Look Out Below!

It’s often interesting to see what industry insiders say about their markets.
Vern

From National Mortgage News Online,
http://www.nationalmortgagenews.com/columns/hearing/

Housing starts plunged by nearly 15% in October to an annualized rate of 1.486 million units, the slowest monthly pace since July 2000. The 15.9% drop in single-family starts was the steepest since 1991. Yes, it looks ugly. How ugly? Here's your weekend homework assignment. Look in your local newspaper, in the real estate section, and behold all the deals builders are cutting on new construction. In The Washington Post, Centex Homes is willing to provide 100% financing on all its properties. In one ad I viewed, the builder wasn't even listing the price of homes. Instead, it was highlighting only the monthly payments. What does all this mean for mortgage bankers? For the next six months the industry can survive off of refinancings. After that -- and if the flat or negative yield curve persists -- look out below. The woes of ECC/Encore will spread like wild fire...