Burbank Real Estate Blog

1) the loan limits on mortgages will be raised to $727,000  in high cost areas

2) the tax credit will be raised to $8,000 with NO payback....this is huge!

3) interest rates shoud react favorably to the package(see below)

4)  the bill has over $50 billion in it for foreclosure mitigation, with Treasury Secretary Geithner's  Treasury plan signaling that the second half of TARP and TALF will be used to  mitigate foreclosures through a government guarantee, drive down interest rates  by buying another $200-300 billion of mortgage paper from the GSES's thereby  freeing them up to do the same with new mortgages. Additionally Fannie Mae has just agreed to  lift the cap of 4 investment properties eligible for loans and raise it to 10. Talk to your CPA for the full details on this.

Mortgage interest  deductability, real estate tax deductability, and the $250,000/$500,000 cap  gains exclusion (an overall package worth more than $100 billion and for some a  very attractive funding source for their pet projects) has remained intact.

The "big and bold" stimulus package will really impact the real estate market as long as the banks can follow through on the lending side.  

Keep in mind that modifying mortgages is not an easy exercise due to all the different parties involved.  Many times mortgages were sold by the originating entity to Wall Street.  From that point they were repackaged and put into "tranches" or pools, based on the perceived stability or ability to pay back the mortgage.  This has created many stakeholders which in turn have to agree to modify the mortgage.

More to come.

Related articles by Zemanta

• White House targets housing plan (msnbc.msn.com)
• U.S. home foreclosure notices hit 274,000 in January (cbc.ca)
• Foreclosures Fall From December To January (huffingtonpost.com)

Monthly Activity Report Burbank-January 2009

Month to month average home sale price in Burbank from December 2008 to January 2009 is down $38,507, or 7%.

Average days on market, are up 3 days.

Most notably number of sold properties is down almost 58 % from December 2008.

Reasons for this trend include the significant price reductions we saw towards the end of last year, banks wanting to clear out inventory before the end of the year and buyers wanting to take advantage of low interest rates and low prices.