New Home Sales, Mortgage Rates Up in Past Week - Weekly Digest, 11/2/2008

Beginning November 1, I have slightly changed the format for my weekly blogs. The weekly blog has become longer and longer, so I have moved the full story and articles to a sister site, http://changhomes.blogspot.com/.

This blog, which continues to be emailed to all subscribers, will summarize newsworthy housing, economic, and real estate events of the week, and will have links to the full story at the sister site.

During the month of November, I will continue to make improvements to interconnect the blog with distribution methods and the website. As always, I look forward to your comments and feedback. Just send me an email at changhomes@gmail.com. Thank you for your continued interest and support!

New Home Sales Up in September - Often considered a precursor to home sales in general, sales of newly built single-family homes posted a slight increase in September, rising 2.7 percent to a seasonally adjusted annual rate of 464,000 units, according to a U.S. Dept. of Commerce report released Monday. The report also indicated that builders are making substantial progress depleting the supply of unsold units on the market. http://changhomes.blogspot.com/2008/11/new-home-sales-rise-27-percent-in.html (CAR, 10/29)

New statistics have been released from the Southland Association of REALTORS(R), but I am unable to retrieve that tonight as I write this. Please view the link above to the article repository. As soon as I can retrieve it, the statistics for San Fernando and Santa Clarita Valleys will be posted there.

Mortgage Rates Inch Up - News Freddie Mac reports a jump in the 30-year fixed mortgage rate to 6.46 percent during the week ended Oct. 30 from 6.04 percent the prior week, as long-term mortgages rates moved in line with long-term Treasury bonds. The 15-year fixed mortgage rate rose as well, climbing to 6.19 percent from 5.72 percent. Meanwhile, the five-year hybrid adjustable mortgage rate moved up to 6.36 percent from 6.06 percent; and the one-year ARM increased to 5.38 percent from 5.23 percent. Freddie Mac chief economist Frank Nothaft expects short-term rates to remain low due to the Federal Reserve’s recent cut in the discount and federal-funds rates, and he notes that falling home prices have jump-started residential sales in some markets by making properties more affordable. http://changhomes.blogspot.com/2008/11/mortgage-rates-inch-up-this-week.html (WSJ, 10/31, via Real Estate Daily News)

Bargain Hunters are out! I was representing clients at a home auction this weekend, and it's incredible the deals you can get. Homes as low as $40,000. Are you a bargain hunter? Call me and lets start shopping!

Plan your Winter with these Santa Clarita Events! -

• Fine Craft Show (November 15-16) - Join us at Old Orchard Park for a relaxed and enjoyable weekend of shopping featuring fine handcrafted items, specialty foods, coffees and jazz music. You will find many one-of-a-kind gifts including intricate and colorful handcrafted jewelry, pottery, woodwork, ceramics, floral arrangements, and much more. For more information, please visit www.santa-clarita.com/crafts.
• Veterans Day (November 11) The Veterans Day Ceremony is held annually on November 11th at the Veterans Memorial in Old Town Newhall. The event is a partnership between the City of Santa Clarita and the Veterans’ Historical Committee, the SCV Chapter 91 Blue Star Moms, Blue Star Moms of the Canyons Chapter 82, Prayer Angels for the Military, and the Knights of Columbus. The Ceremony honors Veterans and individuals serving in the military and their families. For more information, please call (661) 286-4018.
• Paint the Town (December 5) In celebration of the holiday season, and to create a joyful holiday setting in Old Town Newhall, the City of Santa Clarita presents a ‘Holiday Window Painting Contest.’ For more information, please visit www.santa-clarita.com/arts.
• Literacy and Arts Festival (December 6) On Saturday, December 6, celebrate the holidays with the second annual Literacy and Arts Festival, presented by the Santa Clarita Valley Education Foundation and the City of Santa Clarita. For more information, please visit www.scveducationfoundation.org.
• Old Town Newhall Holiday Parade (December 6, 2008) All Santa Clarita Valley children are encouraged to participate by walking in the parade and dressing up according to their family’s holiday traditions. For more information, please visit www.santa-clarita.com/arts.
• Disney’s High School Musical: The Ice Tour (December 27) Celebrate the holidays with the gang from the High School Musical located at the Honda Center in Anaheim. This trip includes transportation by bus and reserved seats in the lower level at the Honda Center. For more information, email trips&tours@santa-clarita.com.
• Tournament of Roses Parade 2009 (January 1) Pasadena’s 120th annual Tournament of Roses Parade, “Hat’s Off to Entertainment” will be making its way down Colorado Boulevard and we have reserved a seat just for you! For more information, email trips&tours@santa-clarita.com.
• Glacier Slide Polar Bear Swim (January 1) Join the official Santa Clarita Polar Bear Club by taking a chilly plunge in the Aquatic Center’s waterslide pool on New Year’s Day. For more information, please contact (661) 250-3766.
• Santa Clarita Valley Film Festival (January 8-11) The 4th Annual SCV Film Festival provides local filmmakers with opportunities to show their work and to come together with an audience to enjoy quality independent films. For more information, please visit www.scvfilmfestival.com.

