Money Is Going Into Us
A report from the California Report. “‘Buy a Home, 1% Down, Free Recorded Message,’ reads a sign at the edge of a vacant lot in the scrappy working-class town of Bloomington near Riverside. It’s a tempting pitch. But it sounds a little suspicious to those who remember subprime lenders and the mortgage meltdown. I don’t leave a message. But somehow I get a call back anyway from a broker based in L.A. who says he’s authorized to sell these new 1 percent down home loans through United Wholesale Mortgage. It’s a licensed private lender in Michigan. When I tell him I’m just fishing for information and not looking for a new mortgage, he’s reluctant to say much more. So I pay a visit to the storefront mortgage company of veteran broker Theresa Tims in the leafy business district of Upland, about 30 minutes outside L.A.”
“‘I specialize in these low down loan type of programs and they fit our area perfectly,’ Tims tells me. Tims does a lot of business in the Riverside-San Bernardino area, the Inland Empire, where median home prices are still comparatively cheap: about $300,000 for a basic three- or even four-bedroom home. ‘Right now one of the only feasible programs is the 1 percent down with equity boost,’ says Tims.”
“She has been offering 1 percent down conventional loans since late last year, when they first became available through United Wholesale Mortgage and its Detroit-based rival Quicken Loans. Right around Christmas, Abraham Bustillos moved his wife and three kids into a 1,300-square-foot home in Riverside with one of these 1 percent down conventional loans. The balance on Bustillos’ loan is around $350,000 stretched over a 30-year fixed mortgage. ‘Yes, it is a little bit more than we were paying as renters,’ says Bustillos, a FedEx delivery driver. ‘But at the same time, now we’re not just throwing the money up in the air or paying the owner’s mortgage for him. You know, money is going into us.’”
From The Oklahoman. “People with student loan debt wanting to buy a house or refinance with a conventional mortgage got two legs up from Fannie Mae this week. It was enough for loan officer Scott Senner of Interlinc Mortgage LLC to advise me to ’stop the presses.’ ‘What that means from a practical standpoint is if you have a $50,000 student loan debt and your payments are only $100 per month, that’s the number we can use. Before, we would have to use at least $500 as the payment because that was 1 percent of the balance. This is a really, really big deal.’”
“Now, Senner said, ‘If someone else is actually making a payment for you, i.e., if a parent or other co-signer is making the payment on the student loans, and we can document that someone has been doing that for 12 months, we don’t have to count that payment against the borrower for qualifying purposes. So that’s also exciting. My guess is that FHA will start feeling pressure to keep up with Fannie Mae in a few months, because this change will definitely pull more business to conventional loans.’”
From CBS 6 Albany in new York. “‘We are seeing properties that sat maybe 3 or 4 months ago, now getting a lot of activity,’ said realtor Brian Sinkoff. ‘If a year ago we had 50 buyers and 50 houses, that’s going to work out. Now, if we have 100 buyers and 70 houses, we have a little bit of a problem,’ he said. Sinkoff says right now the average price of a 3 bedroom 1 bathroom home in the Capital Region is about $220,000, and the average market time is about 33 days. He says there’s no reason to fear a housing bubble burst we saw about a decade ago - as he says lending practices have become much more strict.”
From ABC 6 News in Minnesota. “Twin Cities housing experts say the housing market is hot, with homes going off the market fast and above asking prices. Buyers know in a market like this, where new listings are getting multiple offers, everything counts. ‘Sometimes I can get my clients in to look at a house even before it lists and hits the market, that way they have the opportunity to jump in before competing with everyone else,’ said Ellen Westin with Edina Realty.”
“Another tactic to get a home is writing love letters. They are letters written by the prospective buyers to the sellers.”
