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Southern California Real Estate Sales Up 27%

December 16, 2008 By Leave a Comment

Southern California has continued to show some resiliency in transaction volume albeit at much lower home prices.  According to DataQuick which tracks transactions in California, home sales were up 26.9% in November 2008 compared to November 2007.  Home prices are down about 35% from a year ago and more and more of the overall transaction volume is driving by buyers purchasing foreclosures.

DataQuick reports that 55% of the sales in November were foreclosures.

I like tracking California because I believe it’s the leader in real estate trends.  It will be interesting to see when that market finally turns.

In the Twin Cities we are seeing an increasing portion of the overall transaction activity go to the purchase of foreclosed homes.  The big question I have is that once all the $150,000 and less homes have been purchased, will transaction activity continue and move up the price chain, or will it really come to a stand still.  Only time will tell.

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Housing Starts Drop to Record Lows – Bad News is Good News!

December 16, 2008 By Leave a Comment

Homes builders across the country are finally really slashing new housing starts.   Wall Street analysts were expecting a number around 740,000 new home starts.  The actual came in at 625,000.

I am not an economist, financial advisor, or cable TV talking head.  I’m a real estate agent working on the streets trying to get transactions together and keep them together.  Economists will say this massive decline is yet another sign of a bad economy – and it is.  But the flip side is that far too often we have seen builders scaling back and slowing down projects rather than really pulling the plug on things.  My opinion is that building needs to come to a screeching halt for 12 months minimum in order for the market to catch up.

A drop of 18.9% is a good start with the November housing starts numbers reported today.  It would be comforting to me if we saw similar declines for the December, January, and February numbers.

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USDA – Not Just for Steaks…Get a Home Loan with 100% Financing

December 16, 2008 By Leave a Comment

The Wall Street Journal has a front page article in its Personal Journal section this morning that caught my eye, “Home Buyers Turn to USDA For Mortgages.”  Are you kidding?  No, this is the real deal.  It’s a program that has been in place to help those in rural areas get financing.

Here are some stipulations:

  • Income limitations can’t exceed 115% of the median county income  (Hennepin County’s median income is $54,000)
  • Financing options up to 100%
  • 2% USDA insurance premium paid by the borrower but can often be rolled in to the financing so you could finance 102% of the home’s value
  • Loans are restricted to towns with no more than 25,000 population

There are several cities that this might work in for Hennepin County, and in the western suburbs, Corcoran, Medina, Loretto and Independence.   The challenge of course will be to find cheap enough properties, but they are out there.

USDA’s main website.

USDA’s Home Loan website.

For additional commentary on this story Housing Wire posted this article, “Mortages, USDA-approved.”

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