Dear Mr. Thorngren:
Thank you for contacting me to express your support for permanently increasing the conforming loan limit. I appreciate the time you took to write and agree with you.
The Federal Housing Administration (FHA) plays an important role in insuring home mortgages for those in underserved communities. It is critical that FHA programs be modernized to provide more homebuyers and borrowers looking to refinance with the opportunity to obtain an FHA loan. This remains especially important in California where the cost of housing remains high. For homebuyers faced with so-called "jumbo loans" subject to higher interest rates, raising the government-sponsored enterprise (GSE) conforming loan limit will bring more liquidity to the market and lower interest rates.
On February 13, 2008, the President signed the Economic Stimulus Act of 2008 (H.R. 5140) into law. As the bill was being developed, I sent a letter to Senator Majority Leader Harry Reid (D-NV) expressing strong support for increasing the previous GSE conforming loan limit of $417,000 and the FHA loan limit of $362,790 to $729,750. While I am pleased that a temporary increase was included in the bill, the new loan limits will expire on December 31, 2008.
On July 11, 2008, the Senate passed the "Foreclosure Prevention Act of 2008," (H.R. 3221) introduced by Senators Christopher J. Dodd (D-CT) and Richard C. Shelby (R-AL). Prior to Senate consideration of the bill, I urged Senators Dodd and Shelby to keep the FHA loan limit and GSE conforming loan limits at the current level of $729,750. The Senate passed its version of H.R. 3221 on July 11, 2008. While the Senate-passed version of the bill would only raise the loan limits to $625,500, the House-passed version would keep them at their current level. On July 11, 2008, I joined 52 members of the California Congressional delegation in sending a letter to leaders of the Senate and House leadership urging them to retain the $729,750 limits in the final version of this important bill.
I fully support the higher limit and will continue to push to make it permanent.
Thanks for writing.
Sincerely yours,
Dianne Feinstein United States Senator
Further information about my position on issues of concern to California and the Nation are available at my website http://feinstein.senate.gov/public/. You can also receive electronic e-mail updates by subscribing to my e-mail list at http://feinstein.senate.gov/public/index.cfm?FuseAction=ENewsletterSignup.Signup.
Wednesday, July 23, 2008
Saturday, July 5, 2008
Update on RiverPark Development in Oxnard
Here is a little update to a blog I wrote about the RiverPark development last year. This is inresponse to questions about the local High Schools, gangs, flood zone considerations and home buying expenses. There are also some very basic suggestions for people considering a home purchase in the next few months to make their experience more productive and less stressful.
Yes there are some real expenses with living in Riverpark that include Mello Roos, Oxnard City tax and HOA fees. The Mellos Roos and City tax can total close to 2% of the purchase price yearly, while HOA's average around $250/month. So, for a $450K home, your are talking about an extra $1,000 a month in home expenses.
Having said that, my experience has been that these are nicely built homes at very competitive prices even with the additional add-on expenses. In the last year, these same homes have had a number of price reductions and incentives thrown in to make them really good opportunities for folks who need a brand new home. So for the same $400K to $450K this year, you can often find yourself making an offer on a much nicer home for the same money.
My daughter attends High School at El Rio and we have found their programs for college bound students to be outstanding. There are some possible new developments for students as well which include El Rio High becoming one of only two High Schools in Ventura County (Newbury Park High is the other) to qualify for an international student accelerated learning class this year. It should be fully instituted by next year.
Gangs are a problem in Oxnard, but there have been some very effective law enforcement initiatives taken in the last few years to cripple their influence.
RiverPark has it's own school, fire department and is building some shopping areas as well.
In order to address the flooding issues, I would recommend you contact the City of Oxnard Public Works Department, FEMA for flood plain maps at www.FEMA.gov or http://www.floodalert.fema.gov for a list of insurance companies that offer flood insurance in your area. You can find additional commments on flooding issues in my latest blog on my personal website http://www.markthorngren.com.
Should you buy now or wait. Let's look at each possibility.
Buy later....or Buy now. Home prices will most likely continue to fall for months if not years yet. My personal bet is some areas will turn around before others. Unless you know your neighborhoods intimately, you may have difficulty recognizing when it begins to happen. According to local title information (Land America Lawyers Title - Tom Piszczek - (805) 302-8667) home prices in Oxnard have gone down over 34% from March'07 to March '08, and 16% in Camarillo over the same time frame. Those are some pretty big numbers.
I always do a Comparative Market Analysis of my own for my clients. This is a one year look at a very specific neighborhood for any property my clients are interested in making an offer on. I find price trends, comparative home sale prices and listing information to base the offer or sale price for sellers and buyers needs.
Let us say that home prices continue down for at least another year. During the year we may see the buyers continue to take advantage of this market. Some of these folks are investors who are very savvy to our local markets.
In January my clients purchased a home listed for $600K in a neighborhood with a $604K median price. The sellers were motivated and my buyers made an offer for $450K plus $8,000 in closing costs. It was accepted! That is a 25% price reduction - almost a full years price drop right now!
Those are the kinds of deals that can happen in today's market. Does it always happen like that? No, but such a thing was unheard of a year ago. Will that type market last another year? Impossible to say.Mortage programs are much more strict but progress has been made through FHA and CalHFA to make 100% financing still available to qualified first time home buyers. Very competitive rates are available through FHA for most other well-qualified individuals.
You should have yourself pre-approved with a lender you trust before you go looking for a home. If you don't know what you can afford, you are wasting your valuable time. Also,most realtors are not going to spend a lot of time driving people around at $4.65/gallon if they don't know what they are qualified to purchase or what program best fits their personal needs.
Get several Good Faith Estimates from different lenders and tell them what you are doing. Make them compete for your business! Watch you expenses and fees shrink as they try to lure you their way. Make sure the good faith estimates include pro-rated taxes, Title and Escrow fees. It is not uncommon to receive Good Faith Estimates that look very competitive until you realize they don't include all the normal expenses for your transaction.
Ask your competing lenders to explain any differences in competing Good Faith Estimates. Sometimes your realtor can give you and idea of what is really happening as well.
FHA comforming loan limits have been raised from $417,000 to roughly $729,000 until December 31 of this year. There is great pressure being put on Congress to extend this deadline and it may indeed be extended. Hasn't happened yet but might. If it doesn't, FHA limits will probably default back to $417,000 next year. There are not very many single family detached homes available in California for less than $417,000.
We have no idea what interest rates will do over the next 12 months. That is a very fundamental gamble if you are undecided about when to buy. A very small interest rate change can have an immense effect on the interest you pay over 30 Years. Right now the Fed is under increasing pressure to start raising interest rates again. Higher gas prices, food prices and shipping costs are having a huge inflationary impact on our economy. That should be a concern to more people than just home prices. I'm guessing that after the presidential election we could see higher home mortgage interest rates.
This is a buyers market. It will continue to be a buyers market for months to come. When it changes, it will change gradually and at different times in different towns and neighborhoods. You won't easily see the change until you are past it. That is my thought on today's market. What do they say about a bird in the hand?
