Subscribe to Seattle Condo Blog | Seattle Condos for Sale | Downtown Market Trends

New Stimulus Package: Part III – Neighborhood Stabilization

March 5, 2009 by  
Filed under Featured, Finance, National

The neighborhood stabilization provision includes an additional $2 billion to the $4 billion in grants for states and localities to purchase and redevelop foreclosed properties.  Although our downtown market has not been too affected by foreclosures like the rest of the nation, the intention is to establish financing mechanisms for purchase and redevelopment of foreclosed homes–which does in fact affect the overall stability of our market.

The great thing about this provision is that after purchase, these homes must be used to assist buyers at or below 120 percent of the area’s median income.  25 percent of funds must be used for households with incomes at or below 50 percent of an area’s median income and must be committed within 18 months of receipt.

Essentially, this provision can really make a difference in those neighborhoods where an entire community has been decimated by foreclosures, and restablish an area’s perceived value.

New Stimulus Package: Part II – FHA, Freddie, & Fannie Loan Limits

March 2, 2009 by  
Filed under Featured, Finance, National

The bill regarding FHA, Fannie Mae, and Freddie Mac loan limits has extended its expiration to December 31st, 2009 and increased limits to 125 percent of a local market’s median home price.  In King County, the $417,000 loan limit for FHA has been reported to increase to $567,500 and the GSE loan limit to $567,500.

California had the only three metro regions where the loan limits reached their cap of $729,759.

This provision should lower the cost of home buying or refinancing since it’s favored by investors, but it could be argued that raising the limits just inflates home prices even further–hurting the GSE mission of bringing affordable housing to low- middle -income families.