Oct

25

Government Purchasing of Mortgage Backed Securities…The Party is Coming to an End?

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The government purchasing of mortgage backed securities is nearing an end. To quote, Steve Harney, national residential real estate expert, “When the banks have to lend their own money to people on a 30 year loan, they’re not going to be satisfied with 5%…”

If you’re frequented my website, you know that I pay close attention to what’s happening in the real estate market. I do this so I can be a strong source of valid and useful information for my clients and my readers. What I’m going to cover in this article is going to be like smelling salts that wake you up from a daze.

The Fed will gradually slow the pace of the purchasing mortgage-backed securities (MBS) in anticipation of a full execution of the program to keep the mortgage interest rate low by the end of March, 2010.

It marks an extension of the MBS-purchasing program past the previously anticipated year-end date of December 2009. The slowing of purchases is intended to “promote a smooth transition in markets” as the government ends its participation in the agency MBS market. Basically, the government is going to stop buying mortgage securities in March, 2010.

To implement the gradual slowing of agency MBS purchases, agents acting on behalf of the Federal Reserve Bank of New York’s open market trading desk plan to reduce the average weekly purchase amounts beginning with the reporting week that starts September 24, according to a NY Fed statement.

Will the real estate market be strong enough to withstand this slowdown? Are banks and their investors, willing to invest money into such an unsteady market area, such as the current real estate market? This is the big question…is the party [of low interest rates] coming to an end?

With the largest purchaser of MBS, not buying up these assets (helping turn money over quickly for banks and their investors), will banks be apt to continue writing mortgages at 5%?

The answer is no.

So rates will go up after March, 2010.

Question is, how high and will buyers continue coming out to buy? I would say the answer to buyers still buying is a big fat YES [they just can’t pass up the fact that prices are down 35% from peak]. Additionally, as mortgage interest rates go up, prices must drop [hear that sellers?].

1-877-765-3123, ext. 51


Oct

25

Foreclosures Expected To Rise

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Here’s an article, Foreclosures Expected To Rise, in the Financial Post, showcasing several points that I have continually spoken to homeowners about.

If you are behind on your mortgage, you can call me and we can discuss how you can avoid foreclosure.

Tom McGiveron, LSA 1-877-765-3123, ext. 51.

Oct

16

“What’s Goin’ On?”

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Whenever I think of the Long Island real estate market (which is every single day, 365 days a year), for some reason, the song lyric “What’s Goin On?”, by Marvin Gaye, rings through my head. I believe that many homeowners out there are in the same situation, trying to make sense of all that is happening around them, both locally and nationally.

Every person out there is trying to just raise a family, work, and somehow, somewhere in there, just enjoy day to day living. They’re a cop, an accountant, doctor, garbageman, fireman, nurse, limo driver, coach, teacher, an unemployed job hunter, a mother, a father, son, daughter, etc., and they’re focus isn’t the real estate market. Especially on a daily basis (thank goodness, it will drive you nuts!).

My point is, the country is motoring along and we’re all just doing our thing.

And hopefully, we spend sometime out of our busy week to visit some websites and blogs to read up on what’s goin on, in the markets. But are we visiting the right places with the real information we need to hear?

Well, if you’re reading this article, you’re in the right place because what I’m about to cover is the real deal. Unedited and packed with real useful information, in my next article. So please frequent back to the website to see what’s goin on…

(c) Copyright 2009 www.tommcgiveron.com
By Thomas McGiveron, Licensed Real Estate Salesperson
Contact me at (877)765-3123, ext. 51

Oct

15

Long Island Real Estate Market: 45 Days Remaining For First-Time Tax Credit

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The Long Island real estate market is going to see a flood of hopeful buyers scrambling to close by November 30th, 2009. If you don’t know why that is, then call me immediately (631-587-1700, ext. 51). But most of you will know that the date of Nov. 30th, represents the final day a first-time buyer must close on their new home, in order to be eligible to receive the $8000 tax credit.

For sellers, the date of November 30th, 2009 should be a signal to get their price to a place where they will receive offers. This of course, varies on price range (most first-time buyers are purchasing homes with price tags of under $500,000 here on the Long Island real estate market).

Another item to keep in mind, as a buyer, is the final month of the tax credit eligibility is going to be an extremely busy month for banks, appraisal companies, title companies, and attorney’s, as they all rush to complete transaction tasks.

So if you’re a buyer in this market, as of today, there is a very good chance, that if you’re not in contract as of this week (10/12/09 - 10/16/09), you will not be able to receive the $8000 tax credit.

With regard to speculation as to whether or not the government is going to extend the tax credit, I simply say, that as of today (and the past 2 years), the tax credit ends November 30th, 2009. I am not one to speculate as to what the government is going to do or not going to do.

There may be actually very little reason to extend the tax credit, mainly because we are nearing a bottom, on a national level. Even if there’s still a leveling off period, say of 6 to 10 months of further slight declines as the market adjusts, that may not be enough reason for the government to continue such a program because the “problem” is curing itself.

From articles that I read, it is clear to me that even the experts don’t know exactly what to expect in the future. Read this article and see for yourself.

At the end of the day, if you’re a buyer who’s not in contract, rates are super low, they’re going to remain relatively low and prices are down 35% from peak here on the Long Island real estate market. Now is such a great time to buy and working with a buyer’s agent to get the “inside scoop” on property values is key. I welcome the opportunity to assist.

(c) Copyright 2009, www.tommcgiveron.com
By Thomas McGiveron, Licensed Real Estate Salesperson