GSE limits slated to drop (PLUS bonus question for mortgage experts)

[recordsclerk]

I don’t see this affecting the foreclosure and short sale market. That market is filled with buyers with large down payments. I think the big impact will be new housing from builders and resale homes from the flippers. This sub-market is filled with marginal buyers and minimal down payments.

[Anonymous]

Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.

[Anonymous]

Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.

[Anonymous]

Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.

[Anonymous]

Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.

[Anonymous]

Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.

[bearishgurl]

[quote=deadzone]Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.[/quote]

deadzone, I don’t believe ALL homebuyers shopping in the $600K + range are all flush with cash, either. I was referring to those buying in niche coastal markets of predominately custom properties, such as Monterey (ex LJ and DM in SD County).

In less-desirable inland tracts, especially those encumbered by CFD’s, I think many unqualified buyers quickly got in over their heads buying in the over $600K range when they were helped by developers’ designated loan officers (were offered incentives to use them) who put them in 80/20’s, 80/10/10’s, 30 due in 5/7’s, I/O’s and balloon mtg vehicles. Often, there were never any surrounding comps to begin with to command the prices the developers were asking. They just attempted to create their OWN sales comps by making it easy for an unsophisticated buyer to pay top dollar for a house on a substandard lot (often less than 5000 sf).

Yes, I believe the value of inland tracts (east of I-5 in SD County) where the recent sold comps are currently over about $680K could be affected by lower FNMA/FDMC conforming limits. I do NOT believe highly desirable custom areas in coastal zones will be affected, however, as the buyers of each of these types of properties are completely different animals.

edit: I don’t think the lower conforming limit will affect buyers of acreage either (ex East County). This type of buyer is typically 50+ years old and often has plans for new construction or a major gut/rehab prior to even making an offer.

[bearishgurl]

[quote=deadzone]Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.[/quote]

deadzone, I don’t believe ALL homebuyers shopping in the $600K + range are all flush with cash, either. I was referring to those buying in niche coastal markets of predominately custom properties, such as Monterey (ex LJ and DM in SD County).

In less-desirable inland tracts, especially those encumbered by CFD’s, I think many unqualified buyers quickly got in over their heads buying in the over $600K range when they were helped by developers’ designated loan officers (were offered incentives to use them) who put them in 80/20’s, 80/10/10’s, 30 due in 5/7’s, I/O’s and balloon mtg vehicles. Often, there were never any surrounding comps to begin with to command the prices the developers were asking. They just attempted to create their OWN sales comps by making it easy for an unsophisticated buyer to pay top dollar for a house on a substandard lot (often less than 5000 sf).

Yes, I believe the value of inland tracts (east of I-5 in SD County) where the recent sold comps are currently over about $680K could be affected by lower FNMA/FDMC conforming limits. I do NOT believe highly desirable custom areas in coastal zones will be affected, however, as the buyers of each of these types of properties are completely different animals.

edit: I don’t think the lower conforming limit will affect buyers of acreage either (ex East County). This type of buyer is typically 50+ years old and often has plans for new construction or a major gut/rehab prior to even making an offer.

[bearishgurl]

[quote=deadzone]Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.[/quote]

deadzone, I don’t believe ALL homebuyers shopping in the $600K + range are all flush with cash, either. I was referring to those buying in niche coastal markets of predominately custom properties, such as Monterey (ex LJ and DM in SD County).

In less-desirable inland tracts, especially those encumbered by CFD’s, I think many unqualified buyers quickly got in over their heads buying in the over $600K range when they were helped by developers’ designated loan officers (were offered incentives to use them) who put them in 80/20’s, 80/10/10’s, 30 due in 5/7’s, I/O’s and balloon mtg vehicles. Often, there were never any surrounding comps to begin with to command the prices the developers were asking. They just attempted to create their OWN sales comps by making it easy for an unsophisticated buyer to pay top dollar for a house on a substandard lot (often less than 5000 sf).

Yes, I believe the value of inland tracts (east of I-5 in SD County) where the recent sold comps are currently over about $680K could be affected by lower FNMA/FDMC conforming limits. I do NOT believe highly desirable custom areas in coastal zones will be affected, however, as the buyers of each of these types of properties are completely different animals.

edit: I don’t think the lower conforming limit will affect buyers of acreage either (ex East County). This type of buyer is typically 50+ years old and often has plans for new construction or a major gut/rehab prior to even making an offer.

[bearishgurl]

[quote=deadzone]Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.[/quote]

deadzone, I don’t believe ALL homebuyers shopping in the $600K + range are all flush with cash, either. I was referring to those buying in niche coastal markets of predominately custom properties, such as Monterey (ex LJ and DM in SD County).

