30. November 2007 by Burbank Real Estate.

This week saw volatile trading sessions, again, with the Dow down 237 points on Monday, up 217 points on Tuesday, up 332 points on Wednesday, up 20 points on Thursday and up 60 on Friday. Concerns over credit woes continued as well as rumors of Citigroup layoffs.

Items of note:

• New Home Sales for October rose by 1.7%, but that figure is misleading as September sales, originally reported at a 770k annual pace were decreased to 716k, October sales came in at 728k, which although lower than expected looked better than it was due to the September revisions.
• The Case-Shiller Home Price Index showed a year to year decline of 4.5%.
• Existing Home Sales fell to an annualized pace of 4.97M in October, lowest level since 1999, with inventory levels at a 8.5 month supply, year to year sales were down 24%. “This looks like it’s going to be the deepest correction of any housing correction since World War II, and the question really is, ‘What’s the duration, how long will it be?’” Centex CEO Timothy Eller…..it will be interesting to see if he is right.
• Fed Chairman Bernanke spoke and gave hints of another rate cut in December.
• Personal Spending and Income report showed that consumer spending was flat.
• Weekly Jobless Claims came in higher than expected at 352k this has been a trend for a few weeks and I’m sure the writer’s strike is making it’s contribution.
• Treasury Secretary Paulson is trying to get major banks and mortgage servicers to freeze rates on adjustable rate mortgages.
• Crude oil declined below $90 per barrel.

With weak dollar and inflation concerns continuing the Dow ended the week up 392 points or 3% based on the idea that having reached the 10% decline or correction level will set the stage for a year end rally and of course that the Fed will keep cutting rates.

Have a great weekend!

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19. November 2007 by Burbank Real Estate.

This chart includes housing data for each respective zip code listed for the October 2007 period and percent change from October 2006 levels.

As you can see from the table below, housing prices for the month have varied by area, but it’s interesting to note that the higher end of the market has not been as affected, at least as far as median price, by the slow down.

Most notably in Toluca Lake(91602) we saw a 42.7% increase in the median home price, Studio City(91604) experienced a 3.3% increase and the Hollywood Hills(90068) saw a 12.8% increase in the median home price. What’s been most impacted in many areas is the volume of sales. The main reason for this is that it has become harder for many to obtain a mortgage loan, especially if it’s above the conforming limit of $417,000, which as you can see from the chart below, most areas are above this number.

In Burbank the 91506 area fared best with a 4.8% increase over last year’s median home price.

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15. November 2007 by Burbank Real Estate.

To find out how much money you’ll net from your house, add up your closing costs and subtract them from the sale price of the house.

Reprinted from REALTOR Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS

Copyright 2005 All rights reserved. www.REALTOR.org/realtormag

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15. November 2007 by Burbank Real Estate.

1. The closing date. See if the date the buyer wants to take title is reasonable for you.

2. Date of possession. See if the date the buyer wants to move in is reasonable for you.

3. The earnest money. Look for the largest earnest money deposit possible; since it is forfeited if the buyer backs out, a large deposit is usually a good indication of a sincere buyer.

4. Fixtures and personal property. Check the list of items that the buyer expects to remain with the property and be sure it’s acceptable.

5. Repairs. Determine what the requested repairs will cost and whether you’re willing to do the work or would rather lower the price by that amount.

6. Contingencies. See what other factors the buyer wants met before the contract is final—inspections, selling a home, obtaining a mortgage, review of the contract by an attorney. Set time limits on contingencies so that they won’t drag on and keep your sale from becoming final.

7. The contract expiration date. See how long you have to make a decision on the offer.

Reprinted from REALTOR Magazine Online by permission of the NATIONAL ASSOCIATION OF REALTORS

Copyright 2005 All rights reserved. www.REALTOR.org/realtormag

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8. November 2007 by Burbank Real Estate.

A wave of negative news hit today…….

• Washington Mutual was hit by continued allegations of fraudulent appraisals. Additionally, analyst reports came out that questioned the viability of Citibank and others and indicated that banks would write down $100B in portfolio losses this year. Needless to say stocks got hammered with a 360 point loss on the Dow and the S&P suffered a 3% loss on the day.

• Non-Farm Productivity rose to 3.9$ in the 3rd quarter. Given that the Fed is concerned with inflation this is important data for the Fed to consider because when productivity rises, labor costs go down which in turn is less inflationary for the economy.

• GM reported losses of $39B, $38B was due to an accounting charge, the remaining $1B was larger than expected.CEO of Washington Mutual is predicting lower home prices, lower loan volumes and tighter lending standards for 2008.

• An analyst report on Morgan Stanley cited a potential for a $6B loss on their loan portfolio.

• A Chinese government official said China needs to diversify out of weak currencies (i.e .the dollar) For more on this topic, check out Ricardo Bueno’s interpretive post!

All in all a very negative day. Tomorrow Federal Reserve Chairman Ben Bernanke will speak before the Joint Economic Committee and you can be sure he’ll be asked plenty of questions surrounding the state of the subprime mess and the economy.

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