2010 Year End Mortgage Market Share Report

This is not the end. It is not even the beginning of the end. But it is perhaps, the end of the beginning. ~ Winston Churchill

There are encouraging signs for the Monroe County real estate and mortgage finance markets. Commercial loans showed signs of life in December. Residential sales in the higher price ranges improved over the last six months of the year. Neither of these developments appears to be the result of any artificial stimulus, such as home buyer tax credits. That?s good news.

The twenty mortgages securing loans over $500,000 (see detail) made in December is the highest total in Monroe County since July 2008?the month when the sub-prime crisis became obvious. Most of these loans appear to be commercial in nature which is a positive indicator for the 2011 market. I?ll be watching closely the next few months in hopes that this is a trend, and not a year-end aberration.

Sales of properties for use as a primary residence (see chart) also displayed an upbeat trend. Although the total sales in the second half of 2010 were down compared to the 2009 period, sales in the upper price ranges were actually higher?a lot higher. Second half sales with a stated sales price in excess of $200,000 increased over forty percent over 2009?from 178 to 251! These sales are less driven by tax credits and artificial stimulus. The drivers are more likely low interest rates and buyers feeling financially confident about making a change.

The last trend to keep an eye on is mortgage foreclosures. The number of new foreclosures started and the number of recorded Sheriff?s deeds (foreclosures finished) both continued to drop in Monroe County. Is this drop is real or is it just a pause as a result of the robo-signer-gate revelations in the fourth quarter? Let?s hope it?s the beginning of a return to normal.

The market still has a long way back. The ever increasing overhead of regulation and compliance certainly will retard its progress. Nevertheless, signs of improvement should be celebrated.

~John Bethell