The Daily Herald. “Utah County’s home prices have been on a steady uptick since 2012. The average Utah County home value in 2012 was approximately $291,000. In 2016, that average value had risen to $366,000, according to data from the Utah County Assessor’s Office. ‘There are some (housing) projects that have opened up in Santaquin and sold out in a matter of days,’ said Aaron Drussel, president of the Utah Central Association of Realtors. ‘In the past, you had to do a ton of marketing to get people to even consider (Santaquin) … it’s just getting the perception of making people realize it’s not that far.’”
The Naples News in Florida. “Naples Realtors have no reason to panic. That was one of the key takeaways from the sixth annual Naples Area Board of Realtors Economic Summit. ‘Almost everywhere you look it’s a pretty good story. Great? No,’ said Elliot Eisenberg, a nationally acclaimed economist with Graphs and Laughs LLC. But ‘pretty good’ is OK, he emphasized in an impassioned talk that brought plenty of laughs from a crowd of more than 400.”
“Cindy Carroll, with Carroll & Carroll Appraisers & Consultants in Naples, said housing inventory in the Naples area climbed 23 percent from March 2016 to March 2017, but she told the Realtor-packed audience ‘not to panic about this.’ She pointed out the increase wasn’t nearly as big as the year before, when the number of homes on the market rose by 35 percent over 12 months. ‘We all felt that,’ she said. Over the past year the largest increase in listings in the single-family market has been in the $1 million to $2 million price range, which rose 18 percent, Carroll said.”
“The inventory of condominiums in the under $300,000 market has increased 25 percent in the past year after rising 33 percent the year before. Carroll said the huge increase is a ‘mystery to me.’”
From the Winston-Salem Journal in North Carolina. “Lori Gaines can’t believe her house on Hege Street has a tax value of only $81,400. It’s a brick house in good shape with 1,600 square feet and a basement. It sits on nearly an acre of land. It was valued at $92,800 in 2013, and even that was too low, she thinks. ‘I kind of freaked out and said ‘No,’ Gaines said, recalling her reaction when she got her reappraisal notice from the Forsyth County tax office in the mail. ‘I was furious. Every time they revalue it seems like the price is always much lower than what the property has been listed at, so it is really frustrating. I’m just looking for fair.’”
“Jack Messick, who has a brick house with about 1,800 square feet on Silas Ridge Road in northwest Winston-Salem, thinks his house is overvalued at $197,000. The tax value was set at $181,800 in 2013. Messick said he has looked at nearby sales and thinks $170,000 is a better number. ‘I went online and got the price of three houses close by me that had sold in the past year, and sent that in with the protest,’ Messick said.”
“Property values are reappraised here every four years. It was a huge shock to many city residents, especially people living in predominantly minority parts of town, when the 2013 reappraisal showed sharp declines in many house values. The reappraisal was the first to fully take into account the housing bust and recession. People who saw their house values drop by sometimes as much as 50 percent or more felt the value of their life’s work had gone up in smoke.”
“Brenda Diggs, who lives in eastern Winston-Salem, said she is frustrated that she has to keep going back to ask appraisers to increase the value on her home. She’s asking for a $4,000 increase on a house the county appraisers value at $220,000. She wonders if there is merit to the argument that valuations in eastern Winston-Salem are done unfairly. ‘It is a little bit ridiculous,’ Diggs said. ‘For me it is not about a principle of taxes, it is a principle of equity. It really comes down to the value of me as a taxpayer and a citizen in this community. You paint it with a broad brush to say because it is on the east side of town that we can’t do any more.’”
$350K for a 1300 sq ft shack in the super smoggy Inland Empire.
I know doctors in my little burg who have a 350K house. Now delivery van drivers buy them. This has to be what, 4-5x income for Mr Bustillos?
Mr. Bustillos LOL
How much does a FedEx delivery driver make? 60K? He shouldn’t be allowed to borrow more than 150K, not 350K.
In a normal, non-criminal housing market, he’d still be buying the same house…. for 150k.
they get pensions and you don’t,but Bezos will end allot of their bix.