Warmest Regards,
Mark Thorngren
http://RealtyTimes.com/REUv/MarkThorngren or
http://www.markthorngren.com
(805) 504-0228
Oxnard – Riverpark – 1,800 homes along the Santa Clara River
The largest new home development currently being built in Oxnard is Riverpark There are 15 different home plans by my count, located just North off the 101, along the banks of the Santa Clara River. HOA’s vary by neighborhood, by square footage and by builder. Standard Pacific Homes is currently marketing the Celadon tract. Their HOAs can run from less than $100.00 up to nearly $300.00. There is also a 30 year Mello Roos which is about 1.1% but it is combined with a city special tax assessment. Agents in the development have told me to just multiply the Sale Price x 1.9 to get a rough idea of the combined total. Add the HOA and you will come close to your monthly fees. The HOA in the homes built by Standard Pacific Homes includes outside maintenance, landscaping and lender insurance – typically fire. Add these to your mortgage payment for your monthly housing costs. This does not include all utilities or your personal property insurance. Even with all the added costs, the homes tend to be very competitively priced with more floor space than I would expect. In one case that I know of, a home was offered for 70K below market with a special 6% give back at close of escrow. It was the last home in the tract and had fallen out of escrow previously. This was a nicely upgraded home in a nice location. Good things can happen. Call them to find out what is currently available or I can check for you if you prefer.Shea Homes is offering the Market Street Tract of luxury townhomes. Plans 1 – 4 range in price from 486K for 2,362 sq ft to 545K for 2,631 sq ft. HOAs are up to $292 for Phase 2. This covers the Riverpark master association dues ($32) with the balance for Fire and Casualty Insurance of the building and exterior maintenance of the building. There is a property tax rate of 1.15% of the sale price, plus a Mello Roos Tax Assessment of $4,587 per year. Several other tracts are still under construction. They have a new school opening there this Fall. There are very nice websitesq at http://www.riverparklife.com/ or www.standardpacifichomes.com or www.SheaHomes.com.The tract names are:• Celadon• Destination• Luminaria• Market Street• Promenade• The Avenue• Tradewinds• Trellis• Westerly• Collage• Meridian • Morning View• Veranda• Waypoint • Daybreak
May 10, 2008 Mark J Thorngren
Mark has summed it up really well, about the declines yet to come, the variations in the markets in terms of turning down and up (coastal is last to fall, first to rise for example), and that lending is fairly loose if you look at higher limits and 100% financing for FHA. We had 140 FHA sales last month.
This is where I disagree on interest rates: since it's all about the monthly payment, any rise in interest rates NECESSITATES a lower home price.
If I were even thinking of selling, I would make sure I sold BEFORE1. Interest rates rise, thus shutting out more buyers and forcing me to lower my price 2. More foreclosures increase the supply of homes. As Chris Thornburg was quoted in the NC Times today, nothing is more pernicious to prices, than a high supply.
Yes there are some real expenses with living in Riverpark that include Mello Roos, Oxnard City tax and HOA fees. The Mellos Roos and City tax can total close to 2% of the purchase price yearly, while HOA's average around $250/month. So, for a $450K home, your are talking about an extra $1,000 a month in home expenses.
Having said that, my experience has been that these are nicely built homes at very competitive prices even with the additional add-on expenses. In the last year, these same homes have had a number of price reductions and incentives thrown in to make them really good opportunities for folks who need a brand new home. So for the same $400K to $450K this year, you can often find yourself making an offer on a much nicer home for the same money.
My daughter attends High School at El Rio and we have found their programs for college bound students to be outstanding. There are some possible new developments for students as well which include El Rio High becoming one of only two High Schools in Ventura County (Newbury Park High is the other) to qualify for an international student accelerated learning class this year. It should be fully instituted by next year.
Gangs are a problem in Oxnard, but there have been some very effective law enforcement initiatives taken in the last few years to cripple their influence.
RiverPark has it's own school, fire department and is building some shopping areas as well.
In order to address the flooding issues, I would recommend you contact the City of Oxnard Public Works Department, FEMA for flood plain maps at www.FEMA.gov or http://www.floodalert.fema.gov for a list of insurance companies that offer flood insurance in your area. You can find additional commments on flooding issues in my latest blog on my personal website http://www.markthorngren.com.
Should you buy now or wait. Let's look at each possibility.
Buy later....or Buy now. Home prices will most likely continue to fall for months if not years yet. My personal bet is some areas will turn around before others. Unless you know your neighborhoods intimately, you may have difficulty recognizing when it begins to happen. According to local title information (Land America Lawyers Title - Tom Piszczek - (805) 302-8667) home prices in Oxnard have gone down over 34% from March'07 to March '08, and 16% in Camarillo over the same time frame. Those are some pretty big numbers.
I always do a Comparative Market Analysis of my own for my clients. This is a one year look at a very specific neighborhood for any property my clients are interested in making an offer on. I find price trends, comparative home sale prices and listing information to base the offer or sale price for sellers and buyers needs.
Let us say that home prices continue down for at least another year. During the year we may see the buyers continue to take advantage of this market. Some of these folks are investors who are very savvy to our local markets.
In January my clients purchased a home listed for $600K in a neighborhood with a $604K median price. The sellers were motivated and my buyers made an offer for $450K plus $8,000 in closing costs. It was accepted! That is a 25% price reduction - almost a full years price drop right now!
Those are the kinds of deals that can happen in today's market. Does it always happen like that? No, but such a thing was unheard of a year ago. Will that type market last another year? Impossible to say.Mortage programs are much more strict but progress has been made through FHA and CalHFA to make 100% financing still available to qualified first time home buyers. Very competitive rates are available through FHA for most other well-qualified individuals.
You should have yourself pre-approved with a lender you trust before you go looking for a home. If you don't know what you can afford, you are wasting your valuable time. Also,most realtors are not going to spend a lot of time driving people around at $4.65/gallon if they don't know what they are qualified to purchase or what program best fits their personal needs.
Get several Good Faith Estimates from different lenders and tell them what you are doing. Make them compete for your business! Watch you expenses and fees shrink as they try to lure you their way. Make sure the good faith estimates include pro-rated taxes, Title and Escrow fees. It is not uncommon to receive Good Faith Estimates that look very competitive until you realize they don't include all the normal expenses for your transaction.
Ask your competing lenders to explain any differences in competing Good Faith Estimates. Sometimes your realtor can give you and idea of what is really happening as well.
FHA comforming loan limits have been raised from $417,000 to roughly $729,000 until December 31 of this year. There is great pressure being put on Congress to extend this deadline and it may indeed be extended. Hasn't happened yet but might. If it doesn't, FHA limits will probably default back to $417,000 next year. There are not very many single family detached homes available in California for less than $417,000.
We have no idea what interest rates will do over the next 12 months. That is a very fundamental gamble if you are undecided about when to buy. A very small interest rate change can have an immense effect on the interest you pay over 30 Years. Right now the Fed is under increasing pressure to start raising interest rates again. Higher gas prices, food prices and shipping costs are having a huge inflationary impact on our economy. That should be a concern to more people than just home prices. I'm guessing that after the presidential election we could see higher home mortgage interest rates.
This is a buyers market. It will continue to be a buyers market for months to come. When it changes, it will change gradually and at different times in different towns and neighborhoods. You won't easily see the change until you are past it. That is my thought on today's market. What do they say about a bird in the hand?
