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SD Realtor
ParticipantIt is gonna be interesting. We all knew there was a catalyst needed for pricing to shift gears. I have always thought it was going to be interest rates and for the most part I still do. That event seemed to be a mirage over the past few years but the inevitable downgrade by Moodys will help to change things. Also what nobody seems to have touched on is once rates do start moving the percent of GDP needed to finance the debt will start to climb faster as old debt is retired at lower rates and then reissued at higher rates. So even though we may be taking measures to help the situation we may find that it is to little to late once rates do rise.
I find that sellers are still in a sense of denial with respect to pricing but it does seem like inventory is building again. I havent checked the stats but people on autosearches are getting much heavier volumes of notifications.
ParticipantIt is gonna be interesting. We all knew there was a catalyst needed for pricing to shift gears. I have always thought it was going to be interest rates and for the most part I still do. That event seemed to be a mirage over the past few years but the inevitable downgrade by Moodys will help to change things. Also what nobody seems to have touched on is once rates do start moving the percent of GDP needed to finance the debt will start to climb faster as old debt is retired at lower rates and then reissued at higher rates. So even though we may be taking measures to help the situation we may find that it is to little to late once rates do rise.
I find that sellers are still in a sense of denial with respect to pricing but it does seem like inventory is building again. I havent checked the stats but people on autosearches are getting much heavier volumes of notifications.
ParticipantIt is gonna be interesting. We all knew there was a catalyst needed for pricing to shift gears. I have always thought it was going to be interest rates and for the most part I still do. That event seemed to be a mirage over the past few years but the inevitable downgrade by Moodys will help to change things. Also what nobody seems to have touched on is once rates do start moving the percent of GDP needed to finance the debt will start to climb faster as old debt is retired at lower rates and then reissued at higher rates. So even though we may be taking measures to help the situation we may find that it is to little to late once rates do rise.
I find that sellers are still in a sense of denial with respect to pricing but it does seem like inventory is building again. I havent checked the stats but people on autosearches are getting much heavier volumes of notifications.
ParticipantActually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.
Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.
Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.
ParticipantActually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.
Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.
Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.
ParticipantActually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.
Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.
Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.
ParticipantActually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.
Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.
Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.
ParticipantActually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.
Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.
Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.
ParticipantI would definitely agree with SK on this one. When you make the decision to buy, you should study the current rates with regards to the historical lows we have seen. If they are still at or near those low levels I would suggest to finance the home if you feel you can make a better return on the balance of the loan. Which I would imagine you can if we are going to be in an escalating rate environment down the road. Look back at the 80s where you could get muni bonds with double digit returns. Then again, if you make the purchase in the future and if rates are much higher at that time, you could see a combination of price drops and higher credit costs that would indicate a more heavily weighted downpayment. In general it is a question that is hard to answer until you are ready to pull the trigger and then what your personal thoughts are on the direction of long term yields.
ParticipantI would definitely agree with SK on this one. When you make the decision to buy, you should study the current rates with regards to the historical lows we have seen. If they are still at or near those low levels I would suggest to finance the home if you feel you can make a better return on the balance of the loan. Which I would imagine you can if we are going to be in an escalating rate environment down the road. Look back at the 80s where you could get muni bonds with double digit returns. Then again, if you make the purchase in the future and if rates are much higher at that time, you could see a combination of price drops and higher credit costs that would indicate a more heavily weighted downpayment. In general it is a question that is hard to answer until you are ready to pull the trigger and then what your personal thoughts are on the direction of long term yields.
ParticipantI would definitely agree with SK on this one. When you make the decision to buy, you should study the current rates with regards to the historical lows we have seen. If they are still at or near those low levels I would suggest to finance the home if you feel you can make a better return on the balance of the loan. Which I would imagine you can if we are going to be in an escalating rate environment down the road. Look back at the 80s where you could get muni bonds with double digit returns. Then again, if you make the purchase in the future and if rates are much higher at that time, you could see a combination of price drops and higher credit costs that would indicate a more heavily weighted downpayment. In general it is a question that is hard to answer until you are ready to pull the trigger and then what your personal thoughts are on the direction of long term yields.
ParticipantI would definitely agree with SK on this one. When you make the decision to buy, you should study the current rates with regards to the historical lows we have seen. If they are still at or near those low levels I would suggest to finance the home if you feel you can make a better return on the balance of the loan. Which I would imagine you can if we are going to be in an escalating rate environment down the road. Look back at the 80s where you could get muni bonds with double digit returns. Then again, if you make the purchase in the future and if rates are much higher at that time, you could see a combination of price drops and higher credit costs that would indicate a more heavily weighted downpayment. In general it is a question that is hard to answer until you are ready to pull the trigger and then what your personal thoughts are on the direction of long term yields.
ParticipantI would definitely agree with SK on this one. When you make the decision to buy, you should study the current rates with regards to the historical lows we have seen. If they are still at or near those low levels I would suggest to finance the home if you feel you can make a better return on the balance of the loan. Which I would imagine you can if we are going to be in an escalating rate environment down the road. Look back at the 80s where you could get muni bonds with double digit returns. Then again, if you make the purchase in the future and if rates are much higher at that time, you could see a combination of price drops and higher credit costs that would indicate a more heavily weighted downpayment. In general it is a question that is hard to answer until you are ready to pull the trigger and then what your personal thoughts are on the direction of long term yields.
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