Tuesday, September 30, 2008

IRS Provides Homeownership Credit Guidance

Click IRS guidance to take advantage of the $7,500 homeownership tax credit. The IRS material, IR-2008-106, explains how individuals who use the credit will reflect it on their tax returns and receive the benefit from any refund. NAR has also created a summary of how the credit works.

Existing-home Sales Slide on Tight Mortgages

Existing-home sales were down in August following a healthy gain in July as tight mortgage credit curtailed activity, click here. Sales rose in the Midwest and South but fell in the Northeast and West. Nationally, existing-home sales, including single-family, townhome, and condo, declined 2.2 percent to a seasonally adjusted annual rate of 4.91 million units from an upwardly revised pace of 5.02 million in July. "Sales reflect higher interest rates before the government takeover of Freddie Mac and Fannie Mae," says NAR Chief Economist Lawrence Yun.

Monday, September 29, 2008

Financial crisis: What you should know

The financial crisis has sparked confusion over whether Americans' investments and bank accounts are safe. Here's what you should know about how the crisis might affect you... click here.

Sunday, September 28, 2008

Who wins, who loses under proposed bailout plan?

WASHINGTON (AP) - The proposal to bail out U.S. financial markets to the tune of up to $700 billion creates a lot of potential short-term winners, as well as some losers... click here for more.

$700B rescue plan finalized; House to vote Monday

AP - Congressional leaders and the White House agreed Sunday to a $700 billion rescue of the ailing financial industry after lawmakers insisted on sharing spending controls with the Bush administration. The biggest U.S. bailout in history won the tentative support of both presidential candidates and goes to the House for a vote Monday... click here for more.

Wednesday, September 24, 2008

$700 Billion for What?

Click here for the reality behind the government’s proposed “investment” in the financial markets and what’s at stake for homeowners and taxpayers.

What's a Short Sale?

A short sale occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien that is secured to the property upon receipt of less money than is actually owed.

Tuesday, September 23, 2008

Dire warnings fail to sway senators on big bailout

AP - Senators dug in their heels Tuesday, pushing back against dire warnings from the government's top economic officials of recession, layoffs and lost homes if Congress doesn't quickly approve the Bush administration's emergency $700 billion financial bailout plan...
click here for more.

Foreclosure Investing in an IRA - What You Need To Know

By Jeffrey Roth, Equity Trust Company
Investing in a foreclosure property with your IRA can be a great way to increase your available funds to make deals and possibly grow any earnings tax-free. Yeah, tax-free earnings. For those veteran investors (and learned newbies), tax-free earnings is exactly what you have been looking for. That is one of many benefits of investing with your self-directed IRA that can help build your wealth portfolio. Here are a few points everyone needs to know to help get started:

1) Get that foreclosure. Your IRA can purchase a foreclosure property which could free up other available funds for additional investments. Notice the 'Your IRA' part of that statement. Since your IRA owns the property, all expenses that go into the property must come from the IRA account. Because of this, your IRA can reap certain tax advantages (#4). If your IRA doesn't have enough to own and maintain an investment property outright, you could always own a specified portion of a home through a partnership (undivided interest) or look into non-recourse loans.

2) Go ahead, sell it or rent it out! If you decide to rent or sell a property, that decision is completely up to you. Either way, it will help you reach your investing goals if you’re using a self-directed IRA. The funds received from a sale or income from renters would go directly toward growing your IRA account, which in turn, will help you make more out of your investments.

3) Tax-Advantages! The two types of IRAs, Traditional and Roth, have different tax advantages. With a Traditional IRA investment, you would not have to pay tax on any earnings until you started making qualified distributions at 59.5 years old. The idea is that you could possibly be in a lower tax bracket at that time and enjoy the fruits of your labor with less tax applied than you do today. The Roth IRA allows you to grow all earnings tax free (meaning you never have to pay tax on it) since the money used to fund the account is 'after-tax'. Paying tax later at a lower rate (Traditional) or not ever paying tax on earnings (Roth) makes that foreclosure investment look even better, doesn't it?

4) Where’s your IRA at? To invest in foreclosures with your IRA it must be a self-directed IRA. Unfortunately, most financial institutions will not allow you to self-direct your IRA investments because they want you to invest in their stocks, mutual funds, and bonds portfolio. To get out of that trap and start choosing where your money is invested (i.e. foreclosures), you need the assistance of a qualified and experienced self-directed IRA custodian. A custodian acts on your behalf to facilitate your self-directed investments through IRAs, 401ks and other small business retirement accounts.

