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By Brian Cav, a Mortgage Banker in the Greater Boston Area with over 10 years experience in the Financial Industry.

 Okay, this is the first time I have ever done this.  From here on out while I am in Mortgage Banking I am going to take the fourth quarter of the previous year to do some analysis of what I have read, heard, viewed, etc. and I am going to roll out my annual predictions! Here goes what I have from 4th quarter 2009 and looking into 2010... Yikes
 
Drum roll please...

SmarterBorrowing.com will dominate!

Obviously...

The 30 year fixed Mortgage will be close to 6%

We have had a 30 year fixed in some cases as low as 4.625% on a purchase with 25% down in 2009 (Not including Conventional High balance of $523,750-.  This is a huge change...  Please think about purchase/refinancing now.  Combined this with with First Time HomeBuyer and Tax Credit extended thru April 2010.  These all time low record mortgage interest rates will be long gone very soon.  The government will soon no longer be buying mortgage-backed securities and inflation is soon to catch up.
There is still no 30 Year Fixed Jumbo Mortgage which is attractive to Buyers
But this is okay... Jumbo 5/1 ARMs are the product to go with!  Banks/Credit Unions/Direct Lenders don't like 30 year fixed jumbo mortgages right now...  and looks to be a while before credit markets get better

The Real Estate Market will not get better until 2011

Ouch... Sorry folks but I think its the truth.  Here's why...

•    All of the Washington Mutual Option ARM Mortgages that were originated a few years back are up first and second quarter of 2010.  This means there will be more foreclosures hitting the market starting 2nd quarter 2010.
•    The Homebuyer Credit and extended Tax Credit are done in April...  Please do not count on this nice little gift from the Government to be extended. Again.
•    PS  The Fed's Fannie Freddie purchase program is done at some point in 2010 as well.  Wow, maybe there are more than a few reasons as to why this Real Estate Market has another year or so to get better.
Well, sounds like a great time to buy in the next few months if you ask me.

Everyone, and I mean everyone will LOVE my Monthly and sometimes Bi - Monthly SmaterBorrowing.com Newsletter : )

Tougher to qualify for FHA Loans

Darn...  Borrowers will need to bring more cash to the table, minimum FICO scores will be increased, a hard back end qualifying percent of 45%  (monthly percentage of debt to gross income a Bank will allow) and the days of a 6% seller's concession are long gone. Down to maybe 4%, 3%...?  Get your credit were it needs to be, save for a down payment, and do not plan on such a credit towards closing costs and pre-paids at the closing.

Brian Cav is a Mortgage Banker in the Greater Boston Area with over 10 years experience in the Financial Industry. Feel free to contact him at:
bc@SmarterBorrowing.com, tel 617.771.5021

Reprinted with the permission from www.SmarterBorrowing.com

Please visit http://smarterborrowing.com/ for additional Blog Posts, etc.
 

Retailer's Runway: 2009
This year's participants in the ICSC (International Council of Shopping Centers) Retailer's Runway were:

Auto Zone
Dollar Tree
Game Stop
Haloween Venture
Hobby Lobby
Kiddie Academy
Muscle Maker Grill
Planet Fitness
REI Sporting Goods
Rosa Mexicano Restaurants
Shoprite
Sonic
TD Bank
Wingstop Restaurants

The growth oriented segments in retail this year are value focused shopping, and appropriately so.  This line up is extremely reflective of this trend.

Retailer, Dollar Tree reporting opening 240 new locations in 2009 at the runway, having a total of 3,800 stores nationwide.  Their focus in
2010-2011 will be urban, in contrast to their typically suburban stores.

Sonic, the retro-future drive-in fast food restaurant reported opening
141 franchises in the 2009 fiscal year.  While this is down from their
2008 169 number, it still represents promising expansion.  Their current focus is on penetrating the northeast market.  Their new Peabody, MA location set the record for opening week revenue by more than 4 times the prior record holder.  With almost 3,600 locations across 42 states, the current #1 drive in chain in the U.S. shows promise.

