Durango Colorado Real Estate

Thursday, March 15, 2012

Banks Loosen Credit Standards

I'm reprinting an article below from dsnews.com published today indicating yet another opinion that the housing crisis should end in 2012 with loosening bank credit standards.

Housing Crisis to End in 2012 as Banks Loosen Credit Standards

reprinted from dsnews.com March 15, 2012

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generate actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

If you have any questions, please do not hesitate to call me. You can reach me, Don Ricedorff, at The Wells Group 970-375-7014, don@frontier.net, or at my website at durangorealproperty.com.

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 18+ years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients. The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist

He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

Friday, March 9, 2012

Warren Buffet's Secretary: Its Time to Buy!

I thought you would enjoy the below quote from Warren Buffet's secretary. With affordability of housing at 1971 levels (according to HUD) and with rents rising dramatically, we too think that now is the time to buy and that the spring real estate season will begin to reflect that. The next edition of the Wells Group Real Estate Guide will coincide nicely with the beginning of "Spring" (March 20th) and will be published in the Durango Herald on March 18th.

"I just thought it was time to buy a home. Warren tells me that it will be the best opportunity in my lifetime. Mortgage rates are low and prices have dropped dramatically…I share Warren's view about the future of America and we believe that our country will do just fine. I am happy to make this investment." Debbie Bosanek - Warren Buffet’s Secretary of 37 Years on Purchasing a Second Home

Omaha World Herald 1/27/2012

Wednesday, February 29, 2012

Investing in Real Estate - Still a Winner!

The stock market is doing much better right now. But, the chart I've reproduced above shows that from January 1, 2000 until February 1, 2012, that whether you invested $100,000 in the DOW, the S&P, the NASDAQ, or in Real Estate, Real Estate proved to be the better investment. So, even in what some consider the worst decade of real estate in America, real estate was still a great investment.

As the stock market continues to improve, people may start thinking that the stock market is a better place to invest their funds. My point to those folks is to please just keep the above graph in mind because it proves that that just isn't so!

If you have any questions, please do not hesitate to call me. You can reach me, Don Ricedorff, at The Wells Group 970-375-7014, don@frontier.net, or at my website at durangorealproperty.com.

Don Ricedorff is a licensed real estate broker in the State of Colorado, with 18+ years of experience, and he resides in Durango Colorado.He has numerous real estate designations, which have provided him with an unparalleled education to assist his clients. The designations include:

CRS, Certified Residential Specialist
CRB, Certified Residential Broker
CCIM, Certified Commercial Investment Member
CDPE, Certified Distressed Property Expert
ABR, Accredited Buyer Representation
GRI, Graduate of Realtor Institute
RSPS, Resort and Second Home Property Specialist
CIPS, Certified International Property Specialist
SRES, Senior Real Estate Specialist

He is also an active volunteer in the community and his church. His highest aspiration is spending time with his wife, Janet, and his three children Kelly, Katie, and Kyle. His other interests include playing tennis, fly fishing, hiking, boating, and water skiing.

Wednesday, February 22, 2012

"Upbeat on the Real Estate Market"

The Wall Street Journal:

―"From Bottom Up, Signs of Housing Recovery"

USA Today:

―"Housing Outlook is More Upbeat"

Washington Post:

―"Housing Market and Economy

Showing Encouraging Signs"

CoreLogic:

―"CoreLogic‘s chief economist Mark Fleming says housing statistics and the duration of the downturn to date indicate 2012 may be the year the housing market begins to turn the corner"

Fannie Mae:

―"The housing sector will likely take incremental steps forward in 2012 … according to economists at Fannie Mae.”

Freddie Mac:

―"With the New Year comes a sense of cautious optimism. There are some positive signs in the job market and consumer confidence; housing is starting to raise hopes for continued gradual economic recovery"

Thursday, February 16, 2012

Getting Ready for Spring Market

We are getting ready to come out of the “shoulder season” representing the slower part of real estate activity during the holidays and the winter months.

We are cautiously optimistic about the coming spring market. As weather starts turning warmer and it feels more like spring, we historically have seen an increase in market activity.

However, there are some indicators that cause us to be more guarded in our predictions. You may want to view a good brochure that sets forth some of these concerns titled "Things to Consider if you are Selling Your House" written specifically for 2012 Sellers.

http://www.keepingcurrentmatters.com/pdf/SellingaHouse.pdf

Two things that may hinder a more normal market this Spring are as follows:

1) We are not sure of the impact of pricing as Banks release more of the shadow inventory they have been holding: i.e. there are great many bank owned properties that have not yet been released to the market and also, there are a great many properties that are short sales and/or in the foreclosure process. As these properties continue to be released to the market, supply will be impacted and if there is an oversupply of inventory, prices may still see a downward trend this spring.

2) Lending fees and mortgage insurance rate hikes are in the works which may make the cost of financing a home more expensive. We may continue to see a tight loan market which greatly impacts the number of qualified buyers