It seems that the Lake Tahoe Real Estate market is in it's seasonal wait and see mode.  With many national economic questions and a major mid-term election pending, the buyer enviroment is the best I have seen in many, many years.  There just some great values on many Incline Village Listings right now.  Sellers are thinking that it will be next spring before an offer, my most savvy client know that the fall is a great time to negotiate a great deal on Lake Tahoe property.  Call or write me for more information.  Tim Lampe, your Realtor by Choice for 28 years.

Weekly National Economic Commentary

 “The Conference Board data for October showed a modest rebound in confidence from September but confirmed the level of confidence remains very low. There was some good news in the data as the increase was only the second to occur in October in the last 20 years. Further, assessments of business conditions and the outlook for the stock market improved.” [Scott Hoyt, Moody’s Analytics]

 

A low level of consumer confidence, of course, translates into a reluctance among consumers to make purchases. Among those purchases that get put off into the future are homes. So while we have an increasing “pent-up demand,” at the same time, the market is remaining slow.

 

At some point, when buyers regain enough confidence in their jobs and continuing income, the logjam will likely burst, and real estate sales volume will probably jump noticeably as a result. As for now, though, we see in the week ending 10/15 that there isn’t much enthusiasm driving mortgage applications.

 

Purchase money loan applications have dwindled to very low levels as potential buyers play wait-and-see withthe Fed’s proposed purchases of Treasury securities (which may both stimulate the economy and push rates slightly lower). Refi applications also fell significantly after a brief rise caused by anxious borrowers who were afraid that rates might start to edge up in the near term. Clearly, refi applications are unlikely to rise by much unless rates either fall further, thus becoming even more attractive to borrowers, or seem on the verge of a turnaround, thus threatening to rise far beyond today’s still-very-attractive levels.

 

Investors anxiously await the Federal Open Market Committee announcement (scheduled for Wednesday, November 3), in which the Fed is likely to signal its intentions regarding “QE2”—its program of quantitative easing, in which it makes huge purchases of Treasury securities. The Fed would thus increase demand for Treasury securities, which would elevate their values…and lower their yields. Lower yields on Treasury securities would likely translate into lower mortgage rates as well. (The 10-year Treasury note’s yield is usually tracked at a distance of about 1.5% by the fixed-rate on the 30-year mortgage.)

 

Lower rates—and thus, more available and cheaper money for both businesses and private individuals—are expected to stimulate more borrowing and spending. Will QE2 work? Time will tell, and we’ll be watching closely

October 27, 2010

 

KEY INDICATORS [10/26/10] 

 

Gold $1340.20/ounce [up]

Crude Oil(Brent) $83.40/brl [up]

U.S. Dollar to…

    Euro .7126 [down slightly]

    Japanese Yen 81.39 [down]

6-mo Treasury Bill Yield 0.16%

10-yr Treasury Note Yield 2.61%

[6-month down 1 bp, 10-yr up12 bps]

11th Dist Cost of Funds 1.713%[-]

30-yr Fixed-rate Mortgage 4.58%

15-yr Fixed-rate Mortgage 4.02%

1-yr ARM 3.73%

[HSH averages rates: 30-yr

down 4 bps;15-yr down 5 bps; 1-yr ARM down 6 bps]

 

Mortgage Bankers Association Mortgage Applications Index

week ending 10/15

  Overall

    803.4 (down 10.5%; up 14.6%

the week prior)

  Purchase Money Loans

    169.7 (down 6.7%; down 8.5%

            the week prior)

  Refinancing Loans

    5491.1 (down 11.2%; up 21%

the week prior)

 

Jobless Claims 10/16

    452,000 – prior week 462,000 – continuing claims at 4.441 m

 

Conference Board Index of Leading Indicators Sept

    Up 0.3% (mild rise)

 

Existing Home Sale Sept

    Up 10%

 

Conference Board Consumer Confidence Oct

    Up from 48.6 to 50.2