During the Week, look for the following articles to be posted on the Sister Site -

• Home sales statistics for Santa Clarita and San Fernando Valleys
• Foreclosure: When Must I Move Out?
• Don't Wait Until Selling to Make Repairs
• Will Shopping Multiple Lenders Hurt Credit?
• When It Makes Sense to Overpay for House
• Buy Now, Sell Later?

Already in the Repository -

• NAR Makes Big Push for ‘Four-Point Plan’
• New Laws Protect Tenants from Foreclosures
• Why the Foreclosure Crisis is Hard to Fix
• Survey of Real Estate Articles, Thursday, October ...
• Home Staging is an Essential Step in Selling a Hom...
• CAR Fast Facts, October 29, 2008
• LOAN FORBEARANCE AGREEMENTS MUST BE IN WRITING
• COMMERCIAL REAL ESTATE MARKET TO HIT BOTTOM NEXT Y...
• FED CUTS KEY INTEREST RATE TO 1 PERCENT
• CAR Update on Ongoing Economic Situation

Search these articles and more at - http://changhomes.blogspot.com/.

Sources: CAR, NAR, Wall Street Journal, Real Estate Daily News, USA Today, City of Santa Clarita.

Fed Rates Below 1% Possible, ShakeOut Invitation - Sunday, October 26, 2008

The Federal Reserve is widely expected to cut interest rates again next week - Many investors believe the central bank will cut rates by at least another half-percentage point following the end of a two-day meeting on Oct. 29. Rate cuts have been a key tool the central bank has used in the past to boost a weak economy. A variety of lending rates, including credit cards and home equity lines, as well as the prime rate used to set many business loan rates, are pegged to the fed funds rate.So lower rates usually lead to cheaper credit, thus spurring businesses and consumers to spend money more freely. But in the current credit crisis, with banks afraid to make loans due to worries about their firms' own need for cash in the near term, already relatively low short-term rates have done little to get credit flowing. (CNNMoney.com, 10/24)

ShakeOut Invite - The Earthquake Country Alliance has organized the Great Southern California ShakeOut, a week of special events featuring a massive earthquake drill at 10 AM on November 13, 2008, to prepare our region for "The Big One." The ShakeOut drill centers on the ShakeOut Earthquake Scenario, a realistic portrayal of what could happen in a major earthquake on the southern end of the San Andreas Fault. Created by over 300 experts led by Dr. Lucy Jones of the U.S. Geological Survey, the scenario outlines a hypothetical 7.8 magnitude earthquake originating near the Salton Sea, which would have the potential to devastate the region. Many of you know I am an emergency services volunteer for the City of Santa Clarita, LAFD and LA County Sheriff. Please join me in this training event by signing up at http://participate.shakeout.org/personalpage/changhomes. You can participate from anywhere, because you never know where or when an emergency will strike!

CONGRESS SERIOUS ABOUT LAME-DUCK ECONOMIC STIMULUS PACKAGE - The Senate, House of Representatives and the White House have all stated their willingness to work through a lame-duck session to pass a second economic stimulus package prior to the end of the year. While many ideas have been circulated, few, if any, appear certain to be included in a stimulus package. Some of the ideas under discussion include: An additional round of stimulus checks; extending the temporary loan limit of $729,750 for the Government Sponsored Enterprises (GSE) and Federal Housing Administration (FHA); infrastructure spending; financial aid for states; a temporary increase in block grants; and an extension of unemployment and welfare benefits. The primary factor determining what, if anything, will be done during a lame-duck session is the outcome of the upcoming presidential election. Should the Democrats take the White House and secure a filibuster-proof majority in the Senate, they may wish to wait till after Jan. 20 before proposing or enacting legislation. Should the Republican nominee take the White House, Democrats may feel the Bush administration is more willing to compromise in order to pass last-minute initiatives prior to leaving office. (CAR, 10/22)

FHA POSTS LIST OF LENDERS IN HOPE FOR HOMEOWNERS PROGRAM - The Federal Housing Administration (FHA) of the U.S. Dept. of Housing and Urban Development has posted a list of lenders participating in the HOPE for Homeowners program. Participating lenders have indicated an interest in refinancing loans under the HOPE for Homeowners program. The FHA plans to update the list weekly on Fridays. ( CAR, 10/22)

I have received many questions regarding the H4H program (above). Check with your mortgage lender first to see if they participate and if you qualify for the refinancing programs. To see if your lender participates, call them or go to the FHA website.

