Monday Morning Cup of Coffee: President Obama orders spending cuts
HousingWire’s Monday Morning Cup of Coffee takes a look at news from the weekend, with more coverage on bigger issues.
Late Friday, President Barack Obama instructed federal agencies to start implementing spending cuts across the board, beginning a rare budget process that will most likely play out for months to come, MarketWatch reports.
This order, which formalizes the sequester, will start a domino effect, moving from the White House to federal agencies, state and local governments, employees, businesses, contractors and vendors, according to MarketWatch.
The spending cuts will account for 2.4% of annual federal spending. However, the Obama administration has already warned they could prove disruptive in a number of areas, including housing.
The reality of the cuts will likely not be known until the cuts are phased in over time.
With low inventory increasing frustration for homebuyers right now, buyers and agents are beginning to try a new strategy: wooing people whose homes they like but aren’t for sale.
Agents are targeting pre-sellers — those who are on the verge of listing or even those who hadn’t considered listing but could be persuaded to do so given the right offer, The Washington Post writes.
A shortage of homes on the market is inevitably creating a hindrance for those looking to buy a home. In fact, in the tight inventory in Washington D.C., the number of new listings in January dropped 4%, the lowest for that month in 16 years.
For desperate buyers, the challenge is now to identify potential sellers who have stayed on the sidelines.
After reporting impressive profits Friday, the government-backed mortgage giant, Freddie Mac, is getting some feedback from The Daily Beast. Author Daniel Gross calls Freddie Mac "a smart, careful lender that shares a body with a stupid, reckless one."
Gross points out that on the same day Freddie Mac reported their full-year profits of more than $10 billion, they also revealed it is still coping with the overhang of the bubble. The GSE announced there’s no sign it will be able to pay off the huge amount of government aid it took in 2009 and 2010.
"Despite racking up large profits, the company still owes the taxpayer about $47 billion," The Daily Beast writes.
Read the full article here.
The Federal Deposit Insurance Corp. reported no new bank closings for the week ending March 1.