Hello Everyone,
The market remains on the same track as last week with minor changes. The most significant change is that the $2-$3 million Single Family Residence segment, though still a buyers' market, has continued to show strength by rising to 23% in contract, just south of a balanced market. Improvement in the over-$3million SFR market as well.
Big news this week is that mortgage lenders continue to be under duress. American Home Mortgage, the nation's 10th largest lender announced they are unable to fund their loans, and word has it they are closing their doors. Recent bad news in the mortgage industry has made it more difficult for lenders to package and sell their loans in the money markets and has forced them to sell at lower prices.
This is important to buyers and sellers because it makes it more difficult and more expensive for borrowers to obtain the funds they need to purchase property. Lending and credit standards are tightening. No-doc loans are drying up. Borrowers in many cases are forced to qualify at the fully-amortized rate rather than the introductory "teaser" rate.
Borrowers should take care to find a reliable locally based lender and be sure they are actually pre-approved. This means that the lender or the broker has verified credit and assets, reviewed the loan application, and, often, run it by an underwriter.
Sellers. This is a time when the knowledge and services of an experienced REALTOR are invaluable. The agent can follow up on the buyer's pre-approval, help the seller set appropriate contractual standards for loan approval and contingency removal, closely follow and track the process. This helps avoid unpleasant surprises just before closing when a shaky lender shuts its doors, leaving both seller and buyer in the lurch.
More next week---- (including the monthly City-By-City Report)
Until then---
Best wishes,
Fred
for access to spreadsheets please visit my website http://www.fredanlyan.com/
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