Living In Tucson Blog » Housing

March Madness in Tucson

David — Mon, 26 Mar 2012 00:52:31 +0000

I love March in Tucson with the smell of orange blossoms wafting through the air. The weather is usually about as good as it gets and there are lots of fun activities to enjoy such as the 4th Avenue Street Fair and Spring Training. It’s not too hot and the days get a little longer even though we don’t set back the clocks here. I enjoyed the beautiful weather this afternoon by taking a long bike ride. I must have been passed by more than a dozen pickup trucks on Soldier Trail during while riding north from Tanque Verde. There must have been a pickup truck rally at Agua Caliente Park!

This morning paper had an article on the front page with the headline “Tucson’s No. 1 for housing investors”. This assertion is made by Realtor.com and is based on the low prices for investors who buy distressed properties and fix them up for resale. Homes are selling faster this year and the prices appear to be stabilizing although it is too soon to predict a turnaround in housing. Just this past week, the government released a report that existing home sales are down. Of course, the report is national and real estate is local. As I indicated in my last post, buyers that I have pre-qualfied and the Realtors who referred them to me are telling me the inventory is low and the competition for homes that are priced right and in good shape is very competitive.

In other mortgage related news, FHA mortgage insurance premiums (MIP) are going up. The program attracts buyers who have credit scores as low as 600 and small down payments so it is no mystery that the defaults are still happening and raising the MIP will help to reduce the governments losses by collecting higher fees. Starting in April, new FHA loans will have 1.75% upfront MIP instead of 1%. The FHA loan requires a minimum down payment of 3.5% of the loan amount. The 1.75% upfront MI is added to base loan (96.5% of the sales price). Another change to anticipate is reduced seller concessions from 6% of the sales price down to 3%. The reduced seller concessions should have little impact on the loan program. Even though sellers do wind up paying for buyer’s fees, it typically wouldn’t exceed 3% in my experience. FHA loans have represented a significant percentage of home loans in the past four years.

If you have any mortgage related questions, call me, David Wolsky! david@davidwolsky.com – (520) 977-3300.

Observations From The Front Lines Get Your Government Hands Off My Mortgage Industry! Bank regulators...
What’s Happening With Mortgages In Tucson! Here’s my brief commentary on the mortgage industry in Tucson...

Related posts brought to you by Yet Another Related Posts Plugin.

Come On In, The Water’s Fine!

David — Fri, 06 Jan 2012 00:16:47 +0000

Many people are wary about getting back into the housing market. They are concerned about declining values and challenging mortgage requirements. Despite these negatives, it may be a great time to get back into residential real estate. In the past few months, we have seen an increase in the median price of homes in Tucson, however, a third of the homes sold here in 2011 were under $100,000. The affordability index has never been better! Interest rates have hit record lows according to a recent Freddie Mac’s weekly survey and it’s not quite as arduous to obtain a mortgage as you may have thought.

Will 2012 be The Road to Recovery?

Predictions are that there will be new foreclosures hitting the market in 2012. The good news is delinquency rates are declining quite a bit. The bad news is these foreclosures continue to slow down the housing recovery. Interest rates should remain historically low for the first half of 2012 while housing prices will find their bottom. You can expect to see modest increase in prices of homes in the second half of 2012. Pent up demand for housing is increasing. Rental properties and foreign investors are ready to soak up deals and refinance programs such as HARP (Home Affordable Refinance Program) will also help the housing market recover its equilibrium.

Wild cards:

Eurozone, Employment, Election Year!

Call me, David Wolsky, for any mortgage related questions. I can be reached at (520) 275-2536 or david@davidwolsky.com.

I’m Still Here! Wow…it’s been a long time since my last entry into...
Observations From The Front Lines Get Your Government Hands Off My Mortgage Industry! Bank regulators...

Related posts brought to you by Yet Another Related Posts Plugin.

University of Arizona Professor Making Headlines!

David — Mon, 30 Nov 2009 05:46:55 +0000

Here in Tucson, over 68,000 homes are “underwater”. No, the desert has not flooded. Unless you’re in New Orleans, being “underwater” means that you owe more on your mortgage than the current value of the property. Last week we learned that 25% of homeowners in the country owe more than their homes are worth and in Tucson, over a third are underwater. Arizona is the second worst rate in the country behind Nevada at 48% largely because the number is 54% in Phoenix!! Now you know why banks do not consider offering home equity loans in our state and why Fannie Mae and Freddie Mac consider Arizona as a “severely declining market”.

In Ken Harney’s weekly real estate column, he writes about Brent T. White, a University of Arizona law professor who suggests that homeowners that are “under water” on their home loans, walk away!

