[quote=bearishgurl]
The FHA has absolutely no business whatsoever “guaranteeing” a mortgage for this type of purchase, IMO. That’s not what the FHA was put in place for. The FHA was formed to serve moderate income purchasers shopping for a roof over their heads, the vast majority being FTB’s buying starter homes and/or in underserved areas.
The current FHA loan “ceiling” of $697,500 for a one-family SFR in SD County is turning out to be a bad joke … as predicted by a few of us here over the years. The joke is on ALL taxpayers, all over the country.[/quote]
FHA default rates are up around 10% right now. FHA MIP has been skyrocketing as that default rate has increased and FHA reserves have gone negative. The reason FHA got so popular is it was the only high leverage game in town when the bubble popped. The saving rate in the nation is a record lows. At some point you need the underlying economy and wages to push housing up. You can game it high with increasing amounts of leverage and lower rates but that only lasts so long.
That’s why I’m of the belief that right now or in the next year might be a really good time to sell. Almost every market condition in terms of rates, leverage, constrained inventory, etc. is in the sellers advantage right now. You’re looking for an improving wage and employment situation without any impact in rates to really push it higher on fundamentals.
