Are Property Appraisals holding back or delaying “normal appreciation”?

Mortgage and Lending with CNN Mortgage

Home prices ARE bottoming for homes selling in the first time home buyer range.   As a place to start, one would assume move up home market would be next, and eventually the luxury home market with help from a stronger economy.

When prices start to increase as we come out of this recession (competitive bidding on discounted prices offered by REO sellers) doesn't that mean buyers are willing to pay more? Unfortunately, because appraisals are based on comparable sales recorded in the last 60 to 90 days, you will be hard pressed to find an appraiser that will actually state in writing that values are moving up.  Appraisals are still coming in lower than the agreed-upon price in the purchase contract.   

Trends in credit policy and collateral valuation are changing rapidly this year.  30 days is an eon in this market and August appraisal reports will start to show signs of a recovering housing market in some neighborhoods.  This is because recorded sales will tell the truth and appraisers will have solid numbers to back up the trend.

 Interest Rates for July 1st, 2009 The stock market is having a good morning - the DOW is up 100 points, taking some investors away from Mortgage Backed Securities.  Prices are holding their own though and rates look good. 

Best Conforming Conventional 30Yr Fixed  5.625%

Best Conforming Conventional 15Yr Fixed  5.125%

Best Conforming Conventional 5/1 ARM 4.750%

Best Conforming Conventional 5/1 IO ARM 4.875%

Best Jumbo 5/1 Arm  5.625%

Best Jumbo 30Yr Fixed 6.625%

Best FHA 30Yr Fixed 5.500%

Best FHA 5/1 ARM 4.750%

* Above Conventional rate quotes are as of  7/01/09 on a Conventional $165,000 loan amount, primary residence at 80% loan to value, with a 720 FICO score.  APR includes $1,200 in lender fees and 980 in title charges (title charges may vary).  FHA Quote assumes a $125,000 loan amount and a 680 FICO score, and a 96.5% LTV. Jumbo quote assumes a 75% LTV and 680 FICO score.   Documentation of income and assets required.  No origination or discount points.



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