The Bulls continue to run as the Down Jones gaining another 1.5% (181 pts) and ended the week at 12,273. Friday’s micro-rally stemmed from the announcement of Egyptian President Mubarak’s decision to resign as well as a US Consumer Sentiment report that met expectations. Included in the report was the Barometer of Economic Conditions that reached a level of 86.8, which is the highest it has been in over 3 years.
Mortgage rates continue to inch higher as stocks continue to gain ground. Also contributing to the bond market sell-off is the rise in commodities.
A significant 3-pronged proposal by the White House to unwind and dismantle Fannie Mae and Freddie Mac was released Friday. The premise and hope is that the private markets, over time, will take over for Fannie Mae and Freddie Mac. The general consensus is that it will inevitably lead to higher mortgage rates for the consumer, but that it will take years to make the transition. Below is a link to an article in the USA Today that discusses the proposal.
http://www.usatoday.com/money/economy/housing/2011-02-11-fannie-freddie-mortgage-overhaul_N.htm?csp=34money&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+UsatodaycomMoney-TopStories+%28Money+-+Top+Stories%29
Local Economy and Real Estate Market
This past week I attended a round table discussion in which Real Estate Attorney, Robert Noggle, informed the attendees about how foreclosure mediation works, and I thought I would share with you the “cliff notes”. Basically, once a home owner receives a Notice of Default, they have 30 days to request mediation. In this instance, the home owner has the opportunity to meet with a representative from the bank for up to 4 hours to come to a resolution. Robert mentioned that over 50% walk away with a resolution. He also recommended that a homeowner bring an attorney with them, and was the first to admit that there was a self-interest in the recommendation but that there were other valid reasons why the homeowner should have representation. Below is a link to the Nevada Supreme Court website where a home owner can look into mediation procedures.
Dennis Smith released predictions for real estate in 2011. If your 2010 was successful, then expect more of the same. He expects new home sales, re-sales and home values to be relatively flat, with small upticks in re-sales.
