FSBO BLOG

Well, you could loan it out to businesses, buyers of real estate, etc. at 4-7% interest or you could wait for the FDIC to call and beg you to take over an existing banks assets at 10-20% on the dollar with government guarentees on the principle. This works out to be 500% return on your money. What would you do?

The latest report released by the FDIC shows 829 problem banks with total assets of  $403 billion. Each weekend the FDIC takes over failed banks and on Monday morning they reopen under a new name.

after decades of increasing home size, the median home size in America was near 2,300 square feet in 2007.

Today, the median home size has dropped to about 2,100 square feet and more than one-third of Americans say their ideal home size is actually under 2,000 square feet, according to a survey by real-estate site Trulia.

and inflation will increase.  Freddie Mac says the average rate for 30-year fixed loans fell to 4.17 percent from 4.24 percent last week. That’s the lowest on records dating back to 1971. The average rate on 15-year fixed loans fell to 3.57 percent from 3.63 percent.  Mortgage rates tend to track treasury yields, so for the next several months mortgage rates should remain low. Look for inflation fears to begin in 2011.

Have you bought a ‘bank owned’ foreclosure home lately, then went to your insurance company to get insurance? What you will find out is that to reproduce the building is 2-3 times more than you paid. Why is this? Commodity prices used to build are at a yearly high, things such as; copper, aluminum, steel, etc.  Residential rental rates have remained firm over the past few years. While current home values have dropped, the future price will be higher.  Watch rental rates & commodities in your area.

In the past twelve months:

1.  27% of first-time buyers received a gift from family or friends to help with the down payment. That’s up from 22% a year earlier, and is the highest percentage in the more than 20 year.

2. First time home buyers made up a record 50% of all buyers during the period, up from 47%. (Investors paying cash for bank owned property was another 30%)

3. home ownership is now 66%, after averaging under 64% for decades until the past 10 years saw this percentage peak at 67%.

4. First time buyers plan to stay in their homes for an average 10 years, again this number has been 7-8 years for decades.

Changing attitudes and facts you need to understand when making your own real estate decisions.

HOPE NOW, the private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors released its September 2010 survey data with 1.4 million loan modifications in 2010 saving homeowners with reduced principal and interest payments of 10 percent or more.

This is still another small sign that the banks are finally getting it. They need to reduce their inventory and reduce the number of foreclosures. All of these moves by the banks will help. The market place will tell you if it is working, because you start to see interest rates rise.