The Lending Company

This Blog Has Moved!

John Leach — 2008-02-06T12:13:34-08:00

I am excited to let everyone know that this blog has been upgraded and is now moving to it's permanent location. Please update your subscription.

Here's the new location:

http://www.oregonmortgageplanning.com

Sincerely,

John Leach

Real Estate Is A Bad Investment (Again)!

John Leach — 2008-02-04T12:58:45-08:00

Courtesy of Sue Botelho

Tracking the Track Record

What the ‘Experts’ Say about Housing Prices

“The prices of houses seem to have reached a plateau, and there is reasonable expectancy that prices will decline.”

- Time Magazine 1947

“Houses cost too much for the mass market. Today’s average price is out of reach for two-thirds of all buyers.”

- Science Digest 1948 (average price at the time: $8,000)

“The goal of owning a home seems to be getting beyond the reach of more and more Americans.”

-Business Week 1969 (average price at the time: $28,000)

“The era of easy profits in real estate may be drawing to a close.”

-Money Magazine 1981

“If you are looking to buy, be careful. Rising home values are not a sure thing anymore.”

-Miami Herald 1985

“Most economists agree…a home will become little more than a roof and a tax deduction, certainly not the lucrative investment it was…”

-Money Magazine 1986

“We’re starting to go back to the time when you bought a home not for its potential money-making abilities, but rather as a nesting spot.”

-Los Angeles Times 1993

Note that 1993 was the absolute low-point for real estate values in Los Angeles.

Prices have sky-rocketed since.

“Financial planners agree that houses will continue to be a poor investment.”

-Kiplinger’s Personal Financial Magazine 1993

“A home is where the bad investment is.”

-San Francisco Examiner 1996

Trulia - A Good Start For Oregon Real Estate

John Leach — 2008-01-31T21:57:59-08:00

If you haven't yet experienced Trulia.com it is definitely worth your time as you begin your home search.

The clean intuitive interface, combined with great mapping features and market statistics make it a great resource when looking to narrow down the search for your next home.

Some interesting things I found...

In Eugene, Trulia came up with 534 homes available. Population approximately 153,000.

In Bend there were 1443 listings. Population approximately 78,000.

In Portland 2244 listings. Population approximately 568,380.

These numbers show signs that the Eugene & Portland markets are still fairly healthy, while Bend shows signs of having quite a bit more inventory per capita. The plus side for Bend is that it is still one of the fastest growing areas in the country, but even with this growth it appears it may take a while for the inventory to get back in line especially when comparing it to the Eugene and Portland real estate markets.

OK, so maybe I'm getting off topic on a post that is supposed to be about Trulia, but this is what I found happening to me on the site. I started out searching for listings, and ended up intrigued by the amount of information available.

I still have not found a national site to be 100% "all-things", but Trulia does do a good job with providing potential buyers the information they need when looking for their next home.

Fed Cuts Rates - Mortgage Rates Rise?

John Leach — 2008-01-30T18:31:19-08:00

I know that every time the federal reserve meets I can expect to field a number of phone calls from my clients all over Oregon.

As I expected today the federal reserve cut the federal funds rates by another 50 bps (bps is short for basis points, and 50 bps means .50%). This follows an unexpected cut of 75 bps last Tuesday, conintuing the cuts that began last Summer.

If you look at a graph, you can see that each time there was a rate cut, mortgage bonds actually went the opposite direction in the immediate aftermath.

The reason for this is simple. As mortgage rates reach a certain level, the mortgage bonds that investors buy lose their value (perceived value) due to investors looking at one thing...inflation.

The federal reserve cuts rates to help stimulate the economy, which leads to more investing, more productivity, more employment, and often inflation will follow. They raise rates in order to keep inflation in check and slow the economy. If there is risk of inflation, mortgage rates will rise as investors will see that they need a higher return in order to outpace inflation or else they will be going backwards.

So, we have seen mortgage rates drop this past six months but now mortgage bond investors are wondering what's next? If we are nearing an end to these cuts, thant it would appear that as the economy begins to gain hold we could see inflation rise, and rates will follow.

The next two weeks should give us a good idea of where the economy is headed as there are numerous reports scheduled to be released on jobs, inflation, retail/wholesale cost of goods, and overall economic growth.

If you'd like to keep up-to-date on the weekly happenings in the mortgage market, check out my weekly newsletter by clcking the MMG Weekly logo on my sidebar.

John

Are You A Lead?

John Leach — 2008-01-25T01:28:10-08:00

I am not a lead

I found this and just had to post it.
Eye-opening for me and my business as well.

How's YOUR Real Estate Market?

John Leach — 2008-01-17T22:32:01-08:00

I'm not sure if there is a topic more popular right now than real estate. Newspapers, talk radio, CNBC, blogs, websites...the list goes on all talking about the real estate market.

Those in the industry get accused of being to bullish as they attempt to stay in business, and those looking from the outside are lead to believe that all is (or soon may be) lost.

Part of the reality is this. In a free market society the market (a buyer, a seller, supply and demand) determine the prices of homes.

The other part still goes back to those three famous words...location, location, location.

You see, there is no ONE real estate market. There are thousands of mini-markets.

For example...you can't really say there is an "Oregon" market because someone is not just buying a home in Oregon...that's too general. Going further...you can't really say there is just a "Eugene" market because each area of Eugene will have its own characteristics.

So what about...say...an "East Eugene" market? OK, well now you are getting closer...but what about even more specific, like less than 1/2 of a mile from the University of Oregon?

And then you can go one more step...like what is the "market" like on Fairmount Blvd.?

Now were talking.

If you are a buyer looking for a home on Fairmount or a seller looking to sell your home living on Fairmount...then that's the only market either of you will really be concerned with.

My recommendation...find an expert to help you understand YOUR market.

Interest Rates Dropping

John Leach — 2008-01-16T21:12:55-08:00

It's already been an interesting 2008. Mortgage interest rates here in Eugene, Oregon have plummeted to a 24 month low at just below 5.50% on a 30 year fixed mortgage.

As the economy shows signs of slowing rates have headed down and the consensus is that we may see rates going even lower this year.

Here at The Lending Company, Inc. we are seeing a lot of activity as many homeowners are looking to take advantage of these low rates once again and refinance their current loans, while other potential home-buyers are once again looking for new homes that are becoming more affordable every day.

Feel free to contact me if you have any questions regarding interest rates or the Oregon real estate markets.

John Leach
Senior Managing Partner

Technorati Profile

Apple Macbook Air - What People Want

John Leach — 2008-01-16T19:53:32-08:00

Anyone who knows me knows that I love Macs. Of course now days who doesn't?

My Macbook Pro is incredible and has enabled me to run my mortgage business much more efficiently.

I can't think of another company who listens to what people want as well as Apple.

Great listening creates great products and services.

Here's another great example:

Free DVD Offer

John Leach — 2008-01-03T15:14:55-08:00

Ric Edelman, one of America's top Financial Planners has made available to The Lending Company a special production of his DVD entitled "10 Great Reasons to Carry a Big Long Mortgage."

If you live in Oregon, just email me your address and I will send you a copy for FREE! This DVD is sold by Ric Edelman on his site for $29.95, and Amazon used to have it for $39.95.

January Mortgage Advisor Newsletter

John Leach — 2008-01-03T14:55:12-08:00

Download Advisor15.pdf (1123.9K)