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Los Angeles Mortgage Rates Report: April 29, 2008

No real change in my posture.  I still believe that Los Angeles mortgage rates have room to go lower in the next 30-90 days but I'm advising clients who are closing in less than 17 days to lock. All others can float.

Mortgage-backed securities traders have "baked in" a .25% rate cut from the Fed when they meet tomorrow.  If Bernanke doesn't cut, mortgage rates will jump quickly.  This week is filled with economic data. If the data are reported weaker than the estimates, we could see lower mortgage rates in the next week.  The risk of that not happening, in this volatile market, is real so I'm sticking to the recommendation of locking your loans if you are closing before May 15.

Countrywide Financial  reported a a big loss from foreclosures while MasterCard reported huge profits.  While MasterCard doesn't actually issue the cards (they just make money from transactions), it shows that people are walking away from their mortgages and using credit cards more frequently.  Traders think that Bernanke is fixing the financial crisis in this country but those two events should give you reason to deliberate.  We're still bouncing around on choppy seas and should be through the end of the year.  I just don't see Los Angeles mortgage rates above the 6.5% level at all this year.

Memoirs of a Los Angeles Homebuyer Circa 1883

Republished from "A Southern California Paradise"  written Clniton B. Ripley, and included in a collection of essays compiled by R. W. C. Farnsworth, published in 1883, and now in public domain.

To live under one's one vine and fig-tree in a neat, comfortable home, fitted with all the conveniences of modern times, is a possibility in Los Angeles and its environs.  Houses of all kinds, from the humblest cottage to the stately mansion, are to be seen, some peeping out from luxuriant foliage, half concealed by shubbery, which is perhaps, not yet two years old; others rising grandly from soem eminence, and comparing favorably with the homes of wealth in older places.

To those seeking homes in this locality, the statement that "houses are built and homes are made"; homes made which meet the wants, real and fancied, of all who come, is not enough.  The careful man who proposes to invest his money in a home wants to know the cost of building, the kinds of building materials, where they are obtained, and many other important items, which this writer, having practical knowledge of the subject, will endeavor to furnish.

I would first attempt to correct the erroneous impression which seems to have gone out over the many States from which we derive our population, that any kind of a shelter is sufficient for a house in Southern California.  It is true that from April to October rains rarely ever fall, and the shade of a tree many suffice for a shelter; but this is not a home.  It may do for a brief period while a house is being erected, but will not prove satisfactory for a very long time, unless the gypsy yearning develops faster than usual.

Los Angeles Mortgage Rates Report- April 21, 2008

What a wild week this past one was for Los Angeles mortgage rates.  On April 14, 2008, I advised folks who were closing in the month of April to lock rates; mortgage bonds plummeted from 101 to 99.5.  If you were closing in April and didn't lock your mortgage rate, it would have cost you about 1.5% in discount points to get that same mortgage rate, on Thursday- that's $7,500 extra in closing costs for a $500,000 loan!

I also advised that all May closings float. Mortgage bond prices rebounded to 100.5 today; I still think there's room for upside in the mortgage bond market which means lower mortgage rates.  I don't have high hopes for the American economy through the summer.  The foreclosures, weak housing prices, and credit crunch have closed the consumer's "virtual ATM ".  Higher food and fuel prices are starting to take a bite out of the consumers' budget.  A gallon of gas and a gallon of milk both cost in excess of $4. In past years, a homeowner would suck it up and throw the money on his HELOC.  Now, with HELOCs frozen, the consumer has to tighten his belt.

The consumer drives much of the American economy so his tightened belt means less spending.  That should hurt this economy until we see the banks loosen up a bit.

Will we see lower mortgage rates in May?  I think so but the volatility of the mortgage bonds market still compels me to advise Los Angeles home buyers to lock their mortgage rates for transactions closing within 14 days.  All longer closings should float...for now.

Government Work: Research Links

Useful Research Links from the US Government:

  • General GPO Access - One stop access to thousands of publications from the Government Printing Office.
  • General FirstGov - Web portal with information by topic for citizens, researchers, government employees and others.
  • Science - a gateway to authoritative selected science information provided by U.S. Government agencies, including research and development results.
  • Census American Factfinder - Where you want to go for population and demographic information and anything to do with Census EXCEPT Genealogy.
  • Statistics Fed Stats - Numbers on nearly everything.
  • Congress THOMAS - current federal legislation
  • GAO Reports Government Accountability Office Topic Search - Nonpartisan reports on government operations browseable by topic.
  • CRS Reports Open CRS - Brings together reports on many topics of interest done by the non-partisan Congressional Research Service.
  • Directory US Government Manual - Learn more about the structure of our government and locate government contacts.

And more...

Juanita's At La Casa Blue

La Casa Blue, Food & Bar has joined forces with Juanita's Restaurant in Eagle Rock.

Juanita's Restaurant in Eagle Rock has moved in with La Casa Blue bring you a great beer and wine selection along with Juanita's twenty years of experience creating gourmet Mexican food. The 2008 recession and the new high cost of doing business gave both restaurants the opportunity to combine forces and bring the Highland Park community an even better gathering spot.

Now open for lunch and dinner, Tuesday thru Sunday. Free Delivery with minimum order.

Our new Happy Hour buffet is a great way to sample some of the fifteen house plates while enjoying a pint from our imported draft beer collection.

Click here for our new Menu

Sit at the Bar

Juanita's at La Casa Blue
5930 York Blvd.
Los Angeles CA 90042
Phone: 323-254-4200

Memoirs of a Los Angeles Homebuyer Circa 1874

Republished from "A Southern California Paradise"  written by an anonymous author and included in a collection of essays by R. W. C. Farnsworth, published in 1883, and now in public domain.

An Early Settler's Experience

I arrived in Los Angeles in June, 1874, in feeble health.  Could find no house to go into, so concluded to camp until I could get a small house built.  A carpet thrown over a limb of our big oak made a fine tent, and in that I lived with wife and daughter a jolly life for six weeks.  By that time I had grown strong enough to "grub up" greasewood for fuel supply.  When we finally got into our "board and battened" fourteen by twenty house, I could not for several nights sleep comfortably in it; it felt too close, although at first we had only blankets in place of doors and windows.  This little house, intended to serve for only a year or two, is still, after nine years, our only shelter, we having added to it small porches, a shed here, and a little room there.

One great advantage of these cheap houses is the ease with which you can make changes about them, -- put in a new window, change a door from one place to another, cut through a partition to open communication between rooms, or close up others.  Saw, hammer, nails, and ordinary skill are all that are required.  No cleaning up or repairing of plastering about it.  Another advantage is the good ventilation these cloth ceilings afford (perhaps sometimes a little too much for delicate constitutions.)  However, the heat from an oil stove has been all that was necessary to make our room comfortable during the coldest weather we have had.

Editor's note:  Inspired by this post, Rob Mendel, webmaster of the Historic Highland Park Neighborhood Council web site,  created a slideshow of tent homes in the early 1900s.  You can check it out here:
Note: you must register to access the Neighborhood Council site ... registration is free, and there is a lot of great information.