Home prices were growing at nearly a 15% year-over-year clip back in 2001.
Today, they're falling at nearly a 10% pace.
Saturday, March 15, 2008
Homebuilders Rally On Proposed Plan To Stem Rise In Foreclosures.
Shares of major homebuilders rose sharply Thursday after the government unveiled a new plan to stem the significant rise in mortgage foreclosures.
The iShares Dow Jones U.S. Home Construction ETF (ITB) rose... 4% to $17.75.
The S&P Homebuilders SPDR (XHB) traded up 4% to $19.97...
House Financial Services Committee Chairman Barney Frank announced a proposal for legislation Thursday to allow the Federal Housing Administration to insure and guarantee refinanced mortgages that have been significantly written down by mortgage holders and lenders.
The program would permit FHA to provide up to $300 billion in new guarantees that would help to refinance at-risk borrowers into viable mortgages.
The iShares Dow Jones U.S. Home Construction ETF (ITB) rose... 4% to $17.75.
The S&P Homebuilders SPDR (XHB) traded up 4% to $19.97...
House Financial Services Committee Chairman Barney Frank announced a proposal for legislation Thursday to allow the Federal Housing Administration to insure and guarantee refinanced mortgages that have been significantly written down by mortgage holders and lenders.
The program would permit FHA to provide up to $300 billion in new guarantees that would help to refinance at-risk borrowers into viable mortgages.
Friday, March 14, 2008
All the King's Horses and All the King's Men...
.... Can't Seem to Put the Market Back Together Again
Despite all the government intervention ... and artificial monetary stimulus ... when you look around, not much has changed.
We're still awash in millions of excess homes ...
We're still witnessing the sharpest home price declines in decades ...
We're still seeing hedge fund implosions ... mortgage company meltdowns ... and multi-billion dollar write-downs almost every day.
Just this week, a mortgage bond fund run by the high-powered private equity firm Carlyle Capital essentially collapsed. The fund couldn't meet more than $400 million in margin calls from its lenders, forcing it to default on a whopping $16.6 billion in debt.
Bloomberg puts the total count of losses and write-downs related to the mortgage crisis at $188 billion ... and counting.
And that just underscores a fundamental point I've been making for a long time ...
The only way to prevent the pain of popping bubbles is to prevent bubbles from inflating in the first place!
Despite all the government intervention ... and artificial monetary stimulus ... when you look around, not much has changed.
We're still awash in millions of excess homes ...
We're still witnessing the sharpest home price declines in decades ...
We're still seeing hedge fund implosions ... mortgage company meltdowns ... and multi-billion dollar write-downs almost every day.
Just this week, a mortgage bond fund run by the high-powered private equity firm Carlyle Capital essentially collapsed. The fund couldn't meet more than $400 million in margin calls from its lenders, forcing it to default on a whopping $16.6 billion in debt.
Bloomberg puts the total count of losses and write-downs related to the mortgage crisis at $188 billion ... and counting.
And that just underscores a fundamental point I've been making for a long time ...
The only way to prevent the pain of popping bubbles is to prevent bubbles from inflating in the first place!
Thursday, March 13, 2008
US Foreclosure Activity Rose in February
Nearly 60 percent more U.S. homes faced foreclosure in February than in the same month last year, with Nevada, California and Florida showing the highest foreclosure rates, a research firm said.
A total of 223,651 homes across the nation received at least one notice from lenders last month related to overdue payments, up 59.8 percent from 139,922 a year earlier, according to Irvine, Calif.-based RealtyTrac Inc.
Nearly half of the homes on the most recent list had slipped into default for the first time.
Nevada had the nation's highest foreclosure rate, with one in every 165 households receiving at least one foreclosure-related notice. It had 6,167 properties facing foreclosure, a 68 percent increase from a year earlier and up 1 percent from January,
A total of 223,651 homes across the nation received at least one notice from lenders last month related to overdue payments, up 59.8 percent from 139,922 a year earlier, according to Irvine, Calif.-based RealtyTrac Inc.
Nearly half of the homes on the most recent list had slipped into default for the first time.
Nevada had the nation's highest foreclosure rate, with one in every 165 households receiving at least one foreclosure-related notice. It had 6,167 properties facing foreclosure, a 68 percent increase from a year earlier and up 1 percent from January,
Wednesday, March 12, 2008
Investing -- Fast!
Today's real estate market is full of great buying opportunities, but getting a loan from a bank can take longer than most sellers are willing to wait. That's why smart investors set up their own system to buy and sell houses without using cash.
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The U.S. Dollar - Uncharted Territory
Even cash isn't safe anymore. The U.S. dollar index, which compares the greenback to the world's major currencies, has fallen about 15% this year and is near its lowest levels ever. Recession fears are driving the dollar lower, as jobs disappear, home prices fall and consumer confidence plummets.
And the Federal Reserve isn't helping out. The market is betting the Fed will lower interest rates by 50 to 75 basis points at its meeting next week. That lowers the yield on the dollar versus other currencies, helping grease the skids to send it even lower.
In short, even if you put all your money in cash, and then put that cash under your mattress, you'll still lose money.
And the Federal Reserve isn't helping out. The market is betting the Fed will lower interest rates by 50 to 75 basis points at its meeting next week. That lowers the yield on the dollar versus other currencies, helping grease the skids to send it even lower.
In short, even if you put all your money in cash, and then put that cash under your mattress, you'll still lose money.
Tuesday, March 11, 2008
Falling Prices
Sales of single-family houses in Connecticut dropped 29% in January, from 2,302 in January 2007 to 1,644 in January 2008… The fifth [consecutive] month… in which sales have dropped by double-digit percentages in Connecticut.
The median sales price of single-family houses fell 5.3% in January from $282,000 in 2007 to $267,000 in 2008… In Hartford County, the median price fell 8%, from $238,750 to $220,000…
The second month in a row that the median sales price has dropped. With spring arriving soon, the drop in median prices is foreboding… Median sales prices held steady in 2007
The median sales price of single-family houses fell 5.3% in January from $282,000 in 2007 to $267,000 in 2008… In Hartford County, the median price fell 8%, from $238,750 to $220,000…
The second month in a row that the median sales price has dropped. With spring arriving soon, the drop in median prices is foreboding… Median sales prices held steady in 2007
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