Warren Buffet believes the housing market downturn will end in 2011. In his annual letter to shareholders he wrote,
Prices will remain far below ‘bubble’ levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits. Indeed, many families that couldn’t afford to buy an appropriate home a few years ago now find it well within their means.
Don Grafues
Resource: REALTOR.org
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The Mortgage Brokers Association made a proposal last Wednesday to help the unemployed keep their homes. The proposal is for mortgage servicers to lower mortgage payments to 31 percent of household income for nine months. The amount of the reduction would be added to the end of the mortgage.
The Treasury would make loans available to the servicers to make up the amount of the reduction. This would keep the holder of the mortgage intact.
A concern is that nine months will not be sufficient as finding work in nine months is very optimistic.
Treasury needs to give it approval for this program to be implemented.
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One month does not establish a trend. However on 2/18 we published a post “
New Home Construction Improving?” in which an analyst at Credit Suisse predicted 2010 would be a strong year for home builders,
with certain caveats.
It may be the caveats rule. New Home sales fell 11 percent in January from the December level reaching the lowest level since 1963 according to an
article at REALTOR.org.
Don Grafues
Resource: REALTOR.org
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