Moody’s Economy did a projection for when each state is expected to see a rise out of the recession. According to the article, Oregon, Washington, Idaho, Colorado and Texas should be the first states to start seeing some positive numbers.  The projection…4th quarter of this year.

This is pretty consistent with the projections from Oregon’s economist as well.  California is projected for 3rd quarter 2010.  This is pretty consistent with what California buyers that are relocating to the Salem Oregon area are saying.  They are also having a harder time understanding that our economy isn’t has hard hit as theirs, despite our 12% unemployment rate.

Anyway…this is potentially good news for Salem Oregon area sellers since, selling your home may get a little easier come next year.

Must…fix…broken…link…

Anyway…now that I have a plan for fixing my broken links in-between actually working with real live people, I can get back into my posting routine.

So last week, Zillow announced their top cities where home owners were underwater. According to Zillow, Bend, then Medford, then Portland have the most homeowners underwater here in Oregon.

According to the data crunchers at Zillow 12.9% of homeowners who purchased a home in 2009 in the Salem Oregon MSA (Metropolitan Service Area) are already underwater: they have negative equity already according to Zillow.  I can see that for $350,000+ homes, but the homes under $200,000 are still selling fairly well.

According to Zillow, the Salem Oregon real estate market peaked in the second quarter of 2007, which is pretty much how I see it too.  According to the big Z, the Salem Oregon real estate market is off 13.1% since then.  Honestly, pretty close.

So what does all these numbers mean.  Nothing that you don’t already know.  Homeowner are underwater, short sales, foreclosures, unemployment…same ol’ same ol’.

It’s getting towards the middle of the month, and so I’ll get those monthly market reports cranked out here in the next few days.

Here is a YouTube video that shows the homes that they are bulldozing, around 12 in all.  The subdivision had serious problems with vandalism and the homes were being destroyed.  It was actually cheaper to just bulldoze the homes, then try and sell them.

Why is the fed taking such bold moves?  This…

Credit Suisse Mortgage resets

The Boston Herald reported the results of a survey conducted by Campbell Communications indicating that 52% of real estate agents surveyed felt that the housing market was going to hit bottom in Spring of 2009. 7.7% were eternal optimists that felt the market had already hit bottom, and 16.5% were pessimists that felt it would be 2010 or later.

I study my market fairly closely and post my data for you all to see. I firmly believe that buyers and sellers need to be able to make informed choices about their real estate transaction. Now, it is no secret that Salem and our outlying metro towns did not have the insane appreciation rates that the rest of the country had. We shouldn’t have to much farther to correct. I am not in the 52% of agents that feel that prices will bottom out for the market in spring. Fall of 2009, maybe…here’s why…

Our local Salem economy has 16,000 jobs that are tied to the state. With buyers and sellers arguing property tax rates, the economy in turmoil, and general retraction of spending by consumers we are going to see some economic fallout. The Oregon legislature is going to have to figure out what to do about a budget shortfall in the next legislative session. My concern for our local Salem real estate market is pretty simple…we don’t have a large portion of foreclosures due to lending, but I am concerned about foreclosures due to lost state jobs.

Where the rash of foreclosures across the nation was due to lax lending standards, I do have concern that we will see a new group of foreclosures due to job losses. We already have seen companies laying off individuals and closing shop. The ripple effect of job losses is huge.

So while 52% of my peers are calling it…spring 2009, I am not in that group. I encourage all homeowners to re-evaluate their finances and plan for those rainy days. Our economy is in trouble, and while I would love to help you sell your home, I would prefer that it is not under duress.

(c) Copyright, 2008. Melina Tomson, All Rights Reserved (ie…be nice and create your own content. Don’t steal mine…)

NAR came out with an interactive market research tool. Now, the data currently on it is for the second quarter of this year, so it’s “old” data. What is interesting about it, is looking at how other parts of the country are in comparison to Salem Oregon.

When you really start to look at some of those other drops, our market, while still having it’s own issues, pales in comparison to some other markets.

Check out the link and play around with the cities. I found it interesting…

(c) Copyright, 2008. Melina Tomson, All Rights Reserved (ie…be nice and create your own content. Don’t steal mine…)

Status of the financial markets is important to real estate. Clearly if there is no credit, then there are no loans, which means no buyers, and sellers can’t sell. As such, I have been watching and reading, and reading and watching about all of the happenings in the mortgage world.

Enough. My head hurts.

So…I decided that I have to wait until my brain catches up with the information being thrown at me left and right before I blog about the status of the mortgage markets.

I just want to leave you with a link to Matt Heaton’s post “Who could have seen this coming?”

(c) Copyright, 2008. Melina Tomson, All Rights Reserved (ie…be nice and create your own content. Don’t steal mine…)

What does that mean for us here in Salem Oregon?

We are just one of the many that will be footing the bill. It doesn’t matter what you call the bailout, the American taxpayer is the bottom line. Where is the money going to come from?? Who knows at this point? With it being an election year, the mention of a tax hike to finance this would be a sure fire way to lose the election.

One of the big concerns for the housing market will be the reduced role that Fannie and Freddie will play starting in 2010. In 2010, the mortgage portfolios will be reduced at a rate of 10% per year until they are at a size of around 250 billion. This doesn’t seem like a big deal until you look at the fact that they are at 5.4 trillion right now, and their market share reached 80% earlier this year.

What the secondary mortgage market does is purchase loans. Since banks are required to have a certain ratio of loans to cash, once they loan out a certain amount of money, they have to stop. With entities like Fannie and Freddie, they buy these loans which allows new loans to be created. So starting in 2010, the largest purchasers of loans will be decreasing their loan portfolio by 10% a year.

Now temporarily, interest rates should stay low, so that is good news for buyers that are looking to purchase in the near future.

If you are going to be selling real estate anytime in the next few years, be prepared for a bumpy ride. With limited access to credit, and it appears that in 2010 it will be worse, our local housing prices may continue on their mild decline, or at best plateau.

(c) Copyright, 2008. Melina Tomson, All Rights Reserved (ie…be nice and create your own content. Don’t steal mine…)