I want to wish you a Happy New Year’s and looking forward to working with you in 2013!
Financial Markets
The latest and greatest played out economic term, “Financial Cliff”, for the most part came to a conclusion this past week and had a dramatic affect on the markets. The Dow Jones skyrocketed 400 points on the news that President Obama signed the bill to raise taxes and cut spending. (401k’s win!). As is often the case when stocks rally, the bond market had a miserable day, and selling pressure sent the FNMA 3.0 coupon (bond most directly related to 30 yr fixed mortgage) down 100 bps. This essentially equates to a .125% to .25% move in interest rates for 30 yr fixed mortgages. (borrowers lose!)
Much of the tax increases apply to those making $400,000 or $450,000 for married couples. The tax rate increases from 35% to 39.6% and capital gains increases from 15% to 20%. However, buried in the bill are limits on tax deductions for those making more than $250,000. Social security withholdings goes back up to 6.2% (of the first $112,500) AND Medicare Tax goes from 1.45% to 2.35%, again, only applying to married couples making over $250,000 or $200,000 for singles…I guess it’s time to get on match.com….
As most of you I am sure have heard, included in the bill is the extension of the mortgage debt relief act.
Southern Nevada Real Estate Related Data
Nearly 4,000 home sales transpired for the month of November, and new home builders accounted for nearly 15% of the sales. (596). Developers also pulled 478 permits for the month, nearly twice as many as November 2011. The median priced home approached $133,000, up from $114,000 this time last year (17%).
Have a great week! For more real estate financing information, please visit my website: http://www.matthewtmaltese.com/home.html
