than what the property is valued at. So this is why it is a great time to buy, even with the government tax credit gone by the way side. For example a home that may have been valued at $300,000 several years ago may now be only worth $225,000. But, don't expect if your attempting to purchase a short-sale that it is easy. Why? Well the bank whom which holds the note has a lot to say about whether they want to let it go for less than what is owed and there is a number of factors which the banks look at. But simply put if a home goes on the market at a certain asking price and you make an offer on it at asking or even lower and it is accepted, the bank needs to evaluate and make a decision whether or not to let it go for that price. They need to send out a BPO (Broker Price Opinion) agent to perform the task, but before that even happens the seller needs to provide a heavy load of documentation to the bank i.e. taxes, pay stubs, bank account information, etc. All in all it can be a long process, one which causes a lot of aggravation to buyers and sellers for that matter. The best thing that a buyer can ask of the seller or the seller's agent is how far along in the process is the short-sale and if found to be just in the early stages, then you butter buckle up for a long ride sometimes upwards to 120 days or longer. So you better really like the house to wait that long. Now, if it is been in process for a while then the wait may be cut in half or shorter. The fact is though short-sales can be bargains if your willing to ride out the process.

Wall street reform passes

On Thursday the most broad based regulatory overhaul of the financial system since the new deal. It is a 2,300 page bill that the President will sign into law next week in attempt to make sure that a financial crisis as we had just experienced and one I believe is still happening no matter how much propaganda the powers that be want to spew. I just find it absurdly ridiculous that it takes a crisis like this to finally call for financial reform. After many of the investment bankers lined there pockets and others such as Barney Frank, Geitner, and Greenspan went a long for the ride it is now time to step up and create this reform? The reform may not have been needed to be created if some people were not so greedy. Meanwhile the average American has to try and rebuild, climbing out of the rubble that is the declining equity value on their home, lost wages, mounting debt and lost pride. Now, I get it some of us played into their hands, and shame on us for falling to the corporate machine, but others didn't and still got hurt. Listen "It is what it is" to quote some prominent men that once ruled our kingdom, former President George W. Bush and Patriots football coach Bill Belichick. Lets just hope that we can make a come back and learn from these disastrous lessons.

Double-DIP recession anyone?

Are you up for it? I'm guessing that would be the next most ridiculous question next to would you like to win the lottery? As a good part of the population tries to dig out from the recent recession in some way shape or form, there seems to be a partly cloudy or partly sunny forecast on the financial horizon as it applies. And just like which weatherman you listen to, it also applies to which financial prognosticator you listen to (especially in New England). According to Daniel Kruger who writes for Bloomberg.com, U.S. government bonds are signaling almost no chance of a double-dip recession even as stocks and commodities have struggled recently. The 2.34% point gap between yields on the 2 year and 10 year Treasuries is more than double the 20 year average and about the same as 2003 before the domestic gross product rose 3.6%. The yield curve suggests that growth won't slow to less than 1% and that there is only about a 12% chance of another recession in the next year. Conversely, U.S.Chamber of Commerce President Tom Donahue issued a warning at the beginning of this year that the U.S. faces a double-dip recession because of taxes and regulations under consideration by the Democratic Congress and President Barack Obama. Donahue states in an article written by Ian Swanson and published in (thehill.com,2010) "Congress, the administration and states must recognize that our weak economy simply could not sustain all the new taxes, regulations and mandates now under consideration. It’s a sure-fire recipe for a double-dip recession, or worse.” He also goes on to state “We are talking about a massive tax increase in a very weak economy — a tax increase whose clearly intended purpose is not to reduce the deficit, but to pay for more spending.” Donahue has also criticized President Obama and Democratic lawmakers for not doing more to create jobs. So what will it be only time will tell, but I will say that the time is drawing near and my opinion is that we are still in for some gloomy days, however I'm not quite sure that we will see a double-dip recession, but better bring an umbrella just in case.




References:

Kruger, D. (2010, July, 6). Treasuries showing 12% chance of Double-Dip Recession.
Retrieved on July 14, 2010, from http://www.bloomberg.com/news/2010-07-
07-05/treasuries-show-12-chance-of-double-dip-to-fed-as-yields-near-record-lows.html

Swanson, I. (2010, January, 12). US Warns of Double-Dip Recession Because of Dem Policies.
Retrieved on July 14, 2010, from
http://thehill.com/business-a-lobbying/75401-us-chamber-warns-of-double-dip-recession

Mortgage Rates Drop Again

The average 30 year mortgage rate has dropped this week to 4.71 from 4.78 last week this according to mortgage finance giant Freddie Mac on Thursday This is the lowest since 1971 since the agency had began compiling its weekly survey. Mortgage rates have been relatively low much of the year do to the Federal Reserves heavy buying of mortgage-backed securities. This 1.25 trillion dollar program was designed to push money into the housing market and is due to end this coming spring. The 15 year rate is down to 4.27 from last weeks 4.29. However lenders are now requiring higher credit standards than last year and larger down payments up to 20% on purchases. The new low rates have spawned an increase in loan applications. Thanksgiving week there was a 2.1% increase on a seasonally adjusted basis from a week earlier according to the Mortgage Bankers Association.

The new home buyer Tax Credit

Well its a done deal the home buyer credit has been extended. The details are as follows: Contract has to purchase has to be in place by 04/30/2010, home has to close by 06/30/2010. Those who have not owned a home for the past 3 years can take advantage of the $8,000 tax credit. Those who purchase a new principal residence and have lived in their current home for 5 years can claim a $6,500 tax credit. This should keep homes sales rising!

Pending Home Sales Rise

Pending home sales have increased for 7 straight monthsthe longest in the series of the Pending Home Sales Index which began in 2001, this according to the National Association of Realtors. Based on contracts signed in August, rose 6.4 percent to 103.8 from a reading of 97.6 in July, and is 12.4 percent above August 2008 when it was 92.4. The index is at the highest level since March 2007 when it was 104.5. Buyers are coming out of the woodwork looking for affordable buys. This may be in large part to first-time home buyers taking advantage of the $8,000 tax credit that expires on the 3oth of November of this year. Some deals are not making it to the closing table however, due to long delays associated with short sales as well having to deal with the maze of new appraisal rules that exist currently. All in all this is a good indication that this momentum may continue, especially if the tax credit is extended, there is a good chance it may be......check back for more on that!