Interest Rates Will Rise in March 2010 and on

The government purchasing of mortgage backed securities is nearing an end. To quote, Steve Harney, national residential real estate expert, “When the banks have to lend their own money to people on a 30 year loan, they’re not going to be satisfied with 5%…”If you’re frequented my website, you know that I pay close attention to what’s happening in the real estate market. I do this so I can be a strong source of valid and useful information for my clients and my readers. What I’m going to cover in this article is going to be like smelling salts that wake you up from a daze.

The Fed will gradually slow the pace of the purchasing mortgage-backed securities (MBS) in anticipation of a full execution of the program to keep the mortgage interest rate low by the end of March, 2010.

It marks an extension of the MBS-purchasing program past the previously anticipated year-end date of December 2009. The slowing of purchases is intended to “promote a smooth transition in markets” as the government ends its participation in the agency MBS market. Basically, the government is going to stop buying mortgage securities in March, 2010.

To implement the gradual slowing of agency MBS purchases, agents acting on behalf of the Federal Reserve Bank of New York’s open market trading desk plan to reduce the average weekly purchase amounts beginning with the reporting week that starts September 24, according to a NY Fed statement.

Will the real estate market be strong enough to withstand this slowdown? Are banks and their investors, willing to invest money into such an unsteady market area, such as the current real estate market? This is the big question…is the party [of low interest rates] coming to an end?

With the largest purchaser of MBS, not buying up these assets (helping turn money over quickly for banks and their investors), will banks be apt to continue writing mortgages at 5%?

The answer is no.

So rates will go up after March, 2010.

Question is, how high and will buyers continue coming out to buy? I would say the answer to buyers still buying is a big fat YES [they just can’t pass up the fact that prices are down 35% from peak]. Additionally, as mortgage interest rates go up, prices must drop.

NJ Foreclosure Update

Mortgage foreclosures way up in N.J.

By Cynthia Burton

Inquirer Staff Writer

New Jersey’s residential-mortgage foreclosure rate shot up 29 percent from 2008 to 2009, with a South Jersey county among the hardest hit, according to statistics released yesterday.The number of commercial foreclosures, meanwhile, was up 68 percent, from 875 to 1,471.

The counties with the biggest increases in residential foreclosures were Atlantic, Bergen, and Sussex.

Nationally, about 2.8 million properties are in some stage of foreclosure, an increase of 21 percent over 2008, according to a report by Realty/Trac Inc., which tracks foreclosures.

Pennsylvania had 44,732 foreclosure filings last year, a 20 percent increase over 2008, according to the report.

The foreclosure crisis will not get better any time soon, said James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University.

The crisis started when lenders sold exotic mortgages to people who neither understood nor could afford them. Now the crisis is rapidly moving through the middle class.

“There were a lot of sharks in the cities getting people to buy existing housing at inflated prices, and people were in over their heads. You had all those scandalous mortgage products,” Hughes said.

And he said there is a “shadow inventory” of foreclosures. At President Obama’s request, many banks have held back on publicly filing foreclosure actions, but that won’t last.

In New Jersey, most of the properties in foreclosure, about 63,000, were residential, according to figures compiled by the Office of the Clerk of the Superior Court. In 2006, there were about 25,000.

Many residents find their mortgages are higher than their home values, putting them under water.

“Joining into the aftereffects of predatory lending, you now have middle-class households who have lost their jobs and stretched themselves too thin,” Hughes said.

New Jersey’s unemployment rate hit a 33-year high, going to 10.1 percent in December, according to figures released yesterday by the state Department of Labor and Workforce Development.

Phyllis Salowe-Kaye, executive director of New Jersey Citizen Action, which counsels distressed homeowners, said a group of failing mortgages “won’t be kicking in until the end of 2010 and 2011. It’s really a serious issue.”

The courts have been feeling the bump since at least 2007, when filings went up from 24,857 to 36,360.

Kevin Wolfe, chief of civil practice in the Administrative Office of the Courts, said there was a five- to six-month backlog in reviewing cases.

Another factor delaying foreclosures is that since last January, the state has required lenders to try to mediate alternatives with delinquent property owners. They are not obligated to make deals.

