Archive for February, 2010

US HOME PRICES INCREASE 7TH STRAIGHT MONTH

Friday, February 26th, 2010

Tuesday, February 16th, 2010

 

JAZZ on the Vine is the theme for the 2010 Long Island Winterfest for the third consecutive year. It runs from February 13 to March 21 across the East End of Long Island and once again offers 6 great weekends of OVER 70 FREE jazz concerts* at winery tasting rooms and other venues on Saturdays and Sundays. Make plans to go to the East End of Long Island this winter, where outstanding jazz musicians join with local vineyards, hotels, B&Bs, restaurants, cultural venues and attractions to create an array of special events and offers designed to lift the mid-winter doldrums.
Visit the website for Winterfest for detailed information..
While you are at it, visit some Realtor (TM) Open Houses – email me at jbischoff@1townandcountry.com or call me at 631 948 0234

Mortgage Market Guide

Tuesday, February 16th, 2010

If you have received this newsletter indirectly and would like to be added to our weekly distribution list, use this link
Eve Robin Jarrett
MANAGING DIRECTOR
Senior Mortgage Consultant
Manhattan Mortgage
Office: 631-324-1555 x 25
Blackberry: 631-697-3366
e-Fax: 631-514-3654
Email: EJarrett@manhattanmortgage.com

For the week of Feb 15, 2010 // Vol. 8, Issue 7
Last Week in Review

“IT AIN’T OVER TIL IT’S OVER.” Yogi Berra. And whether you find those words deeply wise or simply puzzling…The Fed has told us repeatedly that their massive purchasing program of Mortgage Backed Securities is just about over – and this translates to home loan rates rising in the near future.

As you can see in the chart below, the amounts of Mortgage Backed Securities the Fed is purchasing are slowly dwindling, as the program is set to wrap up by March 31st, and are clearly trying to ration out the remaining portion. Last week, the Fed purchased $11 Billion in Mortgage Backed Securities, which leaves them with $66 Billion to spend out of their original $1.25 Trillion allotment. So about 95% of the total has already been spent and has purchased about 3 out of every 4 home loans during the past year. When such a large buyer leaves the market, it is very likely that prices will worsen.

This is very important because as the Fed has less money to last through the remaining months of the program, their ability to keep home loan rates low via their purchasing power will wane. And those who can take advantage of currently low home loan rates do not wait, as the clock on these historically low rates is ticking.

———————–
Chart: The Fed’s Purchase of MBS (By Month)

Also last week, Fed Chairman Ben Bernanke provided a speech on a number of topics, perhaps the most important of these being switching the Fed’s benchmark from the commonly watched and monitored Fed Funds Rate, to a new benchmark of “interest paid on excess reserves”. Banks are required to keep money on reserve with the Fed and may, from time to time, have an excess in those reserves, which the Fed can pay interest on. Since the Fed Funds Rate is only a “target rate”, banks can still lend money to other bank overnight at their own negotiated rate. Sometimes near the end of the trading day, banks have been lending their excess reserves out overnight for a rate that differs from the Fed Funds Rate, but is higher than interest on those reserves from The Fed. This undermines the Fed’s ability to set a reliable benchmark.

The Fed wants to fix this by using the amount of interest they pay as the new benchmark, since the Fed has total control of this rate, which should be right at or just under the Fed Funds Rate.

There is one major take-away from this discussion – it appears that the Fed is getting their ducks in a row as they prepare to push interest rates higher. And when they do increase rates, the Fed does not want any obstacles that may undermine their plan.

AND SPEAKING OF OBSTACLES THAT COULD CAUSE PROBLEMS…WATER DAMAGE CAN WREAK HAVOC ON YOUR HOME AND YOUR FINANCES, AND IS ESPECIALLY IMPORTANT TO WATCH OUT FOR DURING COLD WINTER MONTHS. CHECK OUT THE MORTGAGE MARKET VIEW ARTICLE BELOW FOR TIPS ON PROTECTING YOUR HOME!

