First Arnie signs in $200 million more free cheese, now this. Although when I receive unsolicited emails I never know for sure how to verify them, so I’ll call this a rumor – but very believeable:
Jim,
I was just at a conference in NY and they said that the Treasury knows the HAMP program was not working because they were requiring homeowners to sign statements to document their income and no one wanted to do that. The Govt is going to stop requiring that additional documentation of income, and the expectation is that the numbers of mortgages being modified under HAMP will go up significantly.
government is running out of options, responsible tax payers are screwed by both parties, such a shame!
I guess anything is possible, but I don’t buy it.
At the end of January, Treasury announced a tightening of HAMP guidelines after the huge number of defaults that occured after treasury pushed the servicers into granting trial mods without verification in order to get their numbers up:
https://www.hmpadmin.com/portal/docs/news/2010/hampupdate012810.pdf
And it seems like it will be more convenient to push those who can’t verify income into the HAFA short sale program which begins in April.
I don’t think a sneak and creep would work. They would have to pull another 180 degree turn with their guidelines.
This loan modification stuff is a mess I think.They might cut your payment now but all the interest you dont pay now is tacked on to the end of the loan.Youll be paying on that puppy till your 6 feet under.If you are underwater so much that you are losing sleep just let the house go.Call it a business decision and chalk it up to a learning experience.
When will the no doc loans come back again for purchases?I think it will be sooner than you think.
No doc Hamp just seems “too dumb to be true”. I’ll believe it when I see it.
What about a strategic refi? Will update all ya all if I can pull it off.
The monthly sold property for February is out. I think it does not include new homes.92130-Carmel Valley
Number of sales January-February
$800,000-999,000–19 most were low 8.
1,000,000-1,199,000–12
1,200,000-1,500,000–2
1,500,000-2,000,000–2
3,850,000–1
If you think you are going to close a deal above 1.2 million, good luck. I think the potential buyers are shrinking in Carmel Valeey.
Local Boy asked about ez-qual, here’s what is available today:
5.75% fully-amortized, with a 10 year balloon
40% down payment
Libor + 2.5% margin
700+ FICO
Loan amounts from $418,000 to $3 million.
My guess is that 70%-80% of the eager buyers rushed out last year and bought because “it won’t get any better”.
since buying/flipping/buying is not possible these days, then 70%+ of buyers are gone and most of what is left are the patient, analytical, low ballers (me included) who have their own opinion on where values need to be.
Thus, I would expect to see fewer buyers and less demand chasing increasing volume of product (sellers are reactionary and are thinking now is the time to sell because last year was full of multiple offers for properties). I know my neighborhood went from about 5 listings a few months ago to 17 active listings today.
Short blip in Seller’s favor is trending back towards the Buyer’s favor.
No real data to back it up, just intuition and mounting anecdotal evidence.
If you think you are going to close a deal above 1.2 million, good luck.
Thanks, I feel lucky!
CV detached MLS sales in March, 2010, so far:
Under $1M = 11 closed
Over $1M = 7 closed
Concur with clearfund’s comment #8. I’m sensing a slowdown, with more sellers and fewer buyers. Even on the blogs, it seems most “pent up” demand is now largely exhausted. Lots of sellers have been hanging on by their fingertips, waiting for the market to “come back.”
Last year was a seller’s market — very much so. This year, I think we’ll see a gradual realization that the “recession” isn’t anywhere near over yet.
The next few years will be interesting. 🙂
Most people I knew who bought last year were saving for 5-10 years. I wouldn’t call that rushing to buy. It’s one thing to debate the wisdom of buying, it’s another to jump to broad conclusions on people’s motivations based on fairly unrelated statistics.
To illustrate, while recessions and booms have a small measurable impact on the divorce and death rate, by and large people do not choose to divorce or die because of recessions. For the same reason, it’s quite a stretch to say the overwhelming majority of divorcee or dead sellers in a recession timed it to the recession.
I dunno if it’s fair to say that most people who bought last year were saving for years-especially on the lower end of the market. I suspect that lots of those who bought last year (on the low end) were long time renters with minimal savings who discovered that they could now afford to buy a house (and went FHA/VA to do so). Probably most of them could have qualified for a interest-only silly loan at the peak, but were smart enough to realize they wouldn’t be able to afford the payments once they reset.
The current percentage of first timers + cash investors = unsustainable.
“Concur with clearfund’s comment #8. I’m sensing a slowdown, with more sellers and fewer buyers.”
As a buyer I hope you’re right. But I still see a number of properties selling for what seem like fairly high prices relative to the prices they would have sold at during the peak. They’re usually nice, with views and/or pools, upgrades, etc. OTOH, the properties that have bad locations, don’t show well, etc. can languish.
As much as I personally would like to see a continued trend downward in prices, in the inland north county area I’m not sure the data makes a strong case for that conclusion. It seems to be a mixed bag right now (late March, 2010) with lots depending on the specific property in question. Is this quasi-stability?
Waiting, Jim has mentioned before that what we have at this point is 90% of potential buyers chasing 10% quality inventory. There won’t be many “deals” on premium properties, too much competition. But if you are willing to compromise on a fixer or less desirable location, you can find some bargains.
Art Eclectic, I agree. The question is how much of a fixer does it need to be in order for the price to start falling off. I think short sales fall in this bucket too because of how long they take to go through, all the hassle with the junior lien holders, etc. Many folks would rather just buy and be done with it.
Waiting, I think that answer to “how much of a fixer” depends on how eager the seller is. If they want to move that property, they will drop their price early and often until they hit price discovery. At some point, a seller and a buyer come to an agreement that the buyer will buy at X price and the seller will sell at X price.
Anything will sell when the price is right. If it isn’t selling, there isn’t a buyer at that price. There are cases where the seller is determined or can wait, the question is how long. Frankly, I think it’s better to latch onto a motivated seller than guess at how long a determined seller can hold out for. With the motivated seller you know his timeline and that gives you and edge.
Agree with Art Electric. 🙂