I hope your summer is doing well for you. Remember to enjoy as much of today as you can.  

Quote: “Character is not made in a crisis, it is only exhibited.” Author: Freeman, Robert
 

Are times Good?? There are many stories in the news about the problems many are facing now. Most of the news is negative. The below snapshot is mixed, there is good news and some bad. I vote for the good news. We are helping many who need fast cash. The fast cash is easy when you have equity. Refinancing from a subprime loan to a 30 year fixed in the low to mid 6% range, this is good news. Many are buying homes that they normally couldn’t qualify for, because the prices have dropped a bit. The recession isn’t as bad as it was predicted. So we should be thankful for our God given blessings.Rates have risen, against our wishes but why?.Look at this 12 month mortgage rate chart, we sure saw a nice dip back in Feb. To bad more people weren’t able to take advantage of the dip. But rates are still very good. Being in the mid 6% range, nothing to complain about. Home values are down so it’s a great time to buy making this year one of the best years for buyers in 5+ years.We all knew values were increasing at such a wild pace. We all knew there was a bubble. So now we see the adjustment. Very good times for some, being able to purchase homes in areas and at prices that were out of their reach a year ago. We really should look at the bright side, it isn’t as bad as it could be for many, and it is very good for some. For those who are enduring hard times, hopefully the pain and frustration will be shore lived.

Jobs: Although everyone is complaining about the recession, the first quarter GDP [gross domestic product] showed a 0.6% increase in April’s initial or advance report, a 0.9% increase in May’s first revision or preliminary report, and a 1.0% increase in June’s final report. Though 1.0% growth is not robust, it is an acceleration from the 0.6% increase in the fourth quarter of 2007. The classical definition of a recession is a contraction of economic growth for at least two consecutive quarters. So because GDP isn’t decreasing, why does all the media talk about the severe recession?Stocks: Stocks were also strengthened by news that the Fed was expanding its lending program for securities dealers — this move eases some credit concerns. The American Housing Rescue and Foreclosure Prevention Act was signed by President Bush today this also brightens the outlook for wall street.. Although this bill increases government liability, it lessens the risk on mortgage related investments.Fuel: There was a sharp drop in gasoline inventories last week. They fell by 3.5 million barrels, the first contraction in five weeks and the largest since last April. Though supplies were still 4.3% higher than a year ago, the latest decline spurred a jump in oil futures. A barrel of light, sweet crude oil for September delivery rose by $4.58 on the New York Mercantile Exchange to settle at $126.77. The increase was the largest in the last fourteen sessions. My personal feelings, are get use to the shortage or fossil fuels, we have only had so much, eventually we will run out. But there are plenty of renewable energy sources, wind, water, solar, even turning leaves and scrap wood into fuels. Some day we will start considering what Holland does, they harvest more renewable energy then they use.Housing: May home prices dropped a record 15.8% from a year ago, according to the S&P/Case-Shiller Home Price Index of 20 cities. It was the 22nd consecutive month of decline recorded by the index. Prices fell 0.9% from April to May. Each of the 20 metro areas covered by the index posted annual declines; nine posted record lows and 10 cities recorded double-digit drops. Now is a great time to purchase a house or investment property - I am helping many first time buyers who haven’t been able to afford purchasing in the past several years. But now they can afford a nice house in a nice neighborhood. Houses that were selling for $700k 2 yrs ago are now selling for $450k. That is a big drop. Many of these homes are foreclosures or bank owned homes. But in all markets, there are winners and losers.Investors are now able to purchase properties that easily debt service. It was tough a couple years ago, values were going through the roof, but rents weren’t, so investors had to put huge downpayments down on properties to make the rent to payments make sense. Now, lower downpayments are ok, because although house prices have dropped, rents haven’t dropped. In fact rents will probably continue to increase. Now is a good time for new investors to pickup good rental properties. If you need me to run some numbers for you regarding purchasing investment properties, just call or email me.