A frequent question voiced in dinner party circles in this neck of the woods (the metropolitan New York City area) is, 'Is now a good time to consider buying or investing in a home?'

Well, the latest S&P Case Shiller home price index suggests that home prices are likely to remaining sluggish -- selected, niche market gains, with flattish prices in most other markets -- through at least mid-2011. Hence, from a home price standpoint, the bias in tipped toward waiting a quarter or two, if you do not have to purchase a home.

Continue reading Is Now a Good Time to Invest in a Home?

Is Now a Good Time to Invest in a Home? originally appeared on BloggingStocks on Wed, 08 Dec 2010 17:00:00 EST. Please see our terms for use of feeds.

Continue reading Mortgage Rates Hit All-Time Low

Mortgage Rates Hit All-Time Low originally appeared on BloggingStocks on Thu, 11 Nov 2010 17:30:00 EST. Please see our terms for use of feeds.

Will home prices keep falling? The answer is yes. But why this is happening? The reason lies in high unemployment and the increased number of foreclosures.

Here are some analysts' views on the market, as reported by CNNMoney:

• Fiserv, a market analytics company, had forecast price gains of 4% in February. Their latest prediction is for a 7.1% drop in prices.

Continue reading Will Home Prices Keep Falling?

Will Home Prices Keep Falling? originally appeared on BloggingStocks on Mon, 01 Nov 2010 13:00:00 EST. Please see our terms for use of feeds.

Continue reading Are U.S. Interest Rates Headed Even Lower?

Are U.S. Interest Rates Headed Even Lower? originally appeared on BloggingStocks on Wed, 21 Jul 2010 12:00:00 EST. Please see our terms for use of feeds.

Continue reading Greenspan Says Market Forces, Not Federal Reserve Rates, Created Housing Bubble

Greenspan Says Market Forces, Not Federal Reserve Rates, Created Housing Bubble originally appeared on BloggingStocks on Wed, 07 Apr 2010 17:30:00 EST. Please see our terms for use of feeds.

The loans that got us into this mess were generally the first to fall. Variable rate mortgages written without documentation for people with sketchy credit histories shocked nobody as their slide became an avalanche. But, the good stuff is starting to follow. An increasing amount of fixed rate mortgages offered to borrowers with solid credit histories are feeling their ways to foreclosure. Blame unemployment for this one. When people can't work, it gets pretty hard to pay the mortgage.

Fixed rate, high quality mortgages had a foreclosure a year ago. Last quarter, it jumped to 33%, according to a Mortgage Bankers Association report. As this happened, the amount of homeowners behind on their payments or in foreclosure just set another record high ... for the ninth month in a row. Subprime mortgages are headed in the other direction. Low quality adjustable rate mortgages are now 16% of new foreclosures -- compared to 35% last year. And, more than 18% of Federal Housing Administration loans are anywhere from one payment behind to in foreclosure, with California, Nevada, Arizona and Florida worst off: together, they accounted for 44% of new foreclosures.

Continue reading Even the good die young? High-quality mortgages approaching foreclosure

Even the good die young? High-quality mortgages approaching foreclosure originally appeared on BloggingStocks on Fri, 20 Nov 2009 14:30:00 EST. Please see our terms for use of feeds.

It looks like the housing market is coming back, but there's still reason to be careful. In July, home resales had their highest monthly increase in at least a decade. The rush is driven in part by a tax credit that expires on November 30, 2009. The rate of sale grew 7.2%, ahead of expectations.

Last month, sales hit a seasonally adjusted annual rate of 5.24 million in July -- up from a 4.89 million in June. This is the fourth month in a row in which seasonally adjusted sales increased, and it was the strongest growth rate since August 2007. A Thomson Reuters survey had forecast 5 million, but the reality exceeded that.

Continue reading Housing sales come back, led by first-timers

Housing sales come back, led by first-timers originally appeared on BloggingStocks on Sun, 23 Aug 2009 11:10:00 EST. Please see our terms for use of feeds.

There's good news and bad news about the mortgage market. The good news is that you can get your information from a variety of sources. The bad news? You really need to get your news from a variety of sources.

Conflicting reports Wednesday suggest that mortgage applications are up -- and down.

Continue reading Mortgage applications up and down: Who to believe?

Mortgage applications up and down: Who to believe? originally appeared on BloggingStocks on Thu, 13 Aug 2009 12:00:00 EST. Please see our terms for use of feeds.

Are mortgage rates affecting U.S. mortgage applications? The short answer most likely is yes. Mortgage applications tumbled to a 7 month low, with refinancing loans down 30%, according to Reuters. This is clearly not a good sign for the housing market.

Kenneth Rosen from the University of California says that mortgage rates are just one factor causing the drop. He adds that high unemployment, concerns for job security, and problems with buyers being unable to sell their existing homes are also affecting the market.

Continue reading Why did U.S. mortgage applications fall 30% to a 7-month low?

