The Real Estate Pulse

About half of San Fernando Valley Real Estate sales in August involved a home that had been repossessed according to MDA DataQuick. The troubling part of the news was that experts believe that the number of San Fernando Valley foreclosure sales will only continue to increase as banks continue to repossess more and more homes.

What we see in the news and read in the newspaper is that San Fernando Valley Real Estate sales are up and they are up of course but the value of the homes we own continues to fall further and further down.

And the banks aren’t going to let up… they’re going to continue to dump “assets” until they have enough cash on hand and until their balance sheets are balanced and our homes are worth virtually nothing.

I suppose the positive thing then would be that banks might actually then be willing to start making some loans again…

Hey it’s a good time to buy a home in the San Fernando Valley if you can find a bank to make you a loan. I believe I saw a stat somewhere that illustrated the price of San Fernando Valley Real Estate being back down to 2003 levels!

And like I said earlier there’s really no end in sight.

It’s great, I suppose, that sales are up but foreclosures are up as well and that just means that banks have an ever increasing inventory of homes they need to sell and at this point they’re willing to take a loss on a loan because they need the cash. At this point banks are just trying o minimize their losses…hell at this point a lot of banks are just trying to stay open!

Has the San Fernando Valley Real Estate market hit bottom?

Most experts would conclude that no the San Fernando Valley Real Estate market has not yet hit bottom and that prices will continue to fall but not at the dramatic rate of the past couple of years.

With San Fernando Valley Real Estate continuing to plummet many San Fernando Valley residents are wondering how the U.S. Federal governments takeover of Fannie Mae and Freddie Mac will affect the value and sales of homes for sale in the San Fernando Valley…

Well one of the desired effects from the “Frannie” takeover was lower interest rates for home buyers and as of this week interest rates for 30 year fixed rate mortgages are down about 1/2 a percentage point as of this post.

So with interest rates down are more people buying San Fernando Valley Real Estate?

Not necessarily.

While the prices of homes for sale in the San Fernando Valley may be down, more and more potential home buyers are discovering that it’s getting harder and harder to qualify for a home loan in the San Fernando Valley these days.

Most lenders are now requiring a 15% down payment of the purchase price of a home for sale in the San Fernando Valley up from 10% from a while back and I’m starting to wonder if we’ll ever see any interest-only loans again?

I can tell you right now most people will be unable to afford the 15% down payment for San Fernando Valley real Estate. If you can find a home for sale in the San Fernando Valley for about $300,000, you’ll still have to come up with a down payment of $45,000.00!

Fannie and Freddie Mac now have the guaranteed backing of the U.S. Federal Government and in a nutshell they’re making sure that the money they loan out these days has a very high probability of getting paid back. Sounds like good business to me but how it affects the San Fernando Valley Real Estate Market remains to be seen.

Home sales are up in some of the metropolitan areas that have been hardest hit by the real estate and housing slump. The home sales aren’t typical sales however, they’re home sales that are being driven by lenders that are slashing prices on foreclosed properties.

All in all, home sales continue to stay weak as home sales of previously-occupied homes were down by 18% over last years already down numbers but the recent data regarding sales of foreclosed homes is a good sign for the housing and real estate market.

Sales are up in the areas that have been hardest by foreclosures and falling real estate prices…

Areas such as Las Vegas, Nevada, Sacramento, California and Detroit, Michigan are leading the way in foreclosed home sales.

According to the Wall Street Journal, the inventory of foreclosed homes held by lenders is hovering around half a million!

Many lenders have been holding on to their foreclosed properties to avoid slashing prices and to avoid huge losses but apparently the tide is turning somewhat as more and more lenders are unloading foreclosed properties at dirt-cheap prices

The National Association of Realtors released a statement saying that median home prices were down in 100 of 149 metropolitan areas during the first 3 months of this calendar year…

On a national level the median price of an existing single family home for the first 3 months of the year was $196,300 according to the report.

To give you a frame of reference, the median price of an existing single family home for the first 3 months of last year was $212,600…

This report comes out a little late however as there does appear to be signs of the real estate market bottoming out recently…

Maybe not so much that the real estate market is bottoming out but more like correcting itself afters years of inflated home values.

The total number of homes for sale was down in some warm cities located in the Southwest and recent data is now showing that the number of unsold houses is no longer growing at a break-neck pace…

Cities such as Los Angeles, Las Vegas, Phoenix and Sacramento actually had fewer homes for sale available in April then they did in March so certain parts of the country may be starting to show signs of bottoming out and hopefully beginning to rebound soon.

Prices on homes continue to go down and the prices on some foreclosed homes are starting to attract buyers it seems.

The trend for most large, metropolitan areas however is the opposite unfortunately as cities such as Washigton, D.C., Seattle, Chicago, Boston and San Francisco had a larger inventory of homes for sale in April then they did in March.

Sales of new homes dipped to a level in March that has not been seen since 1991 and the inventory of homes for sale has hit a three-decade high…

Single-family home sales dipped 8.5% last month – the lowest level since October 1991. Economists had only expected a dip of about 1.9%.

Sales of pre-owned homes also fell 2% in March…

More bad news for March: the median price for a new home fell 13.3% to $227,000.

Spring is usually a month when real estate sales start to pick and begin to hit robust levels but this Spring has been anything but for the troubled real estate market…

Real estate sales have indeed slowed down and are slower then ever before for this time of the year but people are buying and in what seems to be increasing numbers.

With real estate plummeting why are people buying?

Mortgage rates are at an all time low at 5.88% for a 30 year fixed-rate loan and those that can withstand some short-term equity loss in a home that they plan on staying in for a while are jumping back into the real estate market and they’re not just looking.

It may in fact be a good time to buy for those in that position as there are plenty of good values out there with so many foreclosures on the market and with more and more sellers willing to negotiate.

With Real Estate prices continuing to drop more and more homeowners are receiving similar letters from their respective Home Equity Line of Credit Lenders…

That letter basicaly saying that since the equity in their real estate isn’t what it used to be… their line of credit isn’t what it used to be either!

Most borrowers are seeing their home equity lines of credit being dramatically cut or suspended all together.

I guess  it’s better then losing yur real estate through foreclosure however…