“…one of these 1 percent down conventional loans.”
Haha… remember when a “conventional loan” meant 20% down?
Back when prime loans excluded all the obvious signs of subprime. It’s all junk anymore.
“Instead of being in a mobile home park, we said let’s go and be homeowners,” says Isabel Montanez.
You go girl… ‘Merica!
So, 350K house.
1% down = 3500
Mortgage is 346,500
Going to Google and typing in “mortgage calculator”, it presents a mortgage calculator.
346,500 dollar mortgage
4.25% mortgate
30 year duration
–> Leads to a 1705 dollar P+I payment.
The entire monthly cost is PITI-UMF (principal + interest + taxes + insurance + utilities + maintenance + misc fees), not just P+I. Which is going to be nontrivially more than 1705 a month. So if they can only come up with 1% down, how exactly are they going to sustain a 2K a month payment for any amount of time?
I think these unfortunates are going to have their net worth destroyed and are being put on the foreclosure conveyor belt, to feed the FIRE sector and public coffers. After it defaults the value is covered by the taxpayer one way or another. A clear example of wealth transfer from the have nots to the haves.
I don’t blame these folks actually. Their government and people they trust are telling them this is a perfectly reasonable loan.
The economy is a competition for resources and these folks have no idea who they’re playing against in this game.
how exactly are they going to sustain a 2K a month payment for any amount of time?
Here’s how: “I [Isabel Montanaz] signed the documents April 5, and before June I’ll be in,” she says proudly, before explaining how she plans to expand the home and move in a couple of relatives to help offset mortgage payments and other costs associated with home ownership.
I love how these folks don’t have $6000 for a down payment, but they do have $10K+ to “expand the house” and move in their extended clan.
Why do you buy a home with 1% down?
There are 2 answers:
1. Because 1% is all you have (most cases, I suspect);
2. Because someone is stupid enough to lend you 99% at a high point in the market (some cases, certainly).
sustain a 2K a month payment for any amount of time?
4 people at $500 each, taco bell can support that.
Only four? I’d say that six to eight is the norm, judging from the number of cars parked out front on the lawn.
“I don’t blame these folks actually. Their government and people they trust are telling them this is a perfectly reasonable loan.
The economy is a competition for resources and these folks have no idea who they’re playing against in this game.”
This is 2017. Information is at everyone’s finger tips. Is it really that hard to Google search the costs of homebuying? To use a mortgage calculator? Ok… maybe they’re just not that savvy at searching Google. How many Youtube videos are out there of people that explain all of this? You don’t even have to read it for yourself. You can just watch a video about it. Honestly, in this day and age I don’t have a lot of pity for those in this country who remain ignorant. We live in the information age!
I do blame these folks. I blame them for continually making stupid decisions and not educating themselves. And yes… I also blame the government.
The $250,000 he’ll pay in interest would have bought a REALLY nice and much larger home in 2012!
“Money is going into us”
Is that bad translating or did he actually say that? Sounds like something from “Bad Lip Reading”.
Stop it now.
I’m sorry.
You realize it was an inside joke, right? Go look up “Bad Lip Reading Stop it now.”
I’m sometimes slow on the uptake and thought I offended. Lunch hour BLR here I come… : )
The Force Awakens BLR is one that had me rolling on the floor.
Okay, that is hillarious. Can’t breathe yet….!!!
Ventura, CA Housing Prices Crater 11% YoY
http://www.movoto.com/ventura-ca/market-trends/
Anyone have default estimate for these student loan mortgages?
High. And rising.
Another indicator of Bubble 2.0 - the “bids due” date for a house.
I was listening to DC news radio earlier today when they have their weekly segment with a local real estate agent. They were talking about what buyers could do to improve their chances of successfully finding and buying a house. The agent mentioned the short time frames where the buyer must do several things before the “bids due” date on the house.
