June 9, 2010
The "GOOD NEWS" from Europe
| With all the uproar concerning the European crisis, we must spend a few minutes to look at the bright side. The market's reaction has brought us two very important pieces of good news. First, oil prices have moved significantly lower. Just a few weeks ago we were looking at gas prices hitting $3.00. Now the price of oil is down around 20 percent from its recent peak. What is really extraordinary about this is that the retraction is happening while oil is spilling out into the open waters in one of the largest oil disasters in our history. Ordinarily oil would be skyrocketing, not because of the immediate loss of oil, but because the long-term prospects of offshore drilling has dimmed. Why are lower prices good news? Lower energy costs not only take the pressure off inflation, it gives the consumer more money to spend. Consumer spending helps "fuel" the economic recovery. The second present is comprised of lower rates. Everyone was talking about higher rates being a foregone conclusion. Well, it just goes to show that you can never predict the future. Lower rates free up more money for spending just like lower oil prices. With the recovery in the real estate markets underway, but on very shaky ground because impending foreclosures and "shadow inventory," lower rates are absolutely necessary to help the recovery continue. The Federal Reserve Board has indicated several times that this is the case. Lower rates provide opportunities to refinance debt and purchase homes at incredibly low bargain prices. They help car sales and also small businesses throughout the nation. The stock market may not like what is happening overseas as a fiscal crisis is painful. However, there is good news that will help our economy in the long-run. Homeownership continues to be a bargain! |
| Prime Time for Owning a Home
The national median home price for the quarter was $175,000. "Homeownership continues its more than year-long trend of remaining within reach of more households than it has for almost two decades," said NAHB chairman Bob Jones. "With interest rates still hovering at low levels, companies starting to hire new employees and the economy beginning to rebound, this should encourage more home buyers to enter the market and help further stabilize housing and the economy." The NAHB judges a home to be affordable if a family making the metro area's median income could devote no more than 28% of their take-home pay toward housing costs. Indeed, since this report was released the European debt crisis has forced rates lower and increased affordability even more (see related story). This is truly a once-in a life-time buying opportunity. Source: CNN/Money |
| Unmarried Women Trump Men
He reminded sellers to treat young women as viable buyers, not bystanders, by doing something as simple as handing them a brochure when they enter a for sale home. These women tend to stake their claim on homes in the 1,700-square-foot range predominantly in the Washington, D.C., California and Texas markets, Warrick said. After segmenting the market, Warrick noticed that young women, especially those rooted in secure industries like health care, make more money than their male peers. Source: MarketWatch |
| About Cornerstone Financial Mortgage
Cornerstone employs a team of experienced professionals who are committed to providing the highest level of service while fulfilling the varied needs of our customers. We build our business on satisfied customers - home buyers, homeowners, realtors and builders. Cornerstone strives to create value for all our partners - value for our customers, investors, shareholders, employees and the communities where we do business. Bruce Neumann Sr. Mortgage Consultant 215.601.7755 cell Email Me Visit My Website Eric Baitinger Sr. Mortgage Consultant 215.654.6085 office Email Me Visit My Website |
