While there may be signs of recovery elsewhere in the economy we are not out of the recession by a long shot. You stated that currently “Fewer available units on the market combined with the decrease in new listings coming available, produce an environment conducive to housing value appreciation which is what we are experiencing in various micro markets throughout Monterey County.” This may be a fact.

I have also read further that another wave of foreclosure is in the horizon: “It is estimated that by December 31st, there are 29 Billion (yes with a “B”) sub-prime mortgage loans that are due to adjust to their fully indexed rate. There is significant concern that there will be a whole new crop of loan defaults in the coming months. In addition, between 2010 and 2011, there is another 200 Billion sub-prime loans scheduled to adjust to their fully indexed rate.”

How this impacts our county in future foreclosure rates is to be determined. Appreciation is indeed micro and potentially unsustainable in the short term. As we get closer to the New Year, loan limits and tax credits will be reevaluated for extensions, HUD will introduce new appraisal conditions for FHA, jumbo loans will continue to carve out niche space for those who qualify and first time buyers will delight in the opportunity to buy. Just keep an eye on the fact that recovery will be in the stock market well before housing bounces back. I wonder what “normal” will really look like?

Galen Call

Galen Call
TreeHouse Mortgage Group
direct: 831.645.1164
galen@treehousemortgage.com
http://www.GalenCall.com