Mortgage Industry UpSwing
New home sales plunged in 2007 by the largest amount on record while home prices tumbled sharply in December. Analysts forecast a continues snide in 2008 as the housing market braces for anticipated recession.
National reports per msn.com reported Monday that “sales of new homes dropped by 26.4 percent last year to 774,000. That marked the biggest decline on record, surpassing the old mark of a 23.1 percent plunge in 1980.”
The government is currently reporting that the average price of a new home barely budged last year, edging up a slight 0.2 percent to $246,900, the poorest showing since prices fell by 2.4 percent during the 1991 housing downturn.
While sellers are taking it on the chin right now, it is a buyers market thus keeping the mortgage industry in busy times. With refinance, mortgage cash outs and investment property being a hot commodity the mortgage industry is prepared to report record numbers in 2008.
The prolonged slump in housing is raising concerns that the weakness could be severe enough to push the country into a full-blown recession. In an effort to guard against that threat, the Federal Reserve cut a key interest rate last week by the largest amount in more than two decades with a further rate cut expected on Wednesday when the Fed completes a two-day meeting.
President Bush and House leaders reached agreement on a $150 billion economic stimulus package last week which included items to boost housing by increasing the size of the mortgages that Fannie Mae and Freddie Mac and the Federal Housing Administration can handle. But critics said the continued plunge in housing showed that more dramatic action is needed.
Following the market over the next few weeks could provide for quiet a roller coaster ride and the stimulus bill will probably not have the effect that most legislators are hyping.
February 5th, 2008 at 1:43 pm
A refi boom would help if fha would loosen guidelines.
February 22nd, 2008 at 8:13 pm
“The government is currently reporting that the average price of a new home barely budged last year, edging up a slight 0.2 percent to $246,900, the poorest showing since prices fell by 2.4 percent during the 1991 housing downturn.”
In this current Real Estate market, *everyone* should examine the benefits of home equity acceleration:
More and more folks are using a Home Equity Line of Credit (HELOC) or a business-line-of-credit (BLOC) or personal-line-of-credit (PLOC) as an interest cancellation account to accelerate their home equity and payoff their home *years* sooner than listed on their mortgage amortization schedule.
Unfortunately, today’s Real Estate market means that folks can no longer count on appreciation to build home equity. Those who realize that they need to pay down their current mortgage debt are looking for alternate ways to aggressively (yet safely) build equity.
And they’ve discovered a perfect online system to do that; they can focus on their wealth accumulation goals while accelerating their equity simply by using an Advanced Line of Credit (ALOC) to ‘power’ the Money Merge Account™ financial solutions program.
A typical 30 year loan (of whatever type) can be paid down in 1/3 to 1/2 the time — it’s a great way to save *huge* amounts of income by eliminating a mortgage amortization front-end interest load. (On a million-plus dollar home, I’ve personally seen where the Money Merge Account™ program will save the homeowner $750,000 in interest charges!)
And the best thing – homeowners don’t have to refinance their existing mortgage or, in most cases, make any adjustments to their lifestyle.
It is unfortunate that most of us were never taught to follow three essential principles: (1) Avoid paying interest, whenever possible, (2) Use other people’s money, whenever possible and (3) Find and use a financial system that will guide you, especially if you have the tendency to go off-track. The Money Merge Account™ software and the program’s counselors use these principles to keep each homeowner focused on their wealth accumulation goals.
I’d be happy to provide further details…
April 13th, 2008 at 5:25 pm
With a weak jobs market, weakening dollar, jumps in inflation and banks still holding the cash close to the vest it may take some time before home owners can expect any relief. The hardest part for consumers is people used there homes as piggy banks and taped out all the equity being left with little to no equity and refinancing is becoming difficult in hard hit areas.
That being said the market will bounce back it’s just a matter of when not if.
September 28th, 2008 at 1:23 pm
Mortgage brokers are really struggling due to several factors. First the interest in lending has dropped. Then the deals that lenders now offer are very poor. And finally lenders are not just not keen to lend.