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David and Marlene Macbeth

December 1 - December 31, 2009 Market Update

Enclosed is the update of activity for December 1, 2009 through December 31, 2009, click here to view the updates.  There were a total of  23 new listings.  There were12 pending sales.  Of the residential sales there were 6 sales between $200,000 and $600,000, 6 sales between $601,000 and $999,999, no sales over $1,000,000.  There were 16 sale completes.  Their were 27 price decreases and no price increases.  The number of current listings are down slightly; however they are still very high at 291 listings specific to the Santa Ynez Valley.

Rates continue to go up and down on a daily basis.  We are checking daily with  lenders and trying to make sure our buyer have their loans locked in and for a long enough period of time if they are dealing with the purchase of a short sale.  Conforming 30 year fixed rates up to $417,000 are at 4.6% at 1 point and Jumbo Conforming Loans which are loans up to $729,750 are at 4.7% at 1 point and Super Jumbo Loans are at 5.5% at zero points for origination. The conforming 5 year ARM Interest Only is at 4.2% at 1 point, the Jumbo 5 year ARM Interest Only is at 5.2% at zero points.  The 11th District Cost of Funds index (COFI) is up at 2.094 for the month of January.  We are adding the 6 month LIBOR index to our update letter as it is becoming the standard for many Adjustable Rate Mortgages. The 6 month LIBOR rate is at 0.43; last month it was at 0.48; 12 months ago it was at 1.77.

There is a significant change noted in the interest rate information above on the Cost of Funds Index (COFI). The COFI is computed from data report by COFI Reporting Members of the Federal Home Loan Bank of San Francisco.  For November 2009 25 eligible institutions reported COFI data.  Effective November 1, 2009 Wachovia Mortgage merged into Wells Fargo Bank which is not eligible to be a COFI Report Member.. The impact of removals of COFI Report Members on the COFI index depends entirely on the amount of interest expense and total funds of the entity being removed.   This  merger changed the COFI, the basis for many negative amortization adjustable rate mortgages from 1.259% in October 2009 to 2.094% in November.  The effect of that is adjustable rate mortgages will change almost imediately about .8%.  So if your adjustable rate mortgage rate was based on the COFI plus a margin of 3.0; your interest rate will change from 4.259% to 5.094% in one month. If you pay rate, the interest rate at whiich your payment is recalculated was set for the 4%+ rate and your interest rate is now in the 5% range, all of a sudden you will be accruing negative interest to your principal balance at a time when most of the other indices are dropping or remaining relatively stable. If you have an adjustable rate mortgage and it is tied to the Cost of Funds Index, you should evaluate your  payment amounts because this is not the time to be adding to your principal balance.  Call or email us for more information or  if you have additional questions. 

Other than the above change the market appears to be stabilizing in the price ranges under 1 million which is a good thing.  There was relatively consistent activity at least for us during the month of December as showing occured and a few of our listings in this same range went into escrow.

Happy New Year and let's hope 2010 is a great year for all of us.  We may be reached during the day at our office 805-688-2969, and in the evening at 805-688-2986.  Our toll-free number is 1-800-300-7977.  My cell phone is 805-689-4178 and Marlene's is 805-689-2738.  So whether you need to buy or sell, call us. We would like to show you what we can do!  In the meantime we thank you again for your loyalty and support in seeking us out when looking at properties in the Valley in 2009 and for choosing in 2010 to get your information about Santa Ynez Valley real estate from................


Your Real Estate Professionals Providing
Old-Fashioned Service Using Today's Technology

David Macbeth and Marlene Macbeth

Published Wednesday, January 13, 2010 4:58 PM by Marlene Macbeth
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Marcella Mendez said:

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March 22, 2018 7:11 AM

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