From loancentral.com

You probably have a sense of this already, just by keeping your ears open and applying common sense, but I thought I'd post this article for you:

"RATES IMPROVE SLIGHTLY THIS WEEK!

"The recent unrest in the Middle East is causing investors around the world to move money to the safe‐haven of US bonds, causing bond prices to increase, and resulting in lower mortgage rates. While we’ve seen slight improvements in the mortgage rates this week, they haven’t dropped nearly as much as many analysts expected. This is especially surprising when you consider the stock market dropped 325 points in addition to the bond market increases. However, many experts are warning that the recent gains in bonds will be limited by fears of inflation down the road. Therefore, the improvements in rates are likely to be temporary and may not last for long. In addition, as the economy continues to expand, albeit slowly, rates will move higher over time.
"Many are predicting mortgage rates to be around 5.5% toward the end of 2011. This week’s small downturn in rates provides an excellent opportunity to lock in your rate before they go back up. For those who are waiting to see if housing prices drop further, you should know this fact: a 5% drop in the price of a $400,000 home is completely offset by a 1% increase in interest rates. Now is the time to buy…housing prices are great and rates are still low!"

UNEMPLOYMENT FIGURES CAUSE INTEREST RATES TO RISE

Interesting analysis from WendyC@LoanCentral.com:

Unemployment figures were released today and contained some mixed information. The unemployment rate fell from 9.4% to 9%, shocking many analysts who had expected it to rise slightly. Many experts are scratching their heads trying to figure out how we got to this number. The drop to 9% indicates that 504,000 people from the previous month are no longer unemployed. It’s a good bet that these folks didn’t find a job, but instead have left the labor force because they can’t find a job, or are discouraged.
Signs of economic recovery cause mortgage rates to rise. The markets were very volatile today and interest rates are up on the day. Further interest rate increases are expected with many analysts predicting rates will be around 5.5% by year end, which results in a loss of buying power of approximately $30,000 on a $400,000 sale price.
As of this moment, the Fed Fund Futures, which forecast when the Fed will hike interest rates, has moved from a Monday reading of a 52% chance that they will hike in January 2012…to today’s reading of a 100% chance of a Fed hike at that meeting.
Don’t miss out on these historically low interest rates…now is the time to lock your rate under 5%!

Fannie Mae and your home purchase

FANNIE MAE OWNED PROPERTIES ARE AN EXCELLENT BUYING OPPORTUNITY!

With the surge in foreclosures over the past few years, Fannie Mae has taken back a significant number of homes where the owner’s could no longer afford to make the payments on their loans. In an effort to move these homes off their books, Fannie
Mae is offering special financing options that allow more consumers to qualify for the purchase of these homes. These special financing options coupled with the lower housing prices offered on these homes make a great buying opportunity!
Currently in King County there are 416 Fannie Mae owned homes ranging in price from $49,900 to $459,900. There are 232 homes in Pierce County and 245 homes in Snohomish County. Consumers looking to purchase these homes as their primary residence can get in for as little as a 3% down payment, with a 660 credit score, no private mortgage insurance required, and no appraisal needed.
Those looking to purchase the homes for investment purposes can get in with as little as a 10% down payment, with no mortgage insurance and no appraisal needed.
Fannie Mae has created a website at www.homepath.com where interested consumers
can search to see the homes currently available.
This is one of those opportunities that won’t be around forever so if you or someone you know can benefit from this, now is the time to act!

Up Up and Away!

INTEREST RATES HAVE LIKELY HIT BOTTOM

Today’s headline news was the release of the reports on job creations and unemployment. Both reports rattled the markets as they have come in MUCH worse than analysts’ expected. Analysts expected to see approximately 130,000 new jobs created, and the report showed a disappointing 39,000. Furthermore, the unemployment
figure jumped to 9.8%, well above the expected 9.6%.

Normally, this kind of bad economic news would send mortgage rates lower. However, today’s jobs report now puts into question, were the recent string of economic reports a false start that the economy was improving? And will future reports coincide with today’s weak jobs report? Or was today’s reading a bump on the road to recovery? Only time will tell.

However, you can bet the Fed will be putting forth a full dose of QE2 into the economy. And now we are hearing rumors that QE3 will be forthcoming. Remember that the goal of QE2 is to create inflation, pump up stock prices and lower the unemployment rate. All of these goals result in higher mortgage rates. It is starting to look like mortgage rates may have hit their bottom and are now on their
way back up!