Warmest Regards,
Mark Thorngren
http://RealtyTimes.com/REUv/MarkThorngren or
http://www.markthorngren.com
(805) 504-0228
Oxnard – Riverpark – 1,800 homes along the Santa Clara River
The largest new home development currently being built in Oxnard is Riverpark There are 15 different home plans by my count, located just North off the 101, along the banks of the Santa Clara River. HOA’s vary by neighborhood, by square footage and by builder. Standard Pacific Homes is currently marketing the Celadon tract. Their HOAs can run from less than $100.00 up to nearly $300.00. There is also a 30 year Mello Roos which is about 1.1% but it is combined with a city special tax assessment. Agents in the development have told me to just multiply the Sale Price x 1.9 to get a rough idea of the combined total. Add the HOA and you will come close to your monthly fees. The HOA in the homes built by Standard Pacific Homes includes outside maintenance, landscaping and lender insurance – typically fire. Add these to your mortgage payment for your monthly housing costs. This does not include all utilities or your personal property insurance. Even with all the added costs, the homes tend to be very competitively priced with more floor space than I would expect. In one case that I know of, a home was offered for 70K below market with a special 6% give back at close of escrow. It was the last home in the tract and had fallen out of escrow previously. This was a nicely upgraded home in a nice location. Good things can happen. Call them to find out what is currently available or I can check for you if you prefer.Shea Homes is offering the Market Street Tract of luxury townhomes. Plans 1 – 4 range in price from 486K for 2,362 sq ft to 545K for 2,631 sq ft. HOAs are up to $292 for Phase 2. This covers the Riverpark master association dues ($32) with the balance for Fire and Casualty Insurance of the building and exterior maintenance of the building. There is a property tax rate of 1.15% of the sale price, plus a Mello Roos Tax Assessment of $4,587 per year. Several other tracts are still under construction. They have a new school opening there this Fall. There are very nice websitesq at http://www.riverparklife.com/ or www.standardpacifichomes.com or www.SheaHomes.com.The tract names are:• Celadon• Destination• Luminaria• Market Street• Promenade• The Avenue• Tradewinds• Trellis• Westerly• Collage• Meridian • Morning View• Veranda• Waypoint • Daybreak
May 10, 2008 Mark J Thorngren
Mark has summed it up really well, about the declines yet to come, the variations in the markets in terms of turning down and up (coastal is last to fall, first to rise for example), and that lending is fairly loose if you look at higher limits and 100% financing for FHA. We had 140 FHA sales last month.
This is where I disagree on interest rates: since it's all about the monthly payment, any rise in interest rates NECESSITATES a lower home price.
If I were even thinking of selling, I would make sure I sold BEFORE1. Interest rates rise, thus shutting out more buyers and forcing me to lower my price 2. More foreclosures increase the supply of homes. As Chris Thornburg was quoted in the NC Times today, nothing is more pernicious to prices, than a high supply.
Sunday, April 27, 2008
FEMA & Camarillo Floodplain Issues
When my family first moved into Camarillo back in 1998, the city was experiencing widespread flooding from "La Neina". The rains were heavy for weeks at a time and many of the lower elevations around town were suffering. Since that time many extensive flood control projects have been carried out around the county.
Notable among the projects was a thorough clean up and channeling of the Calleguas Creek. This creek had overflowed in several locations where roads crossed it. The bridge embankments were too narrow and had caused the creek to back up at several locations. New bridge construction and a host of other improvements have greatly eased the risk of flooding in Camarillo.
Despite these improvements, FEMA went ahead and redrew flood maps for our city which include diagrams of areas likely to flood over a 100 year time frame. FEMA has expanded the flood areas to include a new, even less likely area of flooding called the 500 year flood area.
The City of Camarillo which has spent a great deal of it's resources to protect itself from flooding, has been understandably concerned about FEMA's new maps. The city has worked to provide homeowners with a better understanding of the effects the new maps may have on the need for and the cost of insuring their homes because of FEMA's new maps.
Insurance companies often require homeowners to carry flood insurance according to the way these FEMA maps are drawn. Insurance can run from around $300 to upwards of $2,000 per year and is normally required for Federal or federally related mortgage financing.
I have copied and scanned some of the literature the City of Camarillo distributed during 2006 in response to FEMA's new maps. I would be happy to email these to anyone with an interest in their property status.
The long and short of it all appears to be that if you live in one of the mapped areas, you would be well-advised to contact the City of Camarillo, FEMA and your home insurer to determine how each will treat your property. Contact information for City of Camarillo - Public Works Department Ph (805) 388-5340 or www.ci.camarillo.ca.us. FEMA - John Magnotti at (202) 646-3932 or john.magnotti@fema.gov or www.fema.gov/mit/tsd.
Warmest Regards,
Mark Thorngren
http://www.markthorngren.com & http://realtytimes.com/REUv/MarkThorngren
Notable among the projects was a thorough clean up and channeling of the Calleguas Creek. This creek had overflowed in several locations where roads crossed it. The bridge embankments were too narrow and had caused the creek to back up at several locations. New bridge construction and a host of other improvements have greatly eased the risk of flooding in Camarillo.
Despite these improvements, FEMA went ahead and redrew flood maps for our city which include diagrams of areas likely to flood over a 100 year time frame. FEMA has expanded the flood areas to include a new, even less likely area of flooding called the 500 year flood area.
The City of Camarillo which has spent a great deal of it's resources to protect itself from flooding, has been understandably concerned about FEMA's new maps. The city has worked to provide homeowners with a better understanding of the effects the new maps may have on the need for and the cost of insuring their homes because of FEMA's new maps.
Insurance companies often require homeowners to carry flood insurance according to the way these FEMA maps are drawn. Insurance can run from around $300 to upwards of $2,000 per year and is normally required for Federal or federally related mortgage financing.
I have copied and scanned some of the literature the City of Camarillo distributed during 2006 in response to FEMA's new maps. I would be happy to email these to anyone with an interest in their property status.
The long and short of it all appears to be that if you live in one of the mapped areas, you would be well-advised to contact the City of Camarillo, FEMA and your home insurer to determine how each will treat your property. Contact information for City of Camarillo - Public Works Department Ph (805) 388-5340 or www.ci.camarillo.ca.us. FEMA - John Magnotti at (202) 646-3932 or john.magnotti@fema.gov or www.fema.gov/mit/tsd.
Warmest Regards,
Mark Thorngren
http://www.markthorngren.com & http://realtytimes.com/REUv/MarkThorngren
Monday, March 31, 2008
Senator Dianne Feinstein on Home Ownership Assistance
Dear Mr. Thorngren:
Thank you for contacting me regarding homeownership assistance programs. I appreciate the time you took to write and welcome the opportunity to respond.
The Federal Housing Administration (FHA) plays an important role in insuring home mortgages for those in underserved communities. It is critical that FHA programs be reformed to provide more homebuyers and borrowers looking to refinance with the opportunity to obtain an FHA loan. These opportunities are especially important in states, such as California, where the cost of housing is high. For homebuyers faced with jumbo loans subject to high interest rates, raising the government-sponsored enterprise (GSE) conforming loan limit will bring more liquidity to the market and lower monthly interest rate costs.