Forecast for the Week

The financial markets will be closed on Monday in observance of Presidents Day, and in terms of economic reports, there won’t be much action until midweek. On Wednesday, we’ll get a look at the health of the housing industry with reports on Housing Starts and Building Permits for January.

It will be interesting to watch the housing reports over the next several months, as many people are acting to take advantage of currently low home loan rates that may be on the rise soon, as well as the potential of a juicy tax credit. Remember – the Homebuyers Tax Credit is only available on homes purchased with a contract date before April 30th, and the transaction must settle by June 30th.

We’ll also get an update on inflation this Thursday, as the Producer Price Index will be released. This index measures price changes for wholesalers, and prefaces the more important Consumer Price Index coming on Friday, which measures changes in the price paid by consumers for goods and services. These reports are both particularly important, as the Fed will be watching very carefully for any signs of inflation. If inflation begins to rise, the Fed will have no choice but to begin to hike rates to fight off the dangers that inflation could pose to our economy.

In addition to those reports, we’ll get our weekly look at employment through the Initial Jobless Claims data. Last week’s report showed some encouraging signs, but there is still a long way to go before we’ll see stabilization in the Unemployment Rate and some meaningful job creation. At the moment, 6.3 Million people remain unemployed for over six months – an increase of 5 million since the start of the recession in December of 2007. To reach the White House’s projection of a 6% unemployment rate by 2015, the US would need to create 225,000 jobs per month, every month, for the next five years. But that kind of long term job growth has never been seen before. The year 2006, was the only year in US history that had job gains average over 225,000. But that was for just a single year – doing it for five years may be too much of a stretch.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bond prices and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bond prices fell early last week due to weak results from the Treasury auctions, but were able to rally towards the end of the week. When Bond prices are moving higher, home loan rates are improving – so I’ll be watching out to see if the current ground can be held. If you have any questions about how home loan rates move – and if an opportunity exists that would benefit you – please don’t hesitate to call or email me.

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Feb 12, 2010)

The Mortgage Market View…

Keeping Your Home Safe from Water Damage

Preventing water damage in your home is important at any time of year, but particularly in the winter when the cold weather can wreak havoc on plumbing. Here are some tips to make sure your water bill is as low as it should be…and that your home is as safe and dry as it needs to be:

Pay attention to your bill: Major fluctuations in water usage from one month to the next could mean that you have a problem. Taking just a few minutes to look at your bill each month could make a big difference in your wallet!

Inspect appliances: While much of your home’s plumbing can be hidden behind walls and cabinets, most of your appliances that use water can be easily inspected for potential leaks. Each month, take the time to inspect areas around your water heater, dishwasher, refrigerator, washing machine, sinks, and toilets. If any hoses or seals appear old or damaged, replace them. Also, inspect and repair obvious caulking and tile grout damage. It’s a small price to pay for what could be expensive repairs later.

Inspect the sewer line: Clear away build-up and roots from around your sewer line. Obstructions in this area could create major plumbing problems in the future.

Check your water pressure annually: This is easier than it sounds. Simply purchase a pressure gauge and attach it to the hose faucet. Normal results should range from 45 to 65 pounds per square inch (psi). A reading above 65 psi is considered high and could lead to problems down the line.

Find and fix leaks quickly: Make a habit of checking the main fixtures regularly so that when something out of the ordinary occurs you will notice it and take action immediately. Sometimes, however, slow water leaks aren’t very obvious. A great way to discover hidden leaks is to look for stains in areas where water is often used. For example, if you see even small stains on the cabinet floors beneath the sink in the kitchen or bathrooms, you could have a problem. Warm spots in the floor or tiles could also be an indication of hidden water damage.

Before a vacation: The worst thing to come home to after a great vacation is major water damage. Consider turning off your water while you’re gone. For many homeowners there is a separate shut-off valve for the home that doesn’t affect your irrigation system.

The bottom line is that a little time and effort can make a big difference when it comes to keeping your home safe and dry, and your expenses at a minimum!

