Nashville Real Estate Forum

Weekend Market Update

Jan. 30-31, 2010

Stocks logged their worst month in nearly a year as investors shrugged off potentially encouraging economic data.

The blue-chip Dow Jones Industrial Average ended January down 3.5%, its biggest monthly decline since February 2009. The S&P 500 ended January down 3.7%. The tech-heavy Nasdaq shed 5.4% in January.

The Dow closed at 10,067 after a closing print of 10,725 only nine trading days ago on Jan. 19, which was then its highest mark since Oct. 1, 2008.

Good News; Bad News

The Commerce Department said fourth-quarter gross domestic product grew at 5.7%, the fastest rate in six years, easily topping economists' forecast for 4.5% growth. Consumer spending increased at a 2% annual rate, down from 2.9% in the third quarter when the government's cash-for-clunkers program boosted auto sales.

For the entirety of 2009, the economy shrank 2.4%, the worst year for GDP since the 10.9% drop in 1946.

After fourth-quarter GDP was reported, stocks got a lift and bonds were scorned. As Friday’s trading wore on, however, those roles reversed. Mortgage rates were repriced for the better by most lenders in mid-afternoon. The 10-year Treasury note closed at a yield of 3.61%, after yielding just over 4% at Thursday’s close.

Triple Threat

We have three months to take advantage of an unprecedented opportunity for home buyers, and, to some extent, for home sellers. I am referring to the “triple threat” of low interest rates, low home prices and government gifts to homebuyers.

First-time buyers can receive an $8,000 gift from Uncle Sam, and qualified move-up buyers can get a $6,500 gift from the U.S. Treasury for buying a home. Call me to see if you qualify and for your best buying and borrowing strategy. Sellers could get a lift, too, as the market gets a boost from these buyers being in it.

30-Year Conventional Fixed

4.75% $100,000-$417,000


FHA-100% VA

5% $100,000-$393,300


100% Guaranteed Rural Housing w/no MI

5.5% $100,000-$417,000

30-Year Jumbo 5/1 ARM (15% down, No MI)

5% $417,001-$900,000

(Interest-only available-Call me)

Call for free pre-approval and to discover

the best financing for you!

...by Gary Moore

Cell: 615-579-8658  Toll-free fax: 866-321-6513

“Be like a postage stamp. Stick to one thing until you get there.” --Josh Billings

Visit my real estate website:

http://www.RealCarte.com

Visit my mortgage website:

http://www.BrentwoodHomeLoan.com

(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)