Arizona Real Estate Notebook

Below is a long comment I recently made on a post about, “How Texas Avoided the Great Recession.” ========================================= Important Question – Why no Texas real estate boom & bust? A great question because if we can figure out what Texas did right, other states may be able take the same actions to avoid real [...]

I had no idea it was this bad! (I wonder how accurate the graph is?) It’s going to be tough for consumers to spend more when the value of their assets has tanked but the amount of their debts hasn’t changed. Michael David White (via John Lounsbury). ADDED: Which reminds me. People focus on consumer [...]

Comparing this current new home construction bust to the earlier ones is stunning. Those earlier ones were terrible, I remember them, but this one is a lot worse! On the other hand, I don’t think there is anywhere to go but up from here… well, I guess we could go sideways for a while. Like [...]

More apparent corruption at Fannie and Freddie. An ongoing investigation by a House of Representatives committee revealed a VIP lending unit at Countrywide Financial Corp. targeted senior leadership at Fannie Mae. … These documents linked 153 VIP loans to borrowers employed by Fannie and another 20 VIP loans to borrowers employed by Freddie Mac. The [...]

The quote below is from a review of a new book by a former chief economist at the International Monetary Fund, “Fault Lines: How Hidden Fractures Still Threaten the World Economy.” The credit market—at least as regards housing—was distorted by government policy, not by a sudden and mysterious escalation in “greed.” The trends that shook [...]

Despite incredibly low mortgage interest rates, people aren’t applying for mortgages. From Calculated Risk, “Mortgage applications have fallen off a cliff. The weekly applications index is at the lowest level since December 1996.” (Click graph to enlarge.) I should add that mortgage applications spiked in April because of the $8,000 first-time home buyer tax credit [...]

Using the number of searches for “arizona homes” on Google as a proxy for the underlying demand, it appears the demand for Arizona homes has not started to rebound yet. This certainly fits the fact that the current low mortgage interest rates haven’t spurred home sales. Comment (Video) Your browser cannot play this video. Learn [...]

This graph makes me think things are worse than I thought. On the other hand, after the election the politicians will probably stop contantly extending unemployment benefits and that will cause the unemployment numbers to fall. (People tend to be much more successful about finding jobs after their unemployment benefits run out.) But nevertheless, that [...]

Feeling too chipper today! Nouriel Roubini makes a cogent argument here but keep in mind that in the spring of 2009 his economic predictions were way off, way too pessimistic. Also keep in mind that Roubini is giving a global scenario and Arizona, although swimming in that ocean, is unique. My assumption is that Arizona [...]

In many markets — including Washington DC, California’s Inland Empire, Las Vegas and Phoenix — paying for a mortgage is less expensive than renting. An increase in U.S. mortgage interest rates, of course, would quickly make U.S. home ownership less amazingly affordable. If you can get a mortgage loan and you want to move, this [...]

Everything is “green” these days. I was thinking of introducing a dolphin-free home buyer program to jump on the environmental bandwagon but these green mortgages are actually… well, green. The general idea behind a green mortgage is that in the process of buying a house, funds can be set aside for energy efficient improvements…

Great news for Arizona luxury home buyers and Arizona luxury home sellers too! Just a year ago, the average rate on a 30-year jumbo mortgage—a loan of more than $729,750 not backed by government-sponsored agencies Fannie Mae or Freddie Mac—was 6.86%, according to Greg McBride, a senior financial analyst at Bankrate.com. Now it is 5.48%—a [...]

Hey, but don’t you lose most all your other assets in a bankruptcy? I don’t know bankruptcy. I suppose if you don’t have many assets to lose anyway, bankruptcy could work. Any BK lawyers out there? For many borrowers, this makes a Chapter 13 bankruptcy a better choice than a foreclosure. With a foreclosure, the [...]

We’re wondered before what the effect of all the distress sales would have on the size of the pool of potential home buyers. … historically, only 15 percent of consumers have found themselves with a credit score below 600. Now, a quarter of consumers fit the profile. Well, there’s 10% shut out of the market [...]