Keeping Current Aug 5 2008

8/14/2019 Keeping Current Aug 5 2008

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July 2008

keeping

you

current

By Madeleine Romanello



“Hopefully the biggest part of thehousing decline will be over by the

end of the year ."

ReutersReuters

- U.S. Treasury Secretary Henry Paulson

Source: Reuters News 6/24/08



“We are at the beginning of theend of the downturn. It will be along painful ending, but this is the

first step in bringing the downturn toa close.”

ReutersReuters


- Mark Zandi, chief economist at Moody'sEconomy.com



“It is still too early to call a bottomin the home sales market, but thevast majority of the declines insales are behind us.”

ReutersReuters


- Adam York, economic analyst at Wachovia Corp inCharlotte, NC



Sales of previously

owned houses rose 2%last month.

Source: NAR 6/08

tional Assoc. of Realtotional Assoc. of Realto



Source: CNN Money.com 6/2/08



With the national median priceof a single family home at$204,229, mortgage rates

around six percentand the average householdearning nearly $50,000, the

average home buyer spentabout 23 percent of their income on housing during

the first quarter of 2008.

CNN Money.comCNN Money.com



On the path to a housingreboundSo the first time in a decade renters

can carry the mortgage paymentsand taxes on a new house for whatthey're paying a landlord.

Source: Fortune Magazine.com 6/25/08

ortune Magazine.comortune Magazine.com





There were a total of eightmetropolitan areas with month-to-month gains, led by a 2.9

percent increase in Cleveland.

Case-ShillerCase-Shiller



Source: Wall Street Journal 6/05/08



“I don’t think people appreciate howlong it’s going to take to get theinventory level back down enough to

give sellers some pricing power. It’sgoing to take, in our opinion,two to three years.”

- Paul D. Puryear, a real estate analyst at Raymond James

& Associates.

Source: New York Times 5/25/08

New York TimesNew York Times




irst American CoreLogi

231,000

493,0

00

660,0

00

REOs

January 2007 January 2008 April 2008



ource: Credit Suisse



Lenders stung by the housing bustare slashing prices dramatically to ridthemselves of an unprecedented

number of foreclosed properties.

Associated Pressssociated Press

urce: Associated Press 6/12/08



www.homesafepmi.com/



“Home prices, based on the S&P/Case-Shiller data, have fallen about 15percent and I am expecting them to

drop another 10 percent beforereaching a trough in the spring of 2009.”

ReutersReuters


- Mark Zandi, chief economist at Moody'sEconomy.com



“Home prices may fall 25 percent to 30 percent fromtheir peak in 2006 and not hit

bottom until 2010, with greaterdrops still in subprime mortgagedebt markets.”

urce: Reuters 6/11/08

- Peter Acciavatti, credit analyst and

managing director at JP MorganSecurities Inc

ReutersReuters



The median existing-home price is likely todecline 8.4 percent

in the first half of this year , and thenbegin to stabilize in the

second half.

ource: NAR 6/09/08

tional Assoc. of Realtotional Assoc. of Realto

B k’ L diB k’ L di



Bank’s LendingBank’s Lending

StandardsStandards

ource: Federal Reserve

April 2002 June 2008



5

7

9

11

13

1983 2007

rtgage Rates –rtgage Rates – 30 year fixed 30 year fixed

urce: mortgage-x.com 6/10/08



5.9

6

6.1

6.2

6.3

6.4

6.5

ortgage Rates –ortgage Rates – 30 year fixed 30 year fixed

May 22 June 26urce: Federal Reserve

Fi iFi i



FinancingFinancing

flexibilityflexibility

How can theseller make

their homemoreattractiveto a greaterpool of

buyers?



Source: The Washington Post 6/10/08

The number of FHA loansissued rose 126 percent in

the first quarter of 2008,compared with the sameperiod a year ago.

ashington Postashington Post




all Street Journalall Street Journal



Rates on jumbo-conforming loansare currently 6.59 percent comparedto non-conforming jumbos which are

averaging 7.4 percent.


Source: The Wall Street Journal6/19/08





At J.P. Morgan Chase & Co., the volumeof jumbo-conforming applications hasdoubled since prices began to fall in

early May.





For some California lenders, jumbo-conforming loans now account for asmuch as 25 percent of applications,

says Pete Ogilvie, president of theCalifornia Association of MortgageBrokers. "Most of the activity is inpurchases.”





In March 2007, before the creditcrunch hit, jumbo loans accounted formore than 12% of loan applications,

based on the number of loans,according to the MBA, with the shareof jumbo loans much higher in manyhigh-priced markets. The jumbo sharestood at 6% in May, after falling to aslow as 4.4% in March.



“The settlement will ultimately meana drop in sales commissions of 25

percent to 50 percent as a result of

increased competition.”

urce: The New York Times 5/28/08

DOJ RulingDOJ Ruling

- Norman Hawker, a business professor atWestern Michigan University who organized asymposium on the Justice Department litigationas a senior fellow for the American Antitrust

Institute



“More than three-quarters

of thesurvey respondents seesavvy customers not as a

threat, but as anopportunity todifferentiate.”

IBM CEO StudyIBM CEO Study



TravelTravel

agentagent

or doctor?or doctor?

Better InformedBetter Informed

ConsumersConsumers



f knowledge is poweknowledge is power

hen research is kinghen research is king!

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Keeping Current Aug 5 2008