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Are you seeing much fewer jumbos?

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Metamorphic

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Mar 15, 2008
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Certified Residential Appraiser
State
California
I was playing with the sales data through the end of October, and its very curious because all the high end sales are gone and the mid range sales are reduced in number.

See below.

Given the timing of the deacrease and the relative strength of the low end market makes me wonder if the lenders were spiking the high dollar loans during the run up to the bail-out, during all the bank closures in an attempt to hang on to their capitol.

Has anyone heard of such a thing or do you know a resource for checking on the availability of jumbo loans?

2008-11-06_2237.png
 

Mike Boyd

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Retired Appraiser
State
California
My real estate agents friends tell me that there are VERY few high end buyers out there right now. These are agents that specialize in those types of properties. My market area had one of the highest median values in the state when things were booming. Over $600,000. Now the median has dropped to just over $300,000. The great majority of sales are foreclosures and short sales. Add to that the demise of no qualifier loans. That alone has eliminated many business people and independant contractors that do not document their "underground" income as well as speculators.
 

The Warrior Monk

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Certified General Appraiser
State
New York
It depends on the market segment. There is activity here in the $10M-$35M range. Rumor has it that some even more expensive properties are being looked at. Most of this involves "old" or overseas money.

There is less activity the the $2M-$10M range, which is mostly new money...people that became wealthy over that past couple of year in real estate or the stock market. Interestingly enough, there is not a lot of foreclosure activity in this price range.
 

Metamorphic

Thread Starter
Senior Member
Joined
Mar 15, 2008
Professional Status
Certified Residential Appraiser
State
California
The more I look at this data the less I think its a natural market occurance. See below.

The orange and blue lines outline the normal upper and lower limits of the market. They're roughly parallel and up trending. The green line is a polynomial regression. The red line designates an area where the high end of the market just goes away. The activity level in the lower end of the market seems consistent and the rising price trend holds but the upper end sales just aren't there. It just seems very artificial to me, which is what got me thinking about some external influence like lending practice.

2008-11-07_1043.png
 

Lost Cause

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Sep 17, 2004
Professional Status
Certified General Appraiser
State
New York
The bank I'm with targets wealthy customers and we lend almost exclusively on high-dollar residential. We are very, very busy with that these days.
 

Metamorphic

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Senior Member
Joined
Mar 15, 2008
Professional Status
Certified Residential Appraiser
State
California
I just got off the phone with a MB who said she'd heard of some lenders that were declining to fund jumbos in the last few months.
 
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