Comments on: Who REALLY Can Benefit From Lower Mortgage Rates?

By: BertDilbert

BertDilbert — Thu, 11 Dec 2008 07:53:51 +0000

Susan, that was a really nice post you did on Anaheim home prices and incomes. Clearly it showed that the buyers were entering into contracts they could not afford. Which brings about the question: Do you bail out speculators?

Here are two maps from the fed. This one looks like home ownership rates in CA will drop below 1990 levels by the time it is over.

http://research.stlouisfed.org/fred2/series/CAHOWN?rid=144

This will leave CA with the lowest home ownership in the nation.

http://geofred.stlouisfed.org/?l=state,state_lbl&sa=Not Applicable, Annual, Percent&cm=equal&ex=-139.701727,24.811483,-71.726477,49.94623&nob=5&cs=ylorbr&geom=state&st=Home Ownership Rate&dtn=Percent&dt=2007&fq=Annual&

In order for ownership rates to align with the rest of the nation, prices will have to fall to the level of affordability. That means incomes will have to match housing prices without hocus pocus finance.

By: Susan Day Minerly

Susan Day Minerly — Thu, 11 Dec 2008 07:06:15 +0000

Actually the Hope for Homeowners program only had 111 applications, so far.

By: Susan Day Minerly

Susan Day Minerly — Thu, 11 Dec 2008 07:04:01 +0000

Prices will not go up in the next few months or years.

Purchasers are and SHOULD be looking for the best possible price to purchase a home, which are the REO”S.

The majority of the sales in the market today are from REO’S since they can and do under-sell the other homeowners in the same area.

Everyone loves a bargain.
Every closed sale becomes a comparable creating a value for the area.

As a buyer waiting on the side line, why would you purchase a similiar type home in the same vicinity for 20-30-40% more than the REO? You wouldn’t and the deflationary cycle continues.

By: Stu

Stu — Sat, 06 Dec 2008 14:50:31 +0000

AC, I think what you meant to say was that FHA / Hope have delayed a ton of people from entering foreclosure. That and all the new programs from various states not allowing foreclosures to take place. It is all a shell game with the tax payer holding the bag. January brings changes to the conforming loan amounts back to where they were and fewer and fewer will qualify for FHA loans as we move foward. This is all a false blip that will turn right back around. You can delay the inevitable but you can’t make it go away, and that is all that is happening here.

Mr. M. as usual a great post right on target. This will do very little if anything to turn things around. The problem is tied more to the people who can afford to buy and the people we need to be buyers right now to turn things around, simply don’t want to buy right now. As you point out the speculators, renters and first timers are not nearly enough to get things turned around and in fact they may actualy do the opposite if things get a lot worse because they are the buyers that would be least able too handle a continued downturn once in their homes. They could actually end up helping to prolong the problem down the road.

By: Stu

Stu — Sat, 06 Dec 2008 14:50:31 +0000

By: I See theOcean

I See theOcean — Sat, 06 Dec 2008 07:59:05 +0000

Kind of like more homes are selling so prices are higher?

FHA-Hope only prolongs the inevitable.

By: AC

AC — Sat, 06 Dec 2008 07:23:38 +0000

kashmula is right, the FHA-Hope has kept a ton of people out of foreclosure. Mr.M. conveniently leaves out an important fact, the lower interest rate will bring in a bunch of new buyers which in turn will drive up the prices. YES, prices will start to go up within a few months after rates drop below 5%. Keep your day job Mr.M because those of us still in the business are doing much better these days.

By: loan mod chick

loan mod chick — Sat, 06 Dec 2008 04:48:09 +0000

Javagold:
There you go again, with the name calling!
Now, you say I am not only stupid, but thin skinned.
OMG,you must be either very young, or an old control freak.
Try posting your comments without the name calling.
I haven’t ever seen MM comment that people are stupid, thin skinned, or slow, or………and I am pretty sure some of our comments must make him crazy!
What demeaning name is next? Bring it.
You can certainly make your point, without name calling can’t you?

By: Javagold

Javagold — Sat, 06 Dec 2008 04:17:58 +0000

load mod chick,
Slow rion, called Ocean a loser, that is is you should be calling out for harsh posting , not me, you dont even understand what i even posted, and say we have opposite views, when i believe WE HAVE THE SAME, thats why i said you sound stupid…..but either way stop being so thin skinned, its a MB on the internet , who cares what anyone says …

By: loan mod chick

loan mod chick — Sat, 06 Dec 2008 04:05:46 +0000

Javagold said: “I see the Ocean, dont listen to anyone such as Slow-rion, slow is a good name for him, as he is just a bit slow”

Javagold, I am just saying this(I thought)is a format for opinions ,not harsh judgements. You don’t know me, how can you call me stupid?
We all see things with opposite views, but isn’t it so interesting to read others opinions without FORCING our own thoughts on others? My God, arent things difficult enough right now, in this perfect storm of events?