patrick.net

APR is the most accurate measure of the cost of the loan as it accounts for fees as well as rate. Fixed and variable.

FHA is basically subprime with the 1.75% upfront fee and up to 1.35% insurance locked in much longer than in the past. It is worst than before. So yes, FHA will dry up. Do yourself a favor and skip FHA. Anyone with a brain will use a bridge loan instead.

Prime rates are around 4.75%-5% APR. realistically, more households will opt for 5-10 years fixed with APR around 3.25%-4.25%.

SFace says

Prime rates are around 4.75%-5% APR. realistically, more households will opt for 5-10 years fixed with APR around 3.25%-4.25%.

Most 30 year fixed mortgages in CA will be over 5% because of the conforming limit. I've anecdotally have seen 5.25, and 5.5 from associates with really good income and over 20% down. For prime rates of 4.75 to 5.00, you have to be squeaky clean; 5 years of proven W2 income (forget self employed people), and no credit blotches to speak of.

6% is realistically only months away if the FED taper goes through as expected. Rates are spiking pretty drastically over the past 3 months:

5-10 year FIXED is actually very rare. Historically, less than 10% of people financing a home opt for the shorter term loans.

RentingForHalfTheCost says

How about the reality then

The reality is that rising interest rates and falling home prices have not been correlated in the past.

control point says

RentingForHalfTheCost says

How about the reality then

The reality is that rising interest rates and falling home prices have not been correlated in the past.

The past is no place to look at to predict the future. No where in the past have we been in this deep a shit-hole. That is my opinion and you are welcome to yours also. We will be making new ground coming out of this hole. Only the fat-cats are going to be protected. Regular mom/pop home owners could lose big.

I'm calling everyone out - you're all on notice!

This news item proves it: you're idiots. But you won't respond to this thread because - surprise, surprise! - you're cowards, too.

Stupid idiot coward slimes, the whole lot of you...

Come get some, bitches!

control point says

The reality is that rising interest rates and falling home prices have not been correlated in the past.

When has this current market reality ever occurred in the past?

Goran_K says

When has this current market reality ever occurred in the past?

The prime rate bottomed in Jan 1972 at 4.75%. It rose to 15.25% by then end of 1979. The prime rate is currently 3.25% and is likely headed higher.

http://research.stlouisfed.org/fred2/data/PRIME.txt

Unemployment peaked around 9% in 1975 and fell to 6% in 1979. Fell by 3% in 4 years. Unemployment peaked at 10% in 2009 and is currently 7.4%. Fell 2.6% in 4 years.

Inflation adjusted oil prices peaked at $115 in 1979. Oil prices are currently $107.

http://inflationdata.com/Inflation/Inflation_Rate/Historical_Oil_Prices_Chart.asp

Real GDP growth in the 1970s averaged 3.3%. Current GDP growth is 1.7%.

S&P 500 returned 10.5% annually the last 4 years of the 1970s. S&P 500 has returned 12.4% annually the last 4 years.

Median home prices appreciated 65% the last 5 yeaars of the 1970s. Case shiller has appreciated 10% in the past year and 5.4% since March 2009.

So they questions is: what happened in the 5 years after 1979 to home prices? Up 23%. What happened to interest rates, 1980-1984? Went up 1980-1982, then down 1982 to 1984. Finished right where they started.

Interest rates do not increase in a vacuum. They increase due to increased demand vs. supply of loans. If demand for housing falls, demand for loans fall. Supply of loans would have to decrease MORE than the demand falls in order for rates to rise.

Interest rates of term 1 year or less are either down or flat this year. 2 year rates are up slightly, it is not until you look at 3 year and longer that you notice increase in rates. This means the market is pricing a flat ratio of demand/supply of loans for the next two years. The yield curve is the steepest from the 3 to 5 year. The market expects inflation in 3 to 5 years - here is the current expectation of where the peak in the current recovery will be.

So, where does the FED fit in your theory?

There was nothing that came close to this type of intervention in the 70s and 80s. It's unprecedented.

Bigsby says

Actually, I'll do it for you:

http://patrick.net/?p=1227582

Thanks for making my point. Awesome.

Guess you missed this post a while ago now.

"And down we go. Down down down. I have no idea where the bottom will be on this. Into a sinking abyss nonetheless. I'll sell my short position when it goes under 10. Already playing with the houses money. Pun intended!

http://finance.yahoo.com/q/ta?s=DHI&t=3m&l=on&z=l&q=l&p=m50%2Cm200&a=&c=
"

rufita11 says

Q: Why do ducks, have webbed feet?

A: To stomp out forest fires.
Q: Why do elephants have flat feet?

egads101 says

rufita11 says

Q: Why do elephants have flat feet?

A: To stop out burning housing doomers!

Maybe if everyone stays quiet the crisis will go away. Yah, that'll work just great. Down we go...

rufita11 says

rufita11 says

Q: Why do ducks, have webbed feet?

A: To stomp out forest fires.

Q: Why do elephants have flat feet?

A: To stomp out burning ducks!

Bigsby says

In the quote above you say you'll do it below $10. OK....

Guess you can't understand what it means to play with the houses money. In order to get to that point you have to have sold and recouped the initial investment, which I have already done. That was the drop from 27 to 21. The 21 to 10 is just gravy, benefited from all the card reading, house appreciating hoping fools on here. Thanks guys! If it wasn't for you this play wouldn't have half as valuable. Keep pumping!