Comments on: Clash Of The Indicators: The Real Estate Market Hits Bottom

By: Jeff Miller

Jeff Miller — Thu, 17 Jul 2008 18:36:13 +0000

Bryan, I agree with your points in general, once I figured what you meant by Purchase Money Mortgage (in my area PMM means seller carry back).

The fact that banks are making *any* mortgages shows that they have gotten out of the paralysis that has been stifling the housing market. It will also reduce the pain of the next year or two.

I just don\’t think that we are ready for an upturn soon. We spend a long time floating at the peak, buoyed up by series after series of new and more generous loans. I think that we are past the \"house of cards\" phase but we are just getting into the cleanup phase.

That means that the next couple of years are going to be great buying opportunities for the buy and hold investors since real estate is on sale.

Oh, please look at getting a captcha that I can actually read. Attempt #2

By: Bryan Ellis

Bryan Ellis — Thu, 17 Jul 2008 17:43:01 +0000

I agree that purchase money mortgages are important. But I reject the premise of your challenge to my assertion. Here’s why:

Why Refinances Are Good For The Real Estate Market

Have a great day!

By: Jeff Miller

Jeff Miller — Thu, 17 Jul 2008 16:14:23 +0000

Nate’s point is valid. Restructures are up as the banks look for alternatives to keep inventory off of the foreclosure books.

Also, while I agree that we might be at or near the bottom of the cycle, I think that the bottom will last another 2 years (as the peak was drawn out). The reason is the 2004, 5 year loan recasts that will happen in 2009. That will put another surge of distressed properties on the books.

By: Gloria

Gloria — Thu, 17 Jul 2008 14:09:26 +0000

Brian,
I too agree with Nate.. I was going to ask the same question until I read his comment. I wonder also if there is a way to find out what kind of buyer is applying and what the majority of people are qualifying for. My lender here in Arizona tells me he has quite a number of applications on his desk with the majority being for $220K and under. Here in my market $220K can now get a nice starter home for people… I am going after buyers unless underwriting criteria changes and we now have to add gasoline as a recurring debt for qualifying.. (just a joke.. but maybe not)

By: Nate

Nate — Thu, 17 Jul 2008 13:41:50 +0000

Bryan,

The thing I would want to know is what percentage of the increase in mortgage applications relates to refinancing and what portion relates to new home purchases? If the increase in mortgage applications relate primarily to refinance activity on troubled loans, we’d have to curb our optimism a little. Let me know if you have the stats on this. Thanks.

By: Doug

Doug — Thu, 17 Jul 2008 13:06:45 +0000

I hope your crystal ball is correct. BUT remember, the merger of Countrywide and Bank of America is stil at hand and they have withheld dumping their new foreclosures on the market for the last 60 days. As long as we have high levels of excess inventory the pressure on prices will remain downward. Good for buyers & investors bad for sellers, as many find themselves upside down