1. Mortgage insurance premium (MIP) will be increased to build up capital reserves and bring back private lending
   • The first step will be to raise the up-front MIP by 50 bps to 2.25% and request legislative authority to increase the maximum annual MIP that the FHA can charge.
   • If this authority is granted, then the second step will be to shift some of the premium increase from the up-front MIP to the annual MIP.
   • This shift will allow for the capital reserves to increase with less impact to the consumer, because the annual MIP is paid over the life of the loan instead of at the time of closing
   • The initial up-front increase is included in a Mortgagee Letter to be released tomorrow, January 21st, and will go into effect in the spring.
2. Update the combination of FICO scores and down payments for new borrowers.
   • New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA’s 3.5% down payment program. New borrowers with less than a 580 FICO score will be required to put down at least 10%.
   • This allows the FHA to better balance its risk and continue to provide access for those borrowers who have historically performed well.
   • This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer.
3. Reduce allowable seller concessions from 6% to 3%
   • The current level exposes the FHA to excess risk by creating incentives to inflate appraised value. This change will bring FHA into conformity with industry standards on seller concessions.
   • This change will be posted in the Federal Register in February, and after a notice and comment period, would go into effect in the early summer.
4. Increase enforcement on FHA lenders
   • Publicly report lender performance rankings to complement currently available Neighborhood Watch data – Will be available on the HUD website on February 1.
     • This is an operational change to make information more user-friendly and hold lenders more accountable; it does not require new regulatory action as Neighborhood Watch data is currently publicly available.
   • Enhance monitoring of lender performance and compliance with FHA guidelines and standards.
     • Implement Credit Watch termination through lender underwriting ID in addition to originating ID.
     • This change is included in a Mortgagee Letter to be released tomorrow, January 21st, and is effective immediately.
   • Implement statutory authority through regulation of section 256 of the National Housing Act to enforce indemnification provisions for lenders using delegated insuring process
     • Specifications of this change will be posted in March, and after a notice and comment period, would go into effect in early summer.
   • HUD is pursuing legislative authority to increase enforcement on FHA lenders. Specific authority includes:
     • Amendment of section 256 of the National Housing Act to apply indemnification provisions to all Direct Endorsement lenders. This would require all approved mortgagees to assume liability for all of the loans that they originate and underwrite
     • Legislative authority permitting HUD maximum flexibility to establish separate “areas” for purposes of review and termination under the Credit Watch initiative. This would provide authority to withdraw originating and underwriting approval for a lender nationwide on the basis of the performance of its regional branches

Okay, I wanted to give you an idea as to what our market is doing.  The Naples area has suffered just as the rest of the country from the past three years of economical duress.  Our prices have re-adjusted approximately 62% of their inflated highs of 2006.  The inflated prices were due to many things as we all know now;  Lending subprime market, over aggressive realtors pricing each home more then the last, investors who were not qualified to afford the purchases they were making… you see the picture. 

I would be happy to put you on an automated email system which will alert you to any new or revised listings of properties which may interest you.  This is a terrific way to keep on top of the market changes.  We are seeing prices leveling at this time.  You want to make sure you know when they start to move up again as when they do —- they will move quickly in some cases.  Our inventory is also reducing which will have an influence on the market values as well.  You want to keep on top of that too.

Well, let’s hope for a Happy, Healthy, Prosperous New Year!  Welcome 2010! 

Keller Williams Realty Now Third-Largest In U.S.

I thought I should comment on pending sales today – hence my “rebound” title.  Currently, the stats are as follows:

• Single Family – total 67 on Marco Island   – Price Range: $162,900 (Fourwinds) to $3,500,000 (Hideaway)
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• 11 Homes priced well over ONE MILLION ARE PENDING !  Holy Cow !  That’s terrific news! 
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• Multi-Family  total 55 units on Marco – Price Range: $109,000 (Wexford Place) to $2,350,000 (Cozumel)
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• Lots:  Total 9 (in Marco MLS which includes our Naples listings) Price range:  $84,900 (San Marco) to $679,000 (Inlet Drive)

These are terrific numbers especially the value of the units that are selling.  We have, of course, the bottom dwellers who are picking up all the very very low end homes BUT we also have our “end users” who are folks seeing the absolute terrific values in the higher end homes which in past years were featured in the DuPont Registry or seen on “Cribs”!!  Homes are easily 65% of their value from a few years back… I suppose that is relative since our stock profolios are pretty much in the same boat.   I just looked at the GE stock – down 71.368% in a year !!   REAL ESTATE IS STILL A BETTER DEAL!!! 

Interesting…

Obama Needs to Be More ‘Aggressive’ on Banks, Autos, Baker Says

 http://www.bloomberg.com/apps/news?pid=email_en&refer=&sid=alVoqGR0B748

One more for you to look at:  U.S. Stocks Rise as Housing, Manufacturing Data Overshadow GM

 http://www.bloomberg.com/apps/news?pid=email_en&refer=news&sid=apLW87naqMwg

Bottom-line is that price is where it is at.  If you want to sell your home – price it right.  Folks, this is not what YOU think it is worth – it is what Joe the Plumber will pay and what Countrywide and Wells Fargo thinks it’s worth! 

Buyers – name your price and see where it goes.  You never know what the sellers motivation or bottom dollar is.  Find what you want and make an offer.  It will be a win-win for both

Marco Island and the surrounding area in Collier County offer a wealth of cultural activities. Within the county, there are over 30 arts organizations and more than 100 galleries. Head to the one of the many golf courses in Marco Island or Naples for some exercise or take a stroll through one of the areas parks or preserves. Indulge at one of the areas spectacular dining establishments where your options range from casual, where you can bring your own catch to be prepared, to exquisite fine dining.

Marco Island is the largest of Florida’s Ten Thousand Islands, located on the Gulf of Mexico in Southwest Florida. The attraction is tropical sun-washed white beaches and a casual life style. On Marco Island, with nature and art brilliantly intertwined, we have it all!