Credit Suisse Group said Thursday it will use its own illiquid assets such as mortgage-securities to pay senior staff at its investment bank year-end bonuses.

The Zurich-based bank plans to pool its illiquid assets such as commercial mortgage-backed securities and leveraged loans it cannot sell because demand has seized up, then dole out portions of the entity to managing directors and directors. - WSJ.com

This is brilliant.

A recent New York Times article about the economy is helping put the Federal Reserve’s surprisingly large interest rate reduction on Tuesday into perspective, and does a good job of explaining that while the cost of fruits, vegetables, clothing, vehicles, and (most important in our world) houses, are all dropping, these declines have raised fears of a deflationary spiral. “There is good reason to fear deflation. Once prices start to fall, many consumers may decide to reduce their spending even more than they already have. Why buy a minivan today, after all, if it’s going to be cheaper in a few months? Multiplied by millions, such decisions weaken the economy further, forcing companies to reduce prices even more.”

The article also discusses a phenomenon called the “sticky wage theory” explaining why wage prices don’t fall during a recession, and why this along with price drops, helps to keep “real incomes” (inflation adjusted) from dropping too much. Read full article…

Of course this got us thinking about properties that had price drops in the last few months. We’ve assembled a list of properties that have had “significant” price reductions (10% or more) in the last six months just for good measure.

The biggest decrease we’ve seen so far has been this approved short sale in Revere originally listed for $399,900 currently offered at $185,000, a whopping 54% reduction. Suprisingly, it looks to be in unbelievable condition! Have a bit more to spend? Check out this mini Waterfront mansion in Worcester County offered at $500K from it’s original price of $875.

A new Report by RealtyTrac, a national database of foreclosure and bank-owned properties, shows foreclosure filings — default notices, auction sale notices and bank repossessions are down 7 percent from October, though still up nearly 30 percent from a year ago. Massachusetts is still ahead of the curve nationally, with foreclosure rates down 30 percent for the month and down 32 percent overall from last year. Read the full report…

Even if the stats are showing the pace may be slowing down, there are still plenty of active listings. Click here to search our site for Bank Owned and Short Sale properties in MA by town.

MLS #: 70853613 - Condominium- 2/3 Family
Address: 34 Howe Street, Dorchester, MA
List Price: $199,999
Territory Rebate: $5

Buyer’s Agent: Mary Hios

Seller’s Listing Office: At Home Real Estate Group, Inc

Location: Dorchester is a neighborhood of Boston, Massachusetts. It is named after the town of Dorchester in the English county of Dorset, from which Puritans emigrated. Dorchester, including a large portion of today’s Boston, was separately incorporated in 1630. It was still a primarily rural town and had a population of 12,000 when annexed to Boston in 1870. Railroad and streetcar lines brought rapid growth, increasing the population to 150,000 by 1920. It is now a large, diverse working class community with many European Americans, African Americans, Caribbean Americans, Latinos, and East and Southeast Asian Americans, and is still a center of Irish American immigration.

Savin Hill is a section of Dorchester, the largest neighborhood of Boston, Massachusetts, USA.Named after the geographic feature it covers and surrounds, Savin Hill is about one square mile in area, and has a population of about 15,000 people. Savin Hill Beach and Malibu Beach are nearby and are a resource for surrounding communities. Rail and bus routes give access to and from Savin Hill, especially the Savin Hill station. It is the home of the Savin Hill Yacht Club which was founded in 1875 as the Savin Hill Beach Association but later changed its name in 1888. The club is located off Morrisey Boulevard, a main artery in the area. -Wikipedia

Three Up:

1. Spacious, New Renovation
2. 3 Full Sized Bedrooms
3. Washer/Dryer already in Unit

Three Down:

1. Located Near Empty Lot
2: Master Bedroom Closet Very Small
3. Single Families on Block may affect Resale

Guide’s Opinion: This is a gorgeous renovation and the last available unit in the building. Finishes are top-of-the-line. The price per square foot makes it an unbelievable value. The location is also very close to Savin Hill Red Line. This is worth seeing in person to appreciate.

Territory Rating: Buy

CLICK HERE TO SEE IT IN PERSON

Recently, a co-worker teased me for fishing through the trash for a used, plastic coffee cup. As it turns out, I like to forego the three dollar plus beverage purchase and make my iced coffee at home. To fool myself into thinking I actually purchased this homemade treat, I require the luxury of a good sturdy top, and a straw…sue me! What isn’t lost on me is the irony of reusing a tossed plastic cup and the fact that that during these cost-crunching times, the environment is unfortunately, not my primary concern. Sorry Mr. Gore.

It got me thinking about how other Americans may be dealing with this conflict and I came across “Trash to Cash” a program started by a company called RecycleBank, that rewards consumers for recycling with points redeemable to hundreds of local vendors. The program is currently running in over 22 cities nationwide, and building strong. In Massachusetts, the following towns are already participating and you can contact your local municipality about expanding the program in your local community. We’ve even gone the extra mile and found some environmentally-friendly homes in the area.

Sturbridge, MA
Webster, MA
Dudley, MA
Leicester, MA
Charlton, MA

Contact Casella Waste Systems 800-918-1392 for RecycleBank Service in Massachusetts.

