Latest Market News From Weichert

The economy continues to show signs of stabilization. In fact, Federal Reserve Chairman Ben Bernanke announced this week that the recession is probably over and that the economy is likely growing at this point. Famed investor Warren Buffet also said the economy appears to have leveled off.In addition, the number of newly laid off workers applying for unemployment benefits has declined in three of the last four weeks. Consumers also seem to be more comfortable spending money. The government reported that retail sales rose 2.7 percent in August, the most in more than three years.

The positive news also extends to the real estate industry:

  • Rates on 30-year fixed mortgages are at their lowest level since the end of May, making homes more affordable.
  • Housing construction rose in August to the highest level in nine months, and applications for building permits — an indicator of future activity — rose 2.7 percent. Regionally, construction rose 23.8 percent in the Northeast.
  • The National Association of Home Builders’ housing market index rose in September, reflecting growing optimism in the industry.

The market seems to be moving in the right direction — up.

What Will Happen to Our Real Estate Market on December 1st?

As you might already know…If you’re planning on taking advantage of the government’s $8,000 tax credit, you must close on your home by November 30th, 2009.  

Our real estate market in Northern Virginia has definitely felt a positive impact from the tax credit.   Home prices on pre-owned homes and new homes  are continuing to rise.   In addition to this, the Nation Association of Home Builders reported that its Housing Market Index rose last month, and has reached its highest level since May of 2008.  

The  National Association of Realtors has reported that the tax credit has brought 1.2 million new buyers to the national real estate market.   They went on to say that  350,000 of these buyers  would not have purchased a home without the credit.

The biggest question I get as an agent is… Will the tax credit be extended?  

Earlier this week, the Obama administration reported that it is evaluating how the tax credit  has impacted home sales   and could recommend that the President extend it.

Recent Changes in Disclosure Rules….Can this cause problems getting to Settlement?

Starting July 30, 2009,the Federal Reserve Board has adopted new guidelines that will directly impact mortgage lenders and disclosure requirements.  

The Mortgage Disclosure Improvement Act of 2008  has  changed  Regulation Z of the Truth in Lending Act. In short, MDIA makes  new requirements regarding loan disclosures. These rules apply to federally-related mortgages under RESPA and will apply  to purchases and refinances.

 Key Changes:

*Borrowers must be provided with a GFE.   (Good Faith Estimate)   within 3 business days of receiving a written loan application. No fees, except for a credit report, may be taken until then.

*If the final APR at loan consummation varies more that 0.125%, which is 1/8 of 1 percent, from the initial APR on the earlier disclosure, then the lender MUST give the borrower a new disclosure at least 3 BUSINESS DAYS BEFORE CLOSING.

These regulations have been set up to protect you, the consumer,  when making, what might be  one of the biggest financial investments of your lifetime.

Please let me know if you have any further questions on this topic.