Jobs up + oil prices down = sunny economic climate for US

As many of you know, I joined WJ Bradley in the middle of November.  The transition will enable me to better serve your clients through exceptional customer service and an even wider product offering.  I am looking forward to a highly successful 2015 with you!
Unique Product Offerings with WJ Bradley:

• Jumbo Financing up to 90% loan to value, up to $850,000 loan amount.
• Home Is Possible 4% grant compatibility with FHA, VA AND Conventional financing (Note: This product isn’t necessarily in the best interest of all buyers so call me to set up a quick meeting to discuss when it is best to use the product)
• Minor escrow with holds for homes that need minor repairs (great for REO listing agents)
• Non-warrantable condo financing (in-house….not brokered!)

Financial Markets
Friday’s jobs report obliterated forecaster expectations by nearly 50,000, as an estimated 321,000 jobs were created for the month of November.  National unemployment rate held firm at5.8%.  Perhaps as or more encouraging as the number of jobs created is the .4% increase in hourly earnings.  This merry jobs report has investors giddy on stocks and as a result the Dow closed at 17,958.  The price of oil is now trading around $65 per barrel.  The price of oil has a profound impact on the cost of living so the combination of an increase in hourly wages and a decrease in the cost of living concocts a highly successful recipe for robust economic growth. 
The draw-back to robust economic growth is rising interest rates.  Recently the bond market, specifically the Fannie Mae 3.5 coupon, has experienced selling pressure.  The lower oil prices have helped stave off a steeper sell off so mortgage rates have stayed relatively stable in recent weeks despite the rally in stocks. 

Southern Nevada Real Estate Related Data
The past week’s BLM land auction indicated that developers are confident in Southern Nevada real estate.  The article states that it was the biggest land auction since November 2005, as over 400 acres were purchased.    The first BLM land auction since the recession took place in January, and only netted roughly 160 acres in sales.    http://www.reviewjournal.com/business/economy/blm-auction-shows-confidence-vegas-housing-market  PS- WJB has capacity for closings before the end of the year.  Give us a call if you have a transaction that needs to close this year!

Communication and Transparency - With Matthew Maltese

NHD's down payment assistance program is HIP....

PRODUCT ALERT! (THIS IS BIG…I AM TYPING IN ALL CAPS SO IT MUST BE)

Nevada Housing Division gave its down payment assistance program a complete overhaul and you will want to get educated on the new program and its parameters.   "Home is Possible" (HIP...I just made that up)...will be by far the most commonly used DPA (down payment assistance) program in the state.  Below are the cliff notes:

·         Up to 4% GRANT (not 2^nd mortgage)

·         Maximum income is $95,500

·         No First Time Home Buyer requirement….Buyers simply must occupy

·         No re-capture tax

·         Valid for up to  $400,000 sales price

Call my cell or email me and schedule a brief 15 minute appointment to learn more about the program! 702-372-2427

Financial Markets

Stocks nose-dived this past week roughly 600 points as investors struggle with a strengthening US economy vs. weakening global economic conditions.  On the optimistic side of the coin investors are amped about the anticipation of a strong Q3 earnings season.  The Fed Reserve’s increasingly positive rhetoric for the overall health of the US economy has investors long on stocks as well.  That was not enough to overcome investor concerns of a cooling economy in China and a deflationary interest rate environment in Europe, and by Friday, the Dow closed at 16,544, down .2% for the year. 

As is often the case, mortgage rates have improved while stocks struggle to find a floor.  The Fannie Mae 3.5 coupon has improved by 200 basis points over the past month and rates haven’t been this low since June of 2013.

Southern Nevada Real Estate Related Data

Grabbing the headlines locally this week is the opening Downtown Summerlin mall.  I would have never expected to be moved by the opening of a mall.   I attended the grand opening Thursday night and was surprised at the sense of pride I felt being that I live on that side of town and would drive by the stalled project every day for the past 6 years.  http://downtownsummerlin.com/.  It’s too early to estimate the economic effects of the mall, as many surrounding stores simply closed down existing locations to move to the mall, leaving vacancies at their current locations.  The mall certainly has its share of tenants that maintained their current locations as well so the overall impact has to be deemed as a positive one. 
For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

Fannie Mae changes to guidelines not all bad

PPRODUCT ALERT!

