The FED is buying mortgages

The FED is going to purchase trouble mortgage assets, which it hopes will ease lending and help put a bottom on home prices. With this announcement mortgage rates have dropped dramatically this past week.

“The rate reduction is exactly what the Fed intended: "This action is being
taken to reduce the cost and increase the availability of credit for the
purchase of houses, which in turn should support housing markets and foster
improved conditions in financial markets more generally," the central bank said
in its announcement."

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Hats off to you Obama

Congratulations to Barack Obama on becoming the next president elect. I wish him well and hope that he is able to pull our country out of this bleak period. He has a lot of work to do!

Is that home a steal or overpriced?

This article courtesy of bankrate.com provides you with a simple formula to determine if the home you are looking at is overpriced or not. They use the price/rent ratio, which might help you figure out if the home your scoping out is a good deal or not.

The one true thing, I've seen in all my years of Real Estate is never just take the Realtors word for it. Always do your homework and ask for multiple options, unless it’s a specific type of house in a specific neighborhood, then your pretty much stuck.


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Could we see 1% at the FED?

Rumors are starting to surface about the FED lowering the rate to 1%!! Not sure if this is true or not, but I think that it will be a good idea.

Will it affect mortgage rates? Not sure, most of the time when the FED lowers the rate, mortgage rates go up in the short term and lower in the long term. This time I expect the opposite to be true and you will see mortgage rates hit an all time low, before they start to climb back up. Either way, 2009 should produce a really wild market.

Story from Marketwatch

Up 71% and no it’s not your home value or 401K

Foreclosures are up 71% this quarter. That is an astonishing number. The article mentions that some of the hot spots are AZ, CA, and FL.

This quarter and next should be the end of the major spikes in foreclosures. Lending standards have been tighten for quite some time now and high LTV and risky loans have not been made for over a year.

Another stat that I read last year, was that in Oct. 2008 is the month when the most sub-prime ARMs come due and start to adjust. That means that the wave of bad sub-prime deals should be working it’s way through the system. I do also think that our government will step in after the election and help to curb some of these foreclosures.

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Real Estate is all about location…

Not all areas are on the decline in the US. This article posted on Yahoo, shows that some areas are still gaining values while others plunge.

Some of the areas where real estate is keeping value is Seattle, Des Moines, Denver and a few others.

The truth is that every city has pockets where Real Estate is still in demand. Do your homework before you buy it will help you to lower your risk.

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Fastest Selling Zip codes

This is a list of ten fastest selling Zip codes in America compiled by Business Week.

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