Timber Ridge Properties shares the following from an article written by Ruth Simon for the Wall Street Journal December 19, 2009:
Some mortgage insurers and lenders are beginning to relax their down-payment requirements, in a sign of increased confidence in the housing market.
The changes, which are being done on a market-by-market basis, mean buyers in some parts of the country can now borrow 95% instead of 90% of a property's value. Until recently, mortgage companies had tighter standards for these markets because of falling home prices.
"We are feeling better about the economic condition of the marketplace," said Michael Zimmerman, senior vice president of investor relations at mortgage insurer MGIC Insurance Corp. Borrowers who want to finance more than 80% of a home's value must typically purchase mortgage insurance.
Earlier this month, MGIC removed New Orleans, Dover, Del., Akron, Ohio, and four other areas in Ohio from its list of restricted markets. The moves followed the company's decision in September to loosen restrictions on 11 markets, including DENVER and St. Louis.
Under the looser requirements, a borrower with a credit score of 680 or higher in New Orleans, for instance, can finance up to 95% of a home's value. Before the change, a borrower who wanted to finance that much of a home's value would have needed a credit score of at least 700.
In September, Genworth Financial Inc. winnowed its list of declining and distressed markets to five states: Arizona, California, Florida, Michigan and Nevada. That removed 63 markets from the list and followed an action in July that removed 136 other metro areas from the list.
"We've seen some stabilization in the housing market," said Kevin Schneider, president of Genworth. While "additional home price declines" are likely, he added, tighter credit standards, including the requirement of full documentation and higher credit scores, should limit delinquencies.
Credit remains tight in some markets, such as Florida, because of concerns about additional home-price declines. Mortgage companies continue to closely scrutinize property appraisals, making it difficult for some borrowers to get financing. Amid persistent high unemployment, lenders and mortgage insurers are maintaining tough standards for credit scores, documentation and other measures of creditworthiness.
In some cases, those standards are still getting tougher. Fannie Mae, the government-controlled mortgage company, last week raised its minimum credit score to 620 from 580.
But the latest moves, while modest, are an indication that some mortgage companies believe the worst home-price declines are over -- at least in certain parts of the country -- and that prices are likely to stabilize or fall slightly over the coming year.
A rosier view of the housing market isn't the only factor driving the changes. Mortgage insurers also are seeking to regain market share from the Federal Housing Administration.
New insurance written by private mortgage insurers dropped by nearly 60% in the first nine months of 2009, compared with the same period a year ago, according to Inside Mortgage Finance. Borrowers without sufficient funds for a 20% down payment have been flocking to the FHA, which lends to people with as little as a 3.5% down payment.
"To have any presence in the mortgage market, the mortgage insurers have to be more flexible," said Guy Cecala, editor of Inside Mortgage Finance, a trade publication. The mortgage insurers had gotten so strict, he noted, that their standards were tougher than those of Fannie Mae and Freddie Mac.
Meanwhile, some mortgage lenders are revisiting policies that were even tougher than those of the insurers.
Wells Fargo & Co. executives met Friday for their quarterly review of market-based lending standards. For the first time since 2007, more markets will be moving to a less-risky status and lower down-payment requirements. Among those benefiting are parts of central California.
Even in some of the country's most troubled markets, "we are starting to see...moderation" said Neil Librock, head of credit risk for the bank's home and consumer-finance group. Wells Fargo's changes could benefit borrowers the bank has been requiring to make down payments of more than 20%, he said.
Tuesday, December 22, 2009
HAPPY HOLIDAYS FROM TIMBER RIDGE PROPERTIES
Timber Ridge Properties is wishing all our homeowners and neighbors in The Timbers at the Pinery the very best of Christmas and New Year's Holidays - We are so optomistic about 2010 and will look forward to the opportunity to celebrate the new year with each and every one of you.
Tuesday, December 15, 2009
DENVER HOMEBUILDERS SEEING SIGNS OF A TURNAROUND
Timber Ridge Properties quotes Margaret Jackson of the Denver Post - her article dated 12/10/09 follows:
Though it's a far cry from the boom times of just a few years ago, Denver builders are starting to see demand increasing for new homes, especially among first-time buyers.
Builders in the Denver market were selling on average one home per community per month during the third quarter, said Jay Peterson, regional manager for Hanley Wood Market Intelligence. That's up from 0.7 homes a month during the same period last year.
Peterson also noted that cancellations are down 40 percent year-over-year.
"It shows more of a serious and intent buyer," he said.
Richmond American Homes reported 197 orders for new homes in Colorado in the third quarter, compared with 105 during the same time last year, said Zane DeHerrera, spokesman for MDC Holdings-Richmond American Homes.
