As you may have heard, the financial markets have been in a tailspin with the demise of Lehman Brothers and the buyout of Merrill Lynch.  Although the Feds are being pressured to lower interest rates even more, they are protecting the exchange rate of the dollar by holding inflation at bay. 

What usually happens is that the change is anticipated and the rates drop before the fed actually makes any change.  Today the FHA 30-year loan was 5.375% and a conventional 30 year loan was around 5.8%.  Wow!  I haven’t seen rates this low in years. 

The front page of the local newspaper was not about Wall Street but sensationalizing the foreclosure rate in our local market which was up 46% in August.    I know this sounds frightening, and I’m sure it’s meant to sell newspapers; however, the untold piece of the story is that there are 124,616 residences in Washoe County and there were 1105 foreclosure filings.  This is just under 1% of the total number of homes.

Now I do concede that this country is in a crisis and yes there are many short sales and foreclosures, but the picture painted is so grim.  When I ran my numbers this morning there were 15 fewer active listings than last week and 43 more homes under contract than last week.  As the lower priced properties come on the market, whether they are foreclosures, short sales or regular listings, smart buyers/investors are gobbling up the good deals, and this is keeping our inventory steady.  We certainly aren’t out of the woods yet; slowly but surely.

So don’t take everything you read as gospel.  There is always another side to the coin.