5) Do your research. Self-directing IRA investments in real estate is perfectly legal and has been since 1974. You should be aware of the guidelines the IRS has published about IRAs (IRS Publication 590). You wouldn't invest in a home without knowing about the property, would you? Knowing your investment funding options should be treated the same way. Consult your financial team (custodian, CPA, and/or lawyer) to learn as much as you can to maximize your investment's tax benefits. Do some homework, find the right self-directed IRA custodian, and free up additional capital to start growing your foreclosure investments tax-free! Using a self-directed IRA is a great way to build out your investment portfolio and reach your financial goals. Jeffrey A. Roth is the Real Estate Channel Manager at Equity Trust Company. Equity Trust Company is an experienced self-directed IRA custodian with 34 years of service and is recognized as an industry leader with over $3 billion in managed assets. Learn more about self-directed IRAs at www.trustetc.com.

Monday, September 22, 2008

U.S. Ripple Effect

As the U.S. begins moving out from under the housing crunch, other world markets are just beginning to feel the "overseas aftershock" of the global financial system, according to the Sept. 4 Business Week online magazine. What do bad home loans in Alpharetta, Ga. have to do with office buildings in London or Tokyo? "Plenty," says Business Week. Global lenders, wary of further credit problems are denying credit to many builders and/or instituting tougher terms on commercial property loans. This, in turn, impacts employment markets, which impact rents and causes developers to rethink plans. The whole global commercial property market has slowed with the value of commercial real estate transactions worldwide at only $306 billion for the first six months of 2008--about half the amount for the same period in 2007, according to Real Capital Analytics. But it's not just the U.S. subprime mortgage situation at play. An overall softer economy and weak consumer confidence has hurt smaller developers--particularly those is markets that heated up quickly, including those servicing U.S. outsourcing (think IT); a U.S. sector that is slowing along the overall economy. In spite of all this, Business Week notes that opportunities exist, especially for those with cash. Sovereign wealth funds (SWF), which are state-owned entities that manage savings for investment purposes, are key players in commercial real estate and are flush with cash. According to an article in the April Real Estate Forum, SWF have grown from about $500 billion to more than $3 trillion since the 1990s, with projections of tripling that amount by 2012. Go to pg. 10 to read the full article.
NAR International Operations

Saturday, September 20, 2008

Rescue plan seeks $700B to buy bad mortgages

WASHINGTON (AP) - The Federal Government is asking Congress to let the government buy $700 billion in toxic mortgages in the largest financial bailout since the Great Depression, according to a draft of the plan obtained Saturday by The Associated Press.

The plan would give the government broad power to buy the bad debt of any U.S. financial institution for the next two years. It would raise the statutory limit on the national debt from $10.6 trillion to $11.3 trillion to make room for the massive rescue. The proposal does not specify what the government would get in return from financial companies for the federal assistance.

"We're going to work with Congress to get a bill done quickly," President Bush said at the White House. Without discussing details of the plan, he said, "This is a big package because it was a big problem."

The White House and congressional leaders hoped the developing legislation could pass as early as next week.
Administration officials and members of Congress were to negotiate throughout the weekend.

The plan is designed to let faltering financial institutions unload their distressed mortgage-related assets on the government, and in turn the taxpayer, in a bid to avoid dire economic consequences.

Bush said he worried the financial troubles "could ripple throughout" the economy and affect average citizens. "The risk of doing nothing far outweighs the risk of the package, and over time we're going to get a lot of the money back."
He added, "People are beginning to doubt our system, people were losing confidence and I understand it's important to have confidence in our financial system."
"In my judgment, based upon the advice of a lot of people who know how markets work, this problem wasn't going to be contained to just the financial community," the president said. He said he was concerned about "Main Street" and that what happens on "Wall Street" affects "Main Street."

Sen. Chuck Schumer, D-N.Y., called the proposal "a good foundation," but raised concerns it "includes no visible protection for taxpayers or homeowners."

Democrats are insisting the rescue include mortgage help to let struggling homeowners avoid foreclosures. They also are also considering attaching additional middle-class assistance to the legislation despite a request from Bush to avoid adding controversial items that could delay action. An expansion of jobless benefits was one possibility.

Asked about the chances of adding such items, Bush sidestepped the question, saying only that now was not the time for political posturing. "The cleaner the better," he said about legislation he hopes Congress sends back to him at the White House.