On February 13, 2008, the President signed the Economic Stimulus Act of 2008 (H.R. 5140) into law. I strongly supported the provision of this bill which temporarily increases the FHA loan limit and GSE conforming loan limit to 125 percent of an area's median home price, up to a maximum of $729,750. On February 5th, the U.S. Department of Housing and Urban Development published these revised limits for California. Please know that I will carefully monitor the FHA, Freddie Mac, and Fannie Mae as they implement these new loan limits. You may review the newly published FHA loan limits at http://www.HUD.gov. The GSE loan limits can be viewed at http://www.ofheo.gov.
You may be interested to know that conference negotiations to resolve the differences between the House-passed version of the FHA reform bill (H.R. 1852) and the Senate-passed version (S. 2338) are ongoing. These two bills would permanently increase the FHA loan limit, lower down payments, and increase the availability of FHA's reverse mortgage program, among other reforms. I understand that this issue is of major importance to Californians facing high home prices and the threat of losing their home to foreclosure. Please know that I will continue to do everything I can to help on this critical issue.
Once again, thank you for writing. I hope you will continue to keep me informed on issues of importance to you. If you have any additional questions or concerns, please do not hesitate to contact my Washington, D.C. office at (202) 224-3841. Best regards.
Sincerely yours,
Dianne Feinstein
United States Senator
Further information about my position on issues of concern to California and the Nation are available at my website http://feinstein.senate.gov/public/. You can also receive electronic e-mail updates by subscribing to my e-mail list at http://feinstein.senate.gov/public/index.cfm?FuseAction=ENewsletterSignup.Signup.
Thank you for contacting me regarding homeownership assistance programs. I appreciate the time you took to write and welcome the opportunity to respond.
The Federal Housing Administration (FHA) plays an important role in insuring home mortgages for those in underserved communities. It is critical that FHA programs be reformed to provide more homebuyers and borrowers looking to refinance with the opportunity to obtain an FHA loan. These opportunities are especially important in states, such as California, where the cost of housing is high. For homebuyers faced with jumbo loans subject to high interest rates, raising the government-sponsored enterprise (GSE) conforming loan limit will bring more liquidity to the market and lower monthly interest rate costs.
On February 13, 2008, the President signed the Economic Stimulus Act of 2008 (H.R. 5140) into law. I strongly supported the provision of this bill which temporarily increases the FHA loan limit and GSE conforming loan limit to 125 percent of an area's median home price, up to a maximum of $729,750. On February 5th, the U.S. Department of Housing and Urban Development published these revised limits for California. Please know that I will carefully monitor the FHA, Freddie Mac, and Fannie Mae as they implement these new loan limits. You may review the newly published FHA loan limits at http://www.HUD.gov. The GSE loan limits can be viewed at http://www.ofheo.gov.
You may be interested to know that conference negotiations to resolve the differences between the House-passed version of the FHA reform bill (H.R. 1852) and the Senate-passed version (S. 2338) are ongoing. These two bills would permanently increase the FHA loan limit, lower down payments, and increase the availability of FHA's reverse mortgage program, among other reforms. I understand that this issue is of major importance to Californians facing high home prices and the threat of losing their home to foreclosure. Please know that I will continue to do everything I can to help on this critical issue.
Once again, thank you for writing. I hope you will continue to keep me informed on issues of importance to you. If you have any additional questions or concerns, please do not hesitate to contact my Washington, D.C. office at (202) 224-3841. Best regards.
Sincerely yours,
Dianne Feinstein
United States Senator
Further information about my position on issues of concern to California and the Nation are available at my website http://feinstein.senate.gov/public/. You can also receive electronic e-mail updates by subscribing to my e-mail list at http://feinstein.senate.gov/public/index.cfm?FuseAction=ENewsletterSignup.Signup.
Tuesday, March 18, 2008
Subsidized Housing Programs in Ventura County
Many folks coming to Ventura County find the home buying process a daunting task. Without a good credit score, a large income or substantial down payment, things can be just plain tough. To tell the truth, there are many realtors and real estate consultants that have very little knowledge of what kind of help is available to these folks. Everyone seems to rely on lenders or mortgage brokers for knowledge of financial assistance programs. Most lenders have some kind of in-house programs or might even know a little bit about FHA and CAL-HFA programs. After that, knowledge of most home buyer assistance programs gets a little thin.
Last week I was browsing our local newspaper's real estate section and came across an article about the Area Housing Authority of the County of Ventura. I’ve heard of some of their programs before but had never found source material. I felt like a gold miner that had just stumbled across the mother lode. I downloaded 31 pages of their material and had to quit because I was using up all my printer's color cartridges. There is a very large amount of helpful information on their wonderful website. Check out http://www.ahacv.org/home_buyers_workshop.shtml.
This page will give you time, place and date for the next home buyer workshops. The following information is taken directly from the county website.
"The Area Housing Authority is committed to serving the community by being a resource for housing information. With the skyrocketing prices of homes in Ventura County, first-time home buyers are often overwhelmed with the decision of whether to buy a home here, continue renting, or move to a cheaper area.
Many new home buyers are unaware of State and local programs that help with down-payments, closing costs, and lower interest loans. Households with income between $55,000 and $113,000 may qualify for a variety of assistance programs.
The Area Housing Authority sponsors educational home buying workshops in English and Spanish several times throughout the year. The workshops are provided through a mutual agreement with experts in local, State and federal funding resources.Workshops cover tax benefits, raising your FICO score, and loan options for first-time buyers available through the state of California.
To find out more or to reserve a spot in an upcoming workshop, please call 1-800-549-0337, extension 167. Seating is limited at our workshops and we encourage you to reserve your place to ensure adequate seating. To speak with Housing Authority staff regarding a workshop, please call 805-480-9991, extension 235.For a schedule of upcoming workshops, please click here or go to http://www.ahahomebuyingschool.com/ ."
To find information on Housing Programs which include:
-Section 8
-Low Rent Public Housing
-Agency Owned/Managed Housing
-City Sponsored Rental Assistance
Click on http://www.ahacv.org/index.shtml & click again on the Housing Programs Tab (left side)
The Area Housing Authority of the County of Ventura serves the cities of Camarillo, Simi Valley, Moorpark, Thousand Oaks, Ojai, Fillmore and the unincorporated areas of Ventura County.
So what happens if you don’t live in one of those 7 areas?
Easy. Oxnard. Port Hueneme, Santa Paula and the City of San Buenaventura (Ventura) all have their own housing authorities which you can find contact information for at: http://www.ahacv.org/community_resources.shtml.
None of these programs are exactly the same, but most of them provide a degree of benefit and usually can be combined with FHA or CAL-HFA loan programs to provide most of your lending needs. The combination of programs is really remarkable help for first time buyers. By the way, the definition of a first time buyer is not what you might think. It can be someone who has not purchased a home for 3 years. Check with your lender and Housing Authority folks for details.
For those folks who are having a really difficult time just finding a place to lay their heads, there is some provision for them as well at: http://www.ahacv.org/emergency_housing.shtml
This is some really great information on local agencies that provide emergency housing assistance. Here is the basic info from that link.
"The Area Housing Authority does not provide emergency housing services. Please contact the agencies listed below for emergency housing information.
You may also call the 211 Help Line by dialing 2-1-1 from any land line phone (cell phone users, 800-339-9597. The 211 Help Line provides information about and referrals to health and human services, including emergency housing. The 211 Help Line is available 24 hours a day, 7 days a week, and multi-lingual service is available.