Here’s the article: http.latimes.com/classified/realestate/news/la-fi-harney29-2009nov29,0,3801270.story://www

Josh Brodesky’s column in The Arizona Daily Star discusses White’s academic paper and the possible repercussions from walking away from mortgage. The article also gauges reactions from professionals and homeowners.

Here’s the article: AZ Starnet 11.29.09 Real Estate Article

As a mortgage originator, I cannot imagine advising a borrower to default on their mortgage. However, millions of Americans have few alternatives. It will take years for Arizona to recover from the foreclose crisis. On the other hand, this is a very desirable place to live and the housing affordability index in Arizona is at its best level in forty years thanks to low housing values and record low interest rates. If you want to get in on the market, call me! I’m David Wolsky with PHH Home Loans and can be reached at 520-275-2536! Ask me about the tax credit available for buying an owner-occupied home by June 30th, 2010.

More HARP Observations On November 15th, Fannie Mae and Freddie Mac will release...

Related posts brought to you by Yet Another Related Posts Plugin.

Obama Supports An Extension To The Tax Credit!

David — Tue, 06 Oct 2009 06:01:19 +0000

I can tell you first hand, working inside of a real estate office, the tax credit is a definite stimulus to the housing industry. Every seven seconds, another house goes into foreclosures. The inventory must be moved! There are millions of qualified buyers out there, but there is still a lot of fear, especially with those potential buyers that are afraid of losing their jobs. The tax credit is a great lure for those qualified buyers. I personally think they should extend the credit for all home buyers. There is a pent up desire for home buying, but move up buyers and investors are mostly on the sidelines. I met with an investment advisor today and he was quick to remind me that it is a great time to buy stocks when the market is low and that strategy certainly applies to the housing market. The affordability index is at its best levels in decades. With the low prices, the tax credit and record low interest rates, it is the right time to buy (and hold). Here’s more insight on the tax credit…

From Inman News:

White House spokesman Robert Gibbs today confirmed that President Obama supports an extension of the first-time homebuyer tax credit, along with prolonging jobless benefits and health care subsidies for unemployed workers.

Briefing reporters, Gibbs said the measures don’t amount to a second stimulus plan.

Evidence of bipartisan support in the Senate for extending the first-time homebuyer tax credit was also on display Sunday on ABC’s “This Week,” with guests Sen. Charles Schumer, D-N.Y., and Sen. John Cornyn, R-Texas, finding common ground on the issue.

From the Kiplinger’s Tax Letter:

Start with the first time home buyer credit, the $8,000 break that is set to expire on Nov. 30. The credit will be extended for a few months, and lawmakers will clarify that first time purchasers don’t have to complete the sale by the expiration date to get the tax credit. They need only sign a contract. The odds are low that Congress will expand the credit to folks who aren’t first time home buyers, or increase the credit limit to $15,000.

Senate Voted To Extend Tax Credit For Homebuyers The Senate has voted last night (11/4) to extend and...
Tax Credit Extended and Expanded New legislation was signed into law on November 6th....
Take Advantage Of The Tax Credit for Home Buyers Now! Check out this video: http://www.youtube.com/watch?v=OsuRnh-ZDp4 There are only 14 weeks...

Related posts brought to you by Yet Another Related Posts Plugin.

Effective January 1st, FHA implements changes to minimize losses

David — Sun, 27 Sep 2009 06:11:07 +0000

FHA Logo

Special thanks to Inman News and Matt Carter for the following information:

Beginning in January, The Federal Housing Administration will tighten the credit guidelines and make rule changes the appraisal process to minimize defaults.. FHA’s insurance fund is sufficient to cover future losses, Federal Housing Commissioner David H. Stevens said, but the tighter policies will ensure that the loan guarantees remain self-sustaining and continue to be funded by premiums paid by borrowers, not taxpayers. The rule changes for appraisals will be similar to the changes implemented by Fannie Mae and Freddie Mac this past May, known as the Home Valuation Code of Conduct (HVCC). There has been some push back to HVCC by industry groups, but I suspect that it is here to stay.

Other FHA changes include new requirements for streamlined refinancing such as income verification and demonstrating a tangible benefit to the borrowers.

There will bill tighter restrictions for FHA approved lenders that will require us to submit audited annual financial statements. Another rule change transfers the risk of loans originated by mortgage brokers to lenders who fund the loans. This practice is already in place for Fannie and Freddie. Brokers won’t have to be individually approved to originate FHA loans which will potentially increase the number of lenders eligible to provide FHA loans resulting in more effective oversight per The U.S. Department of Housing and Urban Development (HUD).