If passed by Congress, the plan would give the Treasury secretary broad power to buy and sell the mortgage-related investments without any additional involvement by lawmakers. The proposal, however, would require that the congressional committees with oversight on budget, tax and financial services issues be briefed within three months of the government's first use of the rescue power, and every six months after that.

While the proposal contains no requirement that the government receive anything from banks in return for unloading their bad assets, it would allow the Treasury Department to designate financial institutions as "agents of the government," and mandate that they perform any "reasonable duties" that might entail.

In a briefing to lawmakers Friday, Paulson and Federal Reserve Chairman Ben Bernanke painted a grave picture of an economy on the edge of a major recession and telling them that action was urgent and imperative.

In a session with House Democrats, they described a plan where the government would in essence set up reverse auctions, putting up money for a class of distressed assets - such as loans that are delinquent but not in default - and financial institutions would compete for how little they would accept for the investments, said Rep. Brad Sherman, D-Calif., who participated in the conference call.

"You give them good cash; they give you the worst of the worst," Sherman said. A critic of the plan, he complained that Bush and his economic advisers were trying to panic lawmakers into rubber-stamping it.

Paulson said the new troubled-asset relief program must be large enough to have the necessary impact while protecting taxpayers as much as possible.

"I am convinced that this bold approach will cost American families far less than the alternative - a continuing series of financial institution failures and frozen credit markets unable to fund economic expansion," Paulson said. "The financial security of all Americans ... depends on our ability to restore our financial institutions to a sound footing."

Administration officials hoped the rescue plan could be finalized this weekend, to lend calm to Monday morning's market openings, said Keith Hennessey, the director of the president's economic council. The goal is to have something passed by Congress by the end of next week, when lawmakers recess for the elections.

Tuesday, September 16, 2008

NAR Forecast: Home Sales to Stay in Narrow Range

The level of home sales is expected to show little movement in the months ahead, NAR projects. The association's pending home sales index for July fell 3.2 percent to 86.5 from an upwardly revised reading of 89.4 in June. "Pending home sales are oscillating month-to-month, with the long-term trend essentially flat," says NAR Chief Economist Lawrence Yun. "Overly stringent lending criteria imposed by Fannie Mae and Freddie Mac in the past month no doubt held back contract signings."

