The post crisis landscape has really changed with respect to the first time home buyer. Tune in and see how.
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Fannie & Freddie, Housing Statistics, Real Estate News
First Time Home Buyers at Historic Lows
admin - Wednesday May 4, 2016
Please tell me you are not asking why Fannie & Freddie are still in conservaship? It is the same reason banks are getting hammered with fines. It is a win win for the government. They are not relinquishing the agencies because the bulk of the Americans feel Fannie & Freddie are bad (just like banks) so why release them. Secondly, it is a great cash flow for our floundering gov't. It is all about perception and not reality.
The recent announcement of FHA requiring 1% repayment of student loans or the reported monthly payment (whichever is higher) to be used in borrowers DTI is another road block to many first time homebuyers. Since we will no longer be able to use the income based repayment plans for student loans, I have seen many new buyers, (those with significant student loans), that no longer qualify for a home. These are first time home buyers in many cases, who have their first jobs out of college. They want to buy, but again, as rules change, they are edged out of the market until their income catches up with their student loan debt.
I would love to have input from some top Wall St guys about the reasons they are still in conservatorship. I think we would find that we would all be speculating. Here is my speculation: I believe that it comes from the Obama Administration. I believe it is him and his cronies that steer the FRB and the Treasury to continue on the path "Consumer protection". Remember, it is the President who nominates all FRB Members. I look at this current administration and their characteristics and we know they are not big fans of Free Market. We also know that the Cabinet has very limited experience in the private sector and I believe it is the lowest percentage of any cabinet in US History as far as private sector experience. So I speculate that it is a back door deal that has been made with his nominees on the FRB and/or it is just a way for this Admin to hinder the Free Market, kind of his permanent jab in the face.
And who cares if they need a bail out again down the road, so as long as they pay everything back, who cares. Tax payers "don't hold the bill". If you loan me money and I pay you back plus interest, everyone wins. When I am done paying you back, I would like the Title to my car now please.
For the lowering of FTHB's, ie, millennials, I believe you guys have answered your own questions here with previous videos. Millennials do not have the capacity to understand the depth of the financial sector. I don't believe it has anything to do with seeing a Wells Fargo lawsuit of 1.2 bil, because they still have $217 checking account with that Bank. Their mindset is different and we all know this. They just don't have Home-Ownership near the top of their priority list, unless Bernie promises it to them for free. I would expect that number to continue to drop for first time home buyers. They can create a semi-professional marketing video on their phone in 17 minutes, but can't spell the word Mortgage without autocorrect. How do you change this? Good question.
I do believe that the Baby Boomers are going to have to work much later into retirement. And I believe as a result of millennials not truly entering the work force until 30 something, will allow more of the 30-50 crowd to pull down better paying jobs as a result, thus I expect this age group of homeownership to rise in percentage. Just my speculation. Yes, I could totally be off base.
you're just saying all this because POTUS has a funny name / sarc off
If the housing crisis has taught us anything, it’s that a house is no longer considered to be the steady 3%-annual appreciation investment that it once was for our grandparents. There is a whole generation of people who purchased homes between 2004-2007 who got really burned financially. Over-paying for real estate and “leveraging someone else’s money”, just to watch their investment dip to as much as 40 percent right after they bought it.
As far as investments go, a house is NOT a safe, blue-chip type stock any more. Recent history has proven that real estate is more like a Wall Street commodity, not unlike gold, whose values are extremely manipulated by outside market forces. If the price of gold dropped 40% from 2004 to 2010 then came rebounding back in 2016 to its 2004 levels,
who in their right mind would “borrow” money now to purchase gold at its new peak price? Yet here we are again, telling millennials, “come on in, the water’s fine.”
seriously naked gardening day??? I have heard of Lady Godiva day where people ride horses naked…I could not watch…..I was working as a real estate asst and I my agent asked me to take some very well to do people to a beautiful home on the Ranch. As we were going through the property we heard moaning coming from one of the 8 bedrooms (not the master) it seriously sounded like someone in pain. We rushed in only to see more than 2 people getting it on…..I do not think I could have been any redder in the face. I left with the couple and called the cops. when they went inside they found a back door had been busted into. Because it was a foreclosed property and not staged the bank had elected to turn off the alarm so nobody knew. Needless to say, the bank after getting the call from the police had the alarm reset…..
If the housing crisis has taught us anything, it’s that a house is no longer considered to be the steady 3%-annual appreciation investment that it once was for our grandparents. There is a whole generation of people who purchased homes between 2004-2007 who got really burned financially. Over-paying for real estate by “leveraging someone else’s money”, just to watch their investment dip to as much as 40 percent, right after they bought it.
As far as investments go, a house is NOT a safe, blue-chip type stock any more. Recent history has proven that real estate is more like a Wall Street commodity, not unlike gold, whose values are extremely manipulated by outside market forces. If the price of gold dropped 40% from 2004 to 2010 then came rebounding back in 2016 to its 2004 levels,
who in their right mind would “borrow” money now to purchase gold at its new peak price? Yet here we are again, telling millennials, “come on in, the water’s fine.”
Had scheduled an appointment to show a home in an upscale neighborhood to some buyers. I made an appointment the day before and the listing agent verified the property was vacant. Arriving at the home we saw a car in the driveway so rang the door bell several times with no response. I used the lockbox and gained entry and proceeded to show the home. The master bedroom was the last room we went into and probably stood in there 5 minutes talking about the home. Finishing up the showing I opened the big double doors to the master bathroom and to our surprise the owners were in a shower in the middle of the bathroom and they were not just taking a shower. My buyers ran me over getting out of there and will say my buyers did not choose that property. I guess the sellers wanted to come back and try the shower one last time. Pretty shocking.
I think the biggest issues I find is in the 1st time home buyers does concern their student loans.The lendening industry has changed on what they have to use to qualify them. Some use 1% of the balance. I have beed doing business for 34 years and have to many stories to tell you of all the strange situations that have come up while showing a property Take Care
So I'm setting up an appointment to show a house in Savannah, GA. The listing agent tells me to be prepared because it is a divorce situation and that the husband does not want to sell and makes showings awkward. No problem, I got it.
I show up with my clients and ring the bell. The husband answers the door smiling and naked, sporting a chub and holding a big 'ol bong whisping smoke from a recent toke. I smile back acting as though everything is normal and tell him I'm here to show the house. I turn to my client, a very progressive 67 year old woman and her husband from Belize and they nod as though they still wants to see the house. The man welcomes us in.
We tour the house while the husband stays on the back porch smoking up. Still proudly naked.
When we got upstairs, my client (the wife) smiles at me and says "Well at least it was worth looking at". LOL
We closed on the house 32 days later. Full price.