All posts in Economic News

Fort Lauderdale Existing Home Sales Rise

by Justin Miller on June 22, 2011 in Economic News, Mortgage Education 101 with No comments

This is contrary to the rest of the country’s decline in sales for May 2011.  Here is a breakdown of those numbers compared to May 2010 from the Florida Realtor’s Association:

  • Fort Lauderdale and surrounding associations were up 6% to 1,142
  • Miami was up 20% to 875 sales
  • Boca Raton/West Palm Beach were up 26% to 1,115

So what does this mean if you are buying a home in Fort Lauderdale?  I wouldn’t let these numbers dictate whether you should or shouldn’t buy a home.  It depends on whether you plan to stay in the home for the next 10 years and feel you are secure with your job.  It has to do with whether or not you are ready to be the one who has to take on the additional costs of owning a home if something needs fixed, etc.  Owning a home isn’t for everyone and you should always consult a mortgage professional to see what might be right for you.

Fed To Keep Fed Funds Rate Low

by Justin Miller on April 29, 2010 in Economic News, Interest Rates, Mortgage Education 101 with No comments

The headlines about the Fed keeping rates low can be very confusing and misleading.  They are not talking about mortgage rates.  They are talking about the Federal Funds rate which is the rate at which banks lend money to each other overnight. 

Now this can affect mortgage rates indirectly because if they are raising the Fed Funds rate it could be because of inflationary worries and an improving economy both of which are bad for mortgage rates. 

It’s so funny when I talk to people about rates and they say “yeah interest rates are going to go up because the Fed stopped buying mortgage-backed securities” when they most likely have never heard of what mortgage-backed securities nor do they understand it.  It reminds me of that scene in Good Will Hunting when Matt Damon confronts that guy in the bar that just recites paragraphs verbatim from a text book. 

Don’t get me wrong, there is nothing wrong with never hearing about mortgage-backed securities because there was obviously one point in my career that I didn’t know what they were either but don’t comment on something because you heard someone in the media saying.  Comment on it because you spoke to a professional who knows about it and explained to you what it means and what could happen.  There is nothing wrong with having an opinion but make sure it’s your own opinion and not someone else’s.  It could bite you in the butt. 

http://online.wsj.com/article/SB20001424052748704423504575212310478936880.html?mod=djemITP_h 

South Florida Existing Home Sales Are Up

by Justin Miller on April 23, 2010 in Economic News with No comments

Hopefully home prices start to follow but with the “shadow inventory” out there it might be a little while. 

Fort Lauderdale home sales rose 8 percent, to 734 up from 680. However, the median price fell 3 percent, to $214,000 from $219,500.

In Miami, existing home sales rose 17 percent, to 649 from 556. The median price slid 4 percent, to $197,500 from $205,600.

Florida Realtors said existing condo sales rose in all three counties, as well, with the biggest gain in Miami. Sales there were up 58 percent, to 835 from 529. The median price of an existing condo in Miami fell 8 percent, to $138,800 from $151,000.

Existing condo sales in Fort Lauderdale rose 46 percent, to 1,140 from 781, but the median price fell 10 percent, to $73,600 from $82,100.

West Palm Beach existing condo sales were up 45 percent, to 999 from 691. But, the median sales price fell 9 percent, to $90,900 from $99,800.

http://southflorida.bizjournals.com/southflorida/stories/2010/04/19/daily53.html 

Home Price Data Is Good For Buyers

by Justin Miller on December 30, 2009 in Economic News, General News with No comments

Home prices rose for the 5th straight month according to the Case-Shiller Index.  The article goes onto talk about why now is the time to buy and you have heard me talk about this numerous times, property values are down, rates are at historic lows, and the tax credit. 

This is a great explanation on the adjustable rate mortgage resets that are coming in 2010.

“You can hear the objections. Doomsayers ask: What about these waves of mortgage resets coming in the next two years? What about all the unemployment? And the foreclosures? And so on.

These are all valid arguments for refusing to buy homes when they are expensive, or even averagely priced. But the whole point about markets is that they adjust. Prices are now cheap. They reflect this bad news, and more. If you have a stable income, and you can get a 30-year mortgage at 5% or so, and you are willing to drive a hard bargain on a home in this market, this is your time.”

http://online.wsj.com/article/SB10001424052748703510304574626212033033506.html?mod=rss_PJ_Main 

Home Prices Climb Again

by Justin Miller on November 24, 2009 in Economic News with No comments

For the 4th straight month.  Whether I or anyone else believes that it will continue or not, it is good news for consumer confidence which came in higher than expected today. 

