The Collected Works of Author and Blogger Larry Roberts

Mortgages must amortize to prevent housing bubbles If Dodd-Frank were repealed as Republicans want, the end result would likely be another housing bubble. Financing terms largely determine the equilibrium price for housing. Short term fluctuations in supply and demand cause gyrations, but over time the amount potential buyers can borrow will determine what houses cost. For example, the reason prices are going straight up right now is because potential buyers can borrow large sums due to very low interest rates. The activities of these buyers coupled with a depleted MLS inventory is causing prices to rise. Prices will continue to rise until potential buyers reach the limits of their borrowing power or new supply comes to the market. Banks are…[READ MORE]

North County San Diego Beach Housing Report: April 2017 San Diego Housing Market Value & Trends Update Historically, properties in this market sell at a 14.2% premium. Today’s discount is 0.5%. This market is 14.7% undervalued. Median home price is $528,500, and resale $/SF is $335/SF. Prices rose 6.7% year-over-year. Monthly cost of ownership is $2,426, and rents average $2,454, making owning $028 per month less costly than renting. Rents rose 5.3% year-over-year. The current capitalization rate (rent/price) is 4.5%. Market rating = 10 Carlsbad Housing Market Value & Trends Update Historically, properties in this market sell at a 38.4% premium. Today’s premium is 12.1%. This market is 26.3% undervalued. Median home price is $769,700, and resale $/SF is $367/SF.…[READ MORE]

HELOC Abuse and Pascal’s Wager Recent reports show an uptick in mortgage equity withdrawal. Is this history repeating itself, or did people learn the wrong lessons from the housing bust? Money won’t buy happiness, but it can provide the finest forms of misery. Everyone wants money. If given the chance to do nothing and obtain money, most people would take it. Such was the lure of the housing bubble. People only had to do two things to obtain copious amounts of cash. First, they needed to buy a house. Then they needed to find a lender who would give them money for signing some paperwork. That’s it. No work, no skills, no risk, no sacrifice, nothing. Buy a house, sign…[READ MORE]

LA County 9% overvalued due to rising mortgage rates Today’s Best-Execution Rates: 30YR FIXED – 4.25% FHA/VA – 3.75-4.25% 15 YEAR FIXED – 3.5-3.625% 5 YEAR ARMS –  2.75 – 3.25% depending on the lender USA Housing News has National Coverage Complete data and analysis covering the entire United States and protected territories. Includes detailed data from large to small scale including national, state, MSA, county, city, area, and zip code level. The most complete coverage of any analytics provider.  [READ MORE]

Losers from the housing bust portrayed themselves as victims and heros The housing bust twisted people’s point of view so much that deadbeats who gamed the system for personal gain were lionized for their behavior. Many people bought during the housing bubble because they wanted a home for their families. They stayed within reasonable debt-to-income guidelines and used fixed rate mortgages. Unfortunately, the prudent were small in number, and if the prudent borrowers lost jobs or suffered financially during the recession, most of them obtained loan modifications making their super-sized debts manageable. They survived. Many other people bought during the housing bubble because they saw their house as an investment, or worse a cash cow they could milk periodically to…[READ MORE]

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