About 60 days ago, I mentioned to my Foolish friends that my wife and I had put our Florida home on the market in favor of relocating to the Carolinas. At the time, I noted that the Southwestern part of the Sunshine State, where we were trying to attract a buyer, was essentially the epicenter of U.S. housing weakness. As a result, we expected a long siege among the ranks of those with "for sale" signs adorning their front yards.
But lo and behold, we received a contract on our home the day it hit the market. We're therefore in the latter stages of arranging for a mortgage in our new location. Our loan-to-value ratio will be less than 40%, meaning that we won't encroach upon the now famous -- or perhaps infamous -- world of subprime loans. Yet despite having excellent credit, we're being confronted with more mortgage-granting hurdles than has been the case with any of our prior homes, most of which carried 80% or higher mortgages.
That takeaway also would seem logical from a Monday Wall Street Journal article about Sheila Bair, the aggressive and still relatively new chairperson of what the Journal called "the once-sleepy Federal Deposit Insurance Corp.," the entity that oversees federally regulated banks. Apparently, Bair urged Congress earlier this year to hold Wall Street investors and mortgage service companies accountable for the expanding subprime quagmire. Such blame placement makes those in the mortgage "food chain" even more circumspect than they have been.
It also seems that housing's lift-off is anything but imminent. Last week, Meritage Homes
I've stated that I believe Fools can make money by very slowly building positions in the better builders and exercising considerable investor patience. I continue to believe that approach will work, but with each passing week, the words "slowly" and "patience" gain additional currency.
Building on related Foolishness:
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