I'll just give an opinion on what I think will be the effect of the takeover......
Keep in mind that Fannie/Freddie guarantee a secondary market for conforming mortgages to be bought and sold. Non-conforming (jumbo) mortgages have no such luxury and are subject to supply (in absundance on many banks/funds balance sheets in various forms) and demand (none). Although jumbo limits had a revision in 2008 as part of the economic stimulus plan, they're typically set at 417K. If most buyers were well qualified (i.e. income, credit, assets) and had enough equity to only require a conforming mortgage, then things would look rosier. But that's pollyanna thinking.
In the end, Fannie/Freddie will recover and continue to provide the neccessary services they've provided for decades. They will restore investor confidence in MBS products by offering transparent and credit worthy debt. Banks will issue mortgages to only those who can afford it. And buying a house will no longer be as easy as buying a car. You will most likely never see in our lifetime another unchecked, drunken sailor credit binge like we saw in the past 4 years. It was a fun party, but the hangover is just too difficult to deal with.... - Sat Sep 13 2008, 21:29
Yes, there is a greater (and neccessary) trend by lenders to evaluate and price financing based upon geographic locations and trends. You will also see this with non-conforming jumbo maortgage limits varying by town.
As an owner in Hoboken, I'm surprised to see new listings priced as agressively as they are for the seller. With the volatility in real estate/credit markets and the abundance of rental units in Hoboken, you'd think more buyers would be on the side line, creating a greater inventory. Not to mention the massive upper grand/maxwell projects that added hunderds if not thousands of units. But it seems to be holding, for now at least......... - Sat Sep 13 2008, 20:18
Tuta,prices are going down. Probably not at the pace and scale you'd like to see as a buyer, but they're declining nonetheless. Good things come to those that wait..... - Fri Aug 22 2008, 16:17
Prices have depreciated in BC and will most likely continue for the next 12-24 months, although at modest /insignifigant reductions in the more affluent, desirable towns. If you can walk from the property if terms aren't met, go low and see what happens. There's cetainly no inventory shortgage of 400K homes in bergen county......... - Tue Aug 19 2008, 07:22
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