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of February 15 – February 19
Date ET Economic Report For Estimate Actual Prior Impact
Wed. February 17 08:30 Building Permits Jan 615K 653K Moderate
Wed. February 17 02:00 FOMC Minutes 1/27 HIGH
Wed. February 17 09:15 Industrial Production Jan 0.8% 0.6% Moderate
Wed. February 17 09:15 Capacity Utilization Jan 72.6% 72.0% Moderate
Wed. February 17 08:30 Housing Starts Jan 580K 557K Moderate
Thu. February 18 08:30 Producer Price Index (PPI) Jan 0.8% 0.2% Moderate
Thu. February 18 08:30 Core Producer Price Index (PPI) Jan 0.1% 0.0% Moderate
Thu. February 18 10:00 Index of Leading Econ Ind (LEI) Jan 0.5% 1.1% Moderate
Thu. February 18 10:00 Philadelphia Fed Index Feb 17.0 15.2 HIGH
Thu. February 18 08:30 Jobless Claims (Initial) 2/13 430K 440K Moderate
Fri. February 19 08:30 Consumer Price Index (CPI) Jan 0.3% 0.1% HIGH
Fri. February 19 08:30 Core Consumer Price Index (CPI) Jan 0.2% 0.1% HIGH

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett@manhattanmortgage.com

If you prefer to send your removal request by mail the address is:

Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937
The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

Weekly Mortgage Market Update

Sunday, February 7th, 2010

Subject: MMG Weekly: A Look Behind the Curtain at the Jobs Report

If you can’t see the newsletter, or would like to view it online, use this link If you have received this newsletter indirectly and would like to be added to our weekly distribution list, use this link
Eve Robin Jarrett
MANAGING DIRECTOR
Senior Mortgage Consultant
Manhattan Mortgage
Office: 631-324-1555 x 25
Blackberry: 631-697-3366
e-Fax: 631-514-3654
Email: EJarrett@manhattanmortgage.com

For the week of Feb 08, 2010 // Vol. 8, Issue 6
Last Week in Review

“BOTH OPTIMISTS AND PESSIMISTS CONTRIBUTE TO OUR SOCIETY. THE OPTIMIST INVENTS THE AIRPLANE, AND THE PESSIMIST – THE PARACHUTE.” G.B. Stern. And last week’s Jobs Report had something for both optimists and pessimists, as the numbers were both good and bad…depending on which survey you looked at, and what numbers you focused on.

First, the headline numbers: The Labor Department reported that there were 20,000 jobs lost in January, which was worse than expectations of 15,000 jobs gained. However, the Unemployment Rate came in lower at 9.7%, down from last month’s read of 10.0%. But what do these numbers actually tell us?

Remember that the numbers in the Jobs Report come from two separate surveys: First, the Business Survey – also called the Establishment Survey or Current Employment Statistics Survey – which surveys about 140,000 businesses and government agencies. It uses something called the “birth/death ratio” to provide an estimate of the number of jobs gained or lost each month. This survey is used to report the headline number of jobs gained or lost. Now there is also the Household Survey, also known as the Current Population Survey, which uses actual phone calls to 50 – 60,000 households to gather its data. This survey is used to report the headline Unemployment Rate.

The Business Survey is very susceptible to inaccuracy, particularly during times when the labor market is substantially worsening or improving…and you don’t need to look much further than all the revisions to prior reports to see how inaccurate the report seems to be. December’s report was revised to 150,000 jobs lost, nearly doubling the original report of 85,000 job losses. Although November showed 60,000 additional gains – wait a minute – October’s revisions showed another 100,000 jobs lost. And if that weren’t enough, the Business Survey threw in a “Benchmark Revision”, which indicated that there were an additional 900,000 jobs lost from March 2008 – March 2009 from what was previously reported!

———————–
Chart: Non-farm Payroll Change and Revisions

So what about the other report, the Household Survey? It gives us the headline Unemployment Rate, which was reported at 9.7%. That’s an improvement over last month’s reading of 10.0%. But this survey has its own job creation or loss number, just like the Business Survey does. The Household Survey showed that 540,000 jobs were created during January, which is really good news, and explains why the Unemployment Rate declined in the face of the Business Survey showing job losses.