"Back in the third quarter of '08, the capital markets froze," DeHerrera said. "That really impacted consumer confidence and slowed down lending tremendously."
Factors contributing to the increased activity include the first-time-homebuyer tax credit — which was recently expanded to include buyers who have owned their homes for at least five years — low interest rates and fewer existing homes on the market.
"We're definitely in the first stages of a real-estate recovery as it relates to residential," said Pat Hamill, president of Oakwood Homes. "We're starting to see values stabilize, inventories drop and people starting to feel good that this is the right time to buy because pricing has dropped significantly."
Jim Capecelatro, a broker with Fuller real estate who specializes in land deals, said he's starting to see more lots sold to homebuilders. Of the eight transactions he's completed in the past six months, five were builder deals with a combined total of nearly 1,600 finished and platted lots.
"In general, the consensus from builders is that we are at the bottom of the market in Denver and poised for recovery," Capecelatro said.
(Andy Cross, The Denver Post)"New-home and resale inventories are down, and demand for new housing, especially in the entry-level category, is on the rise."
Denver builders are on pace to pull slightly more than 4,000 permits this year, well below the 25,000 recorded in 2005, according to a Hanley Wood study.
"We believe that a normal market in Denver should be about 15,000 homes," DeHerrera said. "2005 was not normal. The market won't rebound as fast as it fell."
Margaret Jackson: 303-954-1473 or mjackson@denverpost.com
Though it's a far cry from the boom times of just a few years ago, Denver builders are starting to see demand increasing for new homes, especially among first-time buyers.
Builders in the Denver market were selling on average one home per community per month during the third quarter, said Jay Peterson, regional manager for Hanley Wood Market Intelligence. That's up from 0.7 homes a month during the same period last year.
Peterson also noted that cancellations are down 40 percent year-over-year.
"It shows more of a serious and intent buyer," he said.
Richmond American Homes reported 197 orders for new homes in Colorado in the third quarter, compared with 105 during the same time last year, said Zane DeHerrera, spokesman for MDC Holdings-Richmond American Homes.
"Back in the third quarter of '08, the capital markets froze," DeHerrera said. "That really impacted consumer confidence and slowed down lending tremendously."
Factors contributing to the increased activity include the first-time-homebuyer tax credit — which was recently expanded to include buyers who have owned their homes for at least five years — low interest rates and fewer existing homes on the market.
"We're definitely in the first stages of a real-estate recovery as it relates to residential," said Pat Hamill, president of Oakwood Homes. "We're starting to see values stabilize, inventories drop and people starting to feel good that this is the right time to buy because pricing has dropped significantly."
Jim Capecelatro, a broker with Fuller real estate who specializes in land deals, said he's starting to see more lots sold to homebuilders. Of the eight transactions he's completed in the past six months, five were builder deals with a combined total of nearly 1,600 finished and platted lots.
"In general, the consensus from builders is that we are at the bottom of the market in Denver and poised for recovery," Capecelatro said.
(Andy Cross, The Denver Post)"New-home and resale inventories are down, and demand for new housing, especially in the entry-level category, is on the rise."
Denver builders are on pace to pull slightly more than 4,000 permits this year, well below the 25,000 recorded in 2005, according to a Hanley Wood study.
"We believe that a normal market in Denver should be about 15,000 homes," DeHerrera said. "2005 was not normal. The market won't rebound as fast as it fell."
Margaret Jackson: 303-954-1473 or mjackson@denverpost.com
Thursday, December 10, 2009
THINGS ARE HEADED IN THE RIGHT DIRECTION!
TIMBER RIDGE PROPERTIES shares excerpts from this encouraging article:
December 9, 2009
Direction Right
Written by Jeff Thredgold, CSP, President, Thredgold Economic Associates
A recent chart of job losses represents near continual improvement (fewer monthly job losses) as we progressed throughout 2009. Let’s hope that such a pattern continues, with actual and consistent monthly job gains sooner rather than later.
The American economy lost an estimated 11,000 net jobs during November, many fewer than the 125,000 loss expected by financial market players and economists. More impressive was the sharp downward (or is it upward?) revision to job losses of the two prior months. The Bureau of Labor Statistics noted that an estimated 159,000 fewer jobs were lost in September and October than reported previously.
A Decline!
Even better was the unexpected decline in the nation’s unemployment rate from 10.2% in October to 10.0% in November. Note, however, that most forecasters still expect the jobless (unemployment) rate to reach, or exceed, 10.5% before mid-year 2010.
