Giving you the bad news before the good news this week. The silver lining is the bad stuff might not happen!
The big story this week is the impending shutdown of the government. Since there is plenty of stuff to talk let’s dive right in!
Turn the Lights Off On Your Way Out
The groans are especially louder this Monday since we are looking forward to the government shutting down. Whether or not this actually happens doesn’t change the fact this has probably already hurt the economy. But looking at this problem from the real estate/housing perspective, this is going to hurt.
You see FHA loans accounted for 45% of all mortgages used to purchase homes issued in 2012. There were even some reports on Friday that if the government shuts down it means that loans guaranteed by the FHA, the VA and the rural development loans of the USDA, may not be processed. However, HUD has since said that loans will be processed but I bet it will take much much longer.
This is only a few of the various bad things we can look forward to…
Now for the Good News
Not sure if I should have recapped the positive news from last week before talking about the potential negative consequences of a government shutdown. In case you missed last week post 3 Positive Reports for Real Estate, check out the highlights:
- NAR reported existing homes sales at the highest point in almost 6 years
- NAR reported the US median home price is up 14.7% YOY
- Case-Shiller reported a 12.4% YOY increase in home prices
- FHFA reported home prices up 8.8% YOY
All this positive news makes it even more disturbing that the political bickering in Washington could derail the recovery in real estate.
On Friday, I posted the usual Mortgage Rate Update. And as we expected, mortgage rates dropped after the Fed surprised everyone by delaying any “tapering” of quantitative easing. Both Freddie and the MBA reported the average mortgage rates dropped.
While the big news is happening today/tonight, there are a few housing and mortgage related reports this week:
- Construction Spending for August 2013
- ADP Employment Report for September 2013
- Federal Non-farm Payrolls and National Unemployment Reports for September 2013
Here are a few good real estate, housing and economic articles from around the web:
Reality Check: Eight Takeaways on Mortgages After the Housing Bust
1 Thing Washington Should Focus On: The Federal Reserve Destroyed Real Estate Financing
The Bank I Love to Hate: BofA goes to trial over mortgage fraud
Liar Liar Pants on Fire? Morgan Stanley sued over faulty securities
Also Getting Off Cheap: JPMorgan in talks to settle for $11 billion
Tap Out: FHA to tap Treasury funds
Noticing a Trend: Banks find appalling new way to cheat homeowners
Bombs Away: FHA Drops a $1.7 Billion Bail Out Bombshell