Salowe-Kaye said she had mediations scheduled through April, a four-month backlog between the time a foreclosure is filed and her organization can get a mediation meeting with a lender.

Advocates and the state are still struggling with ways to slow the mounting number of foreclosures.

A $40 million fund aimed at reducing mortgages for troubled homeowners went largely unspent due to technical problems.

Former Gov. Jon Corzine took about $29 million of it to patch the budget hole, and the Legislature recently reallocated the money for other uses.

The problem was that the program came too late in the process, Salowe-Kaye said.

The “defunded” state program offered $25,000 loans to qualified homeowners who could persuade their lenders to cut their mortgage principles by $25,000, thus making the loans more affordable.

Money left in the program has been allocated to counseling people who have missed a monthly payment or two and to helping them get back on track with their lenders when they fall a month or two behind in their payments. And other money - about $8 million - would go into a revolving loan fund that community developers would use to buy and fix up foreclosed homes, said Assemblywoman Mila Jasey (D., Essex), who sponsored the bill reallocating the money.

“It’s really important to get that money out right now,” she said. “We have speculators who are buying up property with no intent to return those properties to the people in the neighborhoods.”

Great Home Eastside Paterson NJ

December 2009 Case Shiller Report

Case shiller index monitors the most popular metro areas home sales CLICK HERE FOR REPORT

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Paramus New jersey, Oradell NJ & River Edge NJ Real estate market update

wOW!!! things are starting to move in the BIG BC Bergen County. With historic low low interest rates and homes at affordable pricing, this is the

 TIME TO BUY!! As of Dec 1st 2009 Paramus NJ has 100 Active homes for sale, 23 Under contract and 53 Solds in the past 3mos. River Edge NJ has 37 active homes for sale, 11 Under Contract and 35 Solds, and finally Oradell NJ has 38 Active Homes for sale, 11 Under contract and 20 recent sales in the past 3mos also. This numbers are looking alot better then a year ago and looks as if things are beginning to turn around a bit.
      For assistance is selling your home in Bergen County, River Edge NJ, Oradell NJ, Paramus NJ, Emerson NJ, Fairlawn NJ. Contact Carmelo Oliveri, Coldwell Banker Realtor at (201) 618-2854. Visit our web site at www.OurNJhouse.com, www.OurBergenCountyHouse.com or www.SellWithMelNJ.com

Recession Proof Yourself___www.OurNJhouse.com

#1 excuse in todays economy “The Market is Slow”  My question is what are
you going to do about?

Its inevitable this recession isnt going to have a quick recovery,
unemployment isn’t going to be at 2-4% anytime soon, banks are still strict
with lending,  but the most successful CEO’s, entrepreneurs adapt to change
and as home buyers, home sellers and real estate investors so do you, life
is one big business transaction.  Homebuyers what is the biggest challenge?
Living pay check to pay check right?  Well there are numerous things to free
up hundreds if not even thousands of dollars a month

1) Call your bank on refinancing your current mortgage or doing a loan
modification to lower rate.  You owe more then your home is worth, well
Obama implemented the HARP program and most large lenders participate in
this program but they wont tell you that.
2) Put homeowners insurance and car insurance with one company for discounts
and increase deductibles from $500 to $1000
3) Negotiate with your credit card companies to lower interest rates or
consolidate onto one credit card AND SHREAD the others, if you cant afford
to buy cash this month you wont be able to pay it next month you have the
same expenses.

Homesellers

If you need to sell this is the time, the real estate market has yet to
depreciate approx 10-15% before hitting bottom and then its going to be
stagnant for years before the next upswing.

