The number of households in foreclosure who lost their home soared in 2007 to about 405,000 households.
This number might sound alarming, but a little perspective is in order :
- Foreclosures were lower prior to last year, which causes the numbers to appear to be soaring only when looked at purely in terms of percentage gains.
- RealtyTrac reports defaults on loans, not on properties, so one household that defaults on a primary loan and an equity line will be counted as two defaults, even though both loans were for the same house. This could artificially inflate foreclosure statistics.
- A foreclosure filing includes default notices, auction sale notices and bank repossessions. One home may fall into each of these categories as it moves through the long foreclosure process. RealtyTrac counts each step along the way separately. This also skews foreclosure statistics.
- The overwhelming majority of homes are not in danger of foreclosure. If slightly more than 1 percent of U.S. homes were in some stage of foreclosure last year, then 99 percent of homes were not. Although some of the hardest hit communities with high concentrations of defaults are suffering, those communities do not reflect California overall.
Foreclosures up 75% in 2007 [CNNMoney]
Foreclosures; An Additional Perspective [San Francisco Schtuff]
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I got an email today and while I haven’t heard this a lot lately, I guess it can be taken as a good sign. It read like this:
“Rob, We understand that the housing industry is suppose to continue to fall into next year……. We are holding off to see what the market will bring.”
There is a lot of fence sitting going on out there right now, here’s what I think.
“Last year about this time, just prior to the mortgage crisis, the NAR and others stated that they foresaw that 2007 would be a flattening year with a nice recovery, or soft landing, occurring in 2008. As we saw, that wasn’t exactly how it went!
I guess the short answer is that no one really knows what the market will do. It could get worse or it could begin to flatten or it could get better. Based on history over the last 30 years, this is one of the worst downturns of them all. (If I think about this honestly, I feel very comfortable about the future!)
We are at 2003 level prices currently in the resale market and new home builders, traditional and active adult, are generally in a better position than resale. They are the last to feel it and the first to rebound. This is due to many factors.
The following link will take you to a couple of articles in favor of buying now and I’m sure you don’t need any information resources against buying now.
Will prices descend below 2003 levels? If I could answer that question, I’d be a bazillionaire.
Buying California real estate has always been a good investment if held for the long term. The general rule of thumb is that it doubles in value every 10 years. So I would say that if you’re planning on buying and then selling in the next couple years, then analyzing the market on a micro level is definately the strategy.
However, if that isn’t the plan, I believe its a great time to buy. I don’t personally believe 
that prices will go that much lower but you never know. I could be wrong. Many were wrong about 2007.
I do know this: 10 years or even 5 years from today, there will be many people who will be kicking themselves for not buying this year. Do you want to be one of those folks?” (I even think in 2 years, there will be A LOT of kicking going on!)
So how’d I do? I’m almost afraid of asking what you’d say…I’ve seen some of the nasty press out there lately. Be gentle…aside from what your reading, there are some bright sides. Things are getting better, it’s a great time to buy.
Why don’t you come down off that fence, aye? I think even Chicken Little just bought a home! (or two!) 
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This real estate article was posted from Sacramento Real Estate Views
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Who the heck can figure out what’s going on with interest rates right now? The FED lowers the prime rate which, in the past, has brought down the cost of borrowing. But not this time. So what’s the problem?
The credit/mortgage crunch that started in 2007, and now with inflationary concerns, is still and will continue to affect the real estate market for some time to come.
While FreddieMac.com is reporting an average interest rate of 5.72% for a conforming 30 year fixed, lending rates are up. Two rate decreases in the last 2.5 weeks, FreddieMac reporting well under 6% yet getting a fixed rate below 6% without paying points is next to impossible. To say this reflects a lack of confidence in the economy is an understatement.
While the FED is considering another rate cut, the concerns over inflation are pushing mortgage rates higher. The bond data is good but inflation is the real concern at the moment. Until the concern over inflation subsides, don’t expect a decrease in mortgage rates.
The rule of thumb? FED rate cuts do not always mean that mortgage rates with follow suit. There are many more economic factors that enter in to the mix that determine what lenders will charge for their money. For more on this, check out this article from MortgageNewsDaily.com. Great place for “truth in lending”.
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This real estate article was posted from Sacramento Real Estate Views
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Well…nothing good….
First: The interest rate reductions are short term and will help stimulate business, help credit card holders and home equity lines of credit. These respond fairly quickly to short term rate changes.
Housing
Not expected tod do much:
These short term rates will lower mortgage rates a little, but many of the folks in trouble will not be able to make use of a refi because the standards have been raised and pre payment penalties that have been written intothis are draconian.
Recession:
No one really knows yet…the markets are making a fearful bet on the future. Still, the fear is real, the Fed lowered rates .75% just before a meeting - almost unheard of. The last time we saw this was 1984.
I was listening to prior Fed governors talking and this will be solved oly by more home coming onto the market and lower prices until there is whats know as “price equilibrium”. Expect more supply at lower prices unless the Government intervenes and that is not likely on a large scale
Thanks for Reading
http://www.yourpropertypath.com/
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Fixed Rate Mortgage Rates Plummet - 30-Year and 15-Year Fixed Rate At Lowest Level Since Spring 2004
According to Freddie Mac website:
McLean, VA Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®)
1. 30-year fixed-rate mortgage (FRM) averaged 5.48 percent down from last week when it averaged 5.69 percent as well.
Last year the 30-year FRM averaged 6.25 percent. The 30-year FRM has not been lower since the week ending March 25, 2004 when it averaged 5.40
2. The 15-year Fixed Rate averaged 4.95 percent down from last week when it averaged 5.21 percent.
Last Year, the 15-year FRM averaged 5.98 percent. The 15-year FRM has not been lower since the week ending April 1, when it averaged 4.84 percent.
3. Five-year ARMs averaged 5.13 percent this week,
Last Year the 5-year ARM averaged 6.00 percent.
Still the help will be severely diminished two things
1. Many of the more predatory variable loans had high prepayment penalties making it difficult to take advantage of the lower rate
2. Many of the most at risk homeowners have poor credit and new loan standards will hamper their ability to get out from under.
The best answer beside massive Govt. (not likely for the homeowner, but possible for the banks if this continues to deteriorate). The best chance for the homeowner is for the bank to realize if they dont partner up with the borrower and find ways to keep them in their homes they will be warehousing properties for a long time at lower and lower equity values
Thanks for Reading
Howard Bell
http://www.yourpropertypath.om/
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