Homeless Information and Referral (County of Ventura, Human Services Agency)Phone:805-987-6715 or 805-484-2082Hours:M – F 8am to 4:30pmWebsite:http://www.vchsa.org/Ventura County Homeless and Housing Coalitions(temporary winter shelter locations)Website: http://www.vchhc.org/
Ojai Community Assistance Program (through HELP of Ojai)Phone:805-640-3320Hours:M – Th8:00am – 12:00pm and 1:00pm to 5:00pmFriday 8:00am – 12:00pm and 1:00pm to 4:00pm
Coalition to End Family ViolencePhone:805-983-601424-hr Hotline: 800-300-2181 or 805-56-1111Website:http://www.thecoalition.org/
RAIN Project Transitional Housing (County of Ventura)Phone:805-389-3308 (24-hrs)Address:1732 South Lewis Road, Camarillo
Community Action of Ventura County (Goldberg House)Phone:805-648-6088Address:946 E. Thompson Blvd., Ventura,Hours:M – Th: 8 am - 3:30 pmFriday: 8 am – 3:00 pm
Simi Valley Homeless PartnershipPhone:805-527-2533
Housing Reports and Necessary Documents http://www.ahacv.org/housing_reports_and_docs.shtml
Administrative Housing Plans and Documents
Admissions and Continued Occupancy Policy (ACOP)
Agency Owned Housing Plan
Section 8 Admin Plan
Organizational Emergency Plan
Public Housing Application
Instructions for Public Housing Application
Board of Commissioners
Current Board Agenda - Coming Soon
List of Commissioners
Data and Reports
Income Limits
Payment Standards
Utility Allowances
Overview of Assistance by Community
Detailed Summary of Assistance by Community
2007 What Can You Afford
Community Housing Programs - Coming Soon
Presentations
Myths of Affordable Housing Presentation (July 2007) - Coming Soon
If you do not have the Free Adobe PDF Reader, Click Here to get it.
March 21, 2007 Income Limits
Median Family income for a family of four is $79,500
There is a great deal more information available for renters, folks looking for the reduced price housing maintained by the various housing authorities and income limits to qualify. Some of these programs require you to use their approved lenders. Others allow you to shop for the best deal on your new home mortgage program costs. There is everything here you need to get started except a really good local mortgage broker to help steer you through this sea of information.
I can fix that. Call Aracely Avila (805) 504-0221 or email Aracely@YieldFinancial.com. Aracely once worked for the Oxnard Housing Authority and has more than 10 years experience helping your home ownership dreams to come true.
Of course you are welcome to contact me or browse my website for additional Chamber of Commerce websites, or the individual city websites and county information. http://www.markthorngren.com/.
Warmest Regards,
Mark Thorngren
Last week I was browsing our local newspaper's real estate section and came across an article about the Area Housing Authority of the County of Ventura. I’ve heard of some of their programs before but had never found source material. I felt like a gold miner that had just stumbled across the mother lode. I downloaded 31 pages of their material and had to quit because I was using up all my printer's color cartridges. There is a very large amount of helpful information on their wonderful website. Check out http://www.ahacv.org/home_buyers_workshop.shtml.
This page will give you time, place and date for the next home buyer workshops. The following information is taken directly from the county website.
"The Area Housing Authority is committed to serving the community by being a resource for housing information. With the skyrocketing prices of homes in Ventura County, first-time home buyers are often overwhelmed with the decision of whether to buy a home here, continue renting, or move to a cheaper area.
Many new home buyers are unaware of State and local programs that help with down-payments, closing costs, and lower interest loans. Households with income between $55,000 and $113,000 may qualify for a variety of assistance programs.
The Area Housing Authority sponsors educational home buying workshops in English and Spanish several times throughout the year. The workshops are provided through a mutual agreement with experts in local, State and federal funding resources.Workshops cover tax benefits, raising your FICO score, and loan options for first-time buyers available through the state of California.
To find out more or to reserve a spot in an upcoming workshop, please call 1-800-549-0337, extension 167. Seating is limited at our workshops and we encourage you to reserve your place to ensure adequate seating. To speak with Housing Authority staff regarding a workshop, please call 805-480-9991, extension 235.For a schedule of upcoming workshops, please click here or go to http://www.ahahomebuyingschool.com/ ."
To find information on Housing Programs which include:
-Section 8
-Low Rent Public Housing
-Agency Owned/Managed Housing
-City Sponsored Rental Assistance
Click on http://www.ahacv.org/index.shtml & click again on the Housing Programs Tab (left side)
The Area Housing Authority of the County of Ventura serves the cities of Camarillo, Simi Valley, Moorpark, Thousand Oaks, Ojai, Fillmore and the unincorporated areas of Ventura County.
So what happens if you don’t live in one of those 7 areas?
Easy. Oxnard. Port Hueneme, Santa Paula and the City of San Buenaventura (Ventura) all have their own housing authorities which you can find contact information for at: http://www.ahacv.org/community_resources.shtml.
None of these programs are exactly the same, but most of them provide a degree of benefit and usually can be combined with FHA or CAL-HFA loan programs to provide most of your lending needs. The combination of programs is really remarkable help for first time buyers. By the way, the definition of a first time buyer is not what you might think. It can be someone who has not purchased a home for 3 years. Check with your lender and Housing Authority folks for details.
For those folks who are having a really difficult time just finding a place to lay their heads, there is some provision for them as well at: http://www.ahacv.org/emergency_housing.shtml
This is some really great information on local agencies that provide emergency housing assistance. Here is the basic info from that link.
"The Area Housing Authority does not provide emergency housing services. Please contact the agencies listed below for emergency housing information.
You may also call the 211 Help Line by dialing 2-1-1 from any land line phone (cell phone users, 800-339-9597. The 211 Help Line provides information about and referrals to health and human services, including emergency housing. The 211 Help Line is available 24 hours a day, 7 days a week, and multi-lingual service is available.
Homeless Information and Referral (County of Ventura, Human Services Agency)Phone:805-987-6715 or 805-484-2082Hours:M – F 8am to 4:30pmWebsite:http://www.vchsa.org/Ventura County Homeless and Housing Coalitions(temporary winter shelter locations)Website: http://www.vchhc.org/
Ojai Community Assistance Program (through HELP of Ojai)Phone:805-640-3320Hours:M – Th8:00am – 12:00pm and 1:00pm to 5:00pmFriday 8:00am – 12:00pm and 1:00pm to 4:00pm
Coalition to End Family ViolencePhone:805-983-601424-hr Hotline: 800-300-2181 or 805-56-1111Website:http://www.thecoalition.org/
RAIN Project Transitional Housing (County of Ventura)Phone:805-389-3308 (24-hrs)Address:1732 South Lewis Road, Camarillo
Community Action of Ventura County (Goldberg House)Phone:805-648-6088Address:946 E. Thompson Blvd., Ventura,Hours:M – Th: 8 am - 3:30 pmFriday: 8 am – 3:00 pm
Simi Valley Homeless PartnershipPhone:805-527-2533
Housing Reports and Necessary Documents http://www.ahacv.org/housing_reports_and_docs.shtml
Administrative Housing Plans and Documents
Admissions and Continued Occupancy Policy (ACOP)
Agency Owned Housing Plan
Section 8 Admin Plan
Organizational Emergency Plan
Public Housing Application
Instructions for Public Housing Application
Board of Commissioners
Current Board Agenda - Coming Soon
List of Commissioners
Data and Reports
Income Limits
Payment Standards
Utility Allowances
Overview of Assistance by Community
Detailed Summary of Assistance by Community
2007 What Can You Afford
Community Housing Programs - Coming Soon
Presentations
Myths of Affordable Housing Presentation (July 2007) - Coming Soon
If you do not have the Free Adobe PDF Reader, Click Here to get it.
