Investors, half of them using no mortgage, bought 1.23 million homes last year. 41 percent of investment buyers purchased more than one property.
Archive for March, 2012
In February, mortgage refinances dropped 24 percent. Has everyone planning on refinancing their mortgage done so. Quite possible, if you now have a mortgage interest rate below 4.5% you probably are satisfied with the rate, unless they get below 3%. Right now 30 yr fixed rate is above 4%.
Commerce Department said today sales in February slipped 1.6 percent to a seasonally adjusted 313,000-unit annual rate. Sales for November and December were revised up. The median price for a new home rose 8.3 percent to $233,700, the highest level since June.
Foreclosure properties now sell at 1995 prices and rented at 2012 prices. With the stock market recouping it’s loss’s of 2008/2009 and CD’s still paying below 1%, investors are picking up the pace of buying these foreclosed properties. Check your zip code to see what is available: foreclosures
Inventory of 2.43 million up from 2.33 million in January. At the current sales pace, it would take 6.4 months to sell those houses, up from 6 months in January. Cash transactions were 33 percent, the same as a year ago. Distressed sales accounted for 34 percent of the total, little changed from 35 percent a month earlier.
The Commerce Department reported today that building permits rose 5.1% in February and that housing starts in January were revised up to 706,000 from an original reading of 699,000.
In our October 27, 2011 blog: FSBO.com calling the bottom of interest rates We predicted interest rates would move higher, well, yesterday mortgage rates jumped to the highest since Oct 2011. With Europe’s problems smoothing out, Operation Twist winding down, and a 15 trillion dollar US debt that keeps increasing, rates will continue to move higher. Better lock in now!!
Last year, homeowners paid $436 billion in property taxes, about $66 billion more than in 2006 when home values peaked. Why is this? Most states have complex laws that make property tax declines rare, small or long-delayed, even when home values fall. Tax assessments are based on a formula that considers home values as far back as seven years. We expect this year to see reduced taxes and to continue for several years.
with their deposits, U.S. banks bought more government debt in the first two months of 2012 than they did in all of last year. These lenders purchased $78.2 billion of Treasuries in January and February, compared with $62.6 billion in all of 2011, bringing their holdings to $1.78 trillion, Fed data show. If banks would use this to loan to buyers of homes, it would solve these problems: 1. bank non performing assets 2. value of their non performing assets by raising the value of real estate 3.deter borrowers from walking away from their homes/reduce future foreclosures 4.increase their interest rate spread 5.lower unemployment 6.raise govt tax revenues. Bad decision #2
The Increasingly Poor Decisions of Banks reminds me of a recent IFC series on TV. Banks number one priority is to make a profit for their shareholders. They do this in several ways, first is the interest rate spread between what they owe depositors and interest rate they invest at. The second is fee income. Items that interfere with this is called ‘non performing assets’, these are assets not giving the bank any return on invested money. Foreclosed property on the books of banks fall into this category. You would think they would do everything they can to sell them off, then reinvest the money into performing assets. Bad decision #1