More Buyers Pleased With Real Estate Firms

Satisfaction with national real estate companies among home buyers has improved while satisfaction among home sellers has declined in the last year, according to the J.D. Power and Associates 2010 Home Buyer/Seller Study, released Thursday.
J.D. Powers collected 3,000 evaluations from 2,817 respondents who bought or sold a home between March 2009 and April 2010. Overall satisfaction with the buying experience is determined by rating satisfaction with the practitioner, the office they represent, and a variety of additional services. Four factors are examined for the home-selling experience: the quality of the practitioner’s performance, marketing, the office they represent, and other services.
"Among both home buyers and home sellers, the importance of [practitioners] and salespersons has increased substantially in 2010, compared with 2009," said Jim Howland, senior director of the real estate and construction practice at J.D. Power, in a statement.
"Buyers are increasingly relying upon negotiating skills of [practitioners] and seem to be satisfied with the purchase prices they are obtaining. Despite the fact that sales practitioners appear to be doing a good job of negotiating and marketing on behalf of home sellers, the tough economic conditions are negatively impacting their overall satisfaction with real estate companies," Howland added.
On a 1,000-point scale here are the scores in the home buyer segment:
1. Keller Williams, 817
2. Prudential, 811
3. Coldwell Banker, 805
4. Home-Buyer Segment Average, 803
5. RE/MAX, 801
6. Century 21, 798
7. ERA, 785
8. GMAC/Real Living, 765
Satisfaction ratings on a 1,000-point scale from home sellers:
1. Prudential, 760
2. Keller Williams, 751
3. RE/MAX, 744
4. Coldwell Banker, 743
5. Home-Seller Segment Average, 742
6. Century 21, 727
Source: J.D. Power and Associates (07/28/2010)

Low Interest And Fuel Costs Are Providing Relief For US Consumers

NuWire Investor:  Written by: Jacob Gaffney - Affordable mortgage rates should help the nation's economy avoid a double-dip by freeing up consumer spending money, according to Morgan Stanley. Although mounting European debt and a weak Euro could have global reverberations, a stronger dollar indicates improved fundamentals in the US. See the following article from HousingWire for more on this.

The US economics team at financial firm Morgan Stanley  (MS: 25.80 -0.58%) says in their latest research report that recent gains in the nation's economy point to a remote chance of a so-called double dip — where recent upticks in economic activity are only temporary — citing low mortgage rates as a key driver in drawing this conclusion.

"The dip in conventional 30-year mortgage rates to about 4.8% has triggered a minor refinancing boom; reduced debt service will further add to discretionary spending power for many mortgage borrowers," according to the report. "Taking these offsets into account, we expect net financial conditions to be roughly unchanged."

In their latest report, titled "Defying the Double Dip," authors Richard Berner and David Greenlaw look at several macroeconomic factors in coming to this result.  Lower fuel costs and greater infrastructure spending, for example, are providing relief to the American economy at-large, something they don't see changing anytime soon.

"To be sure, the recent surge probably overstates the new upswing, but there remains ample unspent Federal funding," the economists write, "and officials are unlikely to turn off the spigot in an election year when incumbents are threatened."

The report cites "powerful offsets" like the strong dollar, along with low mortgage rates, as potential hedges against the risk of a double dip. Indeed, they concede there are large market worries over growing sovereign debt levels, especially in Europe, where higher borrowing is expected to be favored over austerity measures in the short term.

Paul Ashworth, a senior economist for Capital Economics, did not agree totally with the Morgan Stanley assessment in a note on US manufacturing levels today.

"It is possible we will see a more marked decline in the coming months, as Europe's woes start to affect global trade and domestic inventory rebuilding begins to slow," he wrote.

Ashworth adds that the recent appreciation in the dollar, particularly against the euro, and lower commodity prices mean that over the next 12 months the rise in import prices over the past year will be largely reversed.

"This is another reason to suspect that both headline and core consumer price inflation is going to fall to 0.5% by year-end."

The Morgan Stanley economists recognize the concern that a stronger dollar in concert with the sovereign crisis may promote deflation, but aren't on-board with the theory.