We know Fannie Mae now requires a 4 year seasoning after a short-sale, however they have also made positive changes to their “prior derogatory credit event” policy.  Improvements to the policy are as follows:

·         If a borrower filed a bankruptcy and included a foreclosure in the bankruptcy, they can qualify 4 yrs after bankruptcy discharge. (Prior policy required 7 yrs after foreclosure and foreclosure date was based on Clark County records).

·         If a borrower was dismissed from a chapter 13 bankruptcy, they are eligible 2 yrs after dismissal date. (Prior policy required 4 yrs after dismissal)

·         ***There is much discussion with regards to “extenuating circumstances”.  Once Fannie provides more guidance, this could certainly allow for more borrowers to become eligible for financing.  Under the “extenuating circumstance” policy, many economic events can be as recent as 2 years ago and the borrower can qualify for conventional financing. 

Financial Markets

The Dow Jones ended the week at 17,279, and is up nearly 1,000 pts since August 7^th.  The US Dollar has also continued its run of gaining against other major currencies, as the US economy continues to outperform other nations' economies and the Fed attempts to wind down its quantitative-easing.  The US Dollar ended Friday at a price of 1.28 against the Eruo. 

Southern Nevada Real Estate Related Data

The unemployment rate dropped to 7.7% for the month of August, down from 8.2% in the month of July, and down from 10% in August of 2013.  The construction sector led the way for job growth, followed by Professional and Business services.  The rate is still considerably elevated with respect to the national average (6.1%),  however, the rate is nearly half of what it was at the peak of the recesion, where the jobless rate reached over 14%., just less than 4 years ago.  http://www.reviewjournal.com/business/economy/job-growth-helps-drive-unemployment-six-year-low

Home sales for Southern Nevada in the month of August continues along a similar trajectory, with median prices up year over year (up 9.7%), and activity slowing.  2,401 single family home sales are down from July and from August of 2013.  Inventory continues to climb, with 10,892 active listings being reported, which is up by over 700 from July and up nearly 2,000 listings from the same month last year.  Below is a great fact sheet from Chicago Title with regards to August home sales in Southern Nevada.  http://jamielewis.rereport.com/market_reports?formSubmit=1&searchtype=search&emailtype=search&period=1&area=113&cities=0&locations=0&yearmonth=2014-8&proptype=1&mailer=1&redirected=1

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

Freddie says mortgage rates will reach 5% by this time next year

PRODUCT ALERT!

Last week to get your clients putting 20% and applying for a conventional loan 2 years after a short sale under contract!

Financial Markets

Stocks continued to lose ground as the Dow shed nearly 600 pts in the past 2 weeks before rallying Friday and landing at 16,553.  The Dow rallied nearly 200 points for the day as reports of American involvement in Iraq appear to be less intrusive than initially anticipated, and news broke that Russia has ceased military exercises near the Ukrainian boarder.   

The Fannie Mae 3.5 Coupon, as often is the case when stocks sell off, rallied and improved by about 75 basis points over the past 2 weeks, which loosely translates into about a .125% improvement in rate to the consumer. 

