Wall Street Journal

The U.S. House of Representatives approved an $819 billion stimulus package -- the Economic Recovery

Package -- this week, which if approved by the Senate will extend all 2008 Metropolitan Statistical Areas’

(MSAs’) Fannie Mae, Freddie Mac, and FHA loan limits through the end of this year. The extension will

prevent an MSA’s 2008 loan limit from being reduced in 2009 for Fannie Mae, Freddie Ma and the FHA.

The bill also specifies that if an MSA’s loan limit is set to change, it can increase, but is prohibited from

decreasing.

KEEP THIS IN MIND

buyer tax credit for qualified buyers who purchase a home between Dec. 31, 2008 and July 1.

for alternative energy production, and direct more than $300 billion in aid to states to help rebuild

schools, provide health care, and reconstruct highways and bridges.

it next week. Congress would like to get a bill to he President’s desk by President’s Day, Feb. 16.

To read the full story, please click here:

http://online.wsj.com/article/SB123315486943524321.html

To read additional articles about the Economic Recovery Package, which may be of interest to you and your

clients, please visit:

http://money.cnn.com/2009/01/29/real_estate/tax_credit_near/index.htm?postversion=2009012907

http://www.nytimes.com/2009/01/30/business/worldbusiness/30davos.html?_r=1&hp

http://www.cnbc.com/id/28917177

C.A.R. Mortgage Update

how to decide if refinancing is the best option; strategies under consideration to mitigate U.S. foreclosures;

and Fannie Mae and Freddie Mac.

Approximately 315 financial institutions have signed over some of their shares and other securities to the

U.S. Dept. of the Treasury in exchange for a portion of the Troubled Asset Relief Program (TARP) funds.

The government may take complete ownership of certain troubled banks if the credit crisis does not ease.

If banks are nationalized, consumers probably will not directly be affected. The FDIC will continue to insure

deposits up to $250,000 through Jan. 1, 2010, and may make it easier for qualified borrowers to receive

loans. Credit lending standards also may be loosened, enabling borrowers with less-than-perfect credit

scores to receive loans.

According to a senior financial analyst at Bankrate.com, homeowners at nationalized banks also would

benefit because the government is likely to halt foreclosure proceedings.

To read the full story, please click here:

http://online.wsj.com/article/SB123258304319904345.html

Homeowners thinking of refinancing their home loans should consider if the long-term savings is beneficial

prior to making a decision. Although there isn’t a standard formula to determine whether refinancing is the

best option, there are some basic guidelines.

Focusing on the potential savings, rather than the new rate is the first step. To determine the break-even

point -- the number of months it will take to pay off the cost to refinance -- divide the total cost of the loan by

the monthly savings from refinancing. That number is how long the homeowners should live in the house for

the refinance to be viable. For example, if the refinance will cost $5,000 and the monthly savings is $200,

then the homeowner will have to live in the home for a little over two years to recoup the costs of the

refinance and begin to realize a true savings.

To read the full story, please click here:

http://www.orlandosentinel.com/business/orl-refinance2109jan21,0,4772660.story

To view additional articles about the mortgages, please visit:

To read the full story, please click here:

http://www.latimes.com/business/la-fi-housing26-2009jan26,0,5664777.story

To read the full story, please click here:

http://www.reuters.com/article/gc03/idUSTRE50P7EG20090127

To read the full story, please click here:

http://money.cnn.com/2009/01/23/news/economy/Fannie_freddie/index.htm?postversion=2009012319

Reuters

With home prices in many areas declining to the point where owning a home is a more affordable option

than renting, especially in the West, many potential home buyers appear to be getting off the fence and

starting to purchase. Add affordable prices to record-low interest rates and the demand for housing has

reached a pivotal turning point.

KEEP THIS IN MIND

on single-family homes are comparable to apartment rents, according to recent data. Mollie

Carmichael, a senior vice president with John Burns Real Estate Consulting, says that in the Inland

Empire, the average monthly rent for an apartment is $1,157. Carmichael adds that the average

after-tax monthly mortgage payment on a median-priced single-family detached home is $1,154 in

the same area.

