People have to be employed in order to buy a house. Ignoring that fact is part of what caused the mortgage crisis we face today. ”Stated income” loans made to borrowers without regular, verifiable incomes have come back to haunt their lenders, and those same lenders are more careful now. A lot of stated income loans were made to investors who were counting on rental income to make mortgage payments.

Problem is, now there are more houses on the market and fewer people with jobs. The national unemployment rate has increased from 4.5 percent in late 2006 to 6.1 percent in September 2008, according to the Federal Bureau of Labor Statistics.  And of course their statistics don’t include a lot of people who are simply too discouraged to seek employment.

People need jobs in order to borrow money to buy houses. It’s that simple.

Obama’s tax plan is scary and it cannot work for long, if it could ever work at all.

The scariest statistic I read on Forbes.com today is this: Obama’s tax plan redistributes wealth all right, by exempting up to 50% of Americans from payment of income tax, leaving the rest of us to pick up the tab.

Think about it - that means half the population won’t care about levels of taxation or how the federal government is spending other people’s money.

Oh, no, no, no, we don’t want that to happen. Be sure to cast your vote against Obama’s tax plan on November 4th.

It’s not just about people losing their homes, it’s about the 400,000 homeowners that FHA has helped keep their homes since September 2007 through the FHASecure and HOPE for Homeowners programs. Hooray for FHA!!!

Right after the election, on November 7th to be exact, Freddie Mac will be increasing fees for mortgage loans made to investors. With Fannie Mae you’ll have a little more time, December 1st, 2008.

So, if you’re planning to buy investment property and financing it through a lender who sells to either entity, better get your financing commitments soon.

The increase in fees will affect all loans to investors who are making downpayments of 10% to 40%, with the approximate increase over present fees being about 1.25% of the loan amount.

I don’t know exactly how the National Association of Realtors comes up with predictions like these, based on statistics it released today:

1) New single-family sales are expected to drop 28.2 percent this year to 503,000 and to drop another 6.2 percent in 2009, following drops of 26.3 percent in 2007 and 18.1 percent in 2006.

2) The median resale home price is expected to be $200,700 in 2008 and to rise 2.8 percent next year, while the median new-home price is expected to drop 5.1 percent this year to $234,500 and to rise 2.6 percent next year.

3) Unemployment is expected to rise to 5.7 percent this year and to reach 6.6 in 2009.  

Obviously, the cost of new construction is skyrocketing. Building materials and transportation costs are higher than ever.

Maybe not so obviously, the cost of resale homes is influenced by the cost of new construction, all dependent on how many properties are available on the market.

And most importantly, all these neat little numbers will be dependent on the outcome of the Nov 4th election.

I predict we’d all better GET OUT AND VOTE!