No one can predict what will happen to home prices.  We can certainly speculate and someone will always end up being right but we don’t know who that person will be today. 

I personally think South Florida will see another 5-10% drop and many may disagree.  Even with that being said, I still think now is the time to buy down here for certain people.  The reason is because low interest rates can offset that decline and you cannot time a bottom.  The best saying I have heard is that “it isn’t about timing the market, it’s about time in the market.” 

http://money.cnn.com/2009/11/24/real_estate/home_prices_third/index.htm?section=money_realestate&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_realestate+%28Real+Estate%29 

Home Price Data

by Justin Miller on October 27, 2009 in Economic News with No comments

It is amazing how you can play around with numbers.  You could view today’s Case-Shiller Index release as good or bad. 

CNN reported that “Prices in the S&P Case-Shiller Home Price index of 20 cities rose a non-seasonally adjusted 1.2% in August. It was the fourth consecutive monthly increase and followed a 1.6% gain in July. Prices were down 11.3% versus August 2008, but that drop was less severe than expected. Analysts surveyed by Briefing.com had forecast an 11.9% year-over-year drop.”

Whether prices are increasing or decreasing month over month or year over year, it all depends on where you live.  In South Florida, things seem to be stabilizing with all of the first-time homebuyers, cash offers, and bidding wars going on.

http://money.cnn.com/2009/10/27/real_estate/case_shiller_August_home_price_index/index.htm?section=money_realestate

Home Sale Contracts Increased In August

by Justin Miller on October 1, 2009 in Economic News with No comments

Which is a 7-month rally.  The article below attributes it to the tax credit expiration but I only agree with that a little.  The main reason in my opinion is that prices are so low, the most affordable in a long time, and interest rates are so low.  Don’t let the talks of the tax credit ending on November 30th rush you into buying a home.  Yes, $8,000 is a lot of money and it’s free but you will be in this home for 5 years or so don’t let the credit rush you into buying something you will later regret.

Also keep in mind that a lot of the contracts never close due to many reasons and in my opinion a big one is an inexperienced mortgage person.  There are so many people that are trying to buy a house that shouldn’t be.  Some of those buyers will close but a lot won’t. 

“The rise in pending home sales shows buyers are returning to the market and signing contracts, but deals are not necessarily closing because of long delays related to short sales, and issues regarding complex new appraisal rules,” he said.”

http://money.cnn.com/2009/10/01/real_estate/August_sales_contracts/index.htm?section=money_realestate 

Homes Prices Stabilizing

by Justin Miller on July 28, 2009 in Conventional Loans, Economic News, FHA Loans, General News with No comments

This is great news and will hopefully instill even more confidence in the housing market.

“Home prices in May posted their first monthly increase since the summer of 2006, indicating prices are finally stabilizing, data Tuesday showed.

The Standard & Poor’s /Case-Shiller home price index of 20 major cities rose 0.5 percent from April, but was still 17.1 percent below May a year ago. Thirteen cities showed monthly increases with the best results in Cleveland, Dallas and Boston.”

http://www.msnbc.msn.com/id/32184856/ns/business-real_estate/ 

More On The Credit Crisis

by Justin Miller on April 17, 2009 in Economic News, General News with No comments

This is a great article that talks about the fact that JP Morgan’s earnings were good may look like lending has increased but it hasn’t.  “Today the disastrously managed credit card business threatens to be a major impediment in the economic recovery because the only way the banks can extricate themselves from the mess they have created is literally to shut down the industry. They may not view it that way, but their customers do. When you punish your best customers, the ones who pay on time and pay far over the monthly minimum, by (1) forcing them to pay higher interest rates, despite the lowest interest rates in the country in over fifty years, (2) increasing their monthly payments (3) shortening the payment terms and (4) reducing or even cancelling their credit lines, you are saying you don’t want to be in the business. ”

http://www.cnbc.com/id/30262845 

Housing Bottom?

by Justin Miller on March 31, 2009 in Economic News, General News with No comments

The Housing Affordability Index is at its lowest since 1970.  It is the most affordable time to buy a home.  NOW IS THE TIME TO BUY

http://www.realtor.org/research/research/housinginx

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