Captian Ben's QE3: Record Low Mortgage Rates

Since Fed Chairman Bernanke has announced QE3, the spread between mortgage backed securities (MBS), and benchmark 10yr US Treasuries has all but been eliminated; which has pushed conforming mortgage rates to even lower record lows.

We now have the 30yr fixed at 3.40%, and 15yr fixed at 2.73%. Keep in mind, that QE3's $40 billion in purchases of MBS per month has just gotten underway, and there is no limit to the program in time or quantity. QE3 will continue until 'the economy improves'.

• How low will mortgage rates go before they 'bottom'?
  
  
• What effect will this have on housing prices short term, and long term?
  
  
• When will Bernanke run out of 'gas' to keep manipulating the yield curve on US Treasuries and pump up mortgage backed securities, so as to keep interest rates low and asset/housing prices high?

(satirical graphics courtesy of WilliamBanzia7)

Oregon Supreme Court Limbo

How low can we go?

Despite over 80% of bank owned inventory in the Portland area sitting on the sidelines, and despite our neighbors to the North deciding that MERS was a bankster sham...the verdict for Oregon property title/deed/chain of custody rights hangs in the balance of a still pending supreme court decision.

You can bet your sweet bippy that there is plenty of arm twisting going on from blue jean/cowboy boot wearing Kitzhaber on down through the legislature to make things go 'smoothly' for the big banks back East. Kroger (who sold out to the mortgage fraud settlement) is gone as attorney general, but it remains to be seen if Ellen Rosenblum will play ball with the big banks, or uphold the rule of law locally.

What would happen to home prices in the area if all of the shadow inventory were unleashed on the 'free' market? Would savers be rewarded and debtors be punished? Sounds too much like a free market...

Meanwhile, as it always does over time, the 'free market' moves forward in a steadfast manner courtesy of the Oregon Business Report:

"Titles may now be in doubt for people who bought properties either at a foreclosure sale or further along the line. Also, no market may exist for these properties if title insurers choose not to insure titles until there is some clarity. Going forward, will MERS lenders do business in Oregon? And if so, at what cost? Loans may be more expensive to administer because they either require that all assignments be documented and recorded or foreclosure via the more expensive judicial method. As such, loans in Oregon could demand higher interest rates.

Courts will see a sharp increase in the number of judicial foreclosure filings; it’s happening in Multnomah County already. An already overcrowded judicial system will gain additional burdens."

So are we to restore "certainty" and "sanity" to our real estate markets? Is it worth higher interest rates to have the title/deed recorded properly through the local county authority as has been done for hundreds of years? Or is it clearly imperative that title assignments be handled by Wall St and that home prices keep going "up" regardless of real wages? Heaven forbid that all assignments be documented and recorded locally?!?!?

Where would you rather have your land claim be recorded and heard in court?

A.) With the local county clerk's office

B.) With Wall St / DC sanctioned MERS?

***Comment from Clint8200***

Hello everyone,

I've had to do it again. Twice in five years. I've switched commenting systems. The current comment system (Haloscan) has made a shift away from being a 'free forever' service to a 'pay us or we'll delete all your comments and prevent valued readers from commenting ever again' service. Unfortunately your monthly blog subscriptions don't offset their monthly service charge so I'll switch back to the old blogger commenting system. I apologize for the inconvenience and hope you find the new format easy to use.

Portland RMLS Market Action Report – June 2012

The Regional Multiple Listing Service released the Market Action Report this week and the median sale price for June 2012 was $242,000; this is an 8.6% increase from the median sale price for June 2011.

The Portland residential real estate market peaked in August 2007 with a median sale price of $302,000. Prices fell 30% from that peak before bottoming in January 2012 with a median sale price of $207,500. Prices have risen 16.6% from the bottom.

Months of supply (total inventory/monthly sales) sits at 3.9 months compared to the 6.0 months of supply for the same month last year. A balanced market has about 7 months of supply.
The first graph compares the median and average sale price with the months of supply. Click on any graph for a sharper image.

 

The second graph shows the total supply of homes available for sale. This is simply a calculation of the months closed sales multiplied by the months of supply. There are currently 8,751 homes for sale; this is a decrease of 25.5% from the same month the year before.

 

The third chart shows closed sales by month. There were 2,244 closed sales during the month; an increase of 14.6% from the same month the year before.

The fourth chart shows new listings by month. There were 3,208 new listings during the month; an increase of 2.1% from the same month the year before.

 

The final graph shows how affordable the median priced home is for a family of four. History indicates the ratio is usually between 2.5 and 3.0. Prices would have to fall 10.74% from the current median for the ratio to reach 3.0.

 

The Waiting Game - Portland's REO Constipation

The more things change the more they stay the same...