TD Bank and Gamstop were amongst others with impressive growth statistics and substantial presentations.

For more information on retail real estate, please contact Jason Weissman here.

Stay tuned for more ICSC LIVE updates!  

While those of us who live in Boston understand how phenomenal this city truly really is, Forbes Magazine has corroborated this by giving the Hub props and including us in three of its most revered 2009 lists: Top Cities for Singles, America’s Safest Cities, and America’s Top 25 Towns to Live Well.

Top Cities For Singles: #2
Forbes used criteria such as coolness, cost of living alone, culture, job growth, online dating participation, nightlife and the ratio of singles to the entire population of the metropolitan area in their calculations.  Boston ranked #2, right after New York, in the list.  That’s right, singles, NUMBER 2.  For information about relocating to the Boston area, please don’t hesitate to contact one of our residential experts: for apartment leasing, please contact Kristy Ganong, here.  For condo and home sales, contact Rob Cohen, here.

America’s Safest Cities: #4
To grade cities in order of safeness, Forbes considered four danger categories: workplace death rates, traffic death rates, natural disaster risk and violent crime rates.  The Boston Area placed as the 4th safest area in the country behind the Twin Cities, MN, Milwaukee, WI, and Portland Oregon.  Not bad, Boston!  In these uncertain times, it’s certainly nice to be assured of the safety of your city.  Again, contact our residential leasing Expert, Kristy Ganong, or our Residential Sales expert, Rob Cohen, for more information about Boston Area Residential Real Estate!

America’s Top 25 Towns to Live Well: #6
Just 5 minutes west of Boston, Newton, MA came in at number 6 based on cultural amenities, pro-business environments, highly educated workforces and average salaries.  With high salaries, natural beauty, proximity to a plethora of the world’s most prestigious universities and research institutions, and rich culture, Newton is a shoe-in.

Interested in relocating to Boston yet?  Contact our residential team to assist in finding you your perfect new home.    
 

• Extends deadlines for purchasing and closing on a home.
• Authorizes the credit for long-time homeowners buying a replacement principal residence.
• Raises the income limitations for homeowners claiming the credit.  

• Job Security – with Massachusetts’ unemployment rate continuing to rise, is your position secure?
• Financial Security – has the economy had an affect on your capital?
• Geographic Security – will the state of the economy present relocation possibilities?

Now is a great time to discuss office leasing and renewal options for the Boston Office Market.  The aggressive decline in pricing has created buying opportunity for office tenants in the marketsplace. 

Tuesday, December 1, 2009, 2:20pm EST | Modified: Wednesday, December 2, 2009, 5:33am Report: Boston is most deflated office market in AmericasBoston Business Journal - by Jeff Clabaugh and Craig M. Douglas Washington Business Journal and Boston Business Journal Boston’s central business district has earned the unfortunate distinction as the most deflated rental market in all of the Americas, according to a recent report by CB Richard Ellis Group Inc. The city’s 33.9 percent year-over-year decline in average rental rates ranked as the seventh worst globally and rivaled the precipitous falls seen in other once-overheated markets such as Moscow, Hong Kong and Abu Dhabi, according to the report. Among other U.S. cities, only New York City’s 30 percent year-over-year decline came close to the cratering seen in Boston’s downtown office market, according to the report. “As renewals offer the best option for immediate savings for many tenants, landlords are relying on reduced construction costs to offer ‘turnkey’ build-outs and rent abatements to encourage relocations,” according to the report’s outline of trends affecting the Boston market. As of Sept. 30, the average rent for downtown Boston office space was $36.45 per square foot. To be sure, the world’s most expensive office markets have become significantly less expensive in the last year. Average office rents worldwide declined 7.7 percent in the fiscal year ended Sept. 30, according to the report, with rents down in 131 of the 179 major cities CB Richard Ellis tracks. Nearly 50 markets have seen double-digit declines. Tops among cities seeing declines was Kiev (down 64.6 percent) and Singapore (53.4 percent). Boston’s year-over-year decline ranked seventh globally. Other large drops include a 41 percent decline in Hong Kong, a 39 percent decline in Abu Dhabi and a 35 percent decline in Moscow. New York retained its rank as the most expensive North American market, with Midtown rents of $68.93 per square foot. New York’s rents rank 24th globally. London’s West End, where rents declined 17.8 percent during the period studied, is the world’s most expensive market, at an average of $184.85 per square foot. Tokyo, Hong Kong, Moscow and Paris follow London among the world’s most expensive office rental markets.