There are definitely some glimmers of hope for the job market – but any way you look at it, the bottom line is that continued and significant improvements need to be seen in the labor market before the economy can be considered out of the woods.

Another important note for the week – Pending Home Sales for December were up significantly from November’s reading, and up a healthy 10.9% over December 2008, as homebuyers take advantage of today’s low rates and tax incentives. And speaking of low home loan rates, the Federal Reserve purchased $12 billion in Mortgage Backed Securities last week, bringing the total to $1.173 trillion since the program began in January of 2009…which leaves just $77 billion in purchases to be made over the next eight weeks until the program ends on March 31st. While home loan rates improved very slightly during this volatile week – don’t forget that when the Fed is done buying, home loan rates will be very susceptible to moving higher. Please reach out to me to discuss how you or someone you know might benefit from current low rates, or the Homebuyers Tax Credit. The clock is ticking on both these fronts – so why wait?

THE NEW MILEAGE RATES ARE HERE! THE NEW MILEAGE RATES ARE HERE! OKAY…NEWS FROM THE IRS ISN’T NECESSARILY ALL THAT EXCITING, BUT YOU DON’T WANT TO MISS OUT ON A SINGLE TAX DEDUCTION YOU MIGHT HAVE COMING. CHECK OUT THIS WEEK’S MORTGAGE MARKET GUIDE VIEW FOR THE DETAILS.

Forecast for the Week

We have a quiet week ahead when it comes to economic reports, but whether that’s good or bad news remains to be seen. Be sure to look for Thursday’s Initial Jobless Claims Report, as last week’s numbers came in at 480,000, quite a bit worse than the 455,000 expected and the highest count since mid-December. Last week’s Continuing Claims increased slightly to 4.6 million, and remember this…the Continuing Claims number doesn’t even account for the nearly 6 million people whose Unemployment benefits have expired, and are now receiving Extended Emergency Unemployment benefits.

Also on tap for Thursday is the Retail Sales Report for January. This report is the most-timely indicator of broad consumer spending patterns, and it is important to see in which direction the numbers are moving. And the Treasury will be auctioning $40B in 3-year Notes on Tuesday, $25B in 10-years on Wednesday and $16B in 30-year Bonds on Thursday for a total of $81B. These auctions could move the markets, especially in the face of few scheduled economic reports.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bond prices have been improving of late, but there is tough technical resistance ahead. As always, I’ll be watching closely – so give me a call this week if you’d like an update on the market action!

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Feb 05, 2010)

The Mortgage Market View…

New Mileage Rates for 2010

If you drive a car, truck or van for work, you’ll want to make sure you know the standard mileage rates that the Internal Revenue Service (IRS) has set for 2010. And remember, these mileage rates are not just used to calculate deductible costs for driving an automobile for business, but also for charitable, medical or moving purposes.

New for 2010

As of January 1, 2010, the standard mileage rates are as follows:

Businesses = 50 cents per mile driven
Medical or moving = 16.5 cents per mile driven
Charitable organizations = 14 cents per mile driven

Note: The 2010 rates are slightly lower than last year’s, due to generally lower transportation costs as compared to a year ago.

Make Sure You Qualify

Before you calculate your deduction, make sure you qualify. The IRS reminds taxpayers that they cannot use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Additional Option

Although the IRS provides the standard mileage rate for ease and convenience, you’re not required to use it. If you prefer, you can calculate the actual costs of using your vehicle instead of using the standard mileage rates.

Best yet – most people find that they save money on taxes by working with a tax professional. Let me know if you need a referral!