Sunday, September 14, 2008

Banks seen offering plan to restore confidence

NEW YORK (AP) - As the outlook for Lehman Brothers' future appeared to dim Sunday, U.S. and foreign banks joined forces to create a plan aimed at inoculating the global financial system against the investment bank's possible failure, a top investment banking official said.
Banks are in tense talks to create a pool of money worth up to $50 billion to lend troubled financial companies, the official said on condition of anonymity because the discussions were ongoing. And officials at the U.S. Treasury and the Federal Reserve are expected to say they are prepared to be more generous in the Fed's emergency lending program for commercial and investment banks .
The plan comes as top government officials and Wall Street executives hold marathon meetings to save Lehman Brothers, whose shares have tumbled 95 percent in the past year over worries that it does not have enough money to cover losses from its real estate holdings.
The meetings have failed to find a buyer for the troubled 158-year-old investment bank, raising concerns that its likely collapse would disrupt global financial markets.
The official also said the Treasury Department and the Fed are pushing Bank of America Corp. (BAC) (BAC) to buy Merrill Lynch & Co. (MER) (MERPO), though talks are still preliminary.
On Friday, Merrill Lynch's shares fell as investors fretted it might be the next investment bank to come under pressure from its portfolio of risky mortgage-backed securities.
Global banks and brokerages have written down more than $300 billion since the subprime mortgage crisis undermined the credit markets beginning last August.
Expectations that Lehman would survive as a company dimmed Sunday afternoon after Barclays PLC (BCS) withdrew its bid to buy the investment bank. Barclays' and Bank of America Corp. were considered front-runners to buy Lehman.
The Lehman talks originally were aimed at selling the investment bank in whole or in part. The deal was tripping on the potential buyers' insistence that they receive the same kind of help that Bear Stearns Cos.' got last March when JP Morgan Chase & Co. bought the securities firm with a $29 billion Fed-backed loan.
Treasury Secretary Henry Paulson has said the government will not help close a Lehman deal.
Lehman declined to comment on the talks.
If no deal were reached, it raised the specter of a bankruptcy and liquidation of the investment bank. Bankers and investment banking officials briefed on the talks described them as being both complicated and fluid. Hope was dwindling that an agreement could be brokered or that new bidders might emerge. They spoke on condition of anonymity because talks were ongoing.
There were signs that Lehman Brothers might be edging closer to a bankruptcy filing, with several reports that it has hired Weil, Gotshal & Manges, the law firm that handled the collapse of investment firm Drexel Burnham Lambert in 1990.
Moreover, there was also an emergency trading session being held at the International Swaps and Derivatives Association to "reduce risk associated with a potential Lehman Brothers Holdings Inc. (LEH) (LEH) bankruptcy." The ISDA, which arranges trades for derivatives, said it was allowing customers to make trades and unwind positions linked to Lehman - but that those trades would be voided if no filing occurs before midnight.
Government officials and executives from several Wall Street banks were huddled at the New York Fed's downtown Manhattan headquarters for a third day seeking a solution to Lehman's financial crisis. Failure could prompt skittish investors to unload shares of financial companies, a contagion that might affect stock markets around the world when they reopen Monday.
Dow Jones industrial futures fell 2.5 percent Sunday, indicating a sharply lower open for the blue chip index Monday morning. Asian markets will begin trading Sunday night Eastern time.
Paulson, Timothy Geithner, president of the New York Fed, and Securities and Exchange Commission Chairman Christopher Cox were among those taking part in the meetings. Federal Reserve Chairman Ben Bernanke is actively engaged in the deliberations but wasn't in attendance.
Paulson's tough bargaining stance received support from outside observers Sunday, who argued that the government had no choice but to draw a line in the sand.
"If Treasury put money into the Lehman deal, then going forward no deal would get done without Treasury help," said Mark Zandi, chief economist at Moody's Economy.com. "Every potential buyer would wait until Treasury stepped in and that would mean Treasury would be on the hook for a lot more bailouts."
The current situation is different from Bear Stearns' situation six months ago.
In Lehman's case, financial markets have been aware of Lehman's problems for a much longer period and have had time to prepare. Investment banks also now have the ability to obtain emergency loans directly from the Fed, a crucial support that they did not have back in March when Bear Stearns was rescued.
In the Lehman talks, bankers and government officials were also trying to tackle a broader agenda that includes problems at American International Group Inc. (AIG) and Washington Mutual Inc. (WM), said the investment bank officials, who were briefed on the talks.
AIG, the world's largest insurer, and WaMu, the nation's biggest savings bank, have taken steep losses during the past year from risky investments. The Wall Street Journal reported Sunday that American International Group Inc. plans to disclose a restructuring by early Monday that's likely to include the disposal of major assets including its aircraft-leasing business and other holdings.
Lehman put itself on the block earlier last week. Bad bets on real-estate holdings - which have factored into bank failures and caused other financial companies to founder - have thrust the firm in peril. It has been dogged by growing doubts about whether other financial institutions would continue to do business with it.
Richard S. Fuld, Lehman's longtime CEO, pitched a plan to shareholders Wednesday that would spin off Lehman's soured real estate holdings into a separately traded company. He would then raise cash by selling a majority stake in the company's unit that manages money for people and institutions. That division includes asset manager Neuberger Berman.
AP Business Writer Raphael Satter contributed to this story from London.

Tuesday, September 9, 2008

Making Sense of the Fannie & Freddie Takeover + Good news for Albuquerque

The Federal Government has announced that it has taken control of Fannie Mae and Freddie Mac, which own or guarantee almost half of the country's $12 trillion in outstanding home mortgage debt. They play a vital role in the U.S. economy by making fair and affordable mortgage loans available for home buyers and owners. They support the housing market by purchasing mortgage loans from the banks that originate them, giving the banks the cash to make more loans. They package those loans into securities and ensure repayment. They sell the securities to investors around the world, or retain them for their own portfolios.

The Federal Government's sweeping takeover of mortgage market giants is expected to have positive short-term benefits to the real estate market and opens the door for the industry to shape the restructuring of the companies.

Allowing either Fannie or Freddie to fail would hurt us all... Our ability to get home and auto loans, and even hamper economic growth and job creation.

What the Plan Involves

Under the Treasury Department's action, the two government-sponsored enterprises are placed in a government conservatorship and overseen by two government-appointed chiefs, former Merrill Lynch vice chairman Herbert Allison at Fannie Mae and former U.S. Bancorp CFO David Moffett at Freddie Mac.

