The National Association of Realtors just issued two press releases, which one should we believe?

• Mortgage Problems Hamper Pending Home Sales - Oct 2nd 2007
  OR
• For Most Buyers, the Mortgage Market Is Healthy - Oct 1st 2007
  

It's obvious to me that "Mortgage Problems Hamper Pending Home Sales" is the correct one, so what purpose does it accomplish to release "For Most Buyers, the Mortgage Market Is Healthy" at the same time? When we all know of people with perfect credit having difficulties with mortgages.

It only makes NAR look indecisive and further adds to the credibility problem all Realtors face now. It's time for NAR to tell it like it is. It's too easy for today's educated consumers to get the truth from the many sources on the Internet.

What NAR should do is add their opinion to such releases like "For Most Buyers, the Mortgage Market Is Healthy" and state that viewpoint is coming from the mortgage industry, and that's what someone would expect. The same applies to the opinions coming from NAR, they should be foot-noted with something like "it's in NAR's best interest to take the most optimistic opinion on the real estate market."

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Daily Real Estate News | October 1, 2007
For Most Buyers, the Mortgage Market Is Healthy
The widespread notion that the entire mortgage market is in crisis is just plain wrong, say lenders in various parts of the country.

The majority of mortgage products have been unaffected by troubles in the subprime segment. Interest rates for 30-year, fixed-rated loans remain in the low 6 percent range for people with reasonably good, though not necessarily perfect, credit records, according Kenneth R. Harney, managing director of the National Real Estate Development Center and syndicated columnist.

While there is plenty of money to lend, Harney says underwriting standards are more strict than they were a year ago. Jumbo loans, for example, often require two appraisals – one by an appraiser selected by the lender and the other by one working for the investor.

Similarly, FICO credit-score standards generally are higher than a year ago, stated-income mortgages with no verifications are hard to find and lenders are especially wary of excessive "layering of risk" – combining low down payments with marginal credit scores and high debt-to-income ratios – in markets where prices are trending lower.

Source: The Washington Post Writers Group, Kenneth R. Harney (09/29/07)

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Daily Real Estate News | October 2, 2007
Mortgage Problems Hamper Pending Home Sales

Pending sales of existing-homes activity will be dampened near-term as mortgage disruptions continue to impact the housing market, according to the NATIONAL ASSOCIATION OF REALTORS®.

The Pending Home Sales Index, a forward-looking indicator, fell 6.5 percent to a reading of 85.5 from an upwardly revised 91.4 in July, based on contracts signed in August. It was 21.5 percent below the August 2006 index of 108.9.

Lawrence Yun, NAR senior economist, says the mortgage market impact is quantifiable.

“Fewer contracts were being written because of mortgage availability issues, and a separate internal survey of our members shows more than 10 percent of sales contracts fell through at the last moment in August, primarily the result of canceled loan commitments,” he says. “The volume of activity we’re seeing today is below sustainable market fundamentals because some creditworthy people are trying to buy homes but can’t because of the credit crunch.”

The impact has been greatest in high-cost markets that are more dependent on jumbo mortgages, Yun says. In some areas, as much as 30 percent of signed contracts were falling through in August when the credit crunch problem peaked.

“The problem has since become less severe, though jumbo loan rates are still higher than they would be under normal conditions,” Yun says. “Therefore, sales activity in late fall will better reflect market fundamentals.”

Regional Numbers

Here’s what the index showed across the country:

West: down 2.7 percent in August to 80.3, and is 27.1 percent below a year ago.
Midwest: fell 2.9 percent from July to 78.1 and is 18 percent lower than August 2006.
Northeast: dropped 8.3 percent in August to 77.3 and was 18.3 percent below a year ago.
South: fell 9.5 percent in August to 97.8 and was 21.3 percent below August 2006.

The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

— REALTOR® Magazine Online