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of February 08 – February 12
Date ET Economic Report For Estimate Actual Prior Impact
Wed. February 10 08:30 Balance of Trade Dec -$35.0B -$36.4B Moderate
Thu. February 11 08:30 Jobless Claims (Initial) 2/6 NA 480K Moderate
Thu. February 11 08:30 Retail Sales Jan 0.4% -0.3% HIGH
Thu. February 11 08:30 Retail Sales ex-auto Jan 0.4% -0.2% HIGH
Fri. February 12 10:00 Consumer Sentiment Index (UoM) Feb 74.8 74.4 Moderate

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett@manhattanmortgage.com

If you prefer to send your removal request by mail the address is:

Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937
The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

Subject: MMG Weekly: A Look Behind the Curtain at the Jobs Report

If you can’t see the newsletter, or would like to view it online, use this link If you have received this newsletter indirectly and would like to be added to our weekly distribution list, use this link
Eve Robin Jarrett
MANAGING DIRECTOR
Senior Mortgage Consultant
Manhattan Mortgage
Office: 631-324-1555 x 25
Blackberry: 631-697-3366
e-Fax: 631-514-3654
Email: EJarrett@manhattanmortgage.com

For the week of Feb 08, 2010 // Vol. 8, Issue 6
Last Week in Review

“BOTH OPTIMISTS AND PESSIMISTS CONTRIBUTE TO OUR SOCIETY. THE OPTIMIST INVENTS THE AIRPLANE, AND THE PESSIMIST – THE PARACHUTE.” G.B. Stern. And last week’s Jobs Report had something for both optimists and pessimists, as the numbers were both good and bad…depending on which survey you looked at, and what numbers you focused on.

First, the headline numbers: The Labor Department reported that there were 20,000 jobs lost in January, which was worse than expectations of 15,000 jobs gained. However, the Unemployment Rate came in lower at 9.7%, down from last month’s read of 10.0%. But what do these numbers actually tell us?

Remember that the numbers in the Jobs Report come from two separate surveys: First, the Business Survey – also called the Establishment Survey or Current Employment Statistics Survey – which surveys about 140,000 businesses and government agencies. It uses something called the “birth/death ratio” to provide an estimate of the number of jobs gained or lost each month. This survey is used to report the headline number of jobs gained or lost. Now there is also the Household Survey, also known as the Current Population Survey, which uses actual phone calls to 50 – 60,000 households to gather its data. This survey is used to report the headline Unemployment Rate.

The Business Survey is very susceptible to inaccuracy, particularly during times when the labor market is substantially worsening or improving…and you don’t need to look much further than all the revisions to prior reports to see how inaccurate the report seems to be. December’s report was revised to 150,000 jobs lost, nearly doubling the original report of 85,000 job losses. Although November showed 60,000 additional gains – wait a minute – October’s revisions showed another 100,000 jobs lost. And if that weren’t enough, the Business Survey threw in a “Benchmark Revision”, which indicated that there were an additional 900,000 jobs lost from March 2008 – March 2009 from what was previously reported!

———————–
Chart: Non-farm Payroll Change and Revisions

So what about the other report, the Household Survey? It gives us the headline Unemployment Rate, which was reported at 9.7%. That’s an improvement over last month’s reading of 10.0%. But this survey has its own job creation or loss number, just like the Business Survey does. The Household Survey showed that 540,000 jobs were created during January, which is really good news, and explains why the Unemployment Rate declined in the face of the Business Survey showing job losses.

There are definitely some glimmers of hope for the job market – but any way you look at it, the bottom line is that continued and significant improvements need to be seen in the labor market before the economy can be considered out of the woods.

Another important note for the week – Pending Home Sales for December were up significantly from November’s reading, and up a healthy 10.9% over December 2008, as homebuyers take advantage of today’s low rates and tax incentives. And speaking of low home loan rates, the Federal Reserve purchased $12 billion in Mortgage Backed Securities last week, bringing the total to $1.173 trillion since the program began in January of 2009…which leaves just $77 billion in purchases to be made over the next eight weeks until the program ends on March 31st. While home loan rates improved very slightly during this volatile week – don’t forget that when the Fed is done buying, home loan rates will be very susceptible to moving higher. Please reach out to me to discuss how you or someone you know might benefit from current low rates, or the Homebuyers Tax Credit. The clock is ticking on both these fronts – so why wait?