HUD also proposes to increase the net-worth requirement for approved mortgagees from $250,000 to $1 million — a move that could exclude many smaller companies from FHA lending. The requirement has not been increased since 1993 and is currently below industry standards, HUD said. The Mortgage Bankers Association (MBA) issued a statement saying it has long advocated a higher net-worth requirement for FHA lenders, but noted that it “is just as important that any new requirements be reasonable and not unduly hamper competition.” MBA has proposed a $500,000 net-worth requirements.

I have 15 years of FHA lending experience. My company, PHH Mortgage is the fourth largest lender in the country and we specialize in government loans. Call David Wolsky at 520-275-2536. We are licensed in all 50 states. Email me at david@davidwolsky.com for all your mortgage needs.

No related posts.

Housing News: It’s Not All Bad

David — Tue, 28 Apr 2009 00:49:37 +0000

MORE GOOD NEWS FOR HOUSING

Existing Home Sales for March fell by 3.05% to 4.57 million, somewhat larger drop than expected. However, inventory of homes available for sale slipped by 1.6% to 3.737k, that is 9.3% below its year ago level. This is a 9.8 months supply compared to last November’s 11.0 months supply. The rate of decline is slowing and inventory is shrinking.

It is estimated that about half of these sales are distressed and continue to place downward pressure on both prices and new construction. The other half of these sales were to first-time buyers.

New Home Sales fell by 0.6% in March to 356k. This is a bit higher than estimates and February’s numbers were revised up from 337K to 358K. Inventory of new homes available for sale dropped by 5.2% to 311k. This is 33.7% below its year ago level and 45.6% below its July 2006 peak level. The supply has been steadily declining over the past months, from a January record of 12.5 months to February’s 11.2 and now March’s 10.7. While this is 2.5 times the 4.0 average for the 5 years ending in 2005 it is an encouraging trend.

The MBA Mortgage Applications Index is another bright note. It rose by 5.3% during the week ending April 17. Applications are now 83.8% above their year ago level.

While the Purchase Index fell, affordability is rising and pent up demand appears to be emerging, reflected in the number of first-time homebuyers in the condo market.

Year/Year home sales are improving in highly impacted markets including Las Vegas, Phoenix, Minneapolis and most areas of North Virginia, California and Florida.

The Refinance Index rose by 7.7% and is now 186.1% above its year ago levels. Refinance accounts for about 80% of all new mortgage activity, a real benefit of continued low mortgage rates.

A remaining rub for housing continues to be declining prices from both inventory overhang and mounting foreclosures.

Collectively, the housing indicators suggest a bottom may be at hand.

WEEK OF APRIL 27th

Consumer confidence for April comes out Tuesday and it should increase for the second straight month. Analysts believe it will hit 28.8 — up from 26 in March and February’s all-time low of 25.

One of the most important reports — advance 1^stquarter GDP — will be released Wednesday, and it’s expected to drop 4.9%. However, two revisions follow and further declines are expected. Final 4^thquarter GDP fell -6.3%.

Thursday is the busiest day for reports, beginning with first-time jobless claims for the week ended April 25. They’ve been up and they’ve been down but remain too volatile to establish a trend. Most economists, however, see job losses rising into next year.

We also get personal income and personal spending for March, which should be little changed from February. Income is expected to fall 0.2%, matching the previous data. Personal spending, however, could show slight improvement. It is predicted to decline 0.1% — a tad better than the previous 0.2% dip.

The 1^stquarter employment cost index (ECI) should make no waves. This index monitors the cost of wages, salaries and benefits paid by employers. It is expected to rise 0.5%, just as it did in the 4^thquarter.

Thursday’s final report, the Chicago PMI manufacturing index for April, is expected to rise to 34 from 31.4. This would be the first increase in several months. The national counterpart of that index, the ISM report on manufacturing nationwide, follows on Friday and it, too, is predicted to rise to 38.0 from 36.3. If these reports come in on target they would provide a small ray of hope for the hard-hit manufacturing sector.

Unfortunately, factory orders, which rose 1.8% in February, are expected to turn negative in March, falling 0.7%. Friday’s last report, the University of Michigan/Reuters’ final consumer sentiment survey for April, should not change much. Analysts believe it will come in at 61.5, which is a tad below the 61.9 of two weeks ago.

This last week of the month features a number of key reports and a statement by the Fed after its Wednesday meeting. Although no rate change is expected, the markets want to hear the Fed’s assessment of economic conditions, its outlook and its plans to buy more Treasuries in order to hold lending rates down.

Interesting Headlines Impacting The Mortgage Industry Freddie Mac reports that a 30 Year fixed rate...

Related posts brought to you by Yet Another Related Posts Plugin.