A client asked me what rates were going to do and asked me if he should lock.  I gave him my standard rhetoric: “No one can say what rates will do.  Any one that tells you they know what rates will do is a fool”.  He asked me again, so I googled, for kicks, “what will rates do”?  I stumbled onto a very informative publication released by Freddie Mac.  In a nut shell, the report predicts that mortgage rates will “rise to 5% by the middle of 2015”.  Great forecasting information for the economy and housing market on a macro level.  Take a look!  http://www.freddiemac.com/finance/pdf/July_2014_public_outlook.pdf 

Southern Nevada Real Estate Related Data

The median sales price of resale homes hit a 6 year high for the month of July, up .1% from June and reaching $200,000.  This is up just over 11% from July of 2013 and the highest since August of 2008.  The peak price of median resale homes at one point hit $315,000, in June of 2006.  The abyss was realized in January of 2012, where the median price home dropped to $118,000, a measly 63% decline from peak to trough.  http://vegasinc.com/business/real-estate/2014/aug/08/rising-las-vegas-home-prices-hit-nice-milestone/?_ga=1.66807850.564569733.1395507077

Tsunami of foreclosures finally here? We are about to find out.

PRODUCT ALERT! (Listing Agents, you’ll like this!)

First Cal Mortgage is proud to release “Listing Marketing” to our preferred business partners.  We create websites for each of your listings that you can post on the various social media sites, provide sign riders to capture perspective buyers, and give you access to slick flyers!  Take a look at the link and contact me if you are interested!  http://matthewmaltese.mysalebook.com

 Financial Markets

Friday capped the Dow’s biggest weekly loss in 7 weeks, ending the day at 16,960 (according to the app on my I phone).  The Dow lost over 100 pts during the first hour of the opening bell Friday, after Visa and Amazon released disappointing earnings reports.  2^nd Quarter earnings reports season has turned out to be a positive one thus far, as nearly 70% of the companies in the S and P 500 have either met or topped earnings estimates. 

The Fannie Mae 3.5 and GNMA 3.5 coupons have avoided turbulent trading over the past 2 weeks, with only a variance of just 40 basis points between the high and low.  This basically means that 30 yr fixed rates haven’t moved more than .125% one way or the other.  It appears to be a stale mate between a positive earnings season and geopolitical unrest, and as a result the mortgage-backed securities are sailing through calm waters. 

Southern Nevada Real Estate Related Data

According to a report recently released by Auction Control Systems, notice of defaults are on the rise and will continue to do so over the upcoming months, and would more than likely lead to a dip in sales prices in the upcoming months.  NODs for the month of July project to be nearly 1,000 (less than 200 in January of this year) and the company expects “2,000 notices monthly by fourth quarter”.  The report goes on to state that the banks have navigated through State Senate Bill 321, and are finally able to properly  execute the foreclosure from a legal stand point. 

http://vegasinc.com/business/real-estate/2014/jul/25/banks-moving-more-aggressively-against-delinquent-/?_ga=1.62522280.564569733.1395507077

Below is a thorough, interactive real estate sales report for the month of June.  Most of the data has been covered in previous update, but is still a useful report if you are interested in keeping current with trends.  Thanks Chicago Title!

http://jamielewis.rereport.com/market_reports?formSubmit=1&searchtype=search&emailtype=search&period=1&area=113&cities=0&locations=0&yearmonth=2014-6&proptype=1&mailer=1&redirected=1

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

Cash Buyers and Investors Gambliing Less on Las Vegas Real Estate

PRODUCT ALERT!
Fannie Mae recently released the notes for its August DU release (when Fannie Mae makes changes to its automated underwriting system, DU, it announces the changes in advance).  It appears that Fannie Mae will require 4 years to pass before someone with a short sale can qualify for a conventional loan.  Currently the wait time is 2 yrs for a borrower with 20% down.  It is scheduled to take place on August 16^th, so all borrowers under contract by August 15^th will still be able to close with just 2 years after a short sale.  First Cal is still waiting for the official announcement from the VP of underwriting.

Financial Markets

The Dow continued to lurch forward in recent weeks, this past Friday closing at 16,943.   The markets have been relatively stable, the Dow’s high point (nearly 17,100) and low point (above 16,800) over the past month is less than 300 points or less than 2% in fluctuation in either direction.  The Dow is up roughly 1,000 points from 1 yr ago, or up nearly 6%. 

