Dean Rizzi

What Now?
May 3, 2010 · · 1 Comment

It’s an important question, since it appears the homebuyers tax credits won’t be extended. But it’s a question not to be feared. We think it’s time the housing market stood on its own feet anyway. After all, we can’t gauge the health of a market if it’s still supported with taxpayer stanchions.

But that’s okay; we think the housing and mortgage markets are sufficiently healthy to stand alone. Pessimism is the intellectual position, but the fact is the economy is getting better: Despite worries that American consumers might hunker down for years — spooked by debt, lost savings, and unemployment — austerity has given way to shadows of a new shopping spree: households are replacing cars, upgrading home furnishings, and amassing gadgets. What’s more, wealth – at least wealth measured by equity holdings – is booming.

On the mortgage side, private investors are returning. A California firm recently completed the first private-sector sale of a security backed by mortgages in nearly two years, potentially reopening a market slammed shut by the housing crisis. The $238-million deal was of the highest quality, to be sure, with borrowers making an average down payment of 45 percent and mortgage payments comprising less than 30 percent of income. But as the economy continues to improve and investors become less risk adverse, less restrictive mortgages will be securitized.

Bottom line: we see a growing economy, improving employment, stable home prices, and less restrictive (though higher rate) mortgages in our future. In other words, we see a market for buying and refinancing today.

www.deanrizzi.com

Lee Ginsburg

The Housing Stimulus Package Continued
August 25, 2008 · · Comment here

This is my third and probably final thought on the recent Housing Stimulus Package. 

 http://www.pruvoices.com/2008/08/housing-stimulus-package-i-dont-think-so/
http://www.pruvoices.com/2008/08/is-this-new-stimulous-package-going-to-help-the-bay-area/ 

The FHA foreclosure rescue is a great idea but I don’t think it is practical, at least not in the Bay Area Market that I am familiar with.  The FHA will offer to qualified buyers a new fixed rate loan at 90% of today’s market price for the home they are living in and that they own and owe considerably more money.   With this program the owner shares the future appreciation with the FHA.  This adds to family stability and less homes on the market and gives the family to gain some equity.  I think the original lender will lose more under this than with the foreclosure process but it might be easier, quicker, look better on their books and they also gain a new guaranteed loan.  In my opinion too many ifs to make this work in large numbers but the thought is GREAT.  Read more