May 25, 2010


Presents from Greece

With all the uproar concerning the European crisis, we must spend a few minutes to look at the bright side. The market’s reaction has brought us two very important pieces of good news. First, oil prices have moved significantly lower. Just a few weeks ago we were looking at gas prices hitting $3.00. Now the price of oil is down around 20 percent from its recent peak. What is really extraordinary about this is that the retraction is happening while oil is spilling out into the open waters in one of the largest oil disasters in our history. Ordinarily oil would be skyrocketing, not because of the immediate loss of oil, but because the long-term prospects of off-shore drilling has dimmed. Why are lower prices good news? Lower energy costs not only take the pressure off inflation, it gives the consumer more money to spend. Consumer spending helps "fuel" the economic recovery.

The second present is comprised of lower rates. Everyone was talking about higher rates being a foregone conclusion. Well, it just goes to show that you can never predict the future. Lower rates free up more money for spending just like lower oil prices. With the recovery in the real estate markets underway, but on very shaky ground because impending foreclosures and other "shadow inventory," lower rates are absolutely necessary to help the recovery continue. The Federal Reserve Board has indicated several times that this is the case. Indeed, more good news was received this week in terms of the release of tame inflation data. Lower rates provide opportunities to refinance debt and purchase homes at incredibly low bargain prices. They help car sales and also small businesses throughout the nation. The stock market may not like what is happening overseas as a fiscal crisis is painful. However, there is good news that will help our economy in the long-run.

The Markets. Rates were down again to the lowest levels of the year in the past week. Freddie Mac announced that for the week ending May 20, 30-year fixed rates averaged 4.84%, down from 4.93% the previous week. The average for 15-year fixed fell to 4.24%. Adjustables were also lower with the average for one-year adjustables falling to 4.00% and five-year adjustables decreasing to 3.91%. A year ago 30-year fixed rates were at 4.82%. "Rates on home loans eased back once again this week to the lowest level of the year," said Frank Nothaft, Freddie Mac vice president and chief economist. "Low rates, coupled with the homebuyer tax credit, helped strengthen the housing market in the first four months of the year. New construction on one-family homes rose for the fourth consecutive month in April to an annualized rate of nearly 0.6 million units and represented the strongest pace since August 2008. Three of the four Census regions showed increases, led by a 14.8 percent jump in the South." Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Current Indices For Adjustable Rate Mortgages
Updated May 21, 2010

Daily Value

Monthly Value

May 20

April

6-month Treasury Security

0.22%

0.24%

1-year Treasury Security

0.34%

0.45%

3-year Treasury Security

1.20%

1.64%

5-year Treasury Security

2.04%

2.58%

10-year Treasury Security

3.25%

3.85%

12-month LIBOR

0.951% (April)

12-month MTA

0.413% (April)

11th District Cost of Funds

1.859% (March)

Prime Rate

3.25%

Convenient and comfortable laundry rooms are an increasingly popular feature among home buyers. Tom Byrne, president of Rockville, Md.-based Chadsworth Homes Inc., says they are more popular than such features as studies and media rooms. "In the past few years, 30 percent of the homes we build … have a laundry room with granite countertops, a single-level kitchen-style faucet, and the laundry tub will be an undercounter sink," Byrne says. Stephen Melman, director of economic services for the National Association of Home Builders, concurs. "These rooms are becoming larger and more multifunctional, with organizers, a table for folding, ironing stations, and windows with a view," Melman says. Source: Washington Times

Suburbs are becoming more multicultural and increasingly impoverished, according to an analysis of census data by the Brookings Institution. Arizona and nine other states lead the nation in a growing trend with an increasing number of communities that are divided between senior white populations combined with large minority families. A majority of all racial and ethnic minority groups in the largest metro areas live outside the city. The suburbs now have the largest poor populations in the country. In addition, they are home to the majority of baby boomers, ages 55 to 64, who strain social services as they age. Meanwhile city centers are becoming whiter. "A new image of urban America is in the making," said William H. Frey, a demographer at Brookings who co-wrote the report. "What used to be white flight to the suburbs is turning into ‘bright flight’ to cities that have become magnets for aspiring young adults who see access to knowledge-based jobs, public transportation, and a new city ambiance as an attraction." Source: The Associated Press

If you’re thinking about applying for a home loan this year, here’s some important news: Beginning June 1, your lender is likely to order a second full credit screening immediately before closing. The last-minute credit report will be designed to find out whether you’ve obtained, or even shopped for, new debt between the date of your loan application and the closing. If you’ve made applications for credit of any type, for furnishings and appliances for the new house, a car, landscaping, a home equity line, a new credit card, the closing could be put on hold pending additional research by the lender. If you’ve taken out new loans that are sizable enough to affect the debt-to-income ratio calculations used in your original loan approval, the deal could fall through. The added debt load could render you ineligible for the loan because you suddenly appear unable to handle the payments without a strain on your household budget. Fannie’s so-called "loan quality initiative" will require lenders not only to pull two credit reports for each transaction but to perform additional verifications of borrower occupancy plans for the property, Social Security numbers and Individual Taxpayer Identification Numbers, among other changes. Source: Los Angeles Times

On Your Team,

Kurt M. Galitski

The Kurt Real Estate Goup

Vice President, Weichman Associates- Realtors

877-957-6677

Ca. Broker #1348644

Whether you’re looking for your dream home or a bargain in a Costa Mesa Foreclosure, REO, Short Sale, Distressed Property, or a new vacation home in one of the many coastal  / beach  cites such as  Newport Beach, Huntington Beach, and Laguna Beach or simply dreaming of a new home in Orange County California, KurtRealEstate.com has it all!

In addition to his work in real estate, Kurt has earned a reputation as an active member of his Costa Mesa community. In addition to serving as chairman of Costa Mesa’s Parks and Recreation and a liaison to the Newport School Board, he is a board member of Costa Mesa United and the Costa Mesa Youth Sports Council, and a member of the Tewinkle Sports Facilities Master Plan Committee.

With an industry known for its proverbial ups and downs, Costa Mesa real estate professional Kurt Galitski offers his clients a constant level of exceptional service: he stays abreast of changes and trends, seeks out opportunities, and makes it a priority to give his customers nothing less than the highest quality of care. He’s living the good life, and Kurt’s mission is to help others do the same. Contact Him Today

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Kurt Galitski

Meet Kurt Galitski - The Kurt Real Estate Group, your new best friend. Distinctive Strategies that Deliver Record-Setting Results. When you combine Kurt’s passion and knowledge of the real estate market, you really gain an appreciation for what makes Kurt different. But what truly sets him apart from the crowd are his 5 distinctive strategies and his property management… For Kurt, getting into real estate was not an accident, it was a deliberate and calculated decision to deliver a better experience to home buyers, sellers, and landlords that they have ever received before. Today, you could ask any one of hundreds of clients, read his Yelp reviews, or look at his track record of being featured in Orange Coast Magazine in excess of eight consecu­tive years and you too will say mission accomplished. www.KurtRealEstate.com www.KurtPropertyManagement.com 877-957-6677

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