The bond market, and in particular, the Fannie Mae 3.5 coupon (The instrument that consumer’s mortgage rates are most directly tied to) has been equally stable.  The instrument hasn’t traded higher than 102.8 or lower that 101.7 in the past month.  A little more than 100 basis points separated the high and low, which is equivalent to about .25% in interest rate to the consumer. 

In short, both stocks and mortgage rates have been very stable and we have enjoyed very calm waters so far this summer.  Earning season for 2^nd quarter has begun and we can expect some volatility in the next several weeks as a result. 

Southern Nevada Real Estate Related Data

June home sales for Southern Nevada highlight two continuing trends.  The median home price of $199,900 is up 2.5% from May 2014 and up 14% from the same month last year.  Cash buyers are down to under 35%!  In February of 2013, nearly 60% of the home buyers were paying cash.  Simply put this means less investors are scooping up homes and renting them out.  This is a much more healthy number as home owners that occupy the home will typically spend more in home improvement projects, which stimulates the local economy significantly more than an investor would.    http://www.vegasinc.com/business/real-estate/2014/jul/08/investor-impact-wanes-las-vegas-home-prices-climb-/

According to a recent poll, Nevada jumped over 18 states for “Best states for business”, that’s the good news.  Bad news is we are still ranked in the lower half, 29^th.  According to the poll and scoring system, Nevada’s Achilles’ heel is education.  The state ranked dead last in education in 2013 and inched up to 49^th this year.  http://www.reviewjournal.com/business/economic-development/nevada-moves-18-places-ranking-best-states-business

As many of you have already heard, a new ubber-luxury development is zoned for Southern Summerlin.  One word…Holy Smokes!  http://shar.es/MgTVr

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

How a Sunni uprising in Irag affects the costt of apples...Almost as exciting as how a bill becomes a law...

Happy Father’s Day to all you Dads, I hope you all receive some of the coolest ties and barbeques that Marshalls and Home Depot have to offer!

Financial Markets

The Dow simmered down after nearly reaching the 17,000 barometer this past week, settling in and closing at 16,787.  Much of the equities sell-off can be attributed to the uprising in Iraq.  While there seems to always be political unrest in the Middle East, this particular skirmish has the potential to have a significant impact on Iraq’s oil production.  Prices per barrel are already elevated (as can be attested to by the prices at the gas pump in recent months).  Iraq produces roughly 10% of OPEC’s daily production.  A noticeable increase in oil prices would temporarily cause inflation driving up the price on many products we consume daily, anything from apples to electronics, and has the potential to have a negative impact on consumer spending. 

On the flip side, the bond market also responds negatively to the possibility of higher oil prices.  Higher oil prices triggers inflation and is terrible for fixed income investments.  Example, an investor investing in a bond yielding of 4% in an economic environment that is experiencing 5% inflation actually loses 1% on their investment.  The Fannie Mae 3.5 coupon lost about 100 basis points over the past week, which is equivalent to nearly .25% to the consumer on a 30 yr fixed. 

To make a short story long, political unrest in an oil producing country is bad for both US stocks and US bonds.  The end….

Southern Nevada Real Estate Related Data

May home sales for Southern Nevada reached approximately 3,450, up 7% from April but down 11% from May of 2013.  The median priced home bobbed back up to $195,000, up 1.5% from April and up 14.7% from May 2013.  Less than 17% of the sales were distressed sales (short sales and foreclosures).

http://vegasinc.com/business/real-estate/2014/jun/10/las-vegas-home-prices-climbing-again-short-sales-t/?_ga=1.27601976.564569733.1395507077

There is an interesting graph in the Lied Institute of Business latest economic report, where it illustrates the median price of new homes over the past 14 years.  In 2001 the median priced new home was $200,000.  It peaked to nearly $400,000 in 2006, plummeted during the housing crash, and rebounded to nearly $300,000 today.  A 33% increase over a 13 year span is actually a 2.5% annual increase, which is a very sustainable and healthy appreciation course.  http://business.unlv.edu/lied/

Happy Memorial Day!  I hope you are all having a fun and safe 3 day weekend, and you are able to take a little time off and enjoy time with your families.