It’s been several years since I’ve seen listings with “bids due” dates on them. Seems like an odd way to buy such a large asset for a consumer.
get rich quick seminars are happening a lot more.
A re-post for the weekend crowd:
The rewrite Firefox version of the JoshuaTree extension finally got approved (after ~3months). Please enjoy it here.
Lots of buxfixes and UX improvements, and now the Chrome and Firefox versions are now identical (or will be once version 3.0.13 posts on both platforms).
Nice, quickly identifying new posts would be good. I’m an Opera user though, never really liked firefox though if pressed I probably wouldn’t be able to come up with any good reasons why.
Thank you, drumminj.
Regarding the NC article: everyone wants to manipulate the numbers for their own benefit. I think I have come to the conclusion that Americans actually hate free-market capitalism. They want a command economy, and they want their own little group to be in command.
There’s enough info in the article to identify the house. I think this is 3669 Hege Street, 27127. It’s actually a nice house on a really nice piece of land. Good price for a house with city water/sewer and neighbors. It would be an excellent Oil City type house for a retired active adult couple or a city homesteader.
Zillow says that the house sold for $41K in 2013. ?? Wow, what a whiner Lori Gaines is.
They want a command economy, and they want their own little group to be in command.
That’s human nature. That’s part of what made the founding fathers of the USA amazing…warts and all. They were actually willing to try something better rather than just grabbing for themselves. Washington in particular.
The First article:
Housing risk expert Ed Pinto says these days, the majority of people buying a home for the first time in the U.S. are using FHA, 1 percent down and other types of low down payment programs.
“And this group of low down payment loans is growing very rapidly,” says Pinto. “Seventy percent of all first-time homebuyers today have down payments of less than 5 percent.”
It just gets crazier every day.
Today’s 1% is yesterday’s 20%. Today’s 20% down payment really should be enough to buy a house outright.
It does in some areas. We own a home free and clear in a Dallas-Fort Worth suburb and would like to move back to San Diego. Problem is, the value of our home here is not much more than a 20% downpayment in San Diego for a somewhat larger house in a similarly desirable neighborhood.
Perhaps we’ll wait. Wouldn’t mind losing $38,000 on a sale here if it meant getting a $150,000 discount there. The bigger they are, the harder they fall. We’ll see if there’s anything to the “it’s all because of short supply” argument. Households averaging $60,000 buying homes averaging $500,000 feels like 2006 to me.
Just keep in mind that the value of your DFW house might fall before the price of San Diego houses fall. Really, you might be best off selling your DFW house soon (at near-peak), and renting in San Diego waiting for prices to fall there. You may want to contact Professor Bear. He knows San Diego very well.
Households averaging $60,000 buying homes averaging $500,000 feels like 2006 to me.
Mr. Banker said it’s different this time. But he also sold a bunch of his stock recently.
‘Cindy Carroll, with Carroll & Carroll Appraisers & Consultants in Naples, said housing inventory in the Naples area climbed 23 percent from March 2016 to March 2017, but she told the Realtor-packed audience ‘not to panic about this.’ She pointed out the increase wasn’t nearly as big as the year before, when the number of homes on the market rose by 35 percent over 12 months. ‘We all felt that,’ she said.’
It’s good to know appraisers are getting into the cheer-leading stuff.
It’s good to know appraisers are getting into the cheer-leading stuff.
I hadn’t even picked up on who was making that statement. Collusion.
‘Right now one of the only feasible programs is the 1 percent down with equity boost’
fea·si·ble
adjective: feasible
‘possible to do easily or conveniently’
Equity boost has a nice ring to it.
“Equity boost has a nice ring to it.”
Nothing beats the RE turbocharger. BUY!
‘I kind of freaked out and said ‘No,’ Gaines said, recalling her reaction when she got her reappraisal notice from the Forsyth County tax office in the mail. ‘I was furious. Every time they revalue it seems like the price is always much lower than what the property has been listed at, so it is really frustrating. I’m just looking for fair.’
