The rescue housing bill has finally passed the House and Senate. President Bush is expected to sign it into law. There are many aspects of this bill, some good, and some not so good. Looking over the highlights, there is one that will in my opinion, make an immediate impact:

From the WSJ On-line addition:

It also includes tax relief for future homebuyers and current homeowners. First-time homebuyers purchasing a home between April of this year and through June of next year would receive a tax credit for 10% of the value of their home, up to $7,500, while current homeowners who do not itemize their tax returns would be able to deduct up to $1,000 for property taxes.

A tax credit of this size will certainly encourage first time homeowners (those who can still qualify for a loan) to get off the fence and take the plunge. Hopefully, realtors and mortgage bankers will do a good job advertising this provision.

There are many more provisions in the bill that may or may not help the industry, but one thing is for sure, the rules of the game have changed.

Visit again over the next couple of weeks, as I will highlight other provisions in the law. Its vital to stay abreast of the changes that this law will no doubt bring to our industry.

I love to read these types of articles. It shows how our open market economy can find a way to both make a profit and help their fellow man at the same time. With all the talk of the upcoming government bail-out, it is refreshing to see workouts happening without government intervention. Look for these companies to have a bigger role in the near future.

want to see more?  www.alhousinginfo.com

 

 

 

 

I'm sure most of you have heard this expression. I have to say, when it comes to updated information on these home buying or mortgage finder websites, the expression really hits home. I was reading my daily update from Inman News, and they are featuring the web site Homethinking.com The site promotes itself to be a resource for those people wanting to buy a house, or to find a mortgage company in the area. It has a list of realtors that are connected to a given market. It also has a mortgage link that tells you information about the loans that were obtained for the market, including the largest lenders. All of this information is pulled from HMDA data that is mandated by the government for monitoring purposes. Sounds pretty good, right? WRONG. All of the information is pulled from 2006. That's right, 2006. It shows the leading mortgage company in 2006, the top sales from agents in 2006, and statistical analysis from 2006. Why bother? Two year old information on the housing market is not valuable, and in fact, may hurt a person who doesn't see the fine print.

It appears to be another gimmick site that wants to get leads to its vendors. There are multiple places to contact a real estate broker or to get mortgage rate quotes. This site is part of the problem, and shame on Inman for promoting it.

March saw an increase of 19% in the number of homes sold in the Birmingham area, and an increase of 11% for the entire state. The average sales price was up for Birmingham, as was the median price. Here is the link to the Alabama Center for Real Estate web site. Alabama continues to show positive housing stats despite the fear and despair that is being experienced in other parts of the US. Anyone involved in this industry should keep this information handy so we can educate anyone who thinks that the sky is falling.

It looks as if any housing bill may take some time. I'm glad there isn't a consensus on what to do. Everyday I read another article with valid points, interesting solutions, or just insane proposals. Everyday that goes by, people are voicing opinion, and hopefully, someone is listening to them all. I came across this article on a website I don't normally visit. This author makes the case that Congress should set up an advisory committee to assist in making legislation. He suggests an industry veteran that watched it all happen. A person that understands what happened to the borrowers, and which ones were speculating, committing fraud, or just trying to have their families live in a more desirable neighborhood. I would want it to be someone that has been canned from his mortgage job, or that loss his company and has suffered great financial loss. Someone who has both felt the pain, and knows how the game was played. Someone that won't spend time pointing fingers, but instead, offering solutions.

It looks as if any housing bill may take some time. I'm glad there isn't a consensus on what to do. Everyday I read another article with valid points, interesting solutions, or just insane proposals. Everyday that goes by, people are voicing opinion, and hopefully, someone is listening to them all. I came across this article on a website I don't normally visit. This author makes the case that Congress should set up an advisory committee to assist in making legislation. He suggests an industry veteran that watched it all happen. A person that understands what happened to the borrowers, and which ones were speculating, committing fraud, or just trying to have their families live in a more desirable neighborhood. I would want it to be someone that has been canned from his mortgage job, or that loss his company and has suffered great financial loss. Someone who has both felt the pain, and knows how the game was played. Someone that won't spend time pointing fingers, but instead, offering solutions.

I have linked a page that summarizes the proposed laws for the foreclosure prevention act of 2008. I am pleasantly surprised with the fact that I don't see any "get out of jail free" cards to borrowers, mortgage companies, or Wall St. firms. I don't see any major moral hazards in the bill, and the modernization of FHA will help, since it will become more and more valuable program as we go through this down cycle. I hope this bill will pass as it is.

Like it or not, some sort of borrower bail-out law is on the way. There is some good news about the recent Senate proposal in that the bankruptcy cram down provisions have been dropped. Also, the proposal to have FHA buy up mortgages at a reduced balance has been omitted. The rest of the law, however, will have a negative effect on the housing recovery. The law may help some homeowners stay in their houses, but doing this will prolong the declining values, and keep the banks very tight on credit. It was inevitable that a some sort of law was going to be passed, as it is an election year. Hopefully, this one won't do more harm than good.

I linked the LA Times version because it seems to be in favor of the bankruptcy "cram down" provision that would allow bankruptcy judges to alter interest rates and terms on exisiting mortgage debt. This is by far the most dangerous and careless idea that has been proposed. Allowing this to happen would undermine the entire financial system and bottleneck the courts with undeserving borrowers looking for a better rate on their mortgage.

Despite the headlines, February was a very positive month for Birmingham area housing sales. Sales were up 5% from the previous month, and days on the market were down dramatically. Now, if we could just convince the news reporters to provide more accurate headlines. This link on the Birmingham Business Journal is just one example. They chose the report the numbers as a negative since February's numbers were down from February of last year. I know this is normally a popular way to read the stats, but everyone knows we are in a down market, and it will take until 2009 for monthly numbers to exeed previous year's. An article that had a positive headline would have attracted more readers.

This is by far the most encouraging article I have seen in months. Finally, someone took the time to look at the affordability of a market, not just median values, which have fallen everywhere. Birmingham ranks 3rd in the US for most affordable housing. The index takes into consideration two major factors that most analyst miss: property taxes and personal income. Here is a link to the story.

I hope the local media will pick up on this story and promote the city. This should be included in every real estate agents newcomer guide and promo material.

The article also shows how out of whack the housing market is in California. I think the housing bubble will be bursting there for another year or two. You can look for mortgage lenders and MI companies to adversely select these markets even more so that they do today.