June 2009 market report & AMF info
For a variety of reasons, this Blog has not been added to for over a year. And much has happened within the housing markets (in the USA and in the UK) in that timeframe, and also there have been some developments on bringing the HOMEQUITYBUILDER Alternative Mortgage Fund (AMF) to the market for borrowers.
First, the housing markets. Back about 18 months ago I wrote a Blog post urging home sellers that they needed to do all they could to sell NOW. And since that time, average home prices and values in the US have dropped between 12%- 20% overall. I know I was not the only one to sound that alarm, but I don’t think many people heard it (or listened). All real estate is local of course, but in general it appears that 2009 with be POOR as far as home prices go, and maybe 2010- Spring- we’ll start to see a flattening and then a slow start in home value appreciation again. But that is assuming many things go right, or as planned.
Interestingly, the UK is about 1 year behind the USA as far as housing markets. Where we have been in this funk for a good year and a half, they are at the earlier stages. My guess is we will be out of this funk before they turn it around as well.
Mortgage rates have just been climbing to about 6.0% now, when we were hovering around 5.0% (and lower) for much of the last 3-4 months. The average mortgage rate over the past 15 years is about 7.30%. There is no reason to believe that rates will continue to stay artificially low, as they’ve been for the first half of 2009. Of course rising rates equals lower home prices and affordability, which is not good for anyone.
KLME LLC is proud to have a sales trademark on the name Homequitybuilder Alternative Mortgage Fund (AMF) - our exclusive equity-accelerating mortgage loan product. We are in ongoing discussions to bring this product to borrowers this year. Likewise, a similar/ offshoot company called Alternative Mortgage Funding, Ltd. has been formed in the UK for similar promotions.
All have learned that a homeowner can NOT just assume their house value with appreciate- causing automatic equity increases. This was the case for a 3-4 year run, but no longer, and I don’t see that level of appreciation probably ever- but at least for the next 4-7 years. If you want to increase your home equity, you need to either pay more money every month, use a bi-weekly payment system, or hopefully soon you can apply for an AMF mortgage which has an equity-accelerating feature AUTOMATICALLY built into the loan. This has nothing to do with rising house values, etc.
For those interested in being put on a list to be contacted once a pilot lending program for the AMF is established, please contact us at- sales@homequitybuilder.info (Or you can leave a comment here). Thanks for checking in with my Blog.