Tax Breaks Expanding For Homebuyers!!

Tax credits are being expanded and extended for homebuyers.  A critical expansion provides incentives for “move-up” buyers – those selling a house they’ve lived in for five consecutive years and buying a new house.  This may help create more inventory for first time homebuyers.   HSH Associates blogs more details in a post titled “New Homebuyer Tax Credit Heads To The President.”

Both the House of Representatives and the Senate have passed versions of this legislation.  If these bills are reconciled quickly enough, President Obama could sign the final legislation s early as Friday, November 6th.

Torrance Real Estate Prices Show Signs Of Stabilizing

Torrance Recently Sold Homes

Trulia.com reports Torrance Real Estate prices may be stabilizing.  Median Sales Prices for 3-bedroom homes in October were virtually flat – down -0.3% – compared to October 2008.  Prices for 4-bedroom homes have actually increased slightly - +4.1%.  Historically low-interest rates, and first-time homebuyers incentives have helped new home owners qualify for the financing needed for purchases.  As other economic indicators show the recession to be slowing or even turning into a recovery, the Torrance real estate market adds to other leading indicators tangible support for hope of an economic recovery.

Treasury Department Announces “Sweeping Cuts” To Private Sector Salaries

The Wall Street Journal (WSJ) reports that the Treasury Department and FED have announced far-reaching limits on salaries for employees at banks.  “The crackdown is likely to influence how financial firms pay top executives, traders, loan officers….”  While news reports have focused on pay limits for top executives of firms receiving TARP funds, this announcement rolls out industry wide restrictions.  For example, “loan officers” are front-line, non-management personnel.  The FED has been accepting comments for several weeks on plans to outlaw paying loan originators on a commission basis.  Loan Officers are typically paid a commission based on a percentage of the loan value - like Realtors commission’s based on a percentage of the sale price of a house.  For the full WSJ article click here.

Here’s a key, thought-provoking comment from Treasury official Kenneth Feinberg, according to WSJ:

“To make sure firms follow the new rules, Mr. Feinberg imposed reporting requirements on top executives and directors. He said he hopes the standards ‘will be voluntarily picked up’ throughout corporate America.”

Will your paycheck have to be approved by the Treasury or FED?

(Ed. note: Emphasis added for highlighting purposes.)

Will Housing Prices Rise Or Fall?

Mixed signals from month to month have driven an emotional rollercoaster for homebuyers and sellers.  Tim Manni, at HSH Associates, has a thought-provoking look at the current pricing trends.  Read it here.

Foreclosures Jump 23% Over Last Year Says Realty Trac

“U.S. properties subject to foreclosure filings totaled nearly 938,000 in the third quarter, up 23%.”  This might prolong the real estate slump and the recession.  For more, go to MarketWatch.

Federal Reserve To Begin Slowing MBS Purchases

The FED has announced it will continue buying MBS’ with the intention of keeping mortgage rates low.  However, purchases will begin to slow.  How the bond markets respond to this over the next couple of months may provide some insight into how high rates may jump – as the FED indicated – when MBS purchases stop.  The Wall Street Journal has more on this.

Good News: FHA Relaxes Condo Requirements!

Starting October 1st, FHA’s requirements for qualifying Condos will be relaxed.  The National Association of Realtors® has hailed this move as a very positive step.   For more information see the National Mortgage News.