http://boston.bizjournals.com/boston/stories/2009/11/30/daily26.html

Here is a real estate conundrum:  I don't know if you've received one yet but I just got a shocking "Revaluation Assessment Notice" from the City of Boston Assessing Department which informs me that the Assessed Value of my property has decreased by approximately $100,000!

The notice explains that, due to a downturn in the real estate market, the city has reevaluated property values to reflect a decrease in the real estate market.  The notice states that the city reached its numbers by looking at sales of properties "comparable in location, style, age, size and condition."  Ironically, the notice also states that to offset the tax losses that the city will realize as a result of decrease in property values, the city is increasing real estate taxes to the maximum 2.5% allowed by law (meaning that some of us will actually pay more taxes on a less valuable property).
 
The notice goes on to explain that the Assessing Department is available to review one’s FY 2010 Preliminary Assessment during this Public Disclosure period (Monday, November 16 through Wednesday, November 25). But given that the notices were only recently issued and the review period covers a mere 8 days, with tomorrow being the last day for a review session, it seems like less than adequate conciliation.

So I ask you, how does the city arrive at these assessments? If it were based purely on the properties’ market value the table below, with data collected on a typical brownstone in the South End, illustrates that this is far from the case. And further more do you feel when the property assessment value is dramatically reduced, as we are seeing with 20-25% decreases, that this will effect the resale value of your property?

Send me your comments and any similar experiences you have had with the Enigmatic Assessing Department!

Figures sourced from City of Boston Assessing Deptartment and Link Boston, Listing Information Network, for a South End Brownstone on Chandler Street.

Developers Diversified Realty (DDR) sold a $400M CMBS loan on Monday, officially ending the 18 month CMBS (Commercial Mortgage Backed Securities) market drought. 

Originated by Goldman Sachs Commercial Mortgage Capital, the loan is backed by 28 commercial real estate properties owned by the U.S. shopping center owner.

The deal sold at its asking price and saw very strong investor demand.  This sale is considered a turning point for the CMBS market and a leading indicator as to both the strength of the U.S. economic recovery and investors' appetite for risk.

The sale was the first to close under the Fed’s Term Asset Backed Securities Loan Facility (TALF).  TALF was created to assist market participants in meeting the credit needs of households and businesses.

According to CoStar, the 10 largest commercial real estate properties backing the deal are:

1.    Town Center Plaza, Leawood, KS; 649,696 square feet; $54.3 million;
2.    Hamilton Marketplace, Hamilton, NJ; 956,920 sf; $44.4 million;
3.    Plaza at Sunset Hills, Sunset Hills, MO; 450,938 sf; $30 million;
4.    Brook Highland Plaza, Birmingham, AL; 551,277 sf; $26.4 million;
5.    Crossroads Center, Gulfport, MS; 545,820 sf; $26.4 million;
6.    Mooresville Consumer Square, Mooresville, NC; 472,182 sf; $19.5 million;
7.    Deer Valley Towne Center, Phoenix, AZ; 453,815 sf; $18.9 million;
8.    Downtown Short Pump, Richmond, VA; 239,873 sf; $13.4 million;
9.    Abernathy Square, Atlanta, GA; 129,771 sf; $13 million; and
10.    Wando Crossing, Mt. Pleasant, SC; 325,907 sf; $12.8 million