PRODUCT UPDATE ALERT:  LISTING AGENTS TAKE A LOOK!

First Cal now allows minor withholds at closing for conventional loans.  It is case by case basis, but generally speaking as long as the job is completed within 2 weeks we will allow the funding to take place and withhold up to $10,000 in repairs.  WE will also allow this on FHA loans, up to $5,000 in repairs, but only on HUD homes.  

Financial Markets
Stocks across the board ended the week on a high note as the Dow closed at 16,613 and the S and P 500 closed above 1,900 for the first time ever.  The primary catalylist for the stock market rallies was the better than expected new home sales report that was released Friday morning.  April new home sales were up 6.4% from March, and revised the seasonally adjusted annual rate of sales to 433,000 homes.  March sales were also revised from 384,000 to 407,000.  

Mortgage-backed Securities, in particular, the Fannie Mae 4.0 coupon, improved by nearly 75 basis points over the past two weeks, with 30 yr fixed rate mortgages trending down and hovering in the upper 3’s and low 4’s.  It is somewhat rare to see both bonds and equities rally along-side each other.  To me, this is a strong indication that the U.S. has become the safest haven for international investors to invest, with China’s economy slowing and the political turbulence in Eastern Europe. 

Southern Nevada Real Estate Related Data

Nevada’s foreclosure numbers continue to improve with respect to the rest of the nation, and the state’s overall ranking fell to 14^th highest. 

Delinquency Status	Percent of Loans	National Ranking
30 Days	1.69	43
60 Days	0.66	40
90 Days or More	3.77	2
Total Past Due	6.11	21
In Foreclosure	3.51	8
Total Past Due or In Foreclosure	9.62	14

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

Duck Video is cool to check out for Mother's Day...and borrowers should look to lock in their rate!

Check out these ducks video, very fitting for Mother’s Day….Speaking of which, Happy Mother’s Day to all you moms out there!

https://www.youtube.com/watch?v=JHy6bBKu0j4#t=13

Financial Markets

The Dow reached its all time high Friday, closing at 16,583. It seems that record highs will be somewhat of a norm until we see a noticeable correction.  Investors, for the first Friday in a while, were ok with leaving holdings in stocks despite the volatility in Eastern Europe.  The rally in stocks resulted in a rally killer in the bond market. 

The Fannie Mae 4.0 coupon improved by roughly 100 basis points over the past two weeks (equivalent to an improvement of roughly .25% in interest rate to the consumer).  The instrument traded positively in 10 of the past 13 trading sessions, and that streak ended Friday as the instrument experienced selling pressure.  Clients should be looking to lock in the rate to avoid the eventual correction.  IMO…..(I recently learned that means “In My Opinion”…LOL)

Southern Nevada Real Estate Related Data

Below is an interesting article sourcing Zillow, who states that The “:breakeven horizon”, or time it takes until owning a home becomes less expensive than renting one, has dropped to 1.5 years, which is one of the fastest rates in the nation.  This, despite one of the fastest home value appreciation percentages in the nation, is due to the rising rent rates in Southern Nevada, according to Zillow. 

http://vegasinc.com/business/real-estate/2014/apr/29/las-vegas-home-market-buying-increasingly-beats-re/?_ga=1.3410100.564569733.1395507077

The median priced home in Southern Nevada dropped 1.5% in April from the month prior, but up 15% from April 2013.  This should not be deemed as all that concerning as most real estate economists predict a “bobbing along”, and would expect to see rolling hills (as opposed to jagged cliffs)  on its way to 5% annual appreciation. 

http://vegasinc.com/business/real-estate/2014/may/08/slight-dip-las-vegas-home-prices-investors-back/?_ga=1.73483542.564569733.1395507077

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

Bad Vlad means lower US Mortgage Rates...Condo and Foreign Nat'l financing now available

PRODUCT UPDATE ALERT!!