THE NEW MILEAGE RATES ARE HERE! THE NEW MILEAGE RATES ARE HERE! OKAY…NEWS FROM THE IRS ISN’T NECESSARILY ALL THAT EXCITING, BUT YOU DON’T WANT TO MISS OUT ON A SINGLE TAX DEDUCTION YOU MIGHT HAVE COMING. CHECK OUT THIS WEEK’S MORTGAGE MARKET GUIDE VIEW FOR THE DETAILS.

Forecast for the Week

We have a quiet week ahead when it comes to economic reports, but whether that’s good or bad news remains to be seen. Be sure to look for Thursday’s Initial Jobless Claims Report, as last week’s numbers came in at 480,000, quite a bit worse than the 455,000 expected and the highest count since mid-December. Last week’s Continuing Claims increased slightly to 4.6 million, and remember this…the Continuing Claims number doesn’t even account for the nearly 6 million people whose Unemployment benefits have expired, and are now receiving Extended Emergency Unemployment benefits.

Also on tap for Thursday is the Retail Sales Report for January. This report is the most-timely indicator of broad consumer spending patterns, and it is important to see in which direction the numbers are moving. And the Treasury will be auctioning $40B in 3-year Notes on Tuesday, $25B in 10-years on Wednesday and $16B in 30-year Bonds on Thursday for a total of $81B. These auctions could move the markets, especially in the face of few scheduled economic reports.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bond prices have been improving of late, but there is tough technical resistance ahead. As always, I’ll be watching closely – so give me a call this week if you’d like an update on the market action!

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Feb 05, 2010)

The Mortgage Market View…

New Mileage Rates for 2010

If you drive a car, truck or van for work, you’ll want to make sure you know the standard mileage rates that the Internal Revenue Service (IRS) has set for 2010. And remember, these mileage rates are not just used to calculate deductible costs for driving an automobile for business, but also for charitable, medical or moving purposes.

New for 2010

As of January 1, 2010, the standard mileage rates are as follows:

Businesses = 50 cents per mile driven
Medical or moving = 16.5 cents per mile driven
Charitable organizations = 14 cents per mile driven

Note: The 2010 rates are slightly lower than last year’s, due to generally lower transportation costs as compared to a year ago.

Make Sure You Qualify

Before you calculate your deduction, make sure you qualify. The IRS reminds taxpayers that they cannot use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Additional Option

Although the IRS provides the standard mileage rate for ease and convenience, you’re not required to use it. If you prefer, you can calculate the actual costs of using your vehicle instead of using the standard mileage rates.

Best yet – most people find that they save money on taxes by working with a tax professional. Let me know if you need a referral!

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of February 08 – February 12
Date ET Economic Report For Estimate Actual Prior Impact
Wed. February 10 08:30 Balance of Trade Dec -$35.0B -$36.4B Moderate
Thu. February 11 08:30 Jobless Claims (Initial) 2/6 NA 480K Moderate
Thu. February 11 08:30 Retail Sales Jan 0.4% -0.3% HIGH
Thu. February 11 08:30 Retail Sales ex-auto Jan 0.4% -0.2% HIGH
Fri. February 12 10:00 Consumer Sentiment Index (UoM) Feb 74.8 74.4 Moderate

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett@manhattanmortgage.com

If you prefer to send your removal request by mail the address is:

Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937
The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

Weekly Mortgage Market Update

Sunday, February 7th, 2010

If you have received this newsletter indirectly and would like to be added to our weekly distribution list, use this link
Eve Robin Jarrett
MANAGING DIRECTOR
Senior Mortgage Consultant
Manhattan Mortgage
Office: 631-324-1555 x 25
Blackberry: 631-697-3366
e-Fax: 631-514-3654
Email: EJarrett@manhattanmortgage.com

For the week of Feb 08, 2010 // Vol. 8, Issue 6
Last Week in Review

“BOTH OPTIMISTS AND PESSIMISTS CONTRIBUTE TO OUR SOCIETY. THE OPTIMIST INVENTS THE AIRPLANE, AND THE PESSIMIST – THE PARACHUTE.” G.B. Stern. And last week’s Jobs Report had something for both optimists and pessimists, as the numbers were both good and bad…depending on which survey you looked at, and what numbers you focused on.

