Archive for the 'tax credits' Category

Increased Home Sale Prices Surprise the Media!

Tuesday, August 31st, 2010

 

Prices of single family homes in the USA gained 0.3% in June from May, according to Standard & Poor’s / Case Shiller.
 
“This is the last hurrah for the tax credit,” said Gary Shilling, president of A. Gary Shilling & Company.
 
It always amazes me how the media can even take POSITIVE news and spin it negatively. Increased sales activity (THE NUMBER OF HOME SALES) was directly impacted positively by the tax credit of up to $8,000, but to claim price increases were due entirely to the tax credit is overreaching. While the INCREASED sales activity may have helped to stabilize prices; the price increase was simply a small step off the floor.
 
Media reports are becoming a self fulfilled prophecy unfortunately.
 
What truly is necessary to pull this country out of this great recession is JOBS! Without a job (or the risk of losing one) people don’t spend money! The economy is stalled – the government needs to finance infrastructure project and R & D labs for the betterment of today as well as tomorrow!

HOME CONTRACTS DROP 30% IN MAY

Friday, July 2nd, 2010

The National Association of Realtors stated that its seasonally adjusted index of sales agreements for sales of previously owned homes fell from 110.9 to 77.6 April to May respectively, which was also 15.9% lower than the same month the year prior. This national statistic clearly shows the power of the government incentives which expired. What baffles me though, is why the government set up housing to take such a blow… You don’t need to be a genius to know that in a fragile economy such as this incentives are like bandaids, and if you rip them off too soon you bleed! Sometimes the injury is even worse due to this action… From day 1 I questioned why they didn’t ‘phase out’ all incentive programs. BIG MISTAKE!  I wonder what the next move is? Fortunately, our little microsm of a market here in the East End is somewhat insulated and is not experiencing what other markets are but the over all buyer confidence in the old American Dream of ‘Home Ownership" is taking quite a beating here. Will someone up there on that hill use their head please.. don’t rip off bandaids in this environment,, rather,, change the dressings wisely until we are out of the woods and the wound is healed.

WALL STREET BONUSES & HIGH END REAL ESTATE

Tuesday, January 12th, 2010

HOME SALES & PRICES SHOWING FURTHER STABILITY

Wednesday, December 23rd, 2009

Wall Street Journal — front page– , lead story on all business news networks…

National Association of Realtors yesterday said existing home sales rose 7.4% in November from October’s seasonally adjusted annual rate of 6.54 million units. This was the highest rate posted since February 2007.

Approximately 50% of these sales were to first time home buyers taking advantage of the tax credit available to them.

Low interest rate further fueled this jump in home sales.

Federal Housing Finance Agency’s index rose 0.6% in October compared to November. The FHFA index tracks the purchase price of homes backed by Fannie & Freddie. The S&P/ Case Shiller Home Price Index, another closely watched measure of home prices also shows improvement.

Keep in mind these are National figures. On a local level, we have seen heightened activity since August. That sales activity is remaining steady even through the holiday season– a time of year which is historically quiet for real estate deal making. Not so in 2009– there are many very savoy investors and home buyers jumping in to find the water temp perfect!

HOUSING OFF THE BOTTOM!

Tuesday, December 15th, 2009

According to the Mortgage Banker’s Association, applications for home purchase loans shot up 42% last week on a non-seasonally adjusted basis compared with the week before. All this during the ordinarily quiet holiday season.

A sure sign buyers are jumping ‘off the fence’ and pulling the trigger.

The indicators are all supporting this decision to jump into the homeownership pool. Interest rates are at an all time low (with an expected increase in 2010), inventory is healthy (yet being absorbed at the fastest pase in over a year), first time home buyer credits of up to $8,000, $6500 tax credit for qualified buyers, prices reduced in most markets (but stabilized in many markets), and a market condition in favor of the buyer!

Frddie Mac declared home prices nation wide rose about 1 point on average during the 3rd quarter and 4th quarter activity has been even better.

Realty Trac states there was an 8% drop in November’s filings of delinquencies and foreclosures across the country. November makes the 4th month of declines in such filings.

Seller’s are ready, buyers are ready and brokers are ready…. let’s go shopping

US TREASURY REJECTS BID FROM GOLDMAN FOR FANNIE MAE’S TAX CREDITS

Saturday, November 7th, 2009

The billion dollar question is "what is best for the US tax payers"… ask people in Washington and you’ll get a completely different answer than if you asked people on Wall Street.  Either way, the Obama administration rejected Goldman Sachs’s offer on Friday to buy as much as $1billion in tax credits from Fannie Mae. The bottom line is Treasury officials said " It is our view that the proposed sale would result in a loss of aggregate tax revenues that would be greater tahn the savings". Period end of story! While Goldman argued that the capital could have been used by Fannie Mae to finance low-income housing and bring some relief to the bleeding,, it wasn’t enough.

Just the day before, Fannie announced a loss of $19B in the 3rd Q and expected to ask for another $15B from the US Government.