Why did U.S. mortgage applications fall 30% to a 7-month low? originally appeared on BloggingStocks on Wed, 01 Jul 2009 13:20:00 EST. Please see our terms for use of feeds.

This is good news! The Commerce Department reported that housing starts soared 17% in May. Housing starts increased to 532,000 from 454,000 the prior month. Projections were for an increase to only 485,000.

Here are the supporting numbers:

• Permits rose to 518,000, up from 498,000. Forecasts were for 508,000.
• Single family homes rose 7.5% to 401,000, the third straight monthly gain.

Continue reading Housing starts jump 17% in May

Housing starts jump 17% in May originally appeared on BloggingStocks on Tue, 16 Jun 2009 12:20:00 EST. Please see our terms for use of feeds.

Your mission, should you decide to accept it, Mr. Phelps, is to boost the economy and increase employment but not allow inflation to run rampant. As usual, the secretary will disavow any knowledge of your actions should you fail. This message will self-destruct in five seconds. Good luck, Mr. Phelps. Or should that be Mr. Bernanke?

That, in a nut shell, is the fine line the Fed must walk. It has to get the economy going and more people back to work, mostly by pumping money into the economy. But it can't put too much money into the system or inflation will run rampant. Right now, the presses are running 24/7, and the money is flying out the Treasury's and Fed's windows, seemingly to almost anyone walking underneath them. The stimulus package is in full swing. But what signs are there that it's working?

Continue reading Comfort Zone Investing: Mission impossible?

Comfort Zone Investing: Mission impossible? originally appeared on BloggingStocks on Sat, 13 Jun 2009 10:30:00 EST. Please see our terms for use of feeds.

Did you hear? Mortgage rates are surging. That should be no surprise. All we had to do was look at the sharp sell off in US treasuries and you know that mortgage rates would follow suit. The 30 year fixed rate mortgage rate jumped to 5.29%, up from 4.91% just a week ago. On April 2nd the rate was 4.78%.

Just to give you an example in real dollar terms, let's take a $200,000 30 year fixed mortgage at 5.29%. Your monthly payment would be $1109.37 and your 30 payments would be $399,372.25. At 4.91% your monthly payment would be 1062.67 and your 30 payments would be $382,560. So in real dollar terms your cost has risen $16,812.00. In addition lenders are charging 0.7% in fees and points, unchanged from the previous week.

Continue reading US mortgage rates rise sharply

US mortgage rates rise sharply originally appeared on BloggingStocks on Thu, 04 Jun 2009 15:40:00 EST. Please see our terms for use of feeds.

There is an old saying: "never fight the Fed." If you had been short this bond market, you probably could be wiped out in one afternoon. When the Federal Reserve made its announcement a short time ago that they were buying long term securities the futures on the long bond jumped 4.25 basis points, or more that $4000.00 on just one contract. If you were long say 10 contracts you would be sitting on a $40,000 profit this afternoon.

Continue reading Federal Reserve buys bonds

Federal Reserve buys bonds originally appeared on BloggingStocks on Wed, 18 Mar 2009 17:40:00 EST. Please see our terms for use of feeds.

The Bank of England cut its key rate by half a percentage point to 1%. However, even with the move, the Monetary Policy Committee (MPC) said that there was still disruption in money markets and the rate cuts have not yet had their full impact.

The MPC cited the sharp drop in output in the fourth quarter of last year and a similar drop early this year.

Nationwide, the UK's largest building society announced that it reduced its base mortgage rate to 3% from 3.5%.The MPC pointed to the global nature of the current slowdown and stated that the supply of credit to households and businesses remained constrained.

Continue reading Bank of England cut its key rate to 1%

Bank of England cut its key rate to 1% originally appeared on BloggingStocks on Thu, 05 Feb 2009 10:00:00 EST. Please see our terms for use of feeds.

This post is part of AOL Money & Finance's Best & Worst in Money 2008 feature.

Chicken Little's warning came as good news to astronomers hoping for a better view of the sky. In the same way, not all results of the economic morass of 2008 have been disastrous, at least in the short term. Which of these bits of silver lining do you think shone most brightly this year?

Sales, sales, sales

You've no doubt witnessed the deeper discounts available during the 2008 holiday seasons as retailers, spooked by a drop in consumer spending, are trimming prices to the bone, sometimes beyond, just to keep the cash flowing. The car industry in particular has been caught between the hammer of consumer fear and the anvil of tight credit, so if you're in need of a new car, you'll find dealers, stuck with lots full of new models, ready to cut unheard-of deals.

Cheaper homes

As Lita Epstein reported here recently, houses have declined in value for seven straight quarters, which is bad news, as we've learned, for subprime mortgage holders. For those with good credit, or cash, shopping for a new house the market correction has been a godsend. Since the prices have tumbled furthest in some of the most desirable areas of the country, those retirees who don't need to sell their present home to fund a move to the sunny climes of California, Arizona, or Florida will find some great bargains. In Mountain Home, California, for example, an estimated 90% of all mortgages are upside-down, and upside for buyers shopping in a down market.

