- Philadelphia Business Journal - Mag says Phila. economy built to survive recession
- Risk of house prices falling in Phila., Pitt. low
- Blue Moon blog - Beginning Credit Solvency
- Countdown to Credit Normalcy - CNBC video
- Blue Moon blog - GOV'T TAKEOVER!
- Pimco's CEO Praises GSE Takeover - CNBC video
- ALERT! Freddie Mac Changes Investment Property Guidelines
- Rental market stays afloat amid housing turmoil
- What goes up, must come down, 4/24/08 FOX
- Home Prices Drop Most in Areas with Long Commute 4/21/08, NPR
- Sunny Side of the Street 4/16/08, WSJ
- Magic Johnson Raised $1B for Co-founded Urban Investment
Blue Moon blog - Beginning Credit Solvency
Under recent news on the first page of our site you will find the CNBC video “Countdown to Credit Normalcy” (http://www.cnbc.com/id/15840232?video=850809094) aired September 10, 2008, which covers the four critical steps to Credit Solvency. Here at BMC we have been advising our current and prospective clients through our site, on webinars and seminars that the issue is not necessarily a real estate bubble that has burst but rather a burst bubble of easy and unverified credit that has led us to our current housing crisis and economic recession. Identifying the problem is the first step and taking action to solve it is the final one.
In viewing the video of Michael Thompson from Standards and Poor, he identifies the four measures towards credit solvency:
1. Stabilization of Real Estate Values
2. Rebound of existing home sales
3. Normalization of credit risk spreads
4. Stable commodity oil prices
What is evident is a correction in the housing market is two out of the four needed measures or fifty percent of the critical steps that must be dealt with before we can restore normalcy in the credit markets. When watching this video you are quickly reminded of the obvious and are empowered because if you have been following us you understand the process has already begun. Barring a major catastrophe in our already vulnerable credit markets, the answer is not if, but when, the credit markets repair back to normalcy.
I reported on the Fed’s actions to take over Fannie and Freddie and that Secretary of Treasury Paulson’s plan was an excellent one. Paulson’s plan will lower interest rates, making mortgage rates attractive and in turn will support housing prices and drive future sales. For the first time in quite a while, qualified buyers can get a loan and the terms will be more attractive than ever. When you combine the Title Four housing act which takes effect in October the incentives for first time home buyers will be the final piece of the puzzle that guarantees that steps one and two for credit normalcy will be in place. It will take a little time before Title Four gets some traction and starts to make an impact on foreclosure inventory. In our opinion it will be the third quarter of 2009 that will mark the end to perfect accumulation opportunity.
Today on CNBC, Richard LeFrak of the LeFrak Organization comments on positioning yourself in the market...”If you do anything, buy a house in the next twelve months and you will be well rewarded”. He is calling for a turn in housing prices over the next twenty four months. The LeFrak Organization is the world’s leading commercial & residential real estate developer and the largest private U.S. landlord with over 70,000 units on the books.