Real Estate Market Tid Bits

On July 11th the U.S. Senate passed the housing stimulus bill which allows the Federal Housing Administration to refinance troubled mortgages, even those that are under water, as long as banks agree to take a loss. FHA will be able to help as many as 400,000 homeowners. The bill is in conference committee for bipartisan revisions before it goes to the President.
The FED chairman reassured Congress that Fannie Mae and Freddie Mac are in no danger of failing. He said the two mortgage giants are adequately capitalized. Even so, the weakness of the dollar is having an effect on the companies, making it difficult for them to raise capital. The soft housing market is the central issue according to cautious investors.
Investors with cash are the real kings in today’s market. Some are calling this housing market the best for investors since the early 80’s. Investors are negotiating volume deals on whole subdivisions of distressed properties for literally pennies on the dollar. What we are seeing today dwarfs the 80’s by nearly 10 times! People who have cash positions are likely to do extraordinarily well. It’s just crazy the prices you can buy right now with cash.
30 year mortgage rates fell to 6.42% recently. Rates have been on a wild ride since the start of this year, and were as low as 5.57 for a short period. That’s a swing of over $1100 a month on a $350,000 loan.
Even though sales are down and foreclosures are booming, some experts are saying that the rout is near the end of its course. You wouldn’t know it based on reports in the mainstream media. Recent data suggest the real estate market pessimism is somewhat overblown. Lot’s of pundits and media types are ignoring some of the key facts supporting the reality of an improving market. Stay tuned! By the way, there is no sign of a slump in the San Francisco real estate market.