"In contrast, we think the fundamentals for pricing power are gradually improving," they conclude, again with the view of stability in the short term. "Climbing rents, accelerating prices at the early stages of the processing pipeline, and rising import prices all are starting to signal that inflation is bottoming."

This article has been republished from HousingWire. You can also view this article at HousingWire, a mortgage and real estate news site.

Forecasts For International Real Estate Markets In Second Half Of 2010

NU Wire Investor - The global property market is moving in a positive direction, however, not all markets are on the upswing and investors should be careful to consider economic, political and other factors before buying into any market. While Latin America and the US overall offer strong upside potential, markets in Europe, the Middle East, North Africa and Asia have markets that are both up and down. See the following article from Global Property Guide for more on this. 

Rio de Janeiro, Brazil

The world's property markets are on the road to recovery, but investors will have to be careful about which markets they select. In a new report, the Global Property Guide makes recommendations for residential property investment during 2010 (download the full Global Property Guide Mid-2010 Property Recommendations report).


The world is no longer moving in one direction, as it did during the crash and the bull market of 2006-2007. Some countries' real estate markets are moving down (most notably Bulgaria, Ireland, Iceland, Slovakia, Spain, the Philippines, Greece, the Netherlands and, for political reasons, Thailand). Others are moving up (Hong Kong, Singapore, Taiwan, Australia, Israel, Finland, Norway, Sweden, and the UK) (see The World's Housing Markets at Q1 2010).


However, the general trend is up, due to lower interest rates and higher government spending.


Things are back to normal.


Well, not quite. The world's housing markets will surely be affected by a major long-term trend, the adjustment - deep and powerful - of economic forces which is now impacting everything we do.

   
• The leading developing countries are growing rapidly and are assuming much greater importance.
   
• Relatively speaking, the developed world is losing ground.

For 15 years the loss of momentum of the developed world was disguised by the housing pseudo-boom, but now the issues have become very apparent.

Inevitably property markets will in future reflect these facts. Some ripples on the surface of the waters:


In Latin America:

   
• Interest rates are in long-term decline, due to better Central Bank policies
   
• Economies are booming
   
• Tourism is rising
   
• The residential property boom that began 3 years ago continues
   
• Rental yields - critical indicators of the health of property markets - are still high
   
• Latin currencies are rising

Our selections for investors: Peru, Panama, Brazil, and Chile

Possible: Colombia




In the US:

   
• The economy is recovering
   
• The dollar is rising
   
• Residential property valuations are attractive in some states, and are already attracting investors

Our selections for investors: states whose property markets fell dramatically during the crisis, beginning with Florida

In Europe:

   
• Property markets have not sufficiently adjusted from their 15-year rise. Residential property yields are poor throughout Europe.
   
• The panic over the Greek and other deficits shows no side of abating
   
• The Euro is falling. Currency depreciation should somewhat offset increased fiscal stringency - a positive.
   
• There are buying opportunities for opportunities for non-Euro buyers, but of themselves residential properties are not an appetizing investment in most of Europe.

Our selections for investors: Turkey, Hungary

Turkey, because of its young population, the opening to the East, and its competent government.


Possible: Hungary, because its incompetent government may provoke a crisis which would make its low prices and excellent yields even more attractive.


In the Middle East and North Africa:


The Middle East is in a cycle, led by the Gulf. Recovery may take a while, but the underlying dynamic of petro-dollars, pegged currencies, and high domestic inflation, which tends to push property values up. As yield-oriented investors, we are more interested in the marginal markets, but we expect investors to begin to be interested again in the Gulf soon.
Our selections for investors: Egypt, Jordan
Possible: Morocco, Egypt and Jordan's property markets have been hard-hit by the crisis. But in both countries' capitals, there are generous yields.  Morocco has less attractive yields, but a long term tourism trend.

In Asia:Property is over-valued in most countries in Asia, with two exceptions
Our selection for investors:
MalaysiaPossible: Thailand
Malaysia is very stable, and has reasonable returns

Thailand has excellent yields. Prices have been falling, because of the political uncertainty. Developers want to reduce risk by unloading stock. Opportunity knocks.

In the Pacific:

Avoid. Australian residential property is quite overvalued, and interest rates are rising. In New Zealand there is less overvaluation, but we do not see a strong investment case.Download the full report here.This article has been republished from Global Property Guide. You can also view this article at Global Property Guide, an international real estate news site.