Sounds Ms. Gaines is just dying to pay more property tax.
I know someone who lives in Forsyth county. Amazingly, the bubble passed over Winston-Salem, as my contact has also told me that they also have experienced zero appreciation.
Sounds like Winston-Salem could be another Oil City.
Just don’t say tabor
Fcta.org
In Colorado: Sounds Ms. Gaines is just dying to pay more property tax.
They reported recently that two local retired star athletes, Ray Lewis of the Baltimore Ravens and Cal Ripken of the Baltimore Orioles, had put houses up for sale. Both houses are in a county with a 1.1% property tax rate.
Ray Lewis’s house is for sale at 2.95 million. The annual property tax bill would be 29,500 dollars.
Cal Ripken’s house is for sale at about 10 million. The annual property tax bill would be 100,000 dollars.
These are beautiful properties of course, but the carrying costs are quite significant.
And with these kinds of tax bills, now we more appreciate why politicians love housing bubbles. The individual can leave but the property cannot.
It looks like a lot of vacant space is opening up in New York.
Spoiler alert - this article contains a fair amount of profanity.
http://www.theonion.com/article/84-million-new-yorkers-suddenly-realize-new-york-c-18003
“Twelve hundred a month. That’s total, not per person.”
Haha, or as the kids say, LOL.
Heh, wait until they see Hagerstown, MD. Boooo - nies. The main entertainment there is the dying outlet mall and always-uplifting Antietam National Battlefield.
The Fed’s grand design to use rock-bottom interest rates to enslave American households in debt just before instituting massive rate hikes is working beautifully according to plan!
America’s Credit Card Debt Is More Than $1 Trillion — Should We Be Worried?
Credit card debt is just under its pre-financial-crisis peak, so what does this mean to you?
Matthew Frankel
(TMFMathGuy)
Apr 11, 2017 at 8:32AM
According to data from the Federal Reserve, Americans’ credit card debt rose by $3 billion in February 2017 to its highest level since 2008. We all know what happened in 2008, so should we be worried about a surge in delinquencies and defaults? And what can you do if your credit card debt has gotten a bit too high?
The highest credit card debt level since 2008
Federal Reserve data shows that Americans owed just over $1 trillion on credit cards in February 2017, a level not seen since late 2008. Furthermore, credit card debt has roughly doubled in the United States over the past 20 years.
…
Nice post Pbear.
wahts even odder is that these people actually think they have a loss when you default on the debt that was created out of thin air.
(chuckle)
And that credit card debt isn’t at 3-4% like a mortgage nor is it tax deductible.
Is deadbeat CC debt included in this $1 trillion total?
A lot of people are using their CCs for everything just to get rewards and bonus miles, and then paying it off every month. If that’s where the increase is coming from, then I wouldn’t worry. But if the revolving debt is $1 T, hoo boy.
And banks absolutely hate the 30-day float. Every balance transfer offer that comes in the mail has fine print that removes that float if you take advantage of the transfer offer.