In less-desirable inland tracts, especially those encumbered by CFD’s, I think many unqualified buyers quickly got in over their heads buying in the over $600K range when they were helped by developers’ designated loan officers (were offered incentives to use them) who put them in 80/20’s, 80/10/10’s, 30 due in 5/7’s, I/O’s and balloon mtg vehicles. Often, there were never any surrounding comps to begin with to command the prices the developers were asking. They just attempted to create their OWN sales comps by making it easy for an unsophisticated buyer to pay top dollar for a house on a substandard lot (often less than 5000 sf).

Yes, I believe the value of inland tracts (east of I-5 in SD County) where the recent sold comps are currently over about $680K could be affected by lower FNMA/FDMC conforming limits. I do NOT believe highly desirable custom areas in coastal zones will be affected, however, as the buyers of each of these types of properties are completely different animals.

edit: I don’t think the lower conforming limit will affect buyers of acreage either (ex East County). This type of buyer is typically 50+ years old and often has plans for new construction or a major gut/rehab prior to even making an offer.

[bearishgurl]

[quote=deadzone]Unlike in sdr’s world (where everybody is rich and life is a utopia), I don’t believe everybody is loaded with cash. Of course there are people with cash to put down 20-30% on a non-conforming loan. But, you guys are extremely naive to think that everbody who purchased in the price range had the means to pay 20-30% down. They didn’t have to, so by definition it left the door open for a huge pool of buyers without that kind of cash. Well now it looks like that door will be shut again. It will have significant impact no question.[/quote]

deadzone, I don’t believe ALL homebuyers shopping in the $600K + range are all flush with cash, either. I was referring to those buying in niche coastal markets of predominately custom properties, such as Monterey (ex LJ and DM in SD County).

In less-desirable inland tracts, especially those encumbered by CFD’s, I think many unqualified buyers quickly got in over their heads buying in the over $600K range when they were helped by developers’ designated loan officers (were offered incentives to use them) who put them in 80/20’s, 80/10/10’s, 30 due in 5/7’s, I/O’s and balloon mtg vehicles. Often, there were never any surrounding comps to begin with to command the prices the developers were asking. They just attempted to create their OWN sales comps by making it easy for an unsophisticated buyer to pay top dollar for a house on a substandard lot (often less than 5000 sf).

Yes, I believe the value of inland tracts (east of I-5 in SD County) where the recent sold comps are currently over about $680K could be affected by lower FNMA/FDMC conforming limits. I do NOT believe highly desirable custom areas in coastal zones will be affected, however, as the buyers of each of these types of properties are completely different animals.

edit: I don’t think the lower conforming limit will affect buyers of acreage either (ex East County). This type of buyer is typically 50+ years old and often has plans for new construction or a major gut/rehab prior to even making an offer.

[Anonymous]

Of course in general buyers in prime coastal areas have more cash. But during the housing boom, I guarantee a large proportion of these buyers relied on a positive equity home sale to cover the down payment. These buyers by and large don’t exist anymore. Again it is naive to think that any area is immune.

We’ll find out for sure when (if) the government ever takes away their artificial housing support. The lowering of conforming loan limits is one step and it will certainly affect most areas of San Diego, some more than others as has been pointed out.

[Anonymous]

Of course in general buyers in prime coastal areas have more cash. But during the housing boom, I guarantee a large proportion of these buyers relied on a positive equity home sale to cover the down payment. These buyers by and large don’t exist anymore. Again it is naive to think that any area is immune.

We’ll find out for sure when (if) the government ever takes away their artificial housing support. The lowering of conforming loan limits is one step and it will certainly affect most areas of San Diego, some more than others as has been pointed out.

[Anonymous]

Of course in general buyers in prime coastal areas have more cash. But during the housing boom, I guarantee a large proportion of these buyers relied on a positive equity home sale to cover the down payment. These buyers by and large don’t exist anymore. Again it is naive to think that any area is immune.

We’ll find out for sure when (if) the government ever takes away their artificial housing support. The lowering of conforming loan limits is one step and it will certainly affect most areas of San Diego, some more than others as has been pointed out.

[Anonymous]

Of course in general buyers in prime coastal areas have more cash. But during the housing boom, I guarantee a large proportion of these buyers relied on a positive equity home sale to cover the down payment. These buyers by and large don’t exist anymore. Again it is naive to think that any area is immune.

We’ll find out for sure when (if) the government ever takes away their artificial housing support. The lowering of conforming loan limits is one step and it will certainly affect most areas of San Diego, some more than others as has been pointed out.

[Author]

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