Do you own your home free and clear (mortgage free) but dont want to sell
because the market is weak?  Do you want to get $600k for your home that is
only worth $300K?  Well with todays strict banking guidelines, it is
attactive to buyers if the owner provides OWNER FINANCING when selling.
This will allow you to get a steady stream of monthly income, net more money
for your home because your collecting principal and interest, worst case
scenario if the buyer defaults you keep a 10-20% deposit that they made,
payments that they made and you get your house back.  THIS IS ALSO GREAT FOR
RETIREES WITH SHRINKING RETIREMENT PLANS LOOKING FOR STEADY INCOME AND
AVOIDING PAYING TAXES AT CLOSING IF THEY TOOK ONE LUMP SUM.  ITS LIKE THE
LOTTERY ANNUITY OR CASH =)

Real Estate Investors

WOW this is the time to make money, lowest interest rates in history, ample
inventory to choose from and contractors looking for work, perfect formula
to make money.

You have money in the bank collecting 1-2% interest, well how about
investing it into rental properties and netting a greater return.  Why not
purchase a fixer upper multifamily home renovate it, rent it out and resale
for profit.  If it sells you make money and worst case scenario it doest
sell you have a positive cash flow every month with a property with equity
either way your making money.  Not into being a landlord, why not purchase a
property .40-.50 cents on the dollar from the banks REO inventory for
resale, cash is KING for amazing opportunities.  Word to the wise, just like
the stock market know the real estate market your investing in, study market
trends, number of sales past 3mos, number of inventory currently on the
market, demand etc.

Business Owners looking into the ARC Program (Wachovia and Chase have
special phonelines dedicated to this property) interest free loan up to $35K
to help business owners keep there doors open

I wish you all happy savings and if you ever have any questions please feel
free to contact me anytime

Bergen County Short Sales/ Foreclosures

Its been a while since the last foreclosure email blast, but they have been drying up in the past few months.  With the new HARP Program banks have been remodifing mortgages and limiting inventory which in turn is stabilizing the real estate market.  Homes prices are still dropping (.5-.75% a month according to last few appraisal reports) but home SALES are up, its a great time to take advantage of the interest rates which are fluttering just under 5%!!!!  Below are a few foreclosures currently on the market, if interested in some more please feel free to contact me anytime.

Cresskill 3br 1.5 bth $420K
Park Ridge 2br bth 100×150 Lot $374k Bring your builder
River Edge 4br 3.5bth Move in condition colonial $534k
Saddle River 6br 9.5bth Estate $7.5mil

Also please visit my other sites

www.YouTube.com/OurNJhouse
www.OurNJhouse.com
www.SellwithMelNJ.com
www.MyNJblog.com

WASHINGTON - New U.S. home sales jumped in June by the largest amount in more than eight years as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners.

While home prices are still falling, the figures released Monday were another sign the housing market is finally bouncing back. Data out last week showed home resales rose 3.6 percent in June, the third straight monthly increase.

Shares of big homebuilders soared on the news, with Beazer Homes USA up by more than 13 percent and Hovnanian Enterprises rising 8 percent. But with home prices still falling, these companies won’t be making much money anytime soon.

Commerce Department said new home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000, from an upwardly revised May rate of 346,000.

Buyers are rushing to tax advantage of a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers. Home sales need to be completed by the end of November for buyers to take advantage.

“The window of opportunity is closing,” said Bernard Markstein, senior economist for the National Association of Home Builders

June’s results were the strongest sales pace since November 2008 and exceeded the forecasts of economists surveyed by Thomson Reuters, who expected a pace of 360,000 units. The last time sales rose so dramatically was in December 2000.

Sales have risen for three straight months. The median sales price of $206,200, however, was down 12 percent from $234,300 a year earlier and down nearly 6 percent from $219,000 in May.

There were 281,000 new homes for sale at the end of June, down more than 4 percent from May. At the current sales pace, that represents 8.8 months of supply — the lowest level since October 2007. If that number falls to just over 6 months, analysts say, builders will feel more comfortable ramping up construction.

Fallout from the housing crisis has played a central role in the U.S. recession, now the longest since World War II. Foreclosures have spiked, homebuilders have slashed construction, and financial companies have lost billions.

But it will still be a while before homebuilders turn into an engine for the economic recovery. Construction levels are still weak because builders still have too many unsold homes sitting vacant.