Mortgage Market Still Open for Business - Lenders emphasize that loans continue to be available for a range of potential home buyers, not just those who are putting down 20 percent and have a credit score higher than 720. Although credit underwriting is tougher and loan terms stricter, borrowers can still put down 3 percent (3.5 percent after Jan. 1) on an FHA-insured mortgage and 5 percent on some Fannie Mae and Freddie Mac loan programs with private mortgage insurance. FHA standards are designed to help people with problem credit and those with scores in the upper 600s can still qualify for loans with reasonable rates offered by Fannie Mae and Freddie Mac. (Washington Post Writer's Group, 10/18)

NAR: Home Sales Rise as Affordability Improves - Existing-home sales increased last month as buyers responded to improved housing affordability conditions, according to the National Association of Realtors®. Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 5.5 percent to a seasonally adjusted annual rate of 5.18 million units in September from a level of 4.91 million in August. Home sales are 1.4 percent higher than the 5.11 million-unit pace in September 2007. Lawrence Yun, NAR chief economist, said more markets are seeing year-over-year gains, but there may still be market disruptions. NAR President Richard F. Gaylord says low home prices and low interest rates have helped attract buyers. Yun says that an additional housing stimulus would stabilize prices more quickly and help bring faster stability to Wall Street. A Closer Look at the Numbers:

• Total housing inventory: at the end of September fell 1.6 percent to 4.27 million existing homes available for sale, which represents a 9.9-month supply at the current sales pace, down from a 10.6-month supply in August. This marks two consecutive monthly declines since inventories peaked in July.
• National median existing-home price: $191,600 in September, for all housing types. That's down 9 percent from a year ago when the median was $210,500.
• Single-family home sales: increased 6.2 percent to a seasonally adjusted annual rate of 4.62 million in September from a pace of 4.35 million in August, and are 3.8 percent above the 4.45 million-unit level a year ago. The median existing single-family home price was $190,600 in September, which is 8.6 percent below September 2007.
• Existing condominium and co-op sales: were unchanged at a seasonally adjusted annual rate of 560,000 units in September, but are 15.7 percent below the 664,000-unit pace in September 2007. The median existing condo price was $199,400 in September, down 10.2 percent from a year ago. (NAR, 10/24)

CALIFORNIA HOUSING PRODUCTION DECLINE CONTINUES IN SEPT. - Housing production continued to decline in September, when 4,364 permits were pulled throughout California, down 32 percent compared with the same month a year ago and down 6 percent from August, according to statistics compiled by the Construction Industry Research Board. Single-family permits totaled 2,326, down 35 percent from September 2007 but up 4 percent from August. Multifamily permits totaled 2,038, down 29 percent when compared with September 2007 and down 14 percent from the previous month. (CAR, 10/22)

Mortgage Rates Drop to 5-Week Low - Mortgage rates moved south this week, reaching their lowest point in five weeks, according to Freddie Mac's nationwide survey. The company reported a drop in the average interest on a 30-year fixed loan to 6.04 percent from 6.46 percent last week and a slide in the 15-year fixed rate to 5.72 percent from 6.14 percent. Meanwhile, interest on adjustable-rate mortgages slipped to 6.06 percent from 6.14 percent for five-year ARMs but bumped up to 5.23 percent from 5.16 percent for one-year ARMs. (San Diego Union-Tribune, 10/24)

Fast Facts:

• Calif. median home price - August 08: $350,140
• Calif. highest median home price by C.A.R. region August 08: Santa Barbara So. Coast $930,000
• Calif. lowest median home price by C.A.R. region August 08: High Desert $169,200
• Calif. First-time Buyer Affordability Index - Second Quarter 08: 48 percent

Sources: CNN/Money, Washington Post Writer's Group, California Association of REALTORS, National Association of REALTORS, San Diego Union-Tribune..

Another round of showers coming this week, and I am working my contacts list. Lots of buyers. I am helping several find their dream home as mortgage rates stay low. So a short posting this week.

If you wish my assistance in buying or selling your home, please contact me at changhomes@gmail.com.


Meanwhile, here are latest news from the housing front:
Steady Climb Seen for Existing-Home SalesAlthough new-home sales will take time to recover, existing-home sales are expected to gradually rise this year and well into 2008, says NAR's latest forecast.

Mortgage Rates Drop as Inflation Worries FadeFixed mortgage rates are a compelling refinancing alternative for adjustable rate borrowers facing sharp payment adjustments.

