Property Grunt

Tuesday, September 04, 2007

Cautiously Bullish

Fed asks mortgage servicers to help borrowers

Regulators including the Federal Reserve asked banks and other institutions Tuesday to pursue "loss mitigation" strategies for borrowers at risk of losing their homes, the latest move from Washington aimed at defusing the crisis in the subprime mortgage market.

Translation: Don't even think of asking us for help. We are barely holding on as it is.

I have heard some light chatter about the Manhattan market, apparently deals are being made at very high prices despite the uncertainty of the market. Even with the subprime contagion running wild.

My analysis is this: I do not abide by the party line that Manhattan is a different market which is the reason that apartments are still selling. I think it because buyers are under a different gun. No longer is it irrational exuberance and bouts of last buyer standing. Instead of bidding wars they are under pressure to get the best mortgage they can get as lending standards begin to tighten. The quicker they can sign the contract, the quicker they can lock in a good rate.

Sellers, put on your Sunday best and get those open houses ready. This might be your last chance to make a profit for a long time.

On a personal note I would like to congratulate Joey Arak on his recent promotion to full-time editor at Curbed. From working with Joey, he has proven to be an outstanding editor with a keen eye for detail and an uncanny ability to turn a mess of words into poetry.