The “feel good” overall flavor of the jobs report was one more validation, one more piece of evidence that the longest, most painful, most destructive recession since the Great Depression is over. As noted before…Good Riddance!
December 9, 2009
Direction Right
Written by Jeff Thredgold, CSP, President, Thredgold Economic Associates
A recent chart of job losses represents near continual improvement (fewer monthly job losses) as we progressed throughout 2009. Let’s hope that such a pattern continues, with actual and consistent monthly job gains sooner rather than later.
The American economy lost an estimated 11,000 net jobs during November, many fewer than the 125,000 loss expected by financial market players and economists. More impressive was the sharp downward (or is it upward?) revision to job losses of the two prior months. The Bureau of Labor Statistics noted that an estimated 159,000 fewer jobs were lost in September and October than reported previously.
A Decline!
Even better was the unexpected decline in the nation’s unemployment rate from 10.2% in October to 10.0% in November. Note, however, that most forecasters still expect the jobless (unemployment) rate to reach, or exceed, 10.5% before mid-year 2010.
The “feel good” overall flavor of the jobs report was one more validation, one more piece of evidence that the longest, most painful, most destructive recession since the Great Depression is over. As noted before…Good Riddance!
Tuesday, December 8, 2009
NEVER A BETTER TIME THAN NOW TO BUILD A NEW CUSTOM HOME WITH TIMBER RIDGE PROPERTIES
I hear people saying that they just can't build their new dream home today because they can't sell their present home for what they think it is worth. The good news is that construction labor and materials costs are down significantly in today's economy. Prices have never been better for building a new custom home. So it appears that any appreciation lost on the sale of a present home would be more than recapped with the savings of building today. Another plus is that it takes about 15 months (more or less) to design and build a new custom home. So if you were to start today (and you need to start today to take advantage of low prices before they go back up), by the time your new home is done, chances are good that the shortage of resale homes will drive the value of your present home back up to some extent. A win win situation!
Just something worth considering :)
Marianne Wise - Timber Ridge Properties
Just something worth considering :)
Marianne Wise - Timber Ridge Properties
Wednesday, December 2, 2009
THE TIME IS NOW! THINGS ARE LOOKING UP!
Timber Ridge Properties shares with you excerps from a piece by Jeff Thredgold, President of Thredgold Econommic Associates - written December 2, 2009 - OUTLOOK 2010
THE U.S. ECOMONY - GROWTH HAS RETURNED
The American economy finally returned to “growth mode” during 2009’s second half, fueled in part by extremely aggressive fiscal and monetary stimulus. Pent-up demand by consumers, combined with stronger global performance, also added to growth numbers. A return to positive U.S. economic growth does not imply that problems with commercial real estate, housing, and emotional financial markets are finally behind us, but it clearly helps.
The revised 2.8% inflation-adjusted annual growth pace during the third quarter was a major departure from the 6.4% real annual rate of decline during 2009’s first quarter. A similar 2.6%-3.0% real growth pace seems likely in coming quarters.
The longest, deepest, most painful, and most pervasive recession since the Great Depression has officially been with us since December 2007. Good Riddance!
LONG TERM INTEREST RATES
…time is now
NOW is a very attractive time to refinance a mortgage or buy a new home or foreclosed property. Mortgage rates for conventional loans have been at or near 40-year lows in recent weeks. Mortgage finance for higher-priced homes remains spotty in too many communities. Unfortunately, one in four U.S. home owners are now “underwater” on their mortgages…owing more than the home is worth.
HOUSING
…more stable prices
More housing markets around the nation have stabilized, following the most painful downward adjustment to U.S. home values since the Big D. While further price adjustments are likely in markets that simply got carried away during 2003-2007, modest home price gains could become the norm in numerous communities in 2010.
THE GLOBAL ECOMONY
…a solid 2010?
The global economy returned to growth faster than expected during 2009’s final few months, led by an Asian resurgence. Renewed growth follows the first global recession since just after World War II.
China’s economic growth engine reaccelerated in recent months, following weaker performance 9-12 months ago. Powerful growth has been fueled by massive government spending and aggressive bank lending. China is making efforts to boost domestic demand within its economy, while lessening its dependence upon exports.
Japan returned to modest growth during the most recent quarter, following this nation’s most painful recession since just after World War II. Even so, ongoing economic growth prospects are limited, tied to a massive public debt, an aging (and declining) population, and millions of disillusioned consumers who have lost faith in the prospect of rising living standards following 20 years of economic stagnation.
India’s economy has picked up speed in recent months after recession-induced slowing. Solid growth is likely over the next 12 months. India joined China and Indonesia as the three Asian nations to avoid serious recession during the past year (Reuters).