Rain Ruins Weekend plus Urgent News for Buyers

They say rain is good in dry Southern California. My Saturday was rained-out. I had planned for an open house in Stevenson Ranch area of Santa Clarita for a fellow Realtor, but with the rain, everyone stayed home.

Buyers: economic signs may signal interest rates rise in the near-term. Lock in your best rate now and start shopping for your new home.

The Fed meets this week. CNN states, "there is a growing sense that the Fed may keep rates at 5.25 percent for the foreseeable future." As I stated in a prior post, most people think mortgage rates as being closely linked to the Fed's decisions, they're more closely linked to the bond market.

Last week, stronger than expected economic reports hit the wires, indicating a resilient economy: the inflation measuring Consumer and Producer Price Indexes (CPI and PPI) both were hotter than expected, showing some lingering inflation in the economy; Housing Starts and Building Permits were both reported as better than anticipated; Initial Jobless Claims were lower than expected, indicating a strong labor market; the Philadelphia Fed Manufacturing Index was higher than estimated; and to top off the week, the Consumer Sentiment Index came in very strong - a three year high!

We would therefore expect bond prices and home loan rates to rise. With all this strong economic news, it's surprising that Bond prices and home loan rates just stood there. Despite some midweek bouncing around on the news, Bonds and home loan rates ended up the week only slightly worse than where they started.

It's time for buyers to get off the fence and lock in loans - and shop for their new home!

Economics of Mortgage Rates

This week, I received a bit of news from the economic front, but before I get to it, some background. Looking over the past year, you might have heard "The Fed" keeping interest rates stable and raising them on at least one occasion. These rates that the Fed determines don't directly affect the mortgage rates. They affect credit card and savings interest rates, which affect how people buy, save, and spend money. Mortgage rates are more closely tied to treasury bonds' interest rates.

Bond prices have been disappointing over the past week, and the effect is that home loan rates have increased - about .125% higher across the board.

As a REALTOR(R), I focus on providing the utmost service to my buyers to find the right home with the least amount of their effort and to my sellers to sell their home at the best price and at the shortest time possible. I rely on my support circle of lenders to provide the day-to-day analysis of mortgage rates and assist my buyers with the best mortgage programs available.

You can check out http://www.bankrate.com to find the latest mortgage rates nationwide. Of course there are tools available not only there but on my website, http://www.changhomes.net.

Calls are picking up in Santa Clarita

I'm noticing and hearing from other real estate agents that buyer interest in the Santa Clarita Valley is definitely picking up. We are getting many more phone calls from motivated buyers, although we aren't offiically in a "buyer's market." A buyer's market is defined as having a 180-day (6 months) housing inventory, yet the average time on the market in the triangular valley has decreased from about 100 days to about 90.

If you are interested in selling your home, please call me at 661/312-1232. I pledge to all my sellers unsurpassed service and dedicated marketing plans.


In Other News:
Home Sales to Rise Gradually into 2008
A steady improvement in existing-home sales will support price appreciation moving forward, says National Association of Realtors Chief Economist David Lereah.

Buying, Managing Small Properties Can Pay Off
Even in today's uncertain climate, a hands-on real estate investor can make money with smaller properties.

Empty Houses Lead to Lower Prices
Owners of unrented, unsold homes must pay for insurance, lawn service, taxes and the mortgage. Those costs convince them to lower the price.

30-Year Mortgage Rates Climb to 6.21%
This week's increase in 30-year mortgage rates marked their highest point since November. Interest rates on 15-year fixed loans and ARMs also moved higher.

Mortgage Applications Climb Sharply
Requests for purchase loans were up 16.2 percent and refinancing applications rose 17.3 percent, according to Mortgage Bankers Association data.

New Year, new blog

Happy New Year! Just a short introductory note, with the new year and all. Being full-time in real estate is challenging and exciting. One objective I have for the year is to use technology effectively to expand my business: keep in touch with past clients and prospective buyers and sellers.

I have a new website, http://www.changhomes.net/, which will be the main portal for all your real estate needs. I mainly expect the blog to summarize in quick bullets my observations from the real estate front and real estate news from my many sources on a weekly basis.

Join me in my observations, and I look forward to your comments!

Headlines for this first post:

Mortgage Rates Climb for Third Straight Week
Interest rates for 30-year mortgages increased slightly to 6.18 percent, but still fall well-below this year's high of 6.8 percent set in July.

Consumer Confidence Soars in December
The Conference Board reports that consumers' confidence in the economy rose to an eight-month high, which could signal an end to the housing downturn.

A Recession in 2007 Is No Sure Thing
Economists and other financial professionals have differing views on how the housing slump will affect the economy in the coming year.

Housing Market Trapped by Buyer Negativity
Real estate professionals say sellers are clinging to too-high prices and buyers are equally adamant about getting a bargain.