The Day the Supply of Homes Died.....

Two exciting product updates I wanted to make you all aware of:

·         97% conventional loan!  (great for flips or if non-borrowing spouse had recent foreclosure/short sale)

·         HARP 2.0.  Unlimited Loan to Value.  If the loan is owned by Fannie Mae or Freddie Mac, and the loan was taken out prior to May 31^st, 2009, we can refinance with rates in the high 3’s and low 4’s.

Financial Markets

The Dow Jones ended its best week of the year with a 93 pt gain, up over 400 pts for the week ending at 12,460.  Once again Europe’s debt crisis took center stage, the latest (and who really cares, it’s been dragging on for what seems like years) was that Eurozone leaders indicated that there would be a recapitalization of Spain’s banking system.  This came literally 1 day after Fitch downgraded Spain’s banking system 3 levels to “BBB”.  As is typically the case, mortgage rates increased by about 50 bps for the week (about .125%), as investors trade safe haven bond investments for the riches of more aggressive returns in the stock market.   Facebook ended the day at $27 per share.  (It’s IPO opened at $38 per share)

Southern Nevada Real Estate Related Data

Data we all know too well at this point (unless you have been asleep for the past 6 months).  Prices are up for the 4^th consecutive month, and up 1.6% from May 2011.  The number of single family residence sales are also up (3,413 for the month of May) nearly 10% from May 2011!  According to the article below, 17,346 homes for sale in the MLS and only 3,800 are not under contract.  My uncanny math skills tells me that we have roughly 1 month’s supply of homes available….Again, can’t underscore how encouraging it is for home builders.  There is actually a secondary benefit to the local economy, as home builders build more, it creates construction jobs and am sure you can all draw the parallel to how that helps the local economy.  The future relies heavily on how bill 284 will affect banks bringing the backlog of foreclosures to market.  If we have a tsunami of homes hit the market at once, we will most likely see a decline in prices.  If we experience a trickle or even flow, we can expect slow steady appreciation in home values. 

http://www.lvrj.com/business/sharpened-interest-bidding-wars-send-up-las-vegas-home-prices-158053095.html

It’s been quite some time since my last “Week in Review”…As you can see, my team and I transitioned to a new mortgage company.  I am excited to share with you the phenomenal features about the new company, but I am more of a “proof is in the pudding” kind of a guy so in the upcoming weeks I will provide data with average # of days to docs, and unique circumstances that we have successfully secured financing.   Now that the transition is complete and I have my first month with First Cal in the rear view mirror, I am energized to get back to what I enjoy most and do best, helping home owners secure financing.  

Financial Markets

Friday was a dismal day for the stock market as the Dow Jones shed 300 points on a number of economic reports that failed to satisfy investors.  National unemployment inched up from 8% to 8.2%.  Roughly 69,000 jobs were created but the general consensus is that you need roughly 150,000 jobs to be created on a monthly basis to simply keep pace with population growth.  Consumer confidence dipped and of course, the European Union is been unable to right the debt-crisis ship, which compounded investor confidence in stocks.  The silver lining, as many of you know, is very low mortgage rates.  In many instances, 30 yr fixed mortgages are below 4%. 

Southern Nevada Real Estate Related Data

We all know “the sitch” (Jersey Shore reference).  Inventory down…prices up…(so simple a caveman gets it).  So who reaps the benefits of Bill 284?  Home builders for starters…347 new home sales were recorded in April, a 34% improvement from April 2011.  Year to date, new home closings reached 1,220, up 20% Median prices are up 6% from a year ago as well. 

http://www.lvrj.com/business/new-homes-sales-jump-34-5-percent-in-april-153201195.html

Who else benefits from Bill 284?  Sellers engaged in a short sale transaction.  The estimated timeframe for the bank to foreclose on a home owner has now doubled, (and may even triple but still don’t know the full affects of the Bill)  and clearly there is a financial benefit for the bank to agree to a short sale, more so now than ever before.  In April, 30% of the sales consisted of short sales for Southern Nevada. 

http://www.lvrj.com/business/short-sales-of-homes-increasing-across-u-s-156215715.html

First month with FirstCal Mortgage:

In my first month, I closed 10 transactions with the company and I have been over the moon with excitement on the consistency and speed of the fulfillment aspect of the transactions.  On average, it took 21.8 days to get docs out from the time the file was submitted to processing.  With two transactions, we had docs out in 13 days!  The average doesn’t strip out the days missed because the value did not come in and buyer and seller had to renegotiate.