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Archive for October, 2008

Mortgage Applications up

J. Andrew English J. Andrew English
Thursday, October 9th, 2008

Mortgage Applications are up about 2.2% over last month according to Inman News. The increase in pending listings from July to August brought us to a 14 month high. This in itself is very good news, but even better is that the west showed the most dramatic increase. (upwards of 38%) All of this is hopefully leading to an increase in closed sales reported for the months of Sept to November. As the markets on Wall Street become increasingly unstable, investors may consider moving money back into Real Estate. Just something to watch for over the next few months.

Something to Follow

J. Andrew English J. Andrew English
Wednesday, October 8th, 2008


NAR is reporting an increase in pending listings from July to August of this year. (The report cites an increase of 7.4%.) Here is the important thing to consider. This increase is right about the time it was announced that the Nehemiah program would be discontinued as of Oct 1st, 2008. Is the jump the result of buyers who were previously waiting out the market instead getting off the fence prior to the termination of the Nehemiah program? This seller assisted program was responsible for hundreds of thousands of closings over the past 6-9 months. Are these pending #’s just a result of one last surge from this loan program before it died out? Sept – October pending numbers will be extremely interesting to examine when they are released.

Properties still selling

J. Andrew English J. Andrew English
Tuesday, October 7th, 2008

If you read the news today, you’d think nothing is selling these days in the world of Real Estate. While the markets have not returned to where we’d all like them to be, the reality is that properties in desirable areas do in fact sell. (and sometimes very quickly) We recently listed a property in central Dallas mid last week that received 2 asking price offers by the end of the week. Another property in San Diego we listed received 3 offers in 1 week. The thing to keep in mind is that people still need a place to live. Properties that find themselves in solid school districts or feature some other unique characteristic will always have interested purchasers looking their way. All sellers can surf their local county recorders website for information on recent closed sales. I think people will be shocked when they realize exactly how many properties are closing each and every day.

SIVA Loans

Donald L. Plunkett, Jr. Donald L. Plunkett, Jr.
Monday, October 6th, 2008

We speak with various lenders over the course of the business week to stay apprised of market conditions with regards to financing. One thing we are hearing is that lenders want to get out of the “Stated Income Verified Asset” space. These types of loans do not require the borrower to demonstrate proof of income (e.g. pay stubs), but still require proof of assets. One mortgage broker is quoting astronomically high rates and fees for this product: 8.5% with 6 points for a 75% LTV 30 year fixed rate mortgage. By comparison, a conforming 30 year fixed rate mortgage was quoted at 6.125% and 0 points.

When you hear that credit is tightening and mortgages are tougher to get, this is true. By throwing out super high rates and fees for selected programs, lenders are basically eliminating programs they don’t want to be involved with. As recently as a few years ago, many of these programs were not really available anyway. Understand, however, that traditional mortgage products (including some jumbo mortgages) are still very much available and the rates in most cases are reasonable.

Nevada Economic News

J. Andrew English J. Andrew English
Friday, October 3rd, 2008


When is the right time to invest back in Las Vegas?

It is impossible to pinpoint the exact time to re-enter a real estate market, however, if you are in the market for a high end luxury home in Las Vegas, the time is coming to get off the fence. With a decrease in gaming revenue and overall foot traffic on the strip, jobs are disappearing in a hurry. These include many “higher ups” in the gaming industry and entertainment industry. My prediction is that we will see an increase in properties for sale in the 700k-2million dollar range over the next 3-9 months. Prices within this niche will likely fall rather quickly as supply skyrockets.

While it is not as simple as tying the luxury Las Vegas RE Estate market to the overall gaming numbers, we can draw a few conclusions on the affect of the overall Global and US Economy and its affect on the Las Vegas gaming #’s, which indirectly affect the LV RE market. My point is that if you follow the gaming #’s over the next 12-36 months… you may be able to get a better grip on what to expect in the 700k-2mil Las Vegas housing market.

Sliding Scale Commissions

J. Andrew English J. Andrew English
Thursday, October 2nd, 2008

More and more MLS’s are forbidding the use of sliding scale commissions. A few MLS’s have gone so far as to forbid any type of stipulation on an MLS listed co broke. A sliding scale commission is a commission that is based upon a certain offer price being received. The problem with this sytem is that it puts the buyer’s agent in a potentially bad position. The agent has a duty to protect their clients best interest, however, their fee depends upon bringing the seller the highest offer. Because of this conflict of interest, many MLS’s have just done away with the sliding scale system all together.

Many NM boards have gotten rid of the use of commission stipulations all together. An example would be, “1k bonus to buyer broker with full price offer”.. or something similar to this. Again, the goal of the MLS is to eliminate any possible confusion regarding an MLS listed commission. Subagency in many states outside of Texas is not an option, thus, if a buyer broker must have the buyer’s best interest at heart… conditional commissions are just asking for future problems.