March 21, 2007 Income Limits
Median Family income for a family of four is $79,500
There is a great deal more information available for renters, folks looking for the reduced price housing maintained by the various housing authorities and income limits to qualify. Some of these programs require you to use their approved lenders. Others allow you to shop for the best deal on your new home mortgage program costs. There is everything here you need to get started except a really good local mortgage broker to help steer you through this sea of information.
I can fix that. Call Aracely Avila (805) 504-0221 or email Aracely@YieldFinancial.com. Aracely once worked for the Oxnard Housing Authority and has more than 10 years experience helping your home ownership dreams to come true.
Of course you are welcome to contact me or browse my website for additional Chamber of Commerce websites, or the individual city websites and county information. http://www.markthorngren.com/.
Warmest Regards,
Mark Thorngren
Lower Prime Rate vs Higher Mortgage Rates
Market Changes, Prime Rate Reductions vs Home Mortgage Rate Increases
There is a very defined difference now from the last six months that has made many of us optimistic for the year. I had many folks last year who wanted to wait with their purchase because of falling home prices, and many home sellers were still hanging tough with their prices. Obstinate sellers who have not kept up with the market, have continued to suffer from falling home prices and are now much easier to work with as they realize their predicament. Home Buyers I have been talking with over the last year or two are now calling me to make their initial consultations. I like that! That did not happen last year. That is another reason why I’m optimistic.
Last Fall, I had a large number of home sales that began escrow but did not finish because of mortgage changes during escrow, and seller’s not willing to compromise on terms. That is changing now. Mortgage programs are beginning to gel and lender standards are stabilizing from the free fall – here today, gone tomorrow – conditions that existed last Fall. Our buyer climate is much different this year and presents fewer fundamental changes. We have a much better chance to make it through each escrow this year.
The next challenge our industry faces will be how to reconcile falling interest rates from the Fed with rising home loan interest rates. Investors are worried about the bond market. As the Fed lowers it’s interest rates, the bond market suffers and mortgage investors in the secondary market raise their home mortgage interest rates. Home buyers will tend to save more money on their home purchases with a lower interest rate than on a modest home price decrease. We have seen interest rates fall in January, then turn around and move up steadily through February. Those rate changes will have a far bigger impact on buyers than a 7% to 10% decrease in home prices. Do the math on any home you care to pick and I’ll bet you see what I mean.
I think we need to carefully watch to see if the cost of mortgage loans continues to increase. If the Fed continues to cut the Prime Rate, the response from secondary investors & the bond market may be to raise the cost of home mortgage interest rates. It is possible that rising home loan interest rates could more than offset falling home prices. Home buyers may pay less and have more to choose from if they buy now.
Sellers will most likely continue to experience an eroding of home prices, with stiff competition from bank foreclosures until the number of foreclosures falls in a year or two.
Just the way I see it today.
Warmest Regards,
Mark Thorngren
htttp://www.markthorngren.com
There is a very defined difference now from the last six months that has made many of us optimistic for the year. I had many folks last year who wanted to wait with their purchase because of falling home prices, and many home sellers were still hanging tough with their prices. Obstinate sellers who have not kept up with the market, have continued to suffer from falling home prices and are now much easier to work with as they realize their predicament. Home Buyers I have been talking with over the last year or two are now calling me to make their initial consultations. I like that! That did not happen last year. That is another reason why I’m optimistic.
Last Fall, I had a large number of home sales that began escrow but did not finish because of mortgage changes during escrow, and seller’s not willing to compromise on terms. That is changing now. Mortgage programs are beginning to gel and lender standards are stabilizing from the free fall – here today, gone tomorrow – conditions that existed last Fall. Our buyer climate is much different this year and presents fewer fundamental changes. We have a much better chance to make it through each escrow this year.
The next challenge our industry faces will be how to reconcile falling interest rates from the Fed with rising home loan interest rates. Investors are worried about the bond market. As the Fed lowers it’s interest rates, the bond market suffers and mortgage investors in the secondary market raise their home mortgage interest rates. Home buyers will tend to save more money on their home purchases with a lower interest rate than on a modest home price decrease. We have seen interest rates fall in January, then turn around and move up steadily through February. Those rate changes will have a far bigger impact on buyers than a 7% to 10% decrease in home prices. Do the math on any home you care to pick and I’ll bet you see what I mean.
I think we need to carefully watch to see if the cost of mortgage loans continues to increase. If the Fed continues to cut the Prime Rate, the response from secondary investors & the bond market may be to raise the cost of home mortgage interest rates. It is possible that rising home loan interest rates could more than offset falling home prices. Home buyers may pay less and have more to choose from if they buy now.
Sellers will most likely continue to experience an eroding of home prices, with stiff competition from bank foreclosures until the number of foreclosures falls in a year or two.
Just the way I see it today.
Warmest Regards,
Mark Thorngren
htttp://www.markthorngren.com
Thursday, February 28, 2008
The Market is Waking Up In Ventura County For Home Buyers
I spoke with Bob Curtiss the Regional Sales Director for Property I.D. today. This company provides natural hazard property disclosures to home buyers. Without getting too deep, this company researches a home to see if it is in a flood hazard, fire hazard, or earthquake hazard area and discloses this and much more information to buyers and sellers so they can be aware of what environment the home is in. They are the best at what they do in my experience. They are always in demand by realtors for their excellent service to our home buying clients.
Bob gets around, and I enjoy speaking with him because he is the harbinger of news in real estate for a large area in Southern California. He had just returned from a business trip to Lompoc, Santa Maria and the Solvang, Santa Ynez area. The word from Bob is that business in home sales is booming in those areas. That has not always been the case, but especially in Lompoc this is a big change.
Yesterday I was helping some folks who were in the process of finishing up their escrow and were signing their loan documents at one of our local Title and Escrow companies. As you may already know, these folks represent a neutral third party provider of escrow services. They manage the money and paperwork flowing between the home buyer and the home seller. When nobody is buying a home, they aren't working. When the industry is busy, they put in some very long hours.
In this case I was discussing our local market with Margaret Kelly of LandAmerica Lawyers Title. Margaret is a beautiful lady and an awesome talent with a 20 year track record of success in our local market. By the time Margaret becomes involved in a transaction, it means that a realtor has been working with prospective home buyers to determine their needs, locate their dream home and negotiate a purchase agreement with the home sellers. This process can last a few weeks or it can last upwards of a year or more. My point is, by the time Margaret sits down with my clients, the market shift has already matured a month or so.
Margaret says the last 3 or 4 weeks - most of the month of February - have been markedly busier than previous months. She is busy once again. People are making up their minds to get off the fence and make their home choice now. The conditions are wonderful for some awesome home opportunities and buyers have seen it, made their decision and are now a month into the process with Margaret.