Watch the full Youtube video on the “Trash to Cash” Program.

MLS #: 70842013 - Multi-Family: 2 Family
Address: 322 Tappan: Brookline, MA
List Price: $1,399,000
Territory Rebate: $29,980

Buyer’s Agent: Mary Hios

Seller’s Listing Office: Coldwell Banker Residential Brokerage - Brookline

Location: Brookline is a town in Norfolk County, Massachusetts, United States, which borders on the cities of Boston and Newton. As of the 2000 census, the population of the town was 57,107. Brookline borders Newton (part of Middlesex County) to the west and Boston (part of Suffolk County) to the east, north, south, northwest, and southwest; it is therefore non-contiguous with any other part of Norfolk County. Brookline became an exclave in 1873 when the neighboring town of West Roxbury was annexed by Boston (and left Norfolk County to join Suffolk County) and Brookline refused to be annexed by Boston after the Brookline-Boston annexation debate of 1873.

Brookline actually separates the bulk of the city of Boston (except for a narrow neck or corridor near the Charles River) from its westernmost neighborhoods of Allston/Brighton, which had been the separate town of Brighton until annexed by Boston in 1873.

There are eight elementary schools in the Brookline Public School system: Edith C. Baker School, Devotion, Driscoll, Heath School, Lawrence, Lincoln, Pierce, and Runkle. As of December 2006, there were 6,089 K-12 students enrolled in the Brookline public schools. The system includes one early learning center, eight grades K-8 schools, and one comprehensive high school. Several private primary and secondary schools, including the Beaver Country Day School, Brimmer and May School, British School of Boston, Dexter School, Maimonides School, and The Park School are located in the town. - Wikipedia.com

Three Up:

1. 6 Levels; all over 1,000 Sq Ft.
2. 4 Deeded Parking Spots
3. Priced at less than $200 Per Sq Ft

Three Down:

1. Needs Complete Renovation
2: Some Water Damage on Top Floors
3. 2 of the 4 Parking Spots are Off-Street

Guide’s Opinion: One of the last true single-families in Brookline, this M-2 zoned property means it’s perfect for a developer or someone looking for a Multi-Family conversion. This building has 6 levels with high ceilings, each over 1,000 square feet. It also has 4 deeded parking spots (2 garage, 2 outside). The location is also ideal as it’s minutes from 2 different T-stops, including steps from Cleveland Circle. The building needs work, but the right investor can make this a gem.

Territory Rating: Buy

CLICK HERE TO SEE IT IN PERSON

Some of our first-time condo buyers have been experiencing difficulties obtaining financing these days due to an issue on owner occupancy rates in the buildings. Most lenders, PMI and MI (Mortgage Insurance) and particularly FHA-insured loans are requiring a rate of 50% or more to approve a loan. The reason? Lenders are getting increasingly wary about “high-risk” ventures and a low occupancy rates (meaning a high percentage of renters) may increase this risk. This could be due to increase in the wear and tear of the building, or for financial reasons such as higher ownership could mean a more substantial condo fee reserve, and therefore, less financial risk and better resale potential.

This isn’t necessarily something you’d ask about initially when viewing a property. If you are looking to make your first real estate investment however, it might be wise to ask your lender about their requirements in advance.

Here is a list of properties in the low $200’s with Owner Occupancy Rates over 50%. It has been our experience that the common areas and overall amenities in these buildings are in fact, way better. Go figure!

I spent some time researching this morning trying to find a record of the lowest 30 year fixed mortgage rate ever offered. The most reliable source I could find was Freddie Mac who has been recording mortgage rate data since 1971. According to their records the lowest 30 year fixed mortgage rate offered was 5.23% in June of 2003. Will the rumored Treasury Department plan shatter this record?

“Lobbyists are pushing the Treasury Department to consider a plan to purchase mortgage-backed securities in the hopes of driving mortgage rates to as low as 4.5%, an industry source said.

Similar to an effort unveiled last week by the Federal Reserve, the proposal calls for Treasury to buy securities backed by 30-year fixed-rate mortgages from Fannie Mae and Freddie Mac. Details on the plan remain sketchy, but an announcement could come as early as next week, the source said.” - CNNMoney.com

Has the US Governement learned nothing? Isn’t this the exact same structure that caused the Fannie Mae / Freddie Mac failures? I guess the difference is that now there is no quasi goverment-backed middle man. This time the mortgages will be backed directly by US Treasury Bonds!

If you’re worried that there just isn’t anything affordable on the market in Boston it’s time to read the numbers: The neighborhood of Brighton came out as #1 at 36 listed properties under $300k. South Boston came in at a close second with 33. That’s a pretty impressive number in this market! Here’s how some other Boston neighborhoods measure up:

Condos on the Market Under $300K

Allston: 11
Back Bay: 2
Beacon Hill: 5
Charlestown: 6
North End: 5
South End: 2
Fenway: 5

Our favorite so far? This One Bedroom in Brighton is in one of the only completely renovated buildings in the entire neighborhood. Asking Price? $225,000 Territory Price? (before we even begin negotiating): $223,245

Your Rebate from us at asking Price: $1,755