Continue reading Best & Worst in Money 2008: Best silver lining to the recession

Best & Worst in Money 2008: Best silver lining to the recession originally appeared on BloggingStocks on Fri, 05 Dec 2008 18:20:00 EST. Please see our terms for use of feeds.

Continue reading Dumb Money Move No. 6: Refinance your mortgage with a variable interest rate loan

Dumb Money Move No. 6: Refinance your mortgage with a variable interest rate loan originally appeared on BloggingStocks on Thu, 07 Aug 2008 15:53:00 EST. Please see our terms for use of feeds.

The Associated Press reports that mortgage rates are back up to where they were in August 2007. How can that be? After all, since then, the Fed has cut its Fed Funds rate from 5.25% to 2%. I guess Federal Reserve Chairman, Ben Bernanke's effort to forestall another Great Depression by flooding the zone with more debt has fallen victim to the law of unintended consequences.

While his efforts have not loosened the credit crunch, they have succeeded in boosting inflation to levels not seen in decades. And isn't that exactly the thing that the Fed is supposed to prevent? I was stunned to see that, as AP reported, the rate on 30-year mortgages hit 6.63% this week -- up significantly from last week's 6.26%. It hasn't been that high since August 1, 2007 -- when it hit 6.68% -- before the Fed started cutting rates.

This makes me wonder whether the Fed would have been better off leaving rates at 5.25% last fall. If so, it is likely that inflation would have remained lower instead of spiraling out of control and driving gasoline prices over $4 a gallon, tripling food prices and putting those who are paying now to heat their homes this winter into sticker shock. Simply put, the Fed rate cuts have not uncrunched credit but they have boosted inflation.

Continue reading With the Fed Funds rate at 2%, why are mortgage rates so high?

With the Fed Funds rate at 2%, why are mortgage rates so high? originally appeared on BloggingStocks on Fri, 25 Jul 2008 10:15:00 EST. Please see our terms for use of feeds.

The slow rolling collapse of the housing industry in this country -- which the Center for Economic and Policy Research estimates could wipe out $6 trillion in housing wealth in 2008 -- has gotten me to thinking about the future. Why do we even have mortgages? What would the housing industry look like without them? Is there a better way? My conclusion is that we should eliminate mortgages altogether. This will cause housing prices to drop, which will make it possible for more people to buy homes instead of living in houses that are really owned by the mortgage holders.

The reason we have mortgages is that the $10 trillion industry supporting them is powerful and self-sustaining. It fuels an enormous housing construction and furniture industry. And there are those in government who think home "ownership" is a worthy social goal. Unfortunately, when people take on a mortgage and then move into a house, the people who live there don't have its title -- the mortgage holder does. Simply put, home ownership is an illusion for most people -- the mortgage holder owns the house until the mortgage is paid off. Instead of renting from a landlord, the "homeowner" is living in a house that's owned by a mortgage holder.

With the rise of securitization, that mortgage holder is no longer the company that originated the loan. It's an investor who holds a mortgage-backed security (MBS) that contains your mortgage and thousands of others. It's an oft-repeated illusion that this is "home ownership." But that illusion is critical for keeping the mortgage industry alive. Unfortunately, if Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) fail, it will be us citizens who will be on the hook for the $1 trillion needed to bail them out.

Continue reading Why we should get rid of mortgages

Why we should get rid of mortgages originally appeared on BloggingStocks on Sun, 13 Jul 2008 09:11:00 EST. Please see our terms for use of feeds.

Continue reading MBA weekly mortgage applications index rises 7.5%

MBA weekly mortgage applications index rises 7.5% originally appeared on BloggingStocks on Wed, 09 Jul 2008 00:00:00 EST. Please see our terms for use of feeds.

Mortgage applications decreased 9.3% for the week ended June 20, 2008, the Mortgage Bankers Association announced Wednesday.

The Mortgage Bankers Association's composite index of applications declined to 461.3, on a seasonally-adjusted basis from last week's 508.4. Compared to a year ago, the composite index is down 25.3% on an unadjusted basis.

Also, the Refinance Index decreased 12.1% to 1,212.2 from 1,378.6 the previous week and the seasonally adjusted Purchase Index decreased 7.4% to 333.4 from 360.2 one week earlier.

Mortgage rates dip

Meanwhile, the average rate for a 30-year fixed loan decreased slightly to 6.39% from 6.57% the prior week. The average rate for a 15-year fixed mortgage decreased to 5.95% from 6.14%.

Continue reading MBA weekly mortgage applications index falls 9.3%

MBA weekly mortgage applications index falls 9.3% originally appeared on BloggingStocks on Wed, 25 Jun 2008 14:21:00 EST. Please see our terms for use of feeds.