We covered a lot of ground in twenty minutes or so on Tuesday on Coy Barefoot’s Charlottesville-Right Now! show on WINA. This is a summary, with links, to the topics we discussed. Each time I do a radio show, I realize how I really enjoy doing it. Live radio is a bit scary, but fulfilling.
Market Update – I’ll refer to the market report I published in October.
My advice remains – If you do not have to sell, strongly consider not selling. If you’re looking to buy and stay for a while, you may want to strongly consider buying right now. As Mark Cuban wrote the other –
So whats the difference between being underwater on a mortgage and underwater on a stock ? Is it that â€œexpertsâ€ will tell you to hold the stock in hopes of it going up in value and then explain that those with homes worth less than their mortgages shouldn’t feel bad about breaking their mortgages and defaulting ?
â€œBuy and Holdâ€ for your house is a mantra you should always live by. The difference ?
You can live in your house. You get utility from your house. You may get a deduction for interest paid on your tax bill. You can develop a positive emotional attachment to a house.
Can you get a loan in Charlottesville? Absolutely.
In an attempt to dispel some of the (justified) negativity surrounding the Charlottesville real estate market, I thought I’d ask some of the lenders with whom I regularly work for their insight. Part of my job is knowing stuff, another is knowing whom to ask. With that preface, I asked Matt Hodges with Compass Home Loans, Carl Heimlich with C & F Mortgage and a third person who was not permitted to comment on the record. (that’s what you get for asking permission). *
Assessments versus market value versus appraisals – I was going to link to a few of the stories I’ve written about these, but there are quite a few stories over the past several years. Please go to the Archives page and search for the stories with “assessments” in the titles. But – start here – Assessments, property taxes and shifting market values in Albemarle County
The new bailout/foreclosure prevention bill – start here to educate yourselves –
This is intended to help “thousands” (a drop in the bucket unless it is several hundred thousand), and seems to encourage homeowners to stop making payments until they are 90 days late.
This is the beginning of massive government intervention to try and slow foreclosures. On a positive side, Fannie and Freddie could provide a template for servicers to follow which may help homeowners receive a â€œyesâ€ or â€œnoâ€ answer faster. On the down side, this may also slow the recover of the housing market, prolonging the decline of home prices. Currently 40% of loan modifications re-default. This may also further erode investor confidence in residential mortgage backed securities, the impact being even tighter underwriting guidelines than what we’re now experiencing.
Building permits in Albemarle are very, very low – and this is a good thing. (I was on the radio before I saw that story 🙂 ) Look at the 3rd Quarter 2008 Building Permit Report here (pdf). Also check out Brian Wheeler’s analysis from the First Quarter of 2008.