Non-Warrantable Condo AND Condotel Financing now available through First Cal!!- Parameters as follows:

·         Minimum loan amount $100,000

·         Maximum loan amount $3,000,000

·         Primary Residence LTV up to 80%

·         Investment Property LTV up to 60%

·         Condotel LTV up to 75%

***Condo development cannot be in litigation for anything structurally related.

PRODUCT UPDATE ALERT!!

Foreign National financing now available through First Cal!!-Parameters as follows:

·         TIN or SSN required

·         50% max LTV (Can be higher if used for vacation purposes)

·         No foreign credit report required 

·         Full doc loan.  All documents must be translated to English.  Income and assets converted to U.S. dollars.

Financial Markets

The Dow Jones needle barely budged, and in the past month hasn’t moved more than 300 pts in either direction.  Friday the Dow dropped 140 pts and ended at 16,361, primarily influenced by the political volatility in the Ukraine and Vlad Putin’s even more volatile brain…

The Fannie Mae 4.0 Coupon has been equally flat relatively speaking, but rallied to go along with the stock market sell-off and improved by about 40 basis points…So always remember, a crazy Russian Prime Minister acting crazy often means lower mortgage rates in the U.S. 

Southern Nevada Real Estate Related Data

The Shops at Summerlin continue a torrid construction pace and is set to open before the 2014 holiday season.  The Shops at Summerlin is the biggest retail development in over 30 years, dating back to the Fashion Show mall that opened in 1981.  Plans were recently announced to build a luxury condo development adjacent to the mall, which is scheduled to break ground around the time the mall will be opening. 

http://www.reviewjournal.com/business/economy/mall-construction-track-holiday-season-opening

http://vegasinc.com/news/2014/apr/23/developers-building-luxury-apartments-next-shops-s/?_ga=1.95634456.564569733.1395507077

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html

8.9 million jobs gained in last 6 years...This would be pretty awesome if we didn't lose 8.8 million jobs two years prior.

Take Advantage of FirstCal’s sponsorship of the Quarterly Housing Report on April 22^nd, at 8:30 Am at the Sun Coast Casino, by replying to this email stating you would like to attend, and your admission will be free!  (After Monday Admission will be $25).  Below is a you-tube video of who will be speaking at the event.  

https://www.youtube.com/watch?v=VG-jH4DLQvc&feature=em-share_video_user

Financial Markets

The Dow Jones, Nasdaq and S and P all stumbled to the finish line Friday, with the Dow dropping 160 points, and losing roughly 1% for the day.  The Dow ended trading at 16,412.  The labor report was released and is often a market mover but was not considered the catalyst for stock sell offs yesterday.  March resulted in roughly 192,000 jobs created, just shy of analysts’ expectations of 200,000 jobs and down slightly from February’s 197,000 jobs created.

 As a side note, this month’s report also signifies that the country has gained back all 8.8 million jobs lost during the Great Recession…Just took an easy breezy 6 years to do it.  This is not deemed as beacon of light for recovery because the labor force grows every year, but a milestone none the less.

Mortgage Backed Securities experienced calm trading sessions for the past two weeks and the Fannie Mae 4.0 Coupon did not swing in either direction more than 50 basis points.  (50 basis points loosely translate into .125% in interest rate to the consumer).

Southern Nevada Real Estate Related Data

Interesting article about am underground home that was recently purchased for 1.15 million…You can tell I was searching for content this morning!

http://www.vegasinc.com/news/2014/apr/04/mysterious-group-buys-underground-doomsday-house-l/

Also pretty cool, the Ivanpah Solar Plant located along I-15 south of Las Vegas opened in February, and is the largest Solar Plant in the world.  The article states it can generate enough power to light 140,000 homes. (Not sure if that means, “light” or “power” and more specifically if it includes the AC units…..)

http://www.reviewjournal.com/columns-blogs/john-l-smith/ivanpah-solar-plant-changes-nevada-s-landscape 

For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html