The European economy returned to modest growth during the most recent quarter, led by Germany. Even so, euro strength versus the dollar has led anxiety levels sky-high in export and tourism-focused sectors. The U.K. remains in recession, with minimal growth likely during 2010.
Russia continues to struggle with an overdependence upon energy and commodity prices. Various Middle Eastern nations are trying to limit the damage from Dubai’s recent major debt challenges.
Most South American nations have seen more signs of recent economic improvement, even as major challenges of “doing business” remain. Major oil finds off Brazil’s coast could impact global energy dynamics in coming years.
Mexico remains mired in recession, tied in part to declining oil revenue and major hits to its critical tourism sector. Very aggressive pricing in resort communities should help limit the pain during 2010. The Canadian economy seems in transition to modest growth following its own recession. Even so, total employment is down 400,000 from its October 2008 peak.
THE BOTTOM LINE?
The painful and lengthy U.S. recession has finally given way to a reasonable growth pace, although serious challenges remain. We also expect…unprecedented budget deficits in coming years…mixed employment news…modest inflation this year and next…extremely low short-term and attractive long-term interest rates, with stable housing markets…and an improving global economy.
THE U.S. ECOMONY - GROWTH HAS RETURNED
The American economy finally returned to “growth mode” during 2009’s second half, fueled in part by extremely aggressive fiscal and monetary stimulus. Pent-up demand by consumers, combined with stronger global performance, also added to growth numbers. A return to positive U.S. economic growth does not imply that problems with commercial real estate, housing, and emotional financial markets are finally behind us, but it clearly helps.
The revised 2.8% inflation-adjusted annual growth pace during the third quarter was a major departure from the 6.4% real annual rate of decline during 2009’s first quarter. A similar 2.6%-3.0% real growth pace seems likely in coming quarters.
The longest, deepest, most painful, and most pervasive recession since the Great Depression has officially been with us since December 2007. Good Riddance!
LONG TERM INTEREST RATES
…time is now
NOW is a very attractive time to refinance a mortgage or buy a new home or foreclosed property. Mortgage rates for conventional loans have been at or near 40-year lows in recent weeks. Mortgage finance for higher-priced homes remains spotty in too many communities. Unfortunately, one in four U.S. home owners are now “underwater” on their mortgages…owing more than the home is worth.
HOUSING
…more stable prices
More housing markets around the nation have stabilized, following the most painful downward adjustment to U.S. home values since the Big D. While further price adjustments are likely in markets that simply got carried away during 2003-2007, modest home price gains could become the norm in numerous communities in 2010.
THE GLOBAL ECOMONY
…a solid 2010?
The global economy returned to growth faster than expected during 2009’s final few months, led by an Asian resurgence. Renewed growth follows the first global recession since just after World War II.
China’s economic growth engine reaccelerated in recent months, following weaker performance 9-12 months ago. Powerful growth has been fueled by massive government spending and aggressive bank lending. China is making efforts to boost domestic demand within its economy, while lessening its dependence upon exports.
Japan returned to modest growth during the most recent quarter, following this nation’s most painful recession since just after World War II. Even so, ongoing economic growth prospects are limited, tied to a massive public debt, an aging (and declining) population, and millions of disillusioned consumers who have lost faith in the prospect of rising living standards following 20 years of economic stagnation.
India’s economy has picked up speed in recent months after recession-induced slowing. Solid growth is likely over the next 12 months. India joined China and Indonesia as the three Asian nations to avoid serious recession during the past year (Reuters).
The European economy returned to modest growth during the most recent quarter, led by Germany. Even so, euro strength versus the dollar has led anxiety levels sky-high in export and tourism-focused sectors. The U.K. remains in recession, with minimal growth likely during 2010.
Russia continues to struggle with an overdependence upon energy and commodity prices. Various Middle Eastern nations are trying to limit the damage from Dubai’s recent major debt challenges.
Most South American nations have seen more signs of recent economic improvement, even as major challenges of “doing business” remain. Major oil finds off Brazil’s coast could impact global energy dynamics in coming years.
Mexico remains mired in recession, tied in part to declining oil revenue and major hits to its critical tourism sector. Very aggressive pricing in resort communities should help limit the pain during 2010. The Canadian economy seems in transition to modest growth following its own recession. Even so, total employment is down 400,000 from its October 2008 peak.
THE BOTTOM LINE?
The painful and lengthy U.S. recession has finally given way to a reasonable growth pace, although serious challenges remain. We also expect…unprecedented budget deficits in coming years…mixed employment news…modest inflation this year and next…extremely low short-term and attractive long-term interest rates, with stable housing markets…and an improving global economy.
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