bitter.beerface. renters
Pakuo, Hawaii Housing Prices Crater 23% YoY On Collapsing Housing Demand
https://www.zillow.com/puako-hi/home-values/
Naples, FL Real Estate & Homes for Sale
9,669 Homes
http://www.realtor.com/realestateandhomes-search/Naples_FL
Naples, FL Price Reduced Homes for Sale
4,239 Homes
http://www.realtor.com/realestateandhomes-search/Naples_FL/shw-pr/show-price-reduced
Chosen at random:
442 Palm River Blvd, Naples, FL 34110
3 beds 2 baths 2,131 sqft
For Sale
$415,900
Price cut: -$4,000 (4/29)
Zestimate®: $401,385
04/29/17 Price change $415,900-1.0% $195 ListWithFreedo…
04/15/17 Price change $419,900-1.6% $197 ListWithFreedo…
03/23/17 Price change $426,900-0.2% $200 John R. Wood P…
03/16/17 Price change $427,900-0.2% $200 John R. Wood P…
03/14/17 Price change $428,900-0.5% $201 John R. Wood P…
03/06/17 Price change $430,900-0.5% $202 John R. Wood P…
03/05/17 Price change $432,900-0.5% $203 John R. Wood P…
02/23/17 Price change $434,900-1.1% $204 John R. Wood P…
02/05/17 Price change $439,900-2.1% $206 John R. Wood P…
01/29/17 Price change $449,500-2.2% $210 John R. Wood P…
01/13/17 Price change $459,500-2.1% $215 John R. Wood P…
11/21/16 Price change $469,500-0.9% $220 John R. Wood P…
11/17/16 Price change $474,000-1.0% $222 John R. Wood P…
11/07/16 Price change $479,000-1.0% $224 John R. Wood P…
10/29/16 Price change $484,000-1.0% $227 John R. Wood P…
10/23/16 Price change $489,000-2.0% $229 John R. Wood P…
09/18/16 Price change $499,000-2.1% $234 John R. Wood P…
09/15/16 Price change $509,900-1.0% $239 John R. Wood P…
09/02/16 Price change $514,900-1.0% $241 John R. Wood P…
07/24/16 Price change $519,900-1.0% $243 John R. Wood P…
05/12/16 Listed for sale $525,000+269% $246 John R. Wood P…
11/10/09 Sold $142,250+10.6% $66
Public Record
06/26/97 Sold $128,614 $60
https://www.zillow.com/homedetails/442-Palm-River-Blvd-Naples-FL-34110/43785808_zpid/
That’s 20 price cuts in a bit less than a year. Chase that market down!
It’s a classic Dutch auction. Out of context, it’s hard to tell if the market is falling, or they merely started with a wishing price greatly exceeding market value, requiring myriad $4k decrements to discover the price.
John R Wood is not very good at the Realturd game.
Naples is 22,000 people. Even the MSA is only 322,000. That many homes fire sale is a ton.
Fire = For
Naples has been in a hole for well over a year. I have yet to see the WSJ or other major media mention it. BTW, it was the first in Florida to tank a few years ago too.
Good to know. Leading indicator of bubble deflation.
It amazes me how you keep all that knowledge on demand in your head Ben.
Could have been an intentional slip there : ) Because with those metrics it will be a “Fire Sale” at some point.
Miami Beach, FL Rental Rates Crater 8% YoY
https://www.zillow.com/miami-beach-fl/home-values/
Generation Greed is really desperate to get younger generations to overpay for its houses, and is using the government to do push them.
Let’s see — 45 percent for the mortgage and other debt.
Plus 25 percent savings, since if you were born after 1957 you won’t get Social Security and Medicare.
Plus 30 percent for taxes, even as services are cut, to pay for the cost of underfunded public employee pensions, the deteriorating infrastructure, and debt.
What does that leave to live on? Zero! I guess you can buy ramen noodles with credit card debt.
Generation Greed is really desperate to get younger generations to overpay for its houses
Almost everyone is…the whole ponzi scheme depends on it. If we don’t find a way soon this sucker could go down.
^^ It’s true. For those holding the bag their only hope might be stagflation.
Might I suggest that Canada’s HCG is Bear Stearns circa March 2008.
http://www.zerohedge.com/news/2017-04-30/contagion-fears-rise-aftermath-home-capital-group-collapse
https://en.wikipedia.org/wiki/Subprime_crisis_impact_timeline#2008
Off topic again (I can’t help myself) …
A history professor says carbon dioxide is deadlier that sarin gas.
http://acsh.org/news/2017/04/19/co2-deadlier-sarin-gas-ask-history-professor-11156
Stick with history professor.