I wrote of this market change several weeks ago. Now many service providing professionals like Bob and Margaret are confirming these observations. I can't wait to see what all the newspapers say about our market when next month's reports on this month's sales show the increase. All the rhetoric about our market continuing to wither for another 2 years we hear from "economic experts" will be difficult to reconcile with the facts.
Is our market healed now? I don't think so, but I think it is beginning to heal. I think we must define our market first. Let's say our market is made up of home buyers and home sellers.
The home buyers are now beginning to come out in force. They are taking advantage of current high inventories, low prices and falling interest rates. They are dialing in the new changes to FHA, Fannie Mae and Freddie Mac programs and seeing huge opportunity for themselves and their families.
Home sellers continue to suffer. They are seeing more buyers at open houses, but the buyers are fussy. As prices continue to fall and foreclosures continue to scue neighborhood prices, sellers continue to suffer long listing periods and declining equity. Much of this is driven by the continued foreclosure problem, but some of this is also due to more restrictive lender requirements as well as generally negative news coverage of our market.
I think all of these negative market forces are slowly beginning to correct themselves.
Mortgage programs requirements are more restrictive than a year ago, but there are new, higher lending limits from all the federal lenders. Combining these programs with CAL-HFA programs from the state, gives some well qualified first time home buyers real hope again for finding affordable housing. I think lender programs will continue to improve and become more user friendly in coming months. Don't look for stated income loans to make a strong come back any time soon though!
As home sales continue to increase and lending practices standardize over the coming months, I think we will begin to see a gradual shrinking of our home inventories. Developers are slow to build when prices are soft, so our inventory of homes will tend to build very slowly. As demand continues to build, the relatively fixed number of homes available will slowly drive prices back to stable market values.
I think this process will accelerate once the foreclosure problem eases.
I spoke with Bob Curtiss the Regional Sales Director for Property I.D. today. This company provides natural hazard property disclosures to home buyers. Without getting too deep, this company researches a home to see if it is in a flood hazard, fire hazard, or earthquake hazard area and discloses this and much more information to buyers and sellers so they can be aware of what environment the home is in. They are the best at what they do in my experience. They are always in demand by realtors for their excellent service to our home buying clients.
Bob gets around, and I enjoy speaking with him because he is the harbinger of news in real estate for a large area in Southern California. He had just returned from a business trip to Lompoc, Santa Maria and the Solvang, Santa Ynez area. The word from Bob is that business in home sales is booming in those areas. That has not always been the case, but especially in Lompoc this is a big change.
Yesterday I was helping some folks who were in the process of finishing up their escrow and were signing their loan documents at one of our local Title and Escrow companies. As you may already know, these folks represent a neutral third party provider of escrow services. They manage the money and paperwork flowing between the home buyer and the home seller. When nobody is buying a home, they aren't working. When the industry is busy, they put in some very long hours.
In this case I was discussing our local market with Margaret Kelly of LandAmerica Lawyers Title. Margaret is a beautiful lady and an awesome talent with a 20 year track record of success in our local market. By the time Margaret becomes involved in a transaction, it means that a realtor has been working with prospective home buyers to determine their needs, locate their dream home and negotiate a purchase agreement with the home sellers. This process can last a few weeks or it can last upwards of a year or more. My point is, by the time Margaret sits down with my clients, the market shift has already matured a month or so.
Margaret says the last 3 or 4 weeks - most of the month of February - have been markedly busier than previous months. She is busy once again. People are making up their minds to get off the fence and make their home choice now. The conditions are wonderful for some awesome home opportunities and buyers have seen it, made their decision and are now a month into the process with Margaret.
I wrote of this market change several weeks ago. Now many service providing professionals like Bob and Margaret are confirming these observations. I can't wait to see what all the newspapers say about our market when next month's reports on this month's sales show the increase. All the rhetoric about our market continuing to wither for another 2 years we hear from "economic experts" will be difficult to reconcile with the facts.
Is our market healed now? I don't think so, but I think it is beginning to heal. I think we must define our market first. Let's say our market is made up of home buyers and home sellers.
The home buyers are now beginning to come out in force. They are taking advantage of current high inventories, low prices and falling interest rates. They are dialing in the new changes to FHA, Fannie Mae and Freddie Mac programs and seeing huge opportunity for themselves and their families.
Home sellers continue to suffer. They are seeing more buyers at open houses, but the buyers are fussy. As prices continue to fall and foreclosures continue to scue neighborhood prices, sellers continue to suffer long listing periods and declining equity. Much of this is driven by the continued foreclosure problem, but some of this is also due to more restrictive lender requirements as well as generally negative news coverage of our market.
I think all of these negative market forces are slowly beginning to correct themselves.
Mortgage programs requirements are more restrictive than a year ago, but there are new, higher lending limits from all the federal lenders. Combining these programs with CAL-HFA programs from the state, gives some well qualified first time home buyers real hope again for finding affordable housing. I think lender programs will continue to improve and become more user friendly in coming months. Don't look for stated income loans to make a strong come back any time soon though!
As home sales continue to increase and lending practices standardize over the coming months, I think we will begin to see a gradual shrinking of our home inventories. Developers are slow to build when prices are soft, so our inventory of homes will tend to build very slowly. As demand continues to build, the relatively fixed number of homes available will slowly drive prices back to stable market values.
I think this process will accelerate once the foreclosure problem eases.
Unfortunately, we don't appear to have a good solution on how best to ease the foreclosure crisis. Foreclosures will have a continued dampening effect on our market until that problem can be effectively addressed or has time to work it's way out. Sort of like trying to fight a large forest fire. Eventually it will burn itself out, but we all would like to minimize it's damage and find a good way to fight it.
News media coverage will begin to shift back closer to reality as sales numbers increase once again. No thanks to them.
The article I have included in this blog comes from the Ventura County Star and illustrates my point. I expect we'll see more of these articles in the coming months as newspapers and other media finally pull their heads out of the sand and look around at the real world again.
Mark Thorngren
http://www.markthorngren.com/
Good news on the real estate, mortgage front
Jim Woodard, ColumnistSunday, November 11, 2007
Despite discouraging news on the financial front, the sluggish home sales market should bottom out by the end of the first quarter of this coming year, it was noted in a recent study and report from the National Association of Home Builders.
The housing market will start to turn around next year for a number of reasons: the overall economy and job growth will continue to move ahead at a decent pace, core inflation is under control, the credit crunch in mortgage markets is showing signs of easing, the supply-demand equation will be better balanced as builders begin to whittle down their excess inventories, and another Federal Reserve interest rate reduction of a quarter-point on Oct. 31 will help keep mortgage rates low.
That's the prediction of David Seiders, chief economist for the NAHB.
"With the housing sector facing a large backlog of unsold inventory, new construction starts and permits won't begin to move forward until sales firm up. Home sales should bottom out by the end of the first quarter of next year, and housing starts will be up in the third quarter, assuming the inventory overhang stabilizes," he said.
The tightening standards for home mortgages will not derail a national recovery in the housing market, according to the NAHB. However, it will complicate the system for a while.
The negative impact of the new standards on housing markets comes in two forms. First, tightening lending standards have reduced the availability of some loans and raised the price to riskier borrowers. Second, it creates the potential for a cycle of defaults and price declines, depending on the local home price environment and strength of the local economy, the NAHB study report noted.