"The vast majority of repossessed Portland-area homes aren't up for sale. Instead, more than 80 percent of them are off the market, many vacant and developing maintenance problems that might ultimately take a toll on their resale value if and when they do sell."

And of course at its core, we have simple root cause analysis pointing directly at the behavior of the two legged rats running the banks, who have to make their blatant title/securities/balance sheet fraud legal and/or profitable before it's convenient for them to foreclose...

"In some cases, particularly after the robo-signing scandal that emerged in late 2010, lenders had paperwork issues to resolve before they could sell properties to third parties. Major banks put the brakes on foreclosures and foreclosure sales in the past couple of years while they audited the ones in progress and negotiated what became a $25 billion settlement with 49 states and the District of Columbia.

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McCredie, a broker with 30 years of experience in bank-owned properties, said the Portland foreclosure machine may be further slowed by the issue of the Mortgage Electronic Registration Systems, an industry workaround for local recording laws that's headed to the state Supreme Court. Borrowers have challenged foreclosures involving MERS, and conflicting rulings have left banks skittish about proceeding with new foreclosures and sales, he said.

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And some of the delay is likely the result of a bookkeeping maneuver, said Rick Sharga, executive vice president of Carrington Mortgage Holdings. The homes haven't been marked down to their new, lower market value"

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Note the last paragraph with respect to balance sheet fraud. If bankers don't have to auction the bad collateral/loans, they don't have to realize a loss and can still pay themselves handsome bonuses.

Google "prompt corrective action" and see just how deep the fraud goes.

Too big to fail?

SOURCE: The Oregonian

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Double Dip??

The "mainstream" news today:
Americans brace for next foreclosure wave

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The "black market" news today:
The Second Foreclosure Tsunami Is Coming,
And Is About To Kill Any Hopes Of A "Housing Bottom"

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The Portland Housing Blog commentary from last November:
Double Dip?


So what do the Portland Housing Blog folks see on the ground for our local/regional real estate market in Spring/Summer 2012? 2013?

Is this really the bottom? In nominal dollars? In real dollars?

Or are we merely in the eye of a bigger hurricane?

Buy? Sell now while you still can? Rent? Stop paying and squat?

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Signs of life for commercial real estate

From the Oregonian:

Multnomah County Chairman Jeff Cogen announced a tentative deal with Melvin Mark Development Co. Friday to launch a Pike Place-style market at the west end of the Morrison Bridge.

Envisioned as an "iconic gateway" to downtown, the market would host 110 local vendors of food and food-related products and sit next to a new office tower on Southwest First Avenue. Together, the projects are expected to bring $10.4 million to the county's fragile general fund, transforming an empty county-owned lot into a bustling tourist destination that would complement nearby Portland Saturday Market.

This along with the target deal show things are starting to move again. We are very close to the bottom of the market if not past it.

Oregon Supreme Court Set to Rule on MERS

So the majority of the state attorneys general in the US have rolled over for Wall St and ignored the mass fraud that occurred when it came to recording chain of custody to title/deed/mortgage documentation at the county level. Just for the record, our own Oregon Attorney General John Kroger also chose to sweep the fraud under the rug and signed on to the "settlement".

MERS is a sham property recording system conceived by the banksters, and it has circumvented local property recording laws that have worked well for hundreds of years. Nowadays? We have multiple robo-signers named "Linda Green" with varying signatures via shell corporations that have no real assets on their balance sheets deciding exactly who "owns" what real estate in our fair city. Legal chain of custody via county land records? Ha! That's soooooo 18th-20th century.

I suspect the Oregon supreme court will roll over and play ball as well. At this point, nobody wants to upset the apple cart that's already dripping with rotten apple juice. It's gotten to the point for the five largest banks in America, that knocking off your local 7-11 store for $3k in a robbery is routine, and the "justice" that comes via legal consequences are small fines for a few hundred bucks per heist.

Business as usual. Control fraud.

Good work if you can get it...and if you can get away with it:

"The court will have to determine whether MERS qualifies as a loan beneficiary under state law and whether it has met state recording standards.

"It has undermined the whole basis of law that our country was founded on, in establishing a chain of title," said John Bowles, a partner at the Bowles Fernandez law firm in Lake Oswego. "MERS is a privately owned mechanism, owned by the principal industry players, that have chosen to subvert the whole system of recording."

MERS said Thursday it was still waiting to hear details of the court's order.

"We do not have the specifics yet from the court, but we look forward to the opportunity to present the seven honorable justices of the Oregon Supreme Court with the ample evidence of the benefits and legality of the MERS model," spokeswoman Janis Smith said in a statement. "

Source:

The Oregonian


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