First, the headline numbers: The Labor Department reported that there were 20,000 jobs lost in January, which was worse than expectations of 15,000 jobs gained. However, the Unemployment Rate came in lower at 9.7%, down from last month’s read of 10.0%. But what do these numbers actually tell us?

Remember that the numbers in the Jobs Report come from two separate surveys: First, the Business Survey – also called the Establishment Survey or Current Employment Statistics Survey – which surveys about 140,000 businesses and government agencies. It uses something called the “birth/death ratio” to provide an estimate of the number of jobs gained or lost each month. This survey is used to report the headline number of jobs gained or lost. Now there is also the Household Survey, also known as the Current Population Survey, which uses actual phone calls to 50 – 60,000 households to gather its data. This survey is used to report the headline Unemployment Rate.

The Business Survey is very susceptible to inaccuracy, particularly during times when the labor market is substantially worsening or improving…and you don’t need to look much further than all the revisions to prior reports to see how inaccurate the report seems to be. December’s report was revised to 150,000 jobs lost, nearly doubling the original report of 85,000 job losses. Although November showed 60,000 additional gains – wait a minute – October’s revisions showed another 100,000 jobs lost. And if that weren’t enough, the Business Survey threw in a “Benchmark Revision”, which indicated that there were an additional 900,000 jobs lost from March 2008 – March 2009 from what was previously reported!

———————–
Chart: Non-farm Payroll Change and Revisions

So what about the other report, the Household Survey? It gives us the headline Unemployment Rate, which was reported at 9.7%. That’s an improvement over last month’s reading of 10.0%. But this survey has its own job creation or loss number, just like the Business Survey does. The Household Survey showed that 540,000 jobs were created during January, which is really good news, and explains why the Unemployment Rate declined in the face of the Business Survey showing job losses.

There are definitely some glimmers of hope for the job market – but any way you look at it, the bottom line is that continued and significant improvements need to be seen in the labor market before the economy can be considered out of the woods.

Another important note for the week – Pending Home Sales for December were up significantly from November’s reading, and up a healthy 10.9% over December 2008, as homebuyers take advantage of today’s low rates and tax incentives. And speaking of low home loan rates, the Federal Reserve purchased $12 billion in Mortgage Backed Securities last week, bringing the total to $1.173 trillion since the program began in January of 2009…which leaves just $77 billion in purchases to be made over the next eight weeks until the program ends on March 31st. While home loan rates improved very slightly during this volatile week – don’t forget that when the Fed is done buying, home loan rates will be very susceptible to moving higher. Please reach out to me to discuss how you or someone you know might benefit from current low rates, or the Homebuyers Tax Credit. The clock is ticking on both these fronts – so why wait?

THE NEW MILEAGE RATES ARE HERE! THE NEW MILEAGE RATES ARE HERE! OKAY…NEWS FROM THE IRS ISN’T NECESSARILY ALL THAT EXCITING, BUT YOU DON’T WANT TO MISS OUT ON A SINGLE TAX DEDUCTION YOU MIGHT HAVE COMING. CHECK OUT THIS WEEK’S MORTGAGE MARKET GUIDE VIEW FOR THE DETAILS.

Forecast for the Week

We have a quiet week ahead when it comes to economic reports, but whether that’s good or bad news remains to be seen. Be sure to look for Thursday’s Initial Jobless Claims Report, as last week’s numbers came in at 480,000, quite a bit worse than the 455,000 expected and the highest count since mid-December. Last week’s Continuing Claims increased slightly to 4.6 million, and remember this…the Continuing Claims number doesn’t even account for the nearly 6 million people whose Unemployment benefits have expired, and are now receiving Extended Emergency Unemployment benefits.

Also on tap for Thursday is the Retail Sales Report for January. This report is the most-timely indicator of broad consumer spending patterns, and it is important to see in which direction the numbers are moving. And the Treasury will be auctioning $40B in 3-year Notes on Tuesday, $25B in 10-years on Wednesday and $16B in 30-year Bonds on Thursday for a total of $81B. These auctions could move the markets, especially in the face of few scheduled economic reports.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bond prices have been improving of late, but there is tough technical resistance ahead. As always, I’ll be watching closely – so give me a call this week if you’d like an update on the market action!