NAHB's short-term forecast is based on several assumptions: skillful management of monetary policy by the Federal Reserve, maintenance of solid growth in personal income and employment, a manageable wave of home mortgage foreclosures and better performance of mortgage markets going forward.
The report observed that the long-term potential for housing activity is very good. "By the end of 2009, we may be at a pace of 1.5 million units of new housing production (including manufactured homes). Once we are out of the woods, we should see good growth in front of us — maybe 2 million units per year," it stated.
While there is much press coverage about today's troubled real estate markets, there are many markets throughout the country that have minimal subprime mortgage exposure and are now experiencing a stable market.
These markets experienced modest and sustainable home price appreciation during the boom years and have relatively strong local economies. The markets are positioned to outperform the national trends with earlier and stronger recoveries than the more troubled markets, according to NAHB's chief economist.
These little-publicized markets are primarily located in the Pacific Northwest, mountain states and in the Southeast. The areas are now recording single-family home construction permits at or above pre-boom levels.
"The contrast between the strongest and weakest markets across the country points out substantial regional variation and suggests that steep nationwide home price declines and mortgage defaults are unlikely," Seiders said.
There's more good news on the mortgage front. More people are managing to keep up with payments on mortgage loans made in recent months, according to data from First American Loan Performance, a research firm.
The trend reflects more conservative lending policies adopted by mortgage companies this year in the wake of a surge in defaults and foreclosures, said Mark Carrington with First American. "Even so, defaults continue to rise in proportion to the overall number of home loans outstanding nationwide, mostly those made between 2003 and 2006 when lending standards were growing more lax," he said.
An increasing number of parents of college-bound offspring are purchasing a condo or small house in the area of the college for their student's residence while attending the college or university. In some cases, it appears to be more cost-effective than paying for a room in a dorm.
The student will often rent out a portion of the purchased unit to another student to minimize the investment. When the student's attendance at the college is completed, the unit will be sold, hopefully at a profit.
There are now about 3 million campus houses and condos that have been purchased by students or their parents, according to a report from the National Association of Realtors. That represents about 8 percent of the nation's 37.4 million investment properties, but excludes 6.8 million vacation homes.
In addition to the possible financial advantage, owning such a residence gives the student more freedom, and a choice of roommates. For parents, it offers a chance to recoup some of the rising costs of higher education, assuming it turns out to be a good investment.
Many parents are spooked by the unknowns in such an arrangement. Can the extra space be rented at the projected rental amount? Will the student handle his extra freedom responsibly? Will the property later sell at a profit? These and other concerns tend to keep the dorms fully occupied.
(Jim Woodard, a Ventura resident, writes a nationally syndicated column and freelance features in addition to his Star columns. He also is a storyteller with a Web site at: www.jimwoodard.net. E-mail: Storyjim@aol.com.)
News media coverage will begin to shift back closer to reality as sales numbers increase once again. No thanks to them.
The article I have included in this blog comes from the Ventura County Star and illustrates my point. I expect we'll see more of these articles in the coming months as newspapers and other media finally pull their heads out of the sand and look around at the real world again.
Mark Thorngren
http://www.markthorngren.com/
Good news on the real estate, mortgage front
Jim Woodard, ColumnistSunday, November 11, 2007
Despite discouraging news on the financial front, the sluggish home sales market should bottom out by the end of the first quarter of this coming year, it was noted in a recent study and report from the National Association of Home Builders.
The housing market will start to turn around next year for a number of reasons: the overall economy and job growth will continue to move ahead at a decent pace, core inflation is under control, the credit crunch in mortgage markets is showing signs of easing, the supply-demand equation will be better balanced as builders begin to whittle down their excess inventories, and another Federal Reserve interest rate reduction of a quarter-point on Oct. 31 will help keep mortgage rates low.
That's the prediction of David Seiders, chief economist for the NAHB.
"With the housing sector facing a large backlog of unsold inventory, new construction starts and permits won't begin to move forward until sales firm up. Home sales should bottom out by the end of the first quarter of next year, and housing starts will be up in the third quarter, assuming the inventory overhang stabilizes," he said.
The tightening standards for home mortgages will not derail a national recovery in the housing market, according to the NAHB. However, it will complicate the system for a while.
The negative impact of the new standards on housing markets comes in two forms. First, tightening lending standards have reduced the availability of some loans and raised the price to riskier borrowers. Second, it creates the potential for a cycle of defaults and price declines, depending on the local home price environment and strength of the local economy, the NAHB study report noted.
NAHB's short-term forecast is based on several assumptions: skillful management of monetary policy by the Federal Reserve, maintenance of solid growth in personal income and employment, a manageable wave of home mortgage foreclosures and better performance of mortgage markets going forward.
The report observed that the long-term potential for housing activity is very good. "By the end of 2009, we may be at a pace of 1.5 million units of new housing production (including manufactured homes). Once we are out of the woods, we should see good growth in front of us — maybe 2 million units per year," it stated.
While there is much press coverage about today's troubled real estate markets, there are many markets throughout the country that have minimal subprime mortgage exposure and are now experiencing a stable market.
These markets experienced modest and sustainable home price appreciation during the boom years and have relatively strong local economies. The markets are positioned to outperform the national trends with earlier and stronger recoveries than the more troubled markets, according to NAHB's chief economist.
These little-publicized markets are primarily located in the Pacific Northwest, mountain states and in the Southeast. The areas are now recording single-family home construction permits at or above pre-boom levels.
"The contrast between the strongest and weakest markets across the country points out substantial regional variation and suggests that steep nationwide home price declines and mortgage defaults are unlikely," Seiders said.
There's more good news on the mortgage front. More people are managing to keep up with payments on mortgage loans made in recent months, according to data from First American Loan Performance, a research firm.
The trend reflects more conservative lending policies adopted by mortgage companies this year in the wake of a surge in defaults and foreclosures, said Mark Carrington with First American. "Even so, defaults continue to rise in proportion to the overall number of home loans outstanding nationwide, mostly those made between 2003 and 2006 when lending standards were growing more lax," he said.
An increasing number of parents of college-bound offspring are purchasing a condo or small house in the area of the college for their student's residence while attending the college or university. In some cases, it appears to be more cost-effective than paying for a room in a dorm.
The student will often rent out a portion of the purchased unit to another student to minimize the investment. When the student's attendance at the college is completed, the unit will be sold, hopefully at a profit.
There are now about 3 million campus houses and condos that have been purchased by students or their parents, according to a report from the National Association of Realtors. That represents about 8 percent of the nation's 37.4 million investment properties, but excludes 6.8 million vacation homes.
In addition to the possible financial advantage, owning such a residence gives the student more freedom, and a choice of roommates. For parents, it offers a chance to recoup some of the rising costs of higher education, assuming it turns out to be a good investment.
Many parents are spooked by the unknowns in such an arrangement. Can the extra space be rented at the projected rental amount? Will the student handle his extra freedom responsibly? Will the property later sell at a profit? These and other concerns tend to keep the dorms fully occupied.
(Jim Woodard, a Ventura resident, writes a nationally syndicated column and freelance features in addition to his Star columns. He also is a storyteller with a Web site at: www.jimwoodard.net. E-mail: Storyjim@aol.com.)
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