While thinking about what I was going to say in today’s blog, associate editor Melanie Winters said she talked to someone at the Miami boat show who thought the rebates from the federal stimulus package would help consumers come up with a down payment for a boat.
I shrugged at that idea. As I told Melanie, it looked like the rebates would just about keep families afloat, never mind buy a boat. Melanie was more optimistic.
I did some research and found a headline in the Seattle Times that caught my attention. It read “Stimulus package opens window for high-end housing.”
Well, I immediately thought, that means the package can also open a window for buying a boat.
I read the story and learned that the publicity, alone, of the stimulus package was enough to spur a couple to look at buying a more expensive home, rather than buying a condo. The couple learned they could get a 30-year fixed mortgage for less that what they were paying on their homeowner’s dues.
A mortgage company said it has been receiving a steady stream of inquiries from clients.
The change in loan limits allows Fannie Mae and Freddie Mac to purchase the mortgages, encouraging them to write more mortgages because they can easily sell them to the housing agencies.
Under the newly enacted economic stimulus package, the companies will be permitted to finance loans as large as $729,750, up from $417,000, in an effort to stabilize the housing finance sector. The new loan levels vary based on each market's current home prices.
In Southern California, the limits were raised to the maximum $729,750 in Los Angeles, Orange and Ventura counties, to $697,500 in San Diego County and to $500,000 in Riverside and San Bernadino counties.
Maybe there is hope and potential boat customers who have been shying away from making such a large purchase may not be so skittish, after all.
Having said that, I think the stimulus package cushions the blow for the middle class, but as one economist notes, a rise in the unemployment rate is likely in the next six months. Consumer spending is still low and the subprime lending crisis is ongoing.
Let’s see how all this plays out in the marine industry.
Share your thoughts; that way we can engage in a lively dialogue.
- Lois Caliri