Apparently carbon dioxide is killing Syrians …
https://www.thenation.com/article/the-other-poison-gas-killing-syrians-carbon-dioxide-emissions/
“Climate scientist James Hansen has described our current emissions as like setting off 400,000 Hiroshima atomic bombs each day, every day of the year.”
Wow, 400,000 Hiroshima atomic bombs set off every day of the year.
Bahahahahahahahahahahahahahahaha.
Wouldn’t that cause a nuclear winter??
James Hansen, again.
Aren’t there, like, thousands of scientists who keep signing onto these climate change papers and what not? And yet, it seems that the only drum-banger is James Hansen. Really, they couldn’t find at least ONE other scientist to interview and quote? Maybe lend them a little more credibility?
Among other things James Hansen is known as “The Father of Global Warming”.
Whom better to quote?
Well the issue here is that they are only quoting one guy. What if that one guy is a wacko, or paid to say what other people want him to say, or got corrupted by fame? At least for science, it’s stronger to have at least a dozen guys advocating, not just one mouthpiece.
Atlassian’s Scott Farquhar smashes $70 million house price record to buy Elaine in Point Piper In 2016, a promotional campaign was launched for Elaine Gardens. Let’s take a look.
Scott Farquhar, 37, has come a long way in the property market since 2006 when he bought his first home, a two-bedder in Pyrmont for $1.41 million, where he still lives.
https://www.domain.com.au/news/atlassian-founder-scott-farquhar-smashes-70-million-house-price-record-to-buy-elaine-in-point-piper-20170429-gvvatq/
“Now, Senner said, ‘If someone else is actually making a payment for you, i.e., if a parent or other co-signer is making the payment on the student loans, and we can document that someone has been doing that for 12 months, we don’t have to count that payment against the borrower for qualifying purposes. So that’s also exciting.
“Exciting” isn’t quite the word. They act like they’ve discovered some new law of economics that fixes previous problems.
An eagle that fails to leave the nest is known as a “turkey”.
And that’s also why you see so many Boomers hanging on to their jobs. They are going to be subsidizing these kids until age 40 at this rate. I guess ol’ Bob Toll was right…
So you’re saying that if they (as a group) have a choice between letting the kids have the house cheap versus working until they drop and denying their kids the experience and dignity of making it on their own…they choose option 2?
Maybe the problem is that the housing and economic propaganda has been so successful they don’t even realize what they’re choosing.
Or perhaps Carl they just don’t want to accept their time has gone. What can feel better than telling yourself that your still the man (or woman) heading up your brood and looking after the young’uns.
https://www.census.gov/housing/hvs/files/currenthvspress.pdf
New vacancy data. Nothing all that meaningful to report (no big move up or down in vacancy rates).
Mortgage approvals fell for the second month in a row despite lenders stepping up their offers to borrowers.
A total of 66,837 mortgages were approved for house purchases in March, down 1.6% on the previous month, Bank of England figures show.
The number of loans approved for those remortgaging also fell.
Lenders are currently engaged in a price war, particularly during recent weeks when a number of new low-rate deals have been introduced.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “With HSBC launching the cheapest five-year fix on the market at 1.69% and Yorkshire Building Society introducing a record low two-year discounted rate at 0.89%, the market is more competitive than ever.
“It is a good time for borrowers, with lenders keen to attract business from first-time buyers, home movers and those remortgaging. However, affordability criteria remains tight.”
http://www.bbc.co.uk/news/business-39803515
What is a poor banker to do, they are practically giving away mortgages and less and less are biting.
Why when I look at many housing markets does the phrase saturation point keep popping into my head.
saturation point
n.
1. Chemistry The point at which a substance will receive no more of another substance in solution.
2. The point at which no more can be absorbed or assimilated.
From someone who worked at the heart of subprime, I am not surprised to see the short-term memory many banks/investors have. After many years of increasing values, R/E tends to viewed upon as a safe bet. Then competition increases and VPs need to hit their number. Guidelines loosen and capital is easy to get. The rest is…