A Few Thoughts On Stuff from Howard Blum Pro Mobile Notary › wp-content › uploads › 2011 ›...

A Few Thoughts On Stuff from Howard Blum Pro Mobile Notary

(C) 2017 http://pro-mobile-notary.com

-The National Economy -Interest Rates -The Housing Sector

What will be driving things ahead?


A Little Personal History �  After 25 years in the mortgage industry I opened

Pro Mobile Notary in 2008 and in 2011 we began to offer nationwide mobile notary siging services.

�  We are one of the highest rated nationwide signing services according to independent signing agents.

�  I have appeared on live TV in dozens of countries explaining the relationship between the Fed, the banking sector, the national & global economies and interest rates. I have also lectured about the Fed at The Commonwealth Club in SF.

�  I have written and produced newsletters on these subjects continuously for almost 30 years.


The National Economy

�  Consumer spending on stuff accounts for 2/3 of our national economy.

�  Housing is an important component of consumers’ spending and historically housing has led the national economy into and out of recessions.

�  Federal government policies, priorities and resource allocations can enhance or detract from the economic & interest rate environments.

�  Why has the post 2008 recovery been so lethargic?


Interest Rates

�  Moves tends to be in an inverse relationship with stocks.

�  Mortgage-backed security prices, not the Fed, actually dictates most fixed rate home loans in this country.

�  Federal Reserve monetary policy has greater influence on equity line repayments than on new fixed rate loans.

�  So, what has been going on with rates lately?

�  My rate outlook will follow shortly.


Housing Market-National

�  Most metropolitan statistical areas fully recovered from the devastation of 2006 to 2010 period.

�  New home sales lagging badly tends to be a bad omen for the rest of the housing continuum in many regions.

�  Sluggish income growth, rising interest rates and depressed inventory levels will take its toll.

�  The hardest hit areas will be in between the coasts & in colder areas.

�  The proposed elimination of local and state taxes as a tax deductible item & capping mortgage deduction on $500,000 loans will hurt home prices & sales in higher-priced residential markets, if passed.

�  The proposed elimination of IRS Code Section 1031 will seriously impact investor activity and hurt everyone.


Housing Market-Regional

�  North Bay wildfires changed many thing this year.

�  Forced movings due to being burned out is already driving up home prices, rentals and permanent relocations to other communities already well underway.

�  Skilled trade workers are becoming scarce and more expensive for everyone due to reconstruction activity.

�  Home prices are not likely to go down anytime soon.

�  It could take 2 to 4 years for the normalcy to return to region as the rebuilding will take longer due to extent of fire damage in the North Bay.


Housing Market-Local

�  Call me crazy, but I am convinced if there is a housing recession nationally, SF, Marin, West Contra Costa and northern San Mateo counties will be mostly impervious to a severe price decline.

�  SFR home prices requiring loans above conforming limits has some buyers seeing jumbo fixed rate loans priced lower than confirming ones. That will help.

�  High rise condo towers in SF may have financing issues due to the Millenium Tower sinking and leaning.


Interesting Figures: Sales Volumes Always Decline After Summer.


Some Interesting Other Perspectives

�  My friend Doug Duncan, Fannie Mae’s Chief Economist believes origination volume in 2018 to decline by less than 4% relative to 2017

�  Fannie: Average 30-year fixed rate loan to rise by no more than 2/10% for all of 2018.

�  Freddie: Volume to decline by 6% for 2018

�  Freddie: Rates to rise no more than 4/10%.

�  MBA: Similar to Freddie’s outlook.


Here’s My Take- Our Biz

�  Relative to today, fixed rates will likely start 2018 lower than where they are today.

�  Conforming fixed rates should remain below 4.5% into 2019 in the absence of a recession.

�  Home sales will go down nominally in 2018.

�  Origination dollar volume should be unchanged from 2017 levels in 2018 due to appreciation factors, but the numbers of purchase transaction will be lower.

�  Refi activity will likely be a bit lower due to rate levels.

�  Fed will likely do 3 rate hikes between now and end of 2018.


Here’s My Take- The Economy

�  Stock market’s irrational exuberance is already beginning to abate due to government inaction and this is good for rates. Tax bill could make or break economy.

�  The inability to pass an infrastructure bill that would create millions of much needed jobs hurts economy.

�  If the current tax cut bill is passed as proposed, it will result in a recession within a year to eighteen months.

�  Political discourse will only worsen ahead preventing any meaningful legislation being passed that could help stimulate the economy or increase wage growth.


Thanks for your attention.


Pro Mobile Notary (http://pro-mobile-notary.com) One of the highest rated and most respected nationwide mobile notary signing services providing error free professional closing services anywhere in the USA at competitive pricing.

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A Few Thoughts On Stuff from Howard Blum Pro Mobile Notary › wp-content › uploads › 2011 ›...

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