The Santa Fe Life Blog will is a place to keep informed of the comings and goings of all things Santa Fe.
Mortgage Rates Plunge to Record Lows
In response to the Federal Reserve's cut in the federal funds rate to near zero, Freddie Mac reports that the 30-year fixed mortgage rate fell to 5.17 percent during the week ended Dec. 18--down from 5.47 percent last week and the lowest since the survey's inception in 1971. Interest on 15-year fixed loans slipped to 4.92 percent from 5.20 percent. Meanwhile, the five-year hybrid adjustable mortgage rate dropped to 5.6 percent from 5.82 percent; and the one-year ARM dipped to 4.94 percent from 5.09 percent. A year ago, the 30-year fixed rate stood at 6.14 percent, the 15-year fixed rate at 5.79 percent, the five-year hybrid ARM at 5.9 percent, and the one-year ARM at 5.51 percent.
Source: The Wall Street Journal, Steve Kerch (12/19/08)Labels: Mortgage Rates
Why Are Property Taxes Still Rising?
Property taxes continue to rise across the country, despite steep declines in home values.Property tax collections across the United States rose 3.1 percent this year, according to the U.S. Bureau of Economic Analysis (BEA). That means state and local governments will collect more than $400 billion in property taxes this year—a record amount.Most states have caps that prevent taxes from rising rapidly in boom times. The same laws keep taxes from plummeting when home values decline."Property taxes aren't always popular, but they are a very stable tax, even in tough times," says Thomas Gentzel, executive director of the Pennsylvania School Board Association.Source: USA Today, Dennis Cauchon (12/04/08)
Investors Not Happy With 4-Loan Limit
Many real estate investors, including myself, are not happy about the new Fannie Mae-Freddie Mac policy that limits to four the number of real estate loans that can be held by a single person.The rule, which took effect Dec. 1, prohibits an investor from obtaining even a fifth mortgage no matter how much money is put down or how much income documentation is provided. It offers no exceptions for assets or history of success as a real estate investor.My feeling is that the regulation pendulum has swung too far and that actions like this will only continue to put a damper on the economic recovery. I have never been a fan of policies that do not consider all factors. As always, where there is a will, there is a way. Some investors are trying to work around the rule by partnering with other investors to either buy in cash or use their eligibility to borrow. Also, portfolio lenders who will ultimately hold the paper and not sell it on the secondary market will become increasingly important to the investor. Labels: Finance, Mortgages, Real Estate Investing