Daniel Mudd, who led Fannie Mae for the last few years, and Richard Syron, his counterpart at Freddie Mac, have been relieved of their jobs.

The federal government is taking up to an 80 percent stake in the companies and will review their financial condition on a quarterly basis, injecting money into their operations as needed. The government is directing the companies to help stabilize housing markets by requiring them to increase their mortgage funding over the next year and a half.

For the long-term, the companies and their regulator, the Federal Housing Finance Agency, will begin planning for a major reorganization of their operations, away from their current 100-percent, privately owned model.

According to news reports, one of the models being discussed is something akin to a public utility, in which the government sets limits on the amount of annual return on equity to shareholders.

Positive Real Estate Impact

For the real estate industry, the short term impact is expected to be positive. With the government now explicitly backing the companies' mortgage obligations, the market for the GSE securities will be treated more like Treasurys, thereby exerting downward pressure on rates.

That will help drive a positive cycle of investment as investors return to the market, further lowering rates and generating funds to lenders to expand their mortgage loan operations. That is expected to help speed up housing sales in markets across the country and help stabilize home prices.

The main down side to the federal intervention will be felt by the companies' current shareholders, who will no longer receive dividend payments and whose holdings are diluted by the equity stake of the federal government.
— REALTOR® Magazine Online

Part of the Problem

At one point earlier this year, as the credit crunch worsened, the two companies were responsible for about 80% of all loans being originated in the U.S. But the rise of foreclosures weakened their balance sheets and raised their borrowing costs, reducing their ability to support the market. As the housing downturn worsened, the two companies came to be seen as part of the problem instead of part of the solution.

Technically, Fannie and Freddie have been placed under "conservatorship," a term that ordinarily means they are being stabilized with the objective of returning them to normal operation.

Taxpayers at Risk

It's impossible to say how much the effective takeover of Fannie and Freddie will cost taxpayers. If housing prices begin to recover and foreclosure rates don't get too high, the cost to the government could be very small or zero, because Treasury will earn a return on its preferred shares and get all its secured loans repaid.

Still, the deal is likely to draw criticism because it puts taxpayers at risk while boosting the value of Fannie and Freddie's bonds and mortgage-backed securities, which are held by banks and other investors around the world. Asian central banks, in particular, are large holders.

One group that won't be getting any kind of a bailout: Fannie and Freddie's ordinary common shareholders. They stand last in line for any money the two companies make. Share prices of both Fannie and Freddie have lost more than 90% of their value over the past year, in anticipation of a takeover. In after-market trading on Sept. 5, as word of the conservatorship plans leaked out, Fannie shares were trading around $5.50, down from $70 a year ago, while Freddie Shares were at about $4, down from $65 a year ago.

Candidates Weigh In

Senator John McCain, the Republican Presidential candidate, said at a rally in Albuquerque: "We need to keep people in their homes, but we can't allow this to turn into a bailout of Wall Street speculators." Doug Holtz-Eakin, McCain's top economic adviser, said that longer term, "We believe these institutions should not be making money" through government support. "They have to shrink to a point where they are not a threat, that they are not operating essentially as a big hedge fund."

Senator Barack Obama, the Democratic Presidential candidate, released a statement on Sept. 7 saying, "Given the substantial role that Fannie Mae and Freddie Mac play in our housing system, I believe that some form of intervention is necessary to prevent a larger and deeper crisis throughout our entire economy." He said he wasn't yet ready to say whether Treasury's solution was the right one.
by Peter Coy and Theo Francis

Good news for Albuquerque
by Forbes.com

Believe it or not, in the future people will be buying and selling homes. Some of them will even make a profit.

It's not so crazy an idea. Consider Albuquerque, N.M. The mid-sized Southwestern city has experienced housing price declines since a peak in the third quarter of 2007, job growth has been flat, and housing starts are expected to fade by 45% through the end of 2008. Nevertheless, it's a city that home builders and economists are bullish about for 2010 and beyond.

According to analysts at Moody's Economy.com, Albuquerque's job growth through 2012 is projected at an average annual rate of 1.6%, fueled in large part by its low costs and local business expansion. Housing starts in the city are expected to reverse course in 2009, growing by 26.6%, according to the National Association of Home Builders (NAHB). This means builders have high hopes for 2010 and 2011, when those homes will be completed and on the market.

It's the same story in several other cities: more tough times to come in the short term, but potential for a recovery and a rise in prices in the long term.