Existing home sales across the U.S. rose 6.5 percent to an annual rate of 4.74 million units in

December, according to the NATIONAL ASSOCIATION OF REALTORS® (NAR). A senior director

of housing economics at Moody’s Economy.com believes the latest NAR report means sales have

reach bottom.

which is almost 1 percentage point lower than the average rate in late November 2008, according

to Freddie Mac. The prior week, 30-year mortgage rates average 4.96 percent, the lowest since

Freddie Mac began its weekly survey in 1971.

To read the full story, please click here:

http://www.reuters.com/article/ousiv/idUSTRE50L35320090127

Chicago Tribune

Although new home building activity is at a slower pace than in previous years, many home buyers have

changed what characteristics they look for in a home. To reflect this, some home builders are developing

not only homes with less square footage, but also ones with less dead space, fewer fireplaces, and energyefficient

amenities.

KEEP THIS IN MIND

The heating and cooling bills also may be lower with less dead space.

may have a shower with upgrades, such as multiple body sprays, radiant heat in the bathroom floor

and the shower walls, along with warming drawers for towels and robes, rather than a simple

shower and whirlpool spa tub.

spaces. Traditional home offices are no longer off limits to children, but rather the tech center of

the house, with ample space for computers and electronic gadget chargers.

products, not granite. Along the same lines, stainless-steel appliances also are becoming less

popular. Appliances with built-in panels that resemble the cabinetry also are in higher demand.

To read the full story, please click here:

http://www.chicagotribune.com/classified/realestate/advice/chi-localscene_

chomes_0123jan23,0,1091270.column

Fresno Bee

The CALIFORNIA ASSOCIATION OF REALTORS® this week reported home sales in California soared

84.9 percent in December, compared with the previous year. The median price of an existing, single-family

home declined 41.5 percent to $281,100.

KEEP THIS IN MIND

month. Year-to-date sales are nearly 27 percent above last year. Many California home buyers

benefited during the last half of 2008 from the high-cost loan limit of $729,750, which fell to

$625,500 as of Jan. 1. The restoration of the high-cost loan limit to the previous level would not

only help a housing market still struggling to turn around, but also make financing more affordable

for home buyers.

statewide annual median price declined 38 percent for all of 2008 compared with 2007. While the

month-to-month decrease in December was considerably smaller than in recent months, it remains

too early to determine if prices are beginning to stabilize. Many distressed sales still must work

their way through the system.

household income, improving affordability across the state. This should be especially helpful for

first-time buyers who can qualify for a home loan.

was 5.6 months, compared with 13.4 months for the same period a year ago. The index indicates

the number of months needed to deplete the supply of homes on the market at the current sales

rate.

with 6.10 percent in December 2007, according to Freddie Mac. Adjustable-mortgage interest rates

averaged 4.97 percent in December 2008, compared with 5.50 percent in December 2007.

compared with 66.7 days for the same period a year ago.

To read the full story, please click here:

http://www.fresnobee.com/business/story/1158525.html

Sacramento Bee

To read the full story, please click here:

http://www.sacbee.com/business/story/1560703.html

San Francisco Chronicle

To read the full story, please click here:

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/01/22/MNBG15EFC6.DTL&type=business

Mercury News

To read the full story, please click here:

http://www.mercurynews.com/realestatenews/ci_11513904?nclick_check=1

San Francisco Chronicle

To read the full story, please click here:

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/01/27/financial/f070114S70.DTL

San Diego Union-Tribune

To read the full story, please click here:

http://www3.signonsandiego.com/stories/2009/jan/26/1n26afford1234230-low-cost-units-stucklimbo/?

zIndex=43017

San Francisco Chronicle

To read the full story, please click here:

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/01/25/REBL15FAKS.DTL

Los Angeles Times

To read the full story, please click here:

http://www.latimes.com/business/la-fi-housing23-2009jan23,0,3305475.story

San Francisco Chronicle

To read the full story, please click here:

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/01/25/MNV7155VSC.DTL