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Feb 05, 2010)

The Mortgage Market View…

New Mileage Rates for 2010

If you drive a car, truck or van for work, you’ll want to make sure you know the standard mileage rates that the Internal Revenue Service (IRS) has set for 2010. And remember, these mileage rates are not just used to calculate deductible costs for driving an automobile for business, but also for charitable, medical or moving purposes.

New for 2010

As of January 1, 2010, the standard mileage rates are as follows:

Businesses = 50 cents per mile driven
Medical or moving = 16.5 cents per mile driven
Charitable organizations = 14 cents per mile driven

Note: The 2010 rates are slightly lower than last year’s, due to generally lower transportation costs as compared to a year ago.

Make Sure You Qualify

Before you calculate your deduction, make sure you qualify. The IRS reminds taxpayers that they cannot use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Additional Option

Although the IRS provides the standard mileage rate for ease and convenience, you’re not required to use it. If you prefer, you can calculate the actual costs of using your vehicle instead of using the standard mileage rates.

Best yet – most people find that they save money on taxes by working with a tax professional. Let me know if you need a referral!

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of February 08 – February 12
Date ET Economic Report For Estimate Actual Prior Impact
Wed. February 10 08:30 Balance of Trade Dec -$35.0B -$36.4B Moderate
Thu. February 11 08:30 Jobless Claims (Initial) 2/6 NA 480K Moderate
Thu. February 11 08:30 Retail Sales Jan 0.4% -0.3% HIGH
Thu. February 11 08:30 Retail Sales ex-auto Jan 0.4% -0.2% HIGH
Fri. February 12 10:00 Consumer Sentiment Index (UoM) Feb 74.8 74.4 Moderate

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

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Eve Robin Jarrett
Manhattan Mortgage
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East Hampton, NY 11937
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North Fork 5 Year History Report

Wednesday, February 3rd, 2010

TOWN & COUNTRY REAL ESTATE has compiled a 5 year study of the North Fork of Long Island.

 
We chose 5 years because TOWN & COUNTRY had identified the summer of 2005 as the “Top of the Market” (August 2005) and we were the first to identify the first half of 2009 as “The Bottom” (March 2009).  Thus looking to analyze the comparison from Bull to Bear. 
 
This evaluation examines the Number of Home Sales, Total Sales Volume, Median Sales Price as well as 6 different price categories within each of the four individual markets spanning the North Fork. 
 
Starting at the top of  TOWN & COUNTRY’s chart, we see JAMESPORT (which includes Aquebogue, Baiting Hollow and South Jamesport) had 163 Home Sales in 2005 and only 66 in 2009 – a decline of 60%.  This trend, of course, led to the Total Sales Volume to drop from $89M to $27M or 70%.  If you glance at the different price categories you will see the largest drop was in high end home sales on the North Fork.  Homes $1M and up dropped to zero in 2009 from 10 in 2005.  
 
That specific trend of significantly lower amount of home sales on the high end is a trend that all 4 North Fork markets experienced. In fact, in All North Fork Markets Combined $1M and up home sales dropped from 71 in 2005 to 27 in 2009 or down 62%.
 
On the North Fork, the Median Home Sales Price fluctuated between a mere 7% drop in MATTITUCK (which includes Laurel and Cutchogue) to a 20% drop in ORIENT (which includes East Marion and Greenport) from the height of the market, to the bottom.  A digestible correction, considering other investments may have dropped 50% or more.  
 
While this analysis may confirm what those of us in the business have felt – that the Number of Home Sales suffered, particularly the high end.  The good news is, our markets have established their respective floors and we do not foresee further declines in values or activity… which leads us to our next growth period!
 
To view more specifics on your particular locations and price ranges visit our website 1TownandCountry.com and click on “Reports”.  
 
 
*Source: The Long Island Real Estate Report
**All information is deemed reliable and correct.  Information is subject to errors, omissions and   withdrawal without prior notice.