After all, the process of selling a home is always complex. For assistance is selling your home in Bergen County, River Edge NJ, Oradell NJ, Paramus NJ, Emerson NJ, Fairlawn NJ. Contact Carmelo Oliveri, Coldwell Banker Realtor at (201) 618-2854. Visit our web site at www.OurNJhouse.com or www.OurBergenCountyHouse.com or www.SellWithMelNJ.com

Real Estate Sales Growth up Last 3 Months!!!

 The National Association of Home Builders is reporting that Nationwide housing starts and permits posted substantial gains in June as home builders responded to improved market conditions and the impending expiration of the first-time buyer tax credit. These stats comes from the U.S. Commerce Department.

“The upcoming expiration of the first-time home buyer tax credit on December 1st is encouraging some builders to get homes started now so that they can be completed in time for clients to take advantage of this attractive buying incentive,” said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla. “However, there is still much concern about the difficulty of financing new-home production and continuing weakness in the job market.”  

Commerce reported a 3.6 percent gain in overall housing starts to a seasonally adjusted annual rate of 582,000 units and an 8.7 percent gain in permit issuance to 563,000 units.

“Today’s report was in keeping with our forecasts for some glimmers of improvement on the single-family side in the second quarter, and also with the results of our latest builder surveys,” said NAHB Chief Economist David Crowe. “Many remain very cautious, however, in the face of the severe tightening of credit for acquisition, development and construction financing and increased instances of low appraisals tied to improper use of distressed properties as comps, both of which threaten to derail a housing and economic recovery going forward.”

 Read More @ www.RealtyTimes.com

After all, the process of selling a home is always complex. For assistance is selling your home in Bergen County, River Edge NJ, Oradell NJ, Paramus NJ, Emerson NJ, Fairlawn NJ. Contact Carmelo Oliveri, Coldwell Banker Realtor at (201) 618-2854. Visit our web site at www.OurNJhouse.com or www.OurBergenCountyHouse.com or www.SellWithMelNJ.com

Why 9 Out of 10 FSBO end up using a Realtor

My Number one FSBO Tip? Don’t sell it yourself! A “FSBO,” or house “for sale by owner” can sell fast, and for as much as it would have if listed with a real estate agent. Sometimes - but not normally. Consider the following ten points.

1. Buyers work with agents. Most look at MLS listings. Sell it yourself, and they won’t see or hear about your home. How do you find that “right” buyer or get top dollar when you’re invisible to most of the market?

2. Your FSBO will get lower offers. Naturally, the buyer thinks you’ll take less because you’re saving the commission! Save a $10,000 commission, get $10,000 less - where’s the advantage in that?

3. Advertising is expensive. The costs the real estate office normally pays are yours if you sell it yourself. How much could you spend on ads if it takes a a year to sell?4. They have the resources. And you don’t. Agents have books of sold properties to look at, for example, to determine the best price for your home. You can dig through county records, but you do have to value your time too, right?

5. They know the market. What’s the target market for your house? Young couples, retirees? What features do they want? You should know these things before you write your ads. An experienced real estate salesperson will know.

6. They know the laws. What about written disclosures, and who pays for the real estate transfer tax? When you sell it yourself you don’t get to ignore the laws.

7. Are you a good salesperson? Can you develop rapport and properly answer objections? Could your defensiveness scare off a buyer who criticizes your home? Think back on your own purchases, and you’ll realize that a good salesperson makes a difference.

8. Paperwork. Will you help the buyer properly fill out an offer to purchase? An agent would. Do you have the other closing documents ready?

9. Agents negotiate for you. When did you last learn a new negotiating technique? Can you counter-offer without scaring off a buyer? A good salesperson is trained in these skills.

10. You may not save anything. The documents, newspaper advertising, signs for the yard - it’s all your expense when you sell it yourself. After your hard work, you may get low offers and negotiate poorly. Honestly, sellers often net less money from the sale when they try to save the commission.

After all, the process of selling a home is always complex. For assistance is selling your home in Bergen County, River Edge NJ, Oradell NJ, Paramus NJ, Emerson NJ, Fairlawn NJ. Contact Carmelo Oliveri, Coldwell Banker Realtor at (201) 618-2854. Visit our web site at www.OurNJhouse.com or www.OurBergenCountyHouse.com or www.SellWithMelNJ.com