Behind The Numbers

To determine where house prices are expected to rise next, Forbes.com looked at projections for housing starts from the NAHB and job-growth figures from Moody's Economy.com, for the 100 largest metro areas in the U.S. The estimates are based on the cost structures of business in the respective cities and the composition of the local economies.
Housing start projections from the NAHB may seem like wishful thinking, but the NAHB data are filled with laggards, signifying some realistic thinking. Housing starts in Las Vegas are expected to drop by 32% in 2008 and actually get worse in 2009, falling by a further 43%.

In overbuilt, highly leveraged Phoenix, starts are predicted to fall 50% this year and descend another 11% more in 2009.

Because houses take six months to two years to build, that means home builders aren't expecting profits in the Vegas or Phoenix market until past 2011.

"These are some of the most overbuilt markets," says Robert Denk, an economist at the NAHB. "There are some markets that got really out of hand and they're going to be in trouble for a couple years still." He cites Cape Coral, Fla., as the poster child of overbuilding exuberance. "They built 10 years of housing in two years." The prognosis isn't as bad elsewhere.

Texas On The Rise?

Centex, one of Texas' largest homebuilders, has been stung by overextension into Michigan and Colorado, as well as big bets on the vacation-home market in Texas. In July, the builder reported losses of $150 million.
There's a bright spot, however.San Antonio and Austin, Texas, have largely avoided the real estate crash, with price increases of 2.5% and 4.1% in year-over-year terms, respectively, according to the NAR. This is driven in part by the fact that the two markets are expecting building slowdowns of 24.7% and 28.2%, respectively, through the end of the year, as home builders are bearish about the remainder of 2008 and 2009 in the sales market or cannot find financing. Builders as a whole are taping their wounds and cutting back production, adopting a wait-and-see approach to home prices in the coming year.
But for the start of 2010 and into 2011, builders expect a more vibrant market for sellers. For homes built in 2009, which would come off the conveyor belt in 2010 and 2011, the NAHB forecasts a 9.6% increase in Austin and a 20.9% increase in San Antonio above 2008 levels. Much of that has to do with expected job growth in all non-farm sectors.

Recovery In Obvious Places

At this point, it's clear the subprime contagion won't be contained in the next year, based on the acceleration of home price drops and foreclosures nationwide. But when the bad vintages of loans finally come off the books, the cities where prices are expected to rebound are largely those with vibrant economies.
"The logic is pretty straightforward," says Mark Zandi, chief economist at Moody's Economy.com. "People will spend as much on housing as their income will allow them. House prices are very closely tied to household income over the long run when you look at business cycles."

This means that recovery is likely in the cards for even the hardest-hit spots. Cities like Atlanta and Colorado Springs, may be reeling from high defaults and foreclosures, but from 2007 through 2012, their economies are expected to experience 2% and 1.6% average annual job growth. That means more in-migration and more money in the economy, factors that help businesses grow and profit--and put more money in residents' pockets.

As local economies grow bigger and more dynamic, land values increase because the value of what can be produced on that land increases. When land prices go up, home values go up.

Home prices moving up; it sort of makes one nostalgic.

Provided by:
Brandon DENT : (505) 550-6388
REALTOR® : 1-877-821-8054 (toll free)
MyPropertyNow.com (All a Buyer and Seller needs)


Sunday, September 7, 2008

Officials announce takeover of mortgage giants

AP - The Bush administration, acting to avert the potential for major financial turmoil, announced Sunday that the federal government was taking control of mortgage giants Fannie Mae and Freddie Mac... click for more.

Tuesday, September 2, 2008

Forbes says Albuquerque will lead nation in home appreciation

N e w M e x i c o B u s i n e s s W e e k l y

Forbes.com has named Albuquerque as the top market where home prices are likely to rise.
The city has experienced housing price declines since they peaked in the third quarter of 2007, and job growth has been flat. Housing starts are expected to drop by 45 percent through 2008, according to Forbes.
But Albuquerque is also a city about which homebuilders and economists are “bullish,” writes Matt Woolsey, author of the Forbes.com article.
Moody’s site Economy.com is projecting Albuquerque’s job growth through 2012 to be 1.6 percent annually, fueled by low costs and local business expansion, according to Forbes. Housing starts are expected to grow here by 26.6 percent in 2009, according to the National Association of Home Builders.
In 2006, Forbes ranked Albuquerque as the Nation’s Best City for Business and Careers. Earlier this year, the city was ranked 13th best in the nation for that same category.