My Real Estate Blog

When mega-investor Warren Buffett and other top corporate leaders weigh in on key issues that are crucial to a sustained real estate recovery, we all listen!

Are we going to be let down later in the second half of the year, or is the current, slow-moving national economic growth pattern a long term trend?

Buffet told his annual stockholders gathering in Omaha that, the economy is showing significant and persistent improvement for the first time since the financial crisis broke in 2008.

Other top business leaders polled by the Conference Board -- and quoted last week by the Wall Street Journal - said they are now confident that the U.S. will see sustained growth through 2010 - with moderate gains in employment, consumer spending and consumer confidence.

That's hugely important for housing of course - and offers a strong answer to economic doomsayers who predict a sharp drop in home sales and real estate activity following the expiration of the tax credits.

The latest housing and mortgage numbers certainly look encouraging:

Pending home sales jumped by more than five percent in March, according to the National Association of Realtors, and were 21% higher than the previous year for the same month.

Home prices are turning at least modestly positive again in the majority of large housing markets. The closely-watched PMI risk index, which looks at price decline potentials for two years out, found that 42 of the 50 largest markets in its latest survey showed diminished risk.

Another index -- from valuation data firm Clear Capital - found home prices gained by 5% nationally year over year. Prices in a handful of what Clear Capital calls "micro" markets are doing better than that. Washington DC, for example, saw an 8.4% increase over last year.

Meanwhile, new applications for loans to purchase houses took another big jump -- up 13% over the previous week, according to the Mortgage Bankers Association. Last week's FHA and VA share of home purchase applications soared above 50% -- the highest it's been in more than two decades.

Finally, there was some outstanding news for home buyers and sellers in high cost markets: The jumbo loan market is roaring back with more banks now offering big loans and cutting rates. One major lender even announced that for credit-worthy applicants, it